Midland Energy Resources, Cost of Capital

Midland Energy Resources, Cost of Capital The case is about how Janet Mortensen, senior vice president of project finance for Midland Energy Resources, prepare her annual cost of capital estimates for midland and each of its three divisions for her company. Midland was a global energy company with operations in oil and gas exploration and production (E&P), refining and marketing(R&M), and petrochemicals. Estimates of cost of capital prepared by Mortensen were used in many analyses within Midland, including asset appraisals for both capital budgeting and financial accounting, performance assessments.Since her calculations had been widely applied in various areas and became influential, she was considering appending a sort of user’s guide to the 2007 set of calculations for reference to different applications. Mortensen used WACC formula to estimate cost of capital, compute the cost of debt by adding a premium over US Treasury securities of a similar maturity, and calculate the cost of equity by using the CAPM formula. After reviewing the case and tables given, we calculated the company’s composite WACC and WACCs for each division respectively. The company’s composite WACC is 8. 19%. The inputs we used are spread to treasury of 1. 2%, debt ratio of 42. 2%, Treasury bond yields of 4. 98% at a 30-year maturity, the 2006 tax rate of 39%, beta of 1. 25, and EMRP of 5%. However, we do not think that EMRP given in the case is appropriate. Instead, we recommend 3. 3%, which is the most recent EMRP estimate according the survey results in the Exhibit 6. Midland cannot use the same WACC for all divisions. It has three different divisions with different risk or Beta, which is given in Exhibit 5. If midland uses same WACC for all division it can accept risky investment or some time it may mislead by giving up profitable investment.It should use corporate WACC only for corporate level decision. WACC for E&P and R&M is calculated by using cost of debt by adding risk free rate plus spread to TB. From the Exhibit 5, weights for debt and Equity are calculated. WACC of E&P is 8. 82 and R&F is 9. 83. Both WACC are different to each other because they have different risk level, leverage and credit rating. Calculation Part: WACC (E&P):=rd(D/V)(1-t)+re(E/V)=6. 58*0. 2847(1-0. 39)+10. 73*0. 7153=8. 8178 rd=rf+spread =4. 98+1. 6=6. 58, re=rf+B(EMRP)=4. 98+1. 15*5=10. 73 D/E=0. 398 or V-E/E=0. 398 or E/V=0. 7153D/V=1-E/V=1-0. 7153=0. 2847 WACC (R&M)=rd(D/V)(1-t)+re(E/V)=6. 78*0. 1687(1-0. 39)+10. 98*0. 8313=9. 8253 rd= rf+spread =4. 98+1. 8=6. 78re= rf+B(EMRP)=4. 98+1. 2*5=10. 98 D/E=0. 203orV-E/E=0. 203orE/V=0. 8313, D/V=1-E/V=1-0. 8313=0. 1687 For Petrochemical division, since we don’t have sufficient information of that division. We cannot compute our Beta so that we cannot get an exact number of WACC for the division. If the managers want to have a rough estimate, they can use the overall Beta as an average for three divisions and c alculate the Beta for Petrochemical division. Then they can get the WACC.

