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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS
AUGUST 2011
VOL 3, NO 4
ISSN 2073-7122
IJCRB
7
Vol .3, No. 4 August 2011
Interdisciplinary Journal of Contemporary Research in Business

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AUGUST 2011
VOL 3, NO 4
Editorial Board
IJCRB is a peer reviewed Journal and IJCRB Editorial Board consists of Phd doctors from all over the world including USA, UK, South Africa, Canada, European and Asian countries.
Prof. Renee Pistone

Harvard University, Lifetime Fellow - Harvard URI.
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Lord David K
Oxford University , St Catherine's College, Oxford, OX1 3UJ www.stcatz.ox.ac.uk/ ,

www.ox.ac.uk/ Phone: +44 1865 271700 , Fax: +44 1865 271768 Dr. Kenan Peker Department of Agricultural Economics, University of Selcuk, http://www.selcuk.edu.tr/ University of Selcuk, 42079 Konya, Turkey, Tel: 90-332-231-2877 Dr. A. Sathiyasusuman Senior Lecturer, Dept. of Statistics, University of the Western Cape, South Africa Dr Mahdi Salehi Assistant Professor, Accounting and Management Department, http://www.znu.ac.ir/ Zanjan University , D.N 1 Nagilo Alley, Hidaj City, Zanjan Province, Zanjan, Iran , Tel: 98-9121-425-323 Dr Heryanto Regional Development Bank of West Sumatra Jalan Pemuda No. 21 PO Box 111 Padang 25117 West Sumatra Indonesia Tel: +62-8126771699 Dr. Dave Hinkes Assistant Professor of Managment & Marketing Sam Walton Fellow , Lincoln Memorial University , Harrogate, TN ,UK Tel 423.869.6441 Dr. Francis A. Ikeokwu Sr., Ph.D., MAC, MBA, CFC Adjunct Professor, American Intercontinental University http://www.aiuniv.edu/ Dr Charles C. Dull Sr. MBA, Ph.D. American Intercontinental University http://www.aiuniv.edu/
COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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Dr Cara Peters Assistant professor of marketing , Winthrop University , Rock Hill, South Carolina. PhD in business administration , University of Nebraska Peer-reviewer of the Journal of Consumer Psychology; Consumption, Markets, and Culture; and Journal of Academy of Marketing Science. Dr Mahmoud M. Haddad PhD in Finance 214 Business Administration Building University of Tennessee-Martin ,Martin, TN 38238 Tel No +1731-881-7249
AUGUST 2011
VOL 3, NO 4
Dr G.A. Abu Department of Agricultural Economics, College of Agricultural Economics, Extension and Management Technology, University of Agriculture, P.M.B.2373, Makurdi, Benue State, Nigeria. Phone: +234-803-607-4434; fax: +234-44-534040 Dr.Rashid Rehman Associate Professor , College of Business Studies Al Ghurair University , Dubai, UAE. Dr Ebrahim Soltani Lecturer in Operations Management Kent Business School University of Kent , UK Dr Pu Xujin Business School, Jiangnan University, Jiangsu Wuxi,P.R.China ,214122 Tel: (86510) 85913617 , FAX: (86510) 62753617 , Mobile: (86) 13616193600 Dr. E. B. J. Iheriohanma Ph. D. Sociology Directorate of General Studies, Federal University of Technology, Owerri Imo State Nigeria. Tel +2348037025980. Dr Etim Frank Departmentof Political Science-University of Uyo-Akwa Ibom State-Nigeria Phd (Political Science/Public Administration) University of Calabar SL Choi University Teknologi Malaysia School of Business Management Southern College Malaysia Dr. Nek Kamal Yeop Yunus Senior Lecturer, Department of Business Management Faculty of Business & Economics, Universiti Pendidikan Sultan Idris, Tanjong Malim, Malaysia.
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Dr. S. I. Malik PhD Bio Chemistry & Molecular Biology (National University of Athens) NHEERL. Envrironmental carcinigenei division RTP Complex NC 27713, US Environmental protection Agency , 919-541-3282