Arts along with the downward Essay

Due to factors related to funding for the arts along with the downward turning in the United States economy, a proposal was made for the merger of the Utah Symphony along with the Utah Opera companies. The dire situation confronting the arts community became more and more apparent reaching a crisis level in 2001. The Utah Symphony Orchestra was close to a deficit as noted by Scott Parker, â€Å"Speed of action was essential†¦I knew that there was a possibility that we could quickly find ourselves over the edge,† (DeLong & Ager, 2004).There is very little precedence for mergers between a major symphony orchestra and opera companies in the history of the United States. The two examples offered in the history, the merger of the Madison Symphony Orchestra and the Madison Opera in 1963 along with the Chattanooga Symphony and the Chattanooga Opera in 1985, resulted in either the companies remaining intact for a period of time or in them separating due to different ideologies an d methodologies. The two significant characters are Anne Ewers, who was asked to consider the position of CEO of the combined opera and symphony companies, and Keith Lockhart who is the very respected, long-time, music director and conductor of the Utah Symphony Orchestra. Both were invited to lead the merger in December, 2001. Given two very divergent cultures, they faced a very challenging process of uniting the two companies. The symphony environment is slow to change where as the opera was more adept to challenges and change. The executive committee felt ambivalent initially about the merger but due to the need to alleviate some of the financial pressures the organizations faced, they eventually agreed. However, opposition to the merger include members of the community as the audience and the musicians. Lockhart has a very delicate position as the musicians look to him to protect their interests. So he held in tension the trust of the musicians and the viability of the organization as a whole. The musicians came up with some guiding principles they felt the merged entity needed to honor. The community also expressed its concern regarding the possible â€Å"loss of status† of the symphony if merged with the opera. They also questioned Ewers’ ability to manage the new entity due to her lack of experience in running a symphony orchestra. Both Ewers and Lockhart faced a tremendous task as they set out to bring in the reigns on the merger. The board needs to utilize their motivation skills as they help drum up support  for the merger. Ann also needs to understand her power and utilize it to persuade the community and the musicians that a merger would ultimately benefit the future of both entities. We will also explore her influence tactics. Bill Bailey: Motivation is the reason or reasons that a person has for behaving the way he or she does and those reasons are typically a very complex phenomena. One of the most popular explanation for motivation is based upon the needs of the individual. This is also known as the â€Å"basic needs model,† referred to as the content theory of motivation (Cliffs Notes, 2012). Basically, all individuals want their basic needs satisfied. Those needs are either primary such as the biological need for food, sleep, and basic survival; or secondary needs such as those needs of psychological well-being such as the desire for power, success, and love. The identification of the secondary needs are much more complex since they vary in their definition by the individual due to cultural and experiential factors. Several different theories exist to explain the needs of individuals as the source of motivation because unmet needs motivate individuals to pursue and satisfy them. Abraham Maslow has a theory which involve five basic needs (Kreitner & Kinicki, 2010). His list of basic needs include, â€Å"physiological, safety, love, esteem, and self-actualization,† which influence behavior. He ranked these needs in a hierarchical order since there are levels of need which come into play when a lower need has been satisfied. These needs influence a person’s attitudes and behaviors in that they create a compulsion to satisfy the deficiencies. His theory holds to the premise that unsatisfied needs motivate and influence behavior. A satisfied no longer motivates since people do not need to act to fill a deprivation. The physiological needs motivates an individual to find comfort, rest, refreshment and reasonable work conditions. The safety needs motivates an individual to look for job security, adequate compensation and benefits, and safe work conditions. The love/social needs motivates one to find friendly co-workers, a pleasant and supportive supervisor, and good interaction with customers. Esteem needs motivates an individual to seek an important job which may offer a promotion to a higher status level and greater recognition. Self-actualization needs  may cause an individual to seek participation in the decision-making process also with creative and challenging tasks. Leaders may tap into the different needs as described by Maslow to motivate individuals towards a particular agenda. Mr. Bailey is the chairman of the board for the Utah Opera Organization. He may utilize Maslow’s five basic needs theory to raise support for the merger. Both the Utah Opera and Symphony Orchestra want to survive the financial implications of reduced funding and a dire economy which has contracted the patrons’ ability to support the arts. Mr. Bailey could appeal to satisfying their safety needs in that a merger would provide job security with the same amount of vacation for those involved. He could appeal to the social needs of the performers in the Orchestra by letting them know that Lockhart, who has been a trusted  leader, would continue to provide them with supervision as their conductor and leader even after the merger. Many of the musicians also expressed a concern that their artistic excellence would not be protected. Mr. Bailey could could appeal to their high-level needs as a means of motivating them to support their future as performers both individually and corporately. This involves motivation based upon their need for self-actualization. By letting them have autonomy in creativity and a role in decision-making, the performers could find continued challenge in their work. This would overlap with meeting their esteem needs in helping them to realize the importance of their roles. Understanding and utilizing Maslow’s theory can help Mr. Bailey with influencing the behavior of those involved in both organizations by appealing to their personal interests. Scott Parker: Scott Parker holds the position as the chairman of the board of the Utah Symphony. As a leader of that organization, he also faces the challenging task of finding influential supporters who would back the merger of the two companies. He could consider applying David McClelland’s theory of motivation (Kreitner & Kinick, 2010). McClelland recognized that each individual prioritizes their needs differently since individuals are not born with innate needs but the needs are learned through one’s life experiences. He identified three specific needs: the need for achievement  which drives one to excel towards accomplishments, the need for power which causes one to exert influence or encouragement for others to achieve, and the need for affiliation which is a desire for close interpersonal relationships. Individuals may have distinct needs demonstrated through their work preferences. Those wanting to motivate these individuals may shape the environment to meet these needs. For example, the high achievers would desire to do things better. Therefore, they find motivation in job situations with personal responsibility, feedback, and a moderate level of risk. Those with a high need for power would want to follow a path of subsequent promotions over time. They would desire to be in charge and have the opportunity to have status. Those with a need for affiliation would seek satisfying interpersonal relationships which would lead to companionship and approval. They would desire relationships with a high degree of mutual understanding and social approval. Mr. Parker identified Mrs. Abravanel as an influential individual who may help him persuade others to vote for the merger if he could motivate her to support this endeavor. Mrs. Abravanel ’s late husband, Maurice, was the maestro and music director for the Utah Symphony Orchestra for 32 years. Therefore, Mrs. Abravanel would be greatly interested in sustaining the prestige and excellence of the Symphony which her late husband had secured during his prime. Several of the musicians felt concerned that the orchestra would become â€Å"the appendage of the opera,† (DeLong & Ager, 2004) if Ewers became the CEO of the merged organization. They felt that Ewers would leave the Symphony with  a less significant role as the Opera. Since the musicians represent the largest internal interest group, Mr. Parker could appeal to Mrs. Abravanel’s desire to keep the Symphony in a place of power and stability for the future. It is said that Maurice Abravanel, â€Å"had a reputation of defending his musicians vociferously,† (DeLong & Ager, 2004). Perhaps Mrs. Abravanel shares her husband’s passion for a position of status for the Symphony. McClelland theorizes that those with a high need of power is likely to want a position of status and influence. Mr. Parker could appeal to Mrs. Abravanel and entrust her with the responsibility of influencing others towards the merger due to her husband’s legacy. Mr. Parker could also appeal to her need for achievement. High achieving individuals, according to  McClelland would want to know whether they are improving the quality of job situations. Maurice Abravanel secured full-year contracts with full-time salaries for his musicians. Mr. Parker could pitch this goal as a potential for the musicians if Mrs. Abravanel became a supporter of the merger. This would provide the Symphony with continued professional status as as achieved by her husband in his fight for the musicians. â€Å"The relationship between orchestra musicians and the Utah Symphony Board and management had not always been amicable. The board members had reopened the collective bargaining agreement and altered it such that the musicians were worse off in terms of their salaries,† (DeLong & Ager, 2004). McClelland in his theory sees each individual prioritizing their needs through learned experiences. Mr. Parker could appeal to Mrs. Abranavel’s desire and possible emotional need for continued affiliation with the Symphony because the success of it’s future is strongly related to her husband’s life endeavors. She would be representing her husband by her defense of the Orchestra’s future. Anne Ewers: Though the term â€Å"power† potentially evokes some negative connotations and strong feelings in some. It is, however, an essential part of effective leadership as managers and leaders need to influence subordinates towards organizational goals. Anne Ewers, as the future CEO of the merged organization has both positional power and personal power. Her positional power is legitimate due to her formal position. Thus, the power that she will use is necessary given her authority as a leader to effectively get things done. However, she could have a legitimate role as a leader and expect her subordinates to comply due to her role as their boss. This legitimate role could be expressed either positively or negatively in getting others to comply. Positive legitimate power would result in constructively improving those she would influence to work more effectively. Having negative legitimate power would influence subordinates to comply out of fear, shame, and intimidation. Anne also has referent power which is a power  which comes from her personality. As a leader, she could use charisma and magnetism to appeal to her followers. An effective leader ideally needs to  utilize all the â€Å"tools of the trade† which would include both positional (legitimate) and personal (referent) powers. A leader could have a legitimate role and lead others by authority because he or she is the â€Å"boss†. However, an employee could have referent power but not be the â€Å"boss† of a company, attracting and inspiring many by a force of personality. If Anne utilized both powers together, she would not only lead by her authority, but also inspire and appeal to her subordinates with charisma. Having a leader who uses both positive legitimate power and referent power together would foster a committed staff. She would make an excellent leader since, â€Å"Commitment is superior to compliance because it is driven by internal or intrinsic motivation,† (Kreitner & Kinick, 2010). We will further discuss Anne’s use of these two powers below. Ewer’s Positional Power: Ewers has positional power as the current director of the opera and the future CEO of the merged entity. Her position as the leader/director gives her legitimate authority thus, positional power is the same as â€Å"legitimate power.† Those who work under Ewers must comply if they want to keep their job since she has the authority to make decisions and fire those who refuse to comply with her decisions. She could either use this authority in a positive manner as she manages her employees for in a negative manner. If she utilized her power positively, she would improve job performance and morale with her decisions. She could also use her power in a negative way by threatening to fire her employees and coercing them by fear tactics or shaming her employees by publicizing their failures. Ewers would want to call meetings with leaders of the opera and orchestra so that she may utilize her legitimate power to build confidence and commitment. She wants to foster leaders who will be committed to the endeavors of the company rather than merely comply with the new company because they want job security since â€Å"employees who merely comply require frequent ‘jolts’ of power to keep them headed in a productive direction. Committed employees tend to be self-starters†¦Ã¢â‚¬  (Kreitner & Kinick, 2010). Anne Ewers would expect that her new team of leaders share her commitment towards forming a successful new company. Ewer’s Personal Power: The use of personal power that Anne Ewers would use to influence managers is necessary as a positive force for the organization. She will need to enlist the support and empower Keith Lockhart by utilizing what Kreitner &  Kinick calls, â€Å"referent power.† This power is gained through a leader’s strong personality and relational skills which influences the follower’s loyalty and admiration. A leader needs to â€Å"organize a group of people to achieve a common goal,† (Wikipedia, 2012). This power becomes an integral part of a leader’s personal power and plays an important role as the leader needs to collaborate and influence the followers’ support. Leading by influence has increasingly replaced leading by coercion and control. If Ewers utilizes her referent power, she could influence Keith Lockhart to towards leading the Symphony towards the merger. Ewer’s relationship to Lockhart is one in need of referent power. Ewers has a talent for reducing debt as she retired a $450,000 debt as the general director of the Boston Lyric Opera. She has a knack for fund-raising as well. She could empower Lockhart with these skills as they work side-by-side. Because Lockhart has the loyalty of those in the symphony, Ewers needs to use referent power in order to secure his commitment. Ewers could have a meeting with Lockhart and promise him the co-leader position in the merger process. He knows the history of the symphony and has the trust of the musicians. She can empower him by helping him to see the benefits of the merger. By appealing to Lockhart and endorsing his support, Ewers has a better chance of diminishing the opposition from the musicians. If she increases in her referent power, then a need for coercion which often necessitates the use of punishment, would decrease. Musician Platforms: The symphony musicians have secured through their union, an annual salary between $50,000 and $85,000 which is above the average salary for a musician. Their salaries, benefits, and payroll taxes, were to increase even more over the next two years due to the union’s bargaining agreement. Given an organization change, their salary agreement would be challenged. More than their concern regarding their salaries, they were concerned about the  future of their artistic excellence and whether the new organization would support them. They also have a felt need for a successful fund-raising effort, an improved budget strategy for the orchestra, and a strong collective bargaining agreement. Having the stability provided by the union with a good salary, support for their artistic excellence, and a strong bargaining agreement, the possibility of a merger comes as a more of a threat than as an opportunity for advancement. If Anne does not address the issues which the musicians raised, the organization would not survive on multiple levels. First, with the faltering economy, the orchestra still had a contractual obligation to pay the above average salaries as secured through their union. The organization would collapse under the financial pressure due to the economy, the high salaries, and the decreased funding for the arts. Second, there needs to be a strong leader with business savvy  who could challenge and revise the bargaining agreement of the musicians since their salaries, benefits, and payroll taxes were scheduled to increase even more over a couple years which would push them over the edge financially. Third, the organization is in dire need of a quality leader who would command their respect but who would also hold to the same standards of artistic excellence. The organization is in jeopardy due to a lack of leadership since the CEO of the symphony would be leaving after 2002. Recommendations: Since the musicians have presented their set of guiding principles through Christine Osborne, the musicians’ chairwoman, Ewers with the support of the board need to provide a response. The support of the musicians in the merging process is paramount to the future of the new organization. The future of the musicians in the newly organized symphony also depends upon Ewer and Lockhart as the future leaders. Ewers has positional power which is legitimate given her authority as the future CEO of the merged organization. The question is how she would utilize her legitimacy. Would she exert a positive or a negative legitimate power? She can use her power as a constructive force to unite the two organizations with a mutual vision for profitability and artistic excellence. Anne could use her referent power to solicit participation in fund-raising efforts. By using her referent power,  she can forge a team built on loyalty and commitment. Given the principles presented by the musicians, Ewers has the opportunity to demonstrate her positive legitimate power, her expert power in fund-raising, and her referent power in fostering commitment. First, Ewers needs to influence the leaders of both the Symphony and the Opera as the legitimate future CEO of the merged organizations. As a leader, she would need to cast her vision for the future and hopefully motivate the support of both organizations. She needs to use her referent power to develop selfconfidence and passion in her managers to lead their subordinates successfully. Secondly, she needs to address the financial implications of a failing organization by coming up with a revised budget which would prevail over the contracting financial resources. She would need to utilize her fund-raising experience to seek other sources of funding. Though the musicians have an agreement through the union for a certain salary, Anne would need to renegotiate a revised salary and benefits contract for all the performers which would fall within the revised budget. Ewer’s appeal for the musicians’ willingness to take a pay cut would pose a great challenge. However, she may place an emphasis on their self-interest and organizational interest to continue with the new organization. In order to succeed, she needs to utilize a political tactic of striking a balance between the musician’s self-interest with the interests of a new organization. Third, Anne needs to develop and empower a team of trusted individuals who she could target for specified needs of the merger. As we discussed earlier, the better outcome is to have subordinates who are internally motivated and committed towards the merger. Hopefully, she would develop a base of support by promoting the interest of the whole. Anne would rely on these individuals through â€Å"consultation, strong rational persuasion, and inspirational appeal,† influence tactics which we will further explore below (Kreitner & Kinick, 2010). Influence Tactics: Research performed in the 1980’s by David Kipnis and his colleagues resulted in him developing nine tactics which could be used in the workplace by managers in order to influence their subordinates (Kreitner & Kinick, 2010).  The first tactic is using rational persuasion which utilizes reason, knowledge, or facts to convince someone to comply. Second, a leader can use inspirational appeals to individuals’ emotions, beliefs, and values in order to build enthusiasm. The third tactic is called â€Å"consultation† which invites others to participate in the process of planning and decision making. The fourth tactic is to use ingratiation which uses flattery, praise, and friendliness to get individuals in a positive mood prior to making a request. The fifth tactic is to make personal appeals as with a friend. The sixth tactic is to make an exchange for a personal trade of a favor. The seventh tactic is to form a coalition by asking others to join and support the effort as a group. The eighth and ninth are negative tactics where by one uses pressure or intimidation to demand compliance. The last tactic is make a request (or demand) based on one’s legitimate authority, position, organizational rules, policies, or the support of the boss. The more effective tactics are the former ones since pressure, instillation of fear, or forcing compliance fosters a greater discontent in subordinates and can backfire. Anne Ewers can develop her power in order to synchronize and collaborate a newly established organization. She can use the influence tactic of inspirational appeal since many of those involved share the goal of wanting an organization which will protect their personal interest of a competitive salary and benefits package. The also want to build an excellent organization which will continue to foster their artistic talents. All involved agree that funding is diminishing and new sources need to be found. Ewers can use rational persuasion as an influence tactic to demonstrate her knowledge and experience in developing an effective fund-raising effort given her background. She could also use the tactic of consultation in order to invite others to join her endeavors. This will also allow her to delegate some of the necessary tasks in order to transition into a new organization. Conclusion: The task of bringing about a merger between the Utah Symphony Orchestra and Opera will involve the key people with the skills, knowledge and charisma. It will require not only a concerted effort from the board and the identified leaders, namely Anne Ewers and Keith Lockhart. Ewers has proven skills as a fund-raiser and a devoted manager. However, she will need to  learn new skills by utilizing her position and power to motivate and influence a teams with different cultures, the community, and challenge the opposition. She realizes that the task is far from easy but she seems to have a handle on the priorities in order to integrate the two organizations. References: Cliffe Notes, (2012). Retrieved from http://www.cliffsnotes.com/study_guide/ Motivation-Theories-Individual-Needs.topicArticleId-8944,articleId-8908.html DeLong, T. and Ager, D., (2004). HBS cases are developed solely as the basis for class discussion. President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to http:// www.hbsp.harvard.edu. This document is authorized for use only in JFT2 — Organizational Management —14 by Faculty at Western Governors University from October 2012 to July 2014. Kreitner, R., Kinicke, A. (2010). Organizational Behavior, 9th Ed., McGraw-Hill Irwin, New York, NY. Wikipedia, (2012). Leadership retrieved from http://en.wikipedia.org/wiki/ Leadership.

Tire City Case

Tire City, Inc. Analysis As a lender, I would have no problem giving a loan to Tire City, Inc to help finance their growth for the following reasons. The first thing that is apparent is the annual revenue growth. It is expected to steadily increase by 5% in the coming years. This means that Tire City has strong operating cash flows to fund its day-to-day operations. Additionally, Tire City, Inc has improved in total asset turnover over the years, suggesting that they are indeed growing their revenue in proportion to sales. Also, their net margin, gross margin, and return on equity have stayed constant over the years.It is good that there has been no significant decrease in these ratios. Furthermore, their noteworthy sales growth from ’93-’97 suggests they are finding ways to bring in more money such as increasing their prices. Another thing to be considered is the inventory turnover and payables period. It could be a concern that the inventory turnover period is at almo st 60 days; however, the payables period has been decreasing over the past few years, which means that Tire City is able to pay off some of their debt to creditors more frequently.Also, the company’s current ratio has been improving with only a slight drop in 1996. This proves the company has liquidity and is having no problem generating cash. Plus, it is apparent that the company has more assets than equity as the years move forward, meaning that they are trying to lower their financial leverage and their level of risk as they continue to grow. All things considered, I would be comfortable loaning funds to Tire City, Inc to finance their growth for it seems they have the resources necessary to pay back this loan in the future.

CRM technologies paper (Customer Relationship Management) Essay

CRM technologies paper (Customer Relationship Management) - Essay Example Internet and telephones are helping the organization to build a good relationship with the customers. CRM is a vital resource for the organization. The main goal for the organizations is to convert customer relation keen on higher profitability by growing rate of repeat purchase as well as dropping customer purchase costs. CRM helps the organization in understanding the customer expectations and behaviors. CRM also helps the organization to focus on profitable customers who can obtain long-term profit. Digital transformation has fetched a huge and rapid reconfiguration and restructuring in present day business - the reformation of interaction, products as well as payments from the customers to the organizations and also from organizations to suppliers is generating much consternation and bafflement among the organizations decision makers. Managers in every organizational level are closely engaged in this turbulent period. They are being required to reconsider customary definition of competition, value and service. Certainly a method for this great alteration has been a volatile development of internet. Moreover, the internet adaptation as well as the technologies adaptation has changed the path that many of the businesses developed in terms of strategies, competencies and models. E-Business is the process and strategy of meeting business drivers and also initiatives with the technology drivers as well as information services especially relating the internet. It plays a crucial role to the organization for profit maximization and sustain in this dynamic world. It is a technology driven. It essentially increases the value of the organization. Customers are the essential part of the organizational vision and strategy. So, it can be easily said that building a long term as well as loyal relationship is a key to the profitability for the organization. Furthermore, modern technology has made a good classification in

Think of an incident in your life when you felt pressured to go Essay

Think of an incident in your life when you felt pressured to go against your parents or religion. tell what happened, who pressured you and why, why you confirm - Essay Example Whether this is an all-powerful God, an uninvolved Creator or some sort of ‘alien’ life form I will not discuss here. Just suffice it to say that the same is some sort of a more powerful being which probably takes at least some interest in the actions of those that He has created or placed here on this Earth. The incident which I want to share with you is one that literally shook the foundations of my life. It brought a sense of going against my parents and more specifically my father. My issue was with my father who was an alcohol addict and for that reason I literally abhorred the very idea that I was his child. He has realized that he could have let go on this bad habit of his. Yet somehow or the other he found himself stuck in a quagmire of which he cannot find any solace. Alcohol addition has completely ruined his life and it has left him in shambles in front of one and all. The extent of his involvement was so immense that he did not have any knowledge of what was happening around him. He had some responsibilities to fulfill, some loving people surrounding him who had expectations from him but all this just went out of the window when he got himself into this bad habit. I was taken aback in the whole situation since everything was going against me and this sounded as a pretty pathetic circumstance for me, so to speak. This situation made me feel pressurized too much, so much so that I started losing concentration on many things that I used to do. I did not have my mind and energies towards different projects and activities that I did. The incident completely broke me from inside and the worst part of it was that I was not ready for all this. My pressure came from the different relationships in which I was tied. I had to take care of my father as well as my mother and siblings who were equally troubled by my father’s distress.

To What Extent Have the Literacy Practices of English Speakers Been Essay

To What Extent Have the Literacy Practices of English Speakers Been Shaped by Communication Technology - Essay Example In the start, the books were written for a specific class and were handwritten and expensive, therefore were only accessible to a specific class of readers. With the invention of printing machines and later digital communication technology made reading books more common. The production and reproduction of the physical form of text experienced a great deal of changes from its initial stage to the current form, resulting in gradual enhancement of the literacy practice. In the ancient world the words were inscribed in wax or clay tablets but now this carving technique is only used for decorative purposes. The alphabets taken from the Roman and Latin worlds did not allow much convenience with the pronunciation so they also went through change. The written language was more for the religious elite with no space among the words and an audible effort was made to apprehend the words. The Irish invention of word spacing and silent reading made it easy to be read and freed it from its conventi onal purposes (Allington, 2012). In the twelfth century the woodblock printing, which was originally invented in China, made the Europeans copy only the pictures on the page, later full text was also brought onto the page. The radical development came with the invention of hand press by Johannes Gutenberg in the fifteenth century which consisted of metal blocks containing letters on them, and in spite of it being very  expensive it was used to fulfil the demand of books to the western society (Allington, 2012). This print culture was not cherished by all members of the society as the British politicians were afraid of mass literacy, before then the lower class had access only to chapbooks which contained outdated content. Church authorities attempted to deprive the common people of the literature. Newspapers were imposed with heavy tax by the British government to keep them out of the reach of the poor people with the Stamp Act of 1712. Despite all the hurdles put on mass literacy practice, English language was widely printed and literacy practice had increased enormously by the nineteenth century. It is stated (Eliot, 2007) that the literacy rate was 60 per cent in males and 45 per cent in females in 1800 which progressed to 94 per cent and 93 per cent by 1891. The printing press also went through rapid development in nineteenth century. The twentieth century brought more technological development as metal type printing vanished and photographic and chemical processing was established, this brought easy and fast reproduction of text in bulk setting up a wider range of readers by it being economical and accessible to all classes of the society. The industry of book production was in Edinburgh, Scotland in the seventeenth century and through printing English they managed to keep the English readers and readers from other colonies which maintained their British Empire. The less familiarity of the English language for Scottish people gave way to the publication of the first dictionary of the Scots and later with the political and national movements, the vernacular speeches and the ingenuity of writers made other languages to become print-language (Anderson, 2006, in Allington, 2012). The access to the books helped the writers from different regions to convey all the political, economic and

Nevada Essay Example | Topics and Well Written Essays - 500 words

Nevada - Essay Example Early white settlements were Spaniards headed by two Spanish explorers Father Francisco Atanasio Dominguez and Father Silvestre Velez de Escalante both were looking for the route that connects the San Buenaventura River into the Rocky Mountains down to the Pacific, however none were unearth. On the same occasion another Spanish Friar again aim to locate the route but instead find himself into Las Vegas. When Spain had befallen, Mexico ceded Nevada, this is the time when the Paiute tribes became slaves and were exported by the Mexicans. Nevada was teeming with natural resources that perhaps that is one of the motivations of the newcomers to settle in the place. Exploration had started off during 1821 when Peter Skene Ogden of the Hudson's Bay Company of Great Britain and Jedediah Smith of the Rocky Mountain Fur Company followed by others entered the opposite ends of Nevada seeking new beaver ponds and the elusive river, the San Buenaventura. Several explorations aimed to locate the my sterious San Buenaventura River but none of them ever finds it. The end of the Mexican War started to be the second phase of the Great exploration towards the frontier of Nevada. The discovery of gold had further the determination of many explorers.

Appraise Areas of Early Childhood Development Coursework

Appraise Areas of Early Childhood Development - Coursework Example From birth to the early childhood, a child is most vulnerable to the required changes in the personality and mind set. After the childhood, the habits may develop and then it is difficult to change these habits. Most of the other experts give equal importance to the language development in the children. Language is the basic tool to communicate with others. If not anyone knows the proper and ethical use of language then it is possible that he will fail to convey his message to the other people. In this way, it is a matter of fact that language development is also very necessary for the children. Here it is important to notice that this language development is best possible in the early ages of a child otherwise it will be difficult for the parents. In short, words we can say that the early years of lives of children are the best possible opportunity to make a good and beneficial person in all regard. The things happening at this point of time, are actually building up the mindset of the children, which may not change in the coming years. Cognitive Development: At first, there comes the cognitive development of a child, which is the most important perspective of the growth and development of any child. The cognitive development may show the growth and development of the brain of the children. There are several theories and practices, which are extracted after great research and analysis. These theories suggest different perspectives regarding the cognitive or we can say brain development of the child (Burger, 2010). The famous theorist Piaget says that at first the child may learn to react to those things, which are directing affecting him. It means that he can easily forget the other surrounding environment. After this stage, there comes a phase where the child is concerned about learning those things which affect him in either situation. After remembering these things, he may try to react towards those actions or movements.

Research on Article Essay Example | Topics and Well Written Essays - 750 words

Research on Article - Essay Example This might have a devastating effect on the security status of the country. The bill will improve the security through counter-radicalization measures. This is through requiring that all schools and colleges work together with the government in ensuring that students do not get radicalized. This is through reporting any radicalized suspects to the authority. This will ensure that the young minds in the country are protected from destructive ideologies by the terrorist groups. The bill will make changes to the existing Terrorism Prevention and Investigation Measures. This is to make it possible for the authority to force a suspect to move to another country or town. The laws will also limit the movement of such suspects 1. However, in order to avoid any form of malicious deportation, the new TPIM has been changed to ensure that high standards of proof will be required before such orders are implemented. The bill intends to give the authority the power to seize a suspect’s passport at the airport. Currently, the Home secretary has to give authority to seize passport of a suspect. This has been slowing the fight against terrorism in the country. However, with this bill, the police and border officials will have the powers to confiscate the passport of a suspect temporarily for a period of thirty days as the investigations are being undertaken. This will contain the movement of the suspects. The bill intends to prevent jihadists from returning back to the country. Through Temporal Exclusion Orders, such suspects will be banned from entering the country for a period of two years. Nevertheless, they will only be allowed in the country under very strict measures. This aims at deterring the Britons from joining Terrorist groups. The passports of such suspects will be cancelled and put under â€Å"no fly lists† 1. This will hinder them from getting back to the country. Those who will be willing to come back to the

Sport Psychology Essay Example | Topics and Well Written Essays - 3000 words

Sport Psychology - Essay Example Sports injury is common in different sports and athletic events across the world and these affect the performance of the sports individuals. Self-esteem and other psychological factors like stress are also associated with injury during training and competition in different sports. This paper will evaluate the relationship between sports psychology and injury in athletes and sports person in different competitive sports (Lockhart, Merrill & Bird, 2002). The occurrence of sport injuries are common in athletes and other sports personalities and this is associated with the occurrence of acute trauma or the over reliance on a certain body part. These injuries vary and are associated with simple bruises, acute strains that affect effective muscle coordination, sprains which results from excessive straining of the ligaments and serious wounds caused by major collisions. The management of these injuries is essential in the training and effective performance of athletes and it enhances the mental wellbeing of sports individuals. A number of theoretical approaches have been developed that highlights the psychological approaches to sports injury and these demonstrates the benefits of effective management and care of athletes during training and after injury (Hamson-Utley, Martin & Walters, 2008). Injury in most instances is associated with physical events that are beyond the control of the athlete and which are extremely impulsive for them to avoid. However, psychologists have associated sports injury with a number of psychological events which affects their concentration and increases the proneness to injury. The factors can be classified into personal factors, emotional conditions and stressful events which affect the mental and physical coordination during training and competition. Personal factors have been associated with increased intro and extroversion which affects the self-esteem of individuals during competition and training. Training environments

Ballet and Modern Dance Essay Example | Topics and Well Written Essays - 1250 words

Ballet and Modern Dance - Essay Example Several cultures around the world have also been introduced into the dance in an attempt to make it more understandable in their own context. The dance style was introduced in France by Catherine de Medici when she got married to the king of France and it was mainly performed in the royal courts. Some of the initial costumes for the dance included masks, pantaloons, various ornaments, headdresses as well as other designed outfits (Anderson, 2008). The dance steps were composed of slides, slight hops, curtsies, gentle moves and promenades. The shoes commonly used for the dance in the early times were made up of small heels to increase ease of movement. Currently, there exist three main styles of ballet namely contemporary ballet, classical ballet and neoclassical ballet. Classical ballet is a form that is deeply entrenched on the ancient ballet techniques and vocabularies. The neoclassical version deviates from the classical ballet in the sense that it has non-traditional feats as well as unusually fast moving tempos. The contemporary style is composed of the classical ballet techniques and the modern dance methods. The modern dance began in the 19th century and extended to the early 20th century in the U.S.A and Germany. This dance style was established as a means of responding directly to ballet performances through the refusal of its codified motions and the narrative forms. The modern dance consists of a wide range of styles which were defined by the various artists who took part in it. In ballet, the movements commonly known as line take various forms which include diagonal, horizontal and vertical. The vertical lines in which the dances make slight sequential jumps indicate elegance, grandeur as well as strength while the diagonal lines are signs of movements. In modern dance the lines normally adopted by the dances is horizontal line which indicates calm, placidity as well as repose. Repetition which is common phenomena in all

Saving Belizes Barrier Reefs Essay Example for Free

Saving Belizes Barrier Reefs Essay Earth’s resources are not limitless, they have breaking points and natural properties can be threatened by a multitude of factors that can leave the area in ruins. The Belize Barrier Reef is such an area. It is a breathtaking natural system, home to a diverse array of life forms, which is being threatened by mankind and environmental factors. Conservation efforts can be put into action to ensure the continued existence of this site, but those efforts require financial backing. With proper monetary support, the increased conservation efforts can reverse the destruction on the reef. The Belize Barrier Reef Reserve System is a rich and diverse ecosystem that can be preserved for the enjoyment of generations to come. * The coastal area of Belize is the location of The Belize Barrier Reef Reserve System. The reef is the largest of its kind within the northern hemisphere, stretching out over 200 miles along Belize’s coast. The reef contains many mangrove forests, large atolls, pristine lagoons, and approximately 450 sand cays. Additionally, the reef is home to a plethora of marine life which both directly and indirectly impacts this ecosystem and the diverse life contained within. The preservation of this site is crucial due to the abundant threatened species that make their home in the reef. Specifically, there are nearly a thousand species that inhabit the reef such as the loggerhead, green, and hawksbill sea turtles, the largest population of manatees in the world, and the American marine crocodile. Additionally, the reef system is home to numerous types of coral, sharks, barracuda, dolphins, angelfish, and several species of birds. The aquatic and plant life of the reef react and prosper through their connections; the reef and the vegetation within provide shelter and food for this array of life that live within (UNESCO World Heritage Centre, 1992-2012). * With the abundant life forms that exist within the reef, it is imperative that it be protected, yet the reef system is in danger as a result of huma n interference and climate issues. Because the world is a giant ecosystem, human mistreatment has led to imbalances on a dramatic level, such as fluctuating climate. This climate control issue is adversely affecting both  the water level in the reef and the organisms within. Tropical storms have been an issue as well as they threaten the coast with tidal waves and erosion, however the reef and mangrove cays do offer significant protection to the areas further inland (Young, 2008). According to World Resources Institute (2008), â€Å"Coral reefs and mangroves are highly interconnected habitats, physically supporting each other and providing habitat for many species. For example, mangroves filter sediment and pollutants from coastal runoff, supporting the clean water favored by corals. Many species important to fisheries and tourism rely upon mangrove habitat for part of their life-cycle† (p. 2). * With the delicate balance of this ecosystem and all it offers, it would stand to reason that locals would do everything possible to preserve the reef, yet that is not the case. In fact, locals and tourists are threatening this precious ecosystem and could cause its decline. Deforestation, oil drilling, and coastal development are all threats. In 2002 crude oil was discovered in Belize, igniting frenzy and attracting hundreds of prospectors. Additionally, the growing population and tourism industry has led to rapid development for both residential and commercial purposes (Young, 2008). â€Å"Over the last five decades, large-scale agriculture (citrus, bananas, sugar cane) and, more recently, large-scale aquaculture (shrimp and tilapia farming) have escalated at the expense of the forests. Coupled with rapid and increasing coastal development, illegal logging, and slash-and-burn agriculture, Belize is currently experiencing a deforestation rate that is twice that of Central America (2.3% vs. 1.2% annually)†¦Ã¢â‚¬  (Young, 2008, para. 4). * Fortunately, others have realized the value of the reef system and have taken steps to protect it. â€Å"The preservation of the Belize Barrier Reef Reserve System is critical to both its marine inhabitants and the local communities that depend on the site for their livelihoods† (Terracurve, 2009, para. 3). In 2009, the United Nation Educational, Scientific, and Cultural Organization (UNESCO) added the reef reserve system to their list of World Heritage in Danger sites. The UNESCO foundation hopes to spread the message that the Belize Reef System belongs to all people and its natural heritage and beauty should be protected (UNESCO World Heritage Centre, 1992-2012). Conservation efforts have also been put into play to ensure this world heritage sites continued existence. The department of fishery in Belize has recognized the need to reform the  national fisheries policy in an effort to control over fishing in the reefs, which is a substantial threat to the reef. Such reforms should help the over fished areas to rebuild, offer protection to the reefs and delicate coral, and add to the number of protected marine areas where fishing is not allowed (Wildlife Conservation Society, 2012). Conservation efforts for the Barrier Reef system still have a long way to go. Local Belize communities and their inhabitants are one group that can do much good towards the conservation of this national treasure. However, in order for this to happen the locals need to be educated on conservation and its benefits and become invested in the reefs. Although this is a challenge do to the extreme poverty that exists within Belize and the citizens’ access to educational information. Poverty greatly increases the instances of environmental misuse because those affected typically have greater worries than environmental conservation. In order to implement a conservation plan that includes involvement from local citizens, there must also be efforts made to boost the socio-economic standing of the citizens. Long term preservation of the reef could be financially beneficial to the Belize economy and better the citizen’s socio-economic standings. Additionally, allowing the citizens to work with the government officials towards making decisions concerning the reef will give them a sense of investment in the reef (Young, 2008). * Improving the socio-economic conditions in Belize and educating citizens is just a small step that can lead to more effective conservation efforts for the reef. That still leaves the issues of outside interference on the ecosystem such as oil drilling and deforestation. Although Belize has established a protection plan for certain land a sea areas, it is apparent that tighter restrictions are needed. In particular, oil drilling and deforestation are major issues that threaten the reef that should have increased restrictions placed on them. This will require increased monitoring and amendments to the protected area systems. Additionally, the three management teams which oversee the protected areas appear to all have different ideas concerning best conservation practices. For that reason it would make sense to unify the groups, leaving only one division to oversee the protected areas and enforce regulations (Meerman, 2004). Drastic measures to preserve the reef system need to be taken now, before it is too late. If conservation efforts are not increased, coral health and fish  populations will continue to decline and the mangrove cays will face extinction. As it stands, the shark population in the reef waters has already declined, which is an indicator as to the reefs health. The absence of sharks in the reefs allows the populations of barracudas and rays to increase and take control. These second rate predators can have damaging effects on the reefs if there numbers are not controlled, such as limiting the populations of parrot fish, conch, and lobster. Lobster is important in Belize as it is one of t he country’s major exports. Parrot fish play an integral role in the reef as well, they are plant eaters and there food source is algae. Without parrot fish and other plant eating fish eating the algae and keeping it in check, it will spread until the reef is consumed by it, which could be irreversible (Kryt Ward, 2008). The Barrier Reef Reserve System off of the coast of Belize is breathtaking example of nature’s beauty. Additionally, it is a precious natural system teaming with diverse life forms. Although climate and human interference have caused the reef to become an endangered site, it is not too late to reverse the effects of mistreatment. Education on conservation efforts and increased restrictions can greatly increase the reefs chances of survival for generations to come. Without these efforts, a precious natural resource will be lost, and the reef is most certainly worth preserving. References * Kryt, K. Ward, J. (2008). Trouble in paradise-the struggle to save Belize’s Glover’s atoll. Retrieved from http://www.earthisland.org/journal/index.php/eij/article/trouble_in_paradise/ Meerman, J.C. (2004). Protected Areas Policy and System Plan: Protected Area System Assessment Analysis. Retrieved from http://biological-diversity.info/NPAPSP.htm * Terracurve. (2009). Help protect the Belize Barrier Reef with the support of the United Nations. Retrieved from http://www.terracurve.com/2009/07/01/help-protect-the-belize-barrier-reef-with-the-support-of-the-united-nations/ * UNESCO World Heritage Centre. (1992-2012). Belize Barrier Reef Reserve System. Retrieved from http://whc.unesco.org/en/list/764 Wildlife Conservation Society. (2012).

Allowing Same Sex Marriage in Malaysia

Allowing Same Sex Marriage in Malaysia Marriage normally brings together men and women who complement each other in extraordinary ways (Willard and Harley, n. d.). However, there is an existence of another form of marriage which is a same-sex marriage. Same-sex marriage is legally and socially defined as marriage between two adults of the same gender identity or biological sex (Oxford Dictionaries, 2014). In the earlier century such as ancient Egypt, the marriage between two persons of same gender was encouraged (Altergott, 2012). At that time, attraction between two people with same sexuality is normal and it is considered as an action to express love. In late twentieth century, legalization of this form of marriage becomes a wide debated issue in many nations. However, there are around seventeen countries has approved the freedom to marry for same-sex couples nationwide such as Netherlands which is the first country to offer marriage equality (Pew Research Center, 2013). As of May 2014 in America, same-sex marriage has been legalized in the following states such as Massachusetts, New York, Washington and Delaware (Gay Marriage, 2014). In addition, both Vietnam and Thailand became the first Southeast Asian countries that allow and accept gay marriages but Malaysia is far from adopting the similar accepting attitude to this issue (Michelle, 2013). The issues on religious beliefs and adopted children are the common reason of opponents to affirm their stand. Despite there are some arguments that against gay marriage, there are some reasons that our country and nationwide should consider seriously on the issue of allowing gay couples the equal right of marriage. People usually condemn same-sex marriage based on their religious beliefs. However, it is morally wrong to discriminate homosexual couples solely based on their sexual orientations. In fact, eliminating the right of homosexual couples to get marriage is meant to denying the healthy relationships among gay communities. Therefore, same-sex marriage should be allowed for protecting the right of same-sex couples although there are many arguments against it. Legally allowing gay marriage in our society is able to give basic human right as well as freedom for those who have same-sex orientation based on their behavior preference. The equality principle of human rights is meant by the availability of civil marriage without discrimination to all couple (Australian Human Rights Commission, 2012). Therefore, the right to marriage should be given to everyone as long as that kind of marriage does not hurt anyone. One of the civil right is pursuing the happiness but happiness unable to be chased by homosexual communities when people denying gay marriage (Delano, 2013). In this situation, couples with same gender have no right to marry with the person they love and this is obvious that unequal right of marriage may violate their freedom. In fact, no one should have the right to choose the partner for marriage of other people because this is also morally wrong to eliminate the right of marriage for two people who feel affection for one another. Furthermore, allowing gay couples the right to marry in a legal way is able to foster true freedom of religion (Corner, 2014). Many people are not willing to accept gay marriage as they believe that this form of marriage is morally wrong in their religious belief. However, this is a violation of the true freedom that should be deserved by everyone. In the view of religion, everyone should have the right to get married with the one they love regardless of gender, race or other social category (Faith in America, n.d.). However, banning the gay marriage is actually against the natural and original principles of religious belief. People should be given the right to stay together with another one by concerning on the condition that they will contribute their true love to each other, regardless of sexuality. Therefore, it is no reason to ban the gay marriage based on the religion beliefs. Also, giving the right of marriage for same-sex couples can promote social equality. When gay marriage or same-sex union is in force, this can directly eliminate the minority discrimination towards gay and lesbian. So, this will automatically increase the societal acceptance towards this form of marriage. Based on the statistics, public support to same-sex marriage has risen 8% from the year which gay marriage was first legalized in United States (Saad, 2012). By allowing gay marriage, people will learn to accept and understand the real nature of homosexuality. Therefore, this will able to help in reducing social misunderstanding over the definition of same-gender relationship. Also, permitting gay communities the right to marriage is meant to allow them the right to deserve their dignity and respect. Since everyone has their own dignity, people should not treat gay couples unfairly but respect should be shown to them anytime to prevent them to believe that they are inferior and not worthy to be treated equally. So, this will directly reduce the social stress faced by the gay couples by showing true equality to gay couples in society. In addition, marriage equality will allow gay couples to enjoy benefits and protection legally. Everyone should be treated equal regardless sexuality. By allowing them the right of marriage, gay couples are able to access government benefits and protections of the law which is same with the heterosexual communities (Nolo Law, 2014). Additionally, marriage equality may integrate homosexual individuals into the community. This allows government to provide well protection and benefits to them in an easier way to prevent this community to be treated unfairly in society such the housing benefits and insurance protections to their partner. A strong sense of belonging of gay and lesbian to community can be built with the benefits and support given by government. This is will lead the homosexual couples to be more motivated to make contribution to the society. This is also a cornerstone to create a stable society. Allowing same-sex marriage also can reduce social misunderstanding towards this form of marriage by insisting the right concept on this issue to the people. The ideas of society which think that gay relationships are shallow and uncommitted are inaccurate. Therefore, allowing gay marriage is able to reduce such form of harm to the gay and lesbian. In fact, the unstable relationship is just like in the straight society, where such relationships will also exists but this is merely occupied the minority part within gay communities and exist primarily among the young people (Bidstrup, n.d.). As we know, the relationship will last longer and become more stable as people getting aged and becoming more mature. This natural scenario not only exists within heterosexual communities but also the homosexual communities. So, gay couples should not be denied to marry with the reason of they build shallow and uncommitted relationships all the time. Other than that, allowing gay marriage is able to overcome the problem of misunderstanding over the nature of homosexual relationship. Over the years, people always consider homosexuality as a form of deviant sexual behavior (Messerli, 2009). However, there is a statement about homosexual relationships have existed for around 600 years according to the historical evidence (Bryner, 2007). Also, people always misunderstand that sexual orientation is a choice so that gay and lesbian are able to reform their same-sex orientation to be an opposite-sex anytime they want. However, many researches were being done for proving that there is a biological causation for homosexuality. Scientists stated that the sexual orientation is congenital and unable to be altered (Law Teacher, n. d.). That means if an individual is born to be gay, they cannot made any changes on their sexual orientation. So, it is not fair to treat them in a different way as this is not their choice to be different. Permitting same-sex marriage in a legal way can also improve the health of gay, lesbian and bisexual community. In contrast, banning the same-sex marriage is able to damage the health of those who are identified as sexual minority (Schwecherl, 2013). This decrease both physical and mental related health risk in gay communities. In term of physical health, allowing gay marriage in a legal way may reduce sexually transmitted diseases by discouraging the promiscuous sex. According to the research of scientists, there is an obvious improvement of heath by legalizing same-sex marriage. This is because medical visits about physical problems among homosexual individuals has significantly decreased associated with the reduce in healthcare cost in the twelve months following the change in marriage law as compared to the twelve months before the changes made (Hatzenbuehler et.al., 2012). In addition, allowing gay marriage in a legal way may bring a lot of health benefit regarding the mental health. Since marriage allow couples to become happier they can stay together with the one they love, marriage equality should be promoted to allow the same-gender couples to pursue their happiness (Anderson, n. d.). In addition, unwed people seems less mature in thought and less concern about their discipline. This leads them to be more likely to take some unnecessary risks. So, the homosexual marriage should be promoted to allow same-sex individuals to marry as married people often consider the feeling of their partner before taking risky actions since they are committed to take care of their partner. In addition, since allowing gay marriage is able to reduce or even eliminate the social discrimination, married individuals will less likely to deal with problems of psychological health includes depression (Hatzenbuehler, et. al., 2012). Mental health among sexual minority also ca n be reduced as they can share their problem to each other and they can solve the problem together. On the other hand, there are opponents who argue that allowing same-sex marriage will destroy traditional family values in our society. They always affirm that marriage will only make sense when it happens between opposite-sex couples and allowing this form of marriage will merely alter the natural definition of marriage. Besides, opponents also have considerations about the right given for gay to marriage will directly reduce the normal rates of reproduction. They believe that gay couples are will directly affect the future reproduction level since they do not have the ability of having own children. Opponents argue that allowing same-sex marriage will increase the health risk of gay couples and the heterosexual communities as well. They think that allowing gay marriage will lead to highly promiscuous and bring many related diseases though same-sex couples demonstrate that homosexuality will not harm anyone by trying to segregate their behavior from such diseases (Slick, n.d.). Allowing gay couple the right to marriage will also help in improving their family stability. This is able to promote children well-being in many aspects (American Academy of Pediatrics, 2013). Since children represent the future of the nation, their development should be supported by the society regardless of whom they are parented by. Nowadays, there are about six millions of children are being raised or adopted in households led by gay couples in America (Gates, 2013). However, there are many of them who adopt children are prohibited to get marry legally and this leads the children who are raised by gay couples to be disadvantaged. The lacking of support for gay families denies children within these families the same protections which are afforded by children in heterosexual families. Therefore, this will mislead the children within gay families to believe that their parents are inferior who are not worthy to be treated equally in society. Also, this can avoid the family members o f gay community to be adversely affected. This is because lack of opportunity for gay couples to marry family will add family stress within it. Giving the right of marriage to gay couples can increase the social acceptance and prevent impacts caused on the health and welfare of all household members. Also, the close bond if kinship will be formed by people with a more committed relationship as they are interdependence to each other. So, this definitely will stabilize a family. Therefore, allowing gay marriage can help to support the family stability within gay communities by addressing this injustice. With deeper understanding over gay marriage, it can be known that allowing gay marriage may also bring financial gain or income to government and the society. One of the benefits in term of financial that brought to government and society is the increasing in tax revenue on marriage licenses and tax revenue on sales of wedding items (Ramos et. al., 2009). Since everyone will spend money on their wedding ceremony, this will definitely boost the domestic economic within a gay marriage legalized state. Since permitting same-sex marriage may discourage promiscuous sexual activities and decrease the sexually transmitted illness, it may also reduce the costs of organizing healthy program and campaign. As the marriage equality is able to resolve the problem of psychological health within gay communities, this will also improve their abilities and performance of job which is good for any business and employers. As we know that married couples are happier and become more optimistic and energe tic than singles, they will be more productive. Therefore, this allows them to be more concentrate in doing their works. By an indirectly way, this can improve the business competitiveness and economic conditions within our country. It is also obvious that allowing same-sex marriage does not harm the opposite-sex marriages and communities as well as the traditional family values. This is because society will continue to function well with the existence of gay marriage. There is no proximity between implementation of same sex marriage laws and rates of opposite sex marriage (Ferro, 2013). There is a research of United States recognize that there is no significant changes in rates of opposite-sex marriage as compared the rates after and before the legalization of same-sex marriage (Diebold, 2013). This means same-sex marriage does not bringing down the venerated institution of marriage. Allowing this form of marriage will not alter any previous set legal framework of the marriage institution as gay couples will accept to the same duties that are currently imposed on married opposite-sex couples (Mormons for Marriage, 2014). Apart from that, people always condemn that gay marriage is exposed at high divorce rate as the relationship between gay couples is uncommitted. In fact, divorce rates do not correlate directly with gay marriage. This is because data shows that divorce rate in the states such as Massachusetts that allow marriage equality is lower than in states that gay marriage is not recognized (Aldridge, 2012). Also, decreasing reproduction rates which always condemn by heterosexual communities towards same-sex couples is not only caused by same-sex marriage but also infertile couples. Since infertile couples are still gaining the equal right of marriage, gay marriage should not be the exception. In conclusion, same-sex marriage should be allowed and accepted by government and society since it is uncivilized and unmerited but it promotes the social equality in the way that it does not harm anyone. However, it must be controlled under strictly regulations to protect the equally welfare of both homosexual and heterosexual communities. Therefore, in order to allow the gay marriage by not affecting the other communities, governments should be take a more serious view on the legislation of this form of marriage to ensure the basic human right of everyone being protected. Educational programs should also be supported and developed to change the social view towards this issue.

Importance of Outsourcing of Logistics Function

Importance of Outsourcing of Logistics Function Outsourcing and 3PL, as important business functions, have drawn attention of business operators as well as academic and scholars. A large number of studies have analyzed these areas from a theoretical perspective and a practical point of view. This section will start with the review of outsourcing regarding its definition and importance as well as motivations and concerns. Then, based on the correlation between outsourcing and 3PL, the section presents the concepts of 3PL and most challenges 3PL providers are facing. Lastly, the section shows what could be the current situation of Chinas 3PL industry. Outsourcing of logistics function 2.1.1 Definition and importance Razzaque and Sheng (1998) defined outsourcing as multiple logistics services provided by a single vendor on a contractual basis. Outsourcing is becoming more important today. Due to economic and competitive pressures, it is imperative for different enterprises to pay attention to their core competencies and turn to third-parties to undertake responsibility for other secondary corporate functions. Outsourcing can create profits by improving customer service level, providing high added-value to products, benefiting in exploiting new markets, and offering dedicated resources (Foster and Muller, 1990). By means of outsourcing, companies can obtain competitive advantage through cost reduction and increased responsiveness to market change. Motivation of outsourcing Several reasons lead private business as well as government agencies to outsource logistics functions: Avoid Capital expenditures It reduces capital investment in facilities (Richardson, 1995). This allows the using firm to spending where it can get the best return as in research, manufacturing, marketing, or other functions core to the organization. Increase flexibility This can enable firms to focus on the core business, question any function or department that is not producing revenue and adapt to changes in the market and access to leading edge technology. A third-party will be invited to help a company when demand increase dramatically beyond the capability of the company to fulfill (Razzaque and Sheng, 1998). Many 3PL providers specialize in logistics functions such as transportation, warehousing management and information technology. Cost savings To save costs is identified by most literature as one of the most popular reasons for why outsourcing occurs. In principle, outsourcing will occur to companies for cost reduction when their suppliers offer a service for a low price which however still can cover added overhead, profit, and transaction costs (Harler, 2000). Those companies which outsource their logistics functions to 3PL service providers usually agree that it is more cost saving than to fulfill the same logistics task in-house (Candler, 1994). According to Bradley (1995a), there are some other reasons of logistics outsourcing such as improving service level and customer satisfaction, using 3PL providers logistics IT systems, acquiring outside sophisticated professionals, combining service and minifying number of suppliers, integrating the process of supply chain, and increasing productivity. Concerns of outsourcing Despite the fact that outsourcing is now favored by most organizations, there are still many recognized potential barriers and problems related to outsourcing. Normally the most mentioned reservation which restrains enterprises from employing 3PL service providers is loss of control of 3PLs (Richardson, 1993a). Such tendency can be caused by different objectives and attitudes of the logistics service providers and users towards strategy, profits and service or skills (Axelrod, 2004, p49). The adoption of outsourcing might also lead to a situation in which critical knowledge associated with process and customers would leak to potential competitors (Jennings, 2002). Moreover, unrealized savings with a potential for increased costs, employee moral problems, losing touch with important information, unreliable promises of the providers, their inability to respond to changing requirements have been mentioned as potential risks as well. Each of these concerns should be recognized carefully by organizations that intend to outsource their logistics function, otherwise contract logistics can be another issue to deal with, rather than a catalyst or improvement (Razzaque and Sheng, 1998). Third-Party Logistics 2.2.1 Concept of 3PL Third party logistics service has been described in a few ways, including outsourcing of one single service such as transportation, and outsourcing of a set of complicated processs (Vasiliauskas Barysiene, 2008). Generally, 3PL provide not only just separate warehouse or transport functions but also multiple, bundled services (Leahy et al., 1995). It is also worth mentioned that freight forwarders and shipping lines are included in broad definitions of the 3PL industry (Rao and Young, 1994). On the basis of above definitions, Leib et al. (1993) used the following definition: Third-party logistics involves the use of external companies to perform logistics functions that have traditionally been performed within an organization. The functions performed by the third party can encompass the entire logistics process or selected activities within that process. The authors refer to the 3PL as a new industry and growing business environment has more expectations on 3PL. The usage of 3PL has been considered as logistics alliances at strategic level. Bagchi and Virum (1996, p.193) have developed the following definitions: A logistics alliance indicates a close and long-term, relationship between a customer and a provider encompassing the delivery of a wide array of logistics needs. In a logistics alliance, the parties ideally consider each other as partners. They collaborate in understanding and defining the customers logistics need. Both partners participate in designing and developing logistics solutions and measuring performance. The goal of the relationship is to develop a win-win arrangement. Compared with the prior definition, which focuses on the logistics functional activities, the final one emphasizes the duration of the relationship between the logistics service provider and user, and also covers an extensive range of promising logistics services (Halldorsson Larsen, 2004). Many articles have disclosed that 3PL industry has progressed steadily for ages (Liu, 2008). 3PL providers started as a traditional transportation or warehousing service providers from 1980s. Nowadays, 3PL companies provide a variety services including basis logistics service as well as value added services. Main challenges to 3PL service providers As the 3PL industry has continued to evolve, the 3PL provider, sitting in the middle between the manufacturers or suppliers (the buyers of the 3PL service, known as shippers) and the end customers (the consumer of the products), will need to balance the dynamic pulls generated by upstream and downstream entities, and thus faces challenges are unique to its position. Financial issues Although 3PL providers should develop skills, improve competencies, and provide more value-added service so as to survive and expand business successfully in this flourishing market, the main challenge for them is how to obtain business and achieve acceptable financial performance. Maintain profits under price pressures from customers The economic crisis has caused serious situations for both 3PL users and providers -82 percent of shippers now are implementing cost-cutting strategies and 60 percents are reconsidering their supply chain and relationships with 3PLs accordingly (Capgemini Consulting et al, 2009). As a matter fact, economic factor is a strong motivation for outsourcing, of which cost reduction and cost saving are the main concerns. One of the most significant motivations for outsourcing logistics functions to third parties is their professional knowledge and valuable experience in logistics industry which are costly for their customers to have in-house (Byrne, 1993). However, the decision of employing 3PL providers is usually influenced by the evaluation of cost/service trade-offs (Selviaridis and Spring, 2007). Hence, no matter what strategic stances the logistics providers take, they have to keep upgrading and improving their operational potentialities in the business environment (Sum Teo, 1999). Meanwhile, as price competition is inevitable and most customers are also price sensitive at present, 3PL providers still need to be cost conscious to achieve higher margins, and to prevent themselves from being priced out of the market. Financial stability Many articles have placed emphasis on financial firmness as a critical essential for logistics providers (Bottani Rizzi, 2006). Based on the empirical survey conducted by Boyson et al. (1999) financial stability was ranked as the most significant selection criteria for choosing 3PL providers because it reduce the risk in relationship. A 3PL services provider with stable financial standing can not only better satisfy its clients and implement cost reduction through a dedicated resource, but also diminish risks for logistics partners (Bowersox Daugherty, 1990). Accordingly, Boyson et al. (1999) assert that firms prefer providers demonstrating outstanding customer service level with low price and possessing solid financial stability. Nevertheless, the financial tsunami which has weighted down the world economy has resulted in steep decreasing in logistics demand with no doubt. On the one hand, according to Li Fung Research Center (2009), the clients of the logistics enterprises asked for price cut and longer credit term, and it is difficult for them to collect the payments form clients during such hard times. Bad debts and financial losses will be easily incurred by any imprudent credit management. On the other hand, the confidence for the banks to lend had been damaged by the tsunami. Banks are now only willing to provide loans to selected enterprises or projects, which limits the financing options of the logistics enterprises (Li Fung Research Center, 2009). Clearly, it has always been important for 3PL providers to maintain a sound financial condition to survive in the recession as well as to rise superior to others in the market. Information technology (IT) Capability of information technology IT-based logistics services is considered as significant factor by 88% of shippers, but only less than half (42%) of the shippers are satisfied with the IT capableness of their providers (Capgemini Consulting et al, 2009). Accordingly, such IT capability gap result in a few difficulties for both shippers and 3PLs to collaborate in an adaptive supply chain (Capgemini Consulting et al, 2009). Information is one of the most important elements in logistics management (Cheong, 2004) and it is definitely essential to assist logistics process with effective IT (LaLonde and Masters, 1994). IT capability can be enhanced by employing advanced software, such as electronic data interchange (EDI) networking, enterprise resource planning environments, simulation software, vehicle routing packages, carrier loading optimization tools, etc. (Qureshi et al, 2008). Hardware also may be utilized to facilitate operations and to increase the production efficiency, including radio frequency devices, servers, bar code printers and scanners, global positioning system (GPS), networking and internet/intranet connections, satellite tracking devices, etc. (Qureshi et al, 2008). 3PL services providers which adopt tracking and tracing devices can grant better services to users with quick responsiveness (Rahman, 2004). According to Byrne (1993), the need of sophisticated information technology is impe rative for logistics management to link members like manufacturer, carrier and customer in the supply chain. Sauvage (2003) proposed that to fully satisfy the variety of customers demand, LSPs should continuously employ advanced information technologies in order to enhance their service performance. It is unlikely for a firm which is lagging in a technology to move to a position of leadership (Jennings, 2002). Security of information systems The sharing of so much information inevitably leads to security concerns. It can not be denied that logistics service providers usually still lose customers annually due to issues of trust in privacy and security, though they keep attracting new clients (Pattel Conners, 2008). One possible mentioned security issue is that when a 3PL provider has to serve several direct competitors, the information in relation to all of them should be kept confidential (Grover et al., 1994, p. 38; Lacity and Hirschheim, 1993a, p. 24). Other than cost, security and privacy are also considered as major concerns by many companies when outsourcing. Compatibility of information systems IT compatibility acts an essential role in logistics activities such as forecasting, order purchasing, inventory replenishment and life cycle management (Anand, 2010). According to Arshinder et al. (2007), the information system of the whole supply chain is expected to be compatible. A compatible information system means comprehensible data are quickly shared among the parties throughout the supply chain (Arshinder et al, 2007) while incompatibility will lead to costly and time consuming process because information, though can be shared as well, is rarely in synchronization. At present, it is difficult for information to seamlessly flow throughout the network as international logistics often includes some different transportation modes and carriers. Moreover, there are diverse IT systems in the different trading areas. For example, Europe adopts Administration, Commerce and Transportation (EDIFACT) standards for EDI systems while the US follows the standards of the American National Standards Institute (Rao Young, 1994). These difficulties in global supply chain have challenged 3PLs regarding how to capitalize the gap to provide a distinct competitive advantage. Reliability of information systems As one of the major industry focus in the global logistics market, the field of information systems paid special attention to user satisfaction as an important performance measure (Ives and Olson, 1984; Robey and Farrow, 1982). Bailey and Pearson (1983) have pointed out that reliability is one of the critical criteria of customer satisfaction. There could be many unknown increased reliability risk which result from two major sections of technology. One is that new technology innovations or adoptions of 3PL providers may have an unclear reliability performance. The other is that an existing technology may be applied to a new market with unknown increase failure rates (Collins, 2005). To fulfill the promised logistics service reliably and exactly, 3PL providers must identify and remove uncertainty involved with technology reliability performance. Human Resource (HR) Lack of expertise There is a tendency that firms desire to acquire the expertise from third-party logistics providers who possess particular local knowledge of customs and infrastructure of destination countries in such a growing global market (Razzaque Sheng, 1999). Although one of the drivers for companies to outsource is to acquire resources and logistics professionals (Selviaridis Spring, 2007), the results of the research conducted by Georgia Institute of Technology et al. (2009) show that many outsourcing users dont believe that 3PLs are in the capacity of strategic partners currently, 40% of shippers in the survey expect their 3PL service providers to continue focusing on execution, and a good many of them reckon that 3PL providers lack logistics expertise that would support users increasing outsourcing. Often-cited problems range from misunderstanding the demand of customers supply chain to inadequate professionals in given products and markets (Selviaridis Spring, 2007). In fact, customers are looking for 3PL providers that have expertise in multiple phases of the logistics process. An annual surveys of US 3PL firms indicates that company employee/expertise is regarded by CEOs as the most important asset of the company for business success in the competition, however those same CEOs also agree that currently the most critical problem facing 3PL companies as finding qualified people (Leib and Randall, 1996b). Different culture Almost all members in the supply chain, including third party, have their own company culture which is definitely different from each other (Babics, 2005). According to Pagell (2004), the capacity of how to harmonize its own internal culture with the external different cultures of its customers is one significant factor that 3PL providers should note in the integration of operational services in supply chains. Mckeon (1991) states that for both 3PL providers and their customers, understanding each others cultures and organizational structure is an essential factor to ensure a win-win outsourcing. Compatibility of culture and values is one of the keys to successful partnership which can result in long-term partnership (Qureshi et al, 2008). Culture conflicts often result in change orders, unexpected costs, and sometimes a negative impact on relationships (Kremic et al, 2006). In general, the ability of 3PL providers to understand the customer organizations culture is a basis for partnering. Inadequate education and training In order to remain competitive in the logistics market, 3PL providers have to be vigilant and agile to their customers needs, and continually seek to meet customer expectations as much as possible. Logistics executive should be aware that, due to rapid growth in the logistics industry, there could be a shortage of qualified logistics expertise (Yeung, 2006). Therefore, it is necessary for governments and educational services to allocate more resources, put logistics on formal curriculum, and provide more correlated training programs to fulfill the demand of the whole supply chain. The development of logistics, otherwise, might be constrained by lack of trained logistics personnel (Sum Teo, 1999). Ulengin and Uray (1999) indicate that in Turkey, senior management that is void of professional knowledge of logistics is the fundamental factor limiting the progress of logistics industry. Kerr (2005b) describes poor training as a black hole in China because neither the central government nor Chinas regulatory authorities do much to promote logistics training programs. Obviously, a firm with higher quality of human resources such as better education or training will have superior core competence in the market. Hence, it is imperative for 3PL service providers to offer more training programs to employees so that they can cope with competition in the future (Wang et al, 2006) Business Landscapes Globalization of 3PL market delivering service in new geographic regions The internationalization and globalization of 3PL providers has been boosted by the economies of scale and scope, by the internationalization and globalization of the competitors and by customer following i.e. the internationalization of manufacturing firms, which may demand that the service supplier provides a global network and/or global experience (Arvidsson, 1997, p.74). 3PL providers that take charge of their customers outsourced logistics function normally need to build up a logistics network to deal with the flow of the goods from the customers factory to the end customers (Cheong, 2004). In current global economic environment, manufacturing companies tend to establish partnerships with 3PL service providers and they desire to cooperate with some global freight forwarding companies (Lemoine et al, 2003). 3PL service providers with well-content characteristics, such as far geographical spread and wide range of services are popular among the shippers (Qureshi, 2007). As per Bottani and Rizzi (2006), companies favor the 3PL providers with wide range of advanced services more than those traditional ones which can offer mere single logistics functional service. However, supply chain requirement keep changing. Customer demand can change in spatial and temporal terms. In response to the shippers new requirement, 3PL service providers endeavor to extend service coverage geographically and to expand breadth of service so that they can fulfill the interest of their customers as an integrated logistics provider (Qureshi et al, 2008) Relationship with customers 3PL service providers are normally very concerned with the relationship with their customers because they attempt to establish a long-term one with the users (Cheong, 2004). Long-term customer relationships can enable 3PLs to provide more sophisticated services, reduce the risk of replacement, achieve more earnings, and avoid expense of developing new customer (Cahill, 2006). In addition, long-term relationship is built on the basis of mutual trust and sharing of risk and reward (Qureshi et al, 2008). Bothe shipper and 3PLs will benefit from such long-term relationship (Qureshi et al, 2008). Most of 3PL services users agree that logistics costs could decrease even more through strategic relationships with 3PL service providers. Langley et al. (2004) point out that the successful relationship with 3PL service providers will assist the users to achieve their major objective. Customer relationship management is necessary once a 3PL provider first establishes a relationship with a shipper. To keep customers satisfied and coming back, 3PL providers must demonstrate their capabilities and the value these capabilities provider to customers (Wisner et al, 2005). Third-party logistics service providers in China: China has become the most attractive country for more and more foreign investments, manufacturers, and retailers from all over the world, which results in the fast growth of the Chinese economy (Liu, 2008). Accordingly, the development of 3PL has been spurred in China and 3PL industry has achieved significant achievement. Currently, most logistics companies offer extensively various value-added services and have confidence in the continuous development of Chinas logistics industry. Many literatures have research the Chinese logistics area from diverse perspectives and some supply chain-related difficulties facing foreign 3PLs are identified. High transport cost It is not deniable that Chinese government has invested a lot in the logistics sector to improve traffic in recent years. However, poor transportation is still considered as one significant challenge for logistics industry in China, which may result in the increase in logistics cost and the decrease in company profits (Lau Zhang, 2006). Li Fung Research Center (2009) notes that the transportation occupies more than 50 percent of the total logistics cost in China, and undoubtedly the operation costs of 3PL service providers will still be ascending due to the price upswing of commodity and fuel. Another culprit is high local road tolls and other hefty transportation fees (Kerr, 2005b). Underdeveloped physical infrastructure Many MNCs find that it is difficult for them to implement coherent strategies in China because underdeveloped transportation system hinders their distribution and sourcing throughout the country (Speece and Yukiko, 1995). Although Chinas economy and industrial production have been developing rapidly, the current logistics system is loaded with new challenges as it can barely keep pace with the growth rate of economy (Carter et al, 1997). The undeveloped logistics infrastructure in China, including deficient highways, aged port facilities, and limited runways and airports, can hardly fulfill the growing logistics demand in the progress of new economy (Pollit, 1998). The insufficiencies of present distribution system have restricted foreign enterprises to immensely exploit the plenty opportunities in Chinas market (Goh and Ling, 2003). It is thus imperative that the distribution of products and services be supported by a reliable transportation system. The need for guanxi Literally, guanxi means relationship. It is noted that Chinese culture is quite distinct from Western culture in numerous aspects, including the way to conduct business (Jiang and Prater, 2003). Guanxi, which is an important concept for successful business in China, refer to relationship between people (Michailova and Worm, 2003). It suggests a conveyable, reciprocal, invisible and useful responsibility to dyadic personal relationships (Luo, 2000). It is not surprising that Chinese prefer to deal with people they know and trust. As Wang et al. (2003) indicated, guanxi which is created on the basis of mutually beneficial can lower risk as well as competition in business circles. Millington et al. (2006) also state that when looking for satisfying vendors, guanxi is more useful than other information from website, trade market or media. This implies that the knowledge and expertise to understand local circumstance and the communication skill with foreigners are absolutely necessary for establishment of a successful cooperation (Lightfoot and Almeida, 2007). Government regulation Kerr (2006) identifies that government regulation is still 3PL providers biggest challenge. The development of 3PL in China is obstructed by some barriers such as underdeveloped infrastructure and entrenched regulatory circumstance (Lau Zhang, 2006). In the meantime, various regulations set up by different provinces forcefully influence business activities so that the founding of national networks is hindered (Kerr, 2005). It also has made it difficult for 3PL providers in China to fully meet the requirements of their clients. Moreover, there are many regulations and rules for foreign 3PL providers who plan to enter China logistics market. According to Lai and Hsu (2007), foreign 3PL providers must apply for the class A license issued by the Ministry of Foreign Trade and Economic Co-operation (MOFTERC) if they plan to establish subsidiaries as international freight forwarders in China. A survey conducted by Li Fung Research Center (2009) also identifies that the regulations and policies associated with logistics industry are not unalterable because the government will supervise the execution and analyze the effect of the existing ones and then will formulate new ones accordingly to boost the growth of the industry. It is true that a number of government departments which are involved in policies related to logistics industry have impact on the rhythm of changing regulation (KPMG, 2008). Local 3PL providers Chinas local logistics providers have been growing rapidly because foreign firms are increasingly looking to source there. To contend with foreign logistics providers, domestic companies have to upgrade facilities and enhance their service level (KPMG, 2008). Jiang and Prata (2002) indicate that in contrast with foreign 3PL entrants, local players are always in the close association with local or central governments. For instance, Sinatrans is a state owned company and is the only 3PL service provider in China who can provide a nationwide logistics service with full license. The authors also mention that a number of local 3PL providers at regional level have their own special strength in specific areas or specific business. Some of them even look for individual connection built directly with government officials which may be valuable in their daily business. Literature review summary This section has reviewed the literature ranging from some fundamental definitions of outsourcing and 3PL, to challenges for 3PL industry globally and especially in China which represents the current situation foreign 3PL providers are facing in China. In table 2.1, we summarize the above referred articles in each of the focus challenges. Importance of Outsourcing of Logistics Function Importance of Outsourcing of Logistics Function Outsourcing and 3PL, as important business functions, have drawn attention of business operators as well as academic and scholars. A large number of studies have analyzed these areas from a theoretical perspective and a practical point of view. This section will start with the review of outsourcing regarding its definition and importance as well as motivations and concerns. Then, based on the correlation between outsourcing and 3PL, the section presents the concepts of 3PL and most challenges 3PL providers are facing. Lastly, the section shows what could be the current situation of Chinas 3PL industry. Outsourcing of logistics function 2.1.1 Definition and importance Razzaque and Sheng (1998) defined outsourcing as multiple logistics services provided by a single vendor on a contractual basis. Outsourcing is becoming more important today. Due to economic and competitive pressures, it is imperative for different enterprises to pay attention to their core competencies and turn to third-parties to undertake responsibility for other secondary corporate functions. Outsourcing can create profits by improving customer service level, providing high added-value to products, benefiting in exploiting new markets, and offering dedicated resources (Foster and Muller, 1990). By means of outsourcing, companies can obtain competitive advantage through cost reduction and increased responsiveness to market change. Motivation of outsourcing Several reasons lead private business as well as government agencies to outsource logistics functions: Avoid Capital expenditures It reduces capital investment in facilities (Richardson, 1995). This allows the using firm to spending where it can get the best return as in research, manufacturing, marketing, or other functions core to the organization. Increase flexibility This can enable firms to focus on the core business, question any function or department that is not producing revenue and adapt to changes in the market and access to leading edge technology. A third-party will be invited to help a company when demand increase dramatically beyond the capability of the company to fulfill (Razzaque and Sheng, 1998). Many 3PL providers specialize in logistics functions such as transportation, warehousing management and information technology. Cost savings To save costs is identified by most literature as one of the most popular reasons for why outsourcing occurs. In principle, outsourcing will occur to companies for cost reduction when their suppliers offer a service for a low price which however still can cover added overhead, profit, and transaction costs (Harler, 2000). Those companies which outsource their logistics functions to 3PL service providers usually agree that it is more cost saving than to fulfill the same logistics task in-house (Candler, 1994). According to Bradley (1995a), there are some other reasons of logistics outsourcing such as improving service level and customer satisfaction, using 3PL providers logistics IT systems, acquiring outside sophisticated professionals, combining service and minifying number of suppliers, integrating the process of supply chain, and increasing productivity. Concerns of outsourcing Despite the fact that outsourcing is now favored by most organizations, there are still many recognized potential barriers and problems related to outsourcing. Normally the most mentioned reservation which restrains enterprises from employing 3PL service providers is loss of control of 3PLs (Richardson, 1993a). Such tendency can be caused by different objectives and attitudes of the logistics service providers and users towards strategy, profits and service or skills (Axelrod, 2004, p49). The adoption of outsourcing might also lead to a situation in which critical knowledge associated with process and customers would leak to potential competitors (Jennings, 2002). Moreover, unrealized savings with a potential for increased costs, employee moral problems, losing touch with important information, unreliable promises of the providers, their inability to respond to changing requirements have been mentioned as potential risks as well. Each of these concerns should be recognized carefully by organizations that intend to outsource their logistics function, otherwise contract logistics can be another issue to deal with, rather than a catalyst or improvement (Razzaque and Sheng, 1998). Third-Party Logistics 2.2.1 Concept of 3PL Third party logistics service has been described in a few ways, including outsourcing of one single service such as transportation, and outsourcing of a set of complicated processs (Vasiliauskas Barysiene, 2008). Generally, 3PL provide not only just separate warehouse or transport functions but also multiple, bundled services (Leahy et al., 1995). It is also worth mentioned that freight forwarders and shipping lines are included in broad definitions of the 3PL industry (Rao and Young, 1994). On the basis of above definitions, Leib et al. (1993) used the following definition: Third-party logistics involves the use of external companies to perform logistics functions that have traditionally been performed within an organization. The functions performed by the third party can encompass the entire logistics process or selected activities within that process. The authors refer to the 3PL as a new industry and growing business environment has more expectations on 3PL. The usage of 3PL has been considered as logistics alliances at strategic level. Bagchi and Virum (1996, p.193) have developed the following definitions: A logistics alliance indicates a close and long-term, relationship between a customer and a provider encompassing the delivery of a wide array of logistics needs. In a logistics alliance, the parties ideally consider each other as partners. They collaborate in understanding and defining the customers logistics need. Both partners participate in designing and developing logistics solutions and measuring performance. The goal of the relationship is to develop a win-win arrangement. Compared with the prior definition, which focuses on the logistics functional activities, the final one emphasizes the duration of the relationship between the logistics service provider and user, and also covers an extensive range of promising logistics services (Halldorsson Larsen, 2004). Many articles have disclosed that 3PL industry has progressed steadily for ages (Liu, 2008). 3PL providers started as a traditional transportation or warehousing service providers from 1980s. Nowadays, 3PL companies provide a variety services including basis logistics service as well as value added services. Main challenges to 3PL service providers As the 3PL industry has continued to evolve, the 3PL provider, sitting in the middle between the manufacturers or suppliers (the buyers of the 3PL service, known as shippers) and the end customers (the consumer of the products), will need to balance the dynamic pulls generated by upstream and downstream entities, and thus faces challenges are unique to its position. Financial issues Although 3PL providers should develop skills, improve competencies, and provide more value-added service so as to survive and expand business successfully in this flourishing market, the main challenge for them is how to obtain business and achieve acceptable financial performance. Maintain profits under price pressures from customers The economic crisis has caused serious situations for both 3PL users and providers -82 percent of shippers now are implementing cost-cutting strategies and 60 percents are reconsidering their supply chain and relationships with 3PLs accordingly (Capgemini Consulting et al, 2009). As a matter fact, economic factor is a strong motivation for outsourcing, of which cost reduction and cost saving are the main concerns. One of the most significant motivations for outsourcing logistics functions to third parties is their professional knowledge and valuable experience in logistics industry which are costly for their customers to have in-house (Byrne, 1993). However, the decision of employing 3PL providers is usually influenced by the evaluation of cost/service trade-offs (Selviaridis and Spring, 2007). Hence, no matter what strategic stances the logistics providers take, they have to keep upgrading and improving their operational potentialities in the business environment (Sum Teo, 1999). Meanwhile, as price competition is inevitable and most customers are also price sensitive at present, 3PL providers still need to be cost conscious to achieve higher margins, and to prevent themselves from being priced out of the market. Financial stability Many articles have placed emphasis on financial firmness as a critical essential for logistics providers (Bottani Rizzi, 2006). Based on the empirical survey conducted by Boyson et al. (1999) financial stability was ranked as the most significant selection criteria for choosing 3PL providers because it reduce the risk in relationship. A 3PL services provider with stable financial standing can not only better satisfy its clients and implement cost reduction through a dedicated resource, but also diminish risks for logistics partners (Bowersox Daugherty, 1990). Accordingly, Boyson et al. (1999) assert that firms prefer providers demonstrating outstanding customer service level with low price and possessing solid financial stability. Nevertheless, the financial tsunami which has weighted down the world economy has resulted in steep decreasing in logistics demand with no doubt. On the one hand, according to Li Fung Research Center (2009), the clients of the logistics enterprises asked for price cut and longer credit term, and it is difficult for them to collect the payments form clients during such hard times. Bad debts and financial losses will be easily incurred by any imprudent credit management. On the other hand, the confidence for the banks to lend had been damaged by the tsunami. Banks are now only willing to provide loans to selected enterprises or projects, which limits the financing options of the logistics enterprises (Li Fung Research Center, 2009). Clearly, it has always been important for 3PL providers to maintain a sound financial condition to survive in the recession as well as to rise superior to others in the market. Information technology (IT) Capability of information technology IT-based logistics services is considered as significant factor by 88% of shippers, but only less than half (42%) of the shippers are satisfied with the IT capableness of their providers (Capgemini Consulting et al, 2009). Accordingly, such IT capability gap result in a few difficulties for both shippers and 3PLs to collaborate in an adaptive supply chain (Capgemini Consulting et al, 2009). Information is one of the most important elements in logistics management (Cheong, 2004) and it is definitely essential to assist logistics process with effective IT (LaLonde and Masters, 1994). IT capability can be enhanced by employing advanced software, such as electronic data interchange (EDI) networking, enterprise resource planning environments, simulation software, vehicle routing packages, carrier loading optimization tools, etc. (Qureshi et al, 2008). Hardware also may be utilized to facilitate operations and to increase the production efficiency, including radio frequency devices, servers, bar code printers and scanners, global positioning system (GPS), networking and internet/intranet connections, satellite tracking devices, etc. (Qureshi et al, 2008). 3PL services providers which adopt tracking and tracing devices can grant better services to users with quick responsiveness (Rahman, 2004). According to Byrne (1993), the need of sophisticated information technology is impe rative for logistics management to link members like manufacturer, carrier and customer in the supply chain. Sauvage (2003) proposed that to fully satisfy the variety of customers demand, LSPs should continuously employ advanced information technologies in order to enhance their service performance. It is unlikely for a firm which is lagging in a technology to move to a position of leadership (Jennings, 2002). Security of information systems The sharing of so much information inevitably leads to security concerns. It can not be denied that logistics service providers usually still lose customers annually due to issues of trust in privacy and security, though they keep attracting new clients (Pattel Conners, 2008). One possible mentioned security issue is that when a 3PL provider has to serve several direct competitors, the information in relation to all of them should be kept confidential (Grover et al., 1994, p. 38; Lacity and Hirschheim, 1993a, p. 24). Other than cost, security and privacy are also considered as major concerns by many companies when outsourcing. Compatibility of information systems IT compatibility acts an essential role in logistics activities such as forecasting, order purchasing, inventory replenishment and life cycle management (Anand, 2010). According to Arshinder et al. (2007), the information system of the whole supply chain is expected to be compatible. A compatible information system means comprehensible data are quickly shared among the parties throughout the supply chain (Arshinder et al, 2007) while incompatibility will lead to costly and time consuming process because information, though can be shared as well, is rarely in synchronization. At present, it is difficult for information to seamlessly flow throughout the network as international logistics often includes some different transportation modes and carriers. Moreover, there are diverse IT systems in the different trading areas. For example, Europe adopts Administration, Commerce and Transportation (EDIFACT) standards for EDI systems while the US follows the standards of the American National Standards Institute (Rao Young, 1994). These difficulties in global supply chain have challenged 3PLs regarding how to capitalize the gap to provide a distinct competitive advantage. Reliability of information systems As one of the major industry focus in the global logistics market, the field of information systems paid special attention to user satisfaction as an important performance measure (Ives and Olson, 1984; Robey and Farrow, 1982). Bailey and Pearson (1983) have pointed out that reliability is one of the critical criteria of customer satisfaction. There could be many unknown increased reliability risk which result from two major sections of technology. One is that new technology innovations or adoptions of 3PL providers may have an unclear reliability performance. The other is that an existing technology may be applied to a new market with unknown increase failure rates (Collins, 2005). To fulfill the promised logistics service reliably and exactly, 3PL providers must identify and remove uncertainty involved with technology reliability performance. Human Resource (HR) Lack of expertise There is a tendency that firms desire to acquire the expertise from third-party logistics providers who possess particular local knowledge of customs and infrastructure of destination countries in such a growing global market (Razzaque Sheng, 1999). Although one of the drivers for companies to outsource is to acquire resources and logistics professionals (Selviaridis Spring, 2007), the results of the research conducted by Georgia Institute of Technology et al. (2009) show that many outsourcing users dont believe that 3PLs are in the capacity of strategic partners currently, 40% of shippers in the survey expect their 3PL service providers to continue focusing on execution, and a good many of them reckon that 3PL providers lack logistics expertise that would support users increasing outsourcing. Often-cited problems range from misunderstanding the demand of customers supply chain to inadequate professionals in given products and markets (Selviaridis Spring, 2007). In fact, customers are looking for 3PL providers that have expertise in multiple phases of the logistics process. An annual surveys of US 3PL firms indicates that company employee/expertise is regarded by CEOs as the most important asset of the company for business success in the competition, however those same CEOs also agree that currently the most critical problem facing 3PL companies as finding qualified people (Leib and Randall, 1996b). Different culture Almost all members in the supply chain, including third party, have their own company culture which is definitely different from each other (Babics, 2005). According to Pagell (2004), the capacity of how to harmonize its own internal culture with the external different cultures of its customers is one significant factor that 3PL providers should note in the integration of operational services in supply chains. Mckeon (1991) states that for both 3PL providers and their customers, understanding each others cultures and organizational structure is an essential factor to ensure a win-win outsourcing. Compatibility of culture and values is one of the keys to successful partnership which can result in long-term partnership (Qureshi et al, 2008). Culture conflicts often result in change orders, unexpected costs, and sometimes a negative impact on relationships (Kremic et al, 2006). In general, the ability of 3PL providers to understand the customer organizations culture is a basis for partnering. Inadequate education and training In order to remain competitive in the logistics market, 3PL providers have to be vigilant and agile to their customers needs, and continually seek to meet customer expectations as much as possible. Logistics executive should be aware that, due to rapid growth in the logistics industry, there could be a shortage of qualified logistics expertise (Yeung, 2006). Therefore, it is necessary for governments and educational services to allocate more resources, put logistics on formal curriculum, and provide more correlated training programs to fulfill the demand of the whole supply chain. The development of logistics, otherwise, might be constrained by lack of trained logistics personnel (Sum Teo, 1999). Ulengin and Uray (1999) indicate that in Turkey, senior management that is void of professional knowledge of logistics is the fundamental factor limiting the progress of logistics industry. Kerr (2005b) describes poor training as a black hole in China because neither the central government nor Chinas regulatory authorities do much to promote logistics training programs. Obviously, a firm with higher quality of human resources such as better education or training will have superior core competence in the market. Hence, it is imperative for 3PL service providers to offer more training programs to employees so that they can cope with competition in the future (Wang et al, 2006) Business Landscapes Globalization of 3PL market delivering service in new geographic regions The internationalization and globalization of 3PL providers has been boosted by the economies of scale and scope, by the internationalization and globalization of the competitors and by customer following i.e. the internationalization of manufacturing firms, which may demand that the service supplier provides a global network and/or global experience (Arvidsson, 1997, p.74). 3PL providers that take charge of their customers outsourced logistics function normally need to build up a logistics network to deal with the flow of the goods from the customers factory to the end customers (Cheong, 2004). In current global economic environment, manufacturing companies tend to establish partnerships with 3PL service providers and they desire to cooperate with some global freight forwarding companies (Lemoine et al, 2003). 3PL service providers with well-content characteristics, such as far geographical spread and wide range of services are popular among the shippers (Qureshi, 2007). As per Bottani and Rizzi (2006), companies favor the 3PL providers with wide range of advanced services more than those traditional ones which can offer mere single logistics functional service. However, supply chain requirement keep changing. Customer demand can change in spatial and temporal terms. In response to the shippers new requirement, 3PL service providers endeavor to extend service coverage geographically and to expand breadth of service so that they can fulfill the interest of their customers as an integrated logistics provider (Qureshi et al, 2008) Relationship with customers 3PL service providers are normally very concerned with the relationship with their customers because they attempt to establish a long-term one with the users (Cheong, 2004). Long-term customer relationships can enable 3PLs to provide more sophisticated services, reduce the risk of replacement, achieve more earnings, and avoid expense of developing new customer (Cahill, 2006). In addition, long-term relationship is built on the basis of mutual trust and sharing of risk and reward (Qureshi et al, 2008). Bothe shipper and 3PLs will benefit from such long-term relationship (Qureshi et al, 2008). Most of 3PL services users agree that logistics costs could decrease even more through strategic relationships with 3PL service providers. Langley et al. (2004) point out that the successful relationship with 3PL service providers will assist the users to achieve their major objective. Customer relationship management is necessary once a 3PL provider first establishes a relationship with a shipper. To keep customers satisfied and coming back, 3PL providers must demonstrate their capabilities and the value these capabilities provider to customers (Wisner et al, 2005). Third-party logistics service providers in China: China has become the most attractive country for more and more foreign investments, manufacturers, and retailers from all over the world, which results in the fast growth of the Chinese economy (Liu, 2008). Accordingly, the development of 3PL has been spurred in China and 3PL industry has achieved significant achievement. Currently, most logistics companies offer extensively various value-added services and have confidence in the continuous development of Chinas logistics industry. Many literatures have research the Chinese logistics area from diverse perspectives and some supply chain-related difficulties facing foreign 3PLs are identified. High transport cost It is not deniable that Chinese government has invested a lot in the logistics sector to improve traffic in recent years. However, poor transportation is still considered as one significant challenge for logistics industry in China, which may result in the increase in logistics cost and the decrease in company profits (Lau Zhang, 2006). Li Fung Research Center (2009) notes that the transportation occupies more than 50 percent of the total logistics cost in China, and undoubtedly the operation costs of 3PL service providers will still be ascending due to the price upswing of commodity and fuel. Another culprit is high local road tolls and other hefty transportation fees (Kerr, 2005b). Underdeveloped physical infrastructure Many MNCs find that it is difficult for them to implement coherent strategies in China because underdeveloped transportation system hinders their distribution and sourcing throughout the country (Speece and Yukiko, 1995). Although Chinas economy and industrial production have been developing rapidly, the current logistics system is loaded with new challenges as it can barely keep pace with the growth rate of economy (Carter et al, 1997). The undeveloped logistics infrastructure in China, including deficient highways, aged port facilities, and limited runways and airports, can hardly fulfill the growing logistics demand in the progress of new economy (Pollit, 1998). The insufficiencies of present distribution system have restricted foreign enterprises to immensely exploit the plenty opportunities in Chinas market (Goh and Ling, 2003). It is thus imperative that the distribution of products and services be supported by a reliable transportation system. The need for guanxi Literally, guanxi means relationship. It is noted that Chinese culture is quite distinct from Western culture in numerous aspects, including the way to conduct business (Jiang and Prater, 2003). Guanxi, which is an important concept for successful business in China, refer to relationship between people (Michailova and Worm, 2003). It suggests a conveyable, reciprocal, invisible and useful responsibility to dyadic personal relationships (Luo, 2000). It is not surprising that Chinese prefer to deal with people they know and trust. As Wang et al. (2003) indicated, guanxi which is created on the basis of mutually beneficial can lower risk as well as competition in business circles. Millington et al. (2006) also state that when looking for satisfying vendors, guanxi is more useful than other information from website, trade market or media. This implies that the knowledge and expertise to understand local circumstance and the communication skill with foreigners are absolutely necessary for establishment of a successful cooperation (Lightfoot and Almeida, 2007). Government regulation Kerr (2006) identifies that government regulation is still 3PL providers biggest challenge. The development of 3PL in China is obstructed by some barriers such as underdeveloped infrastructure and entrenched regulatory circumstance (Lau Zhang, 2006). In the meantime, various regulations set up by different provinces forcefully influence business activities so that the founding of national networks is hindered (Kerr, 2005). It also has made it difficult for 3PL providers in China to fully meet the requirements of their clients. Moreover, there are many regulations and rules for foreign 3PL providers who plan to enter China logistics market. According to Lai and Hsu (2007), foreign 3PL providers must apply for the class A license issued by the Ministry of Foreign Trade and Economic Co-operation (MOFTERC) if they plan to establish subsidiaries as international freight forwarders in China. A survey conducted by Li Fung Research Center (2009) also identifies that the regulations and policies associated with logistics industry are not unalterable because the government will supervise the execution and analyze the effect of the existing ones and then will formulate new ones accordingly to boost the growth of the industry. It is true that a number of government departments which are involved in policies related to logistics industry have impact on the rhythm of changing regulation (KPMG, 2008). Local 3PL providers Chinas local logistics providers have been growing rapidly because foreign firms are increasingly looking to source there. To contend with foreign logistics providers, domestic companies have to upgrade facilities and enhance their service level (KPMG, 2008). Jiang and Prata (2002) indicate that in contrast with foreign 3PL entrants, local players are always in the close association with local or central governments. For instance, Sinatrans is a state owned company and is the only 3PL service provider in China who can provide a nationwide logistics service with full license. The authors also mention that a number of local 3PL providers at regional level have their own special strength in specific areas or specific business. Some of them even look for individual connection built directly with government officials which may be valuable in their daily business. Literature review summary This section has reviewed the literature ranging from some fundamental definitions of outsourcing and 3PL, to challenges for 3PL industry globally and especially in China which represents the current situation foreign 3PL providers are facing in China. In table 2.1, we summarize the above referred articles in each of the focus challenges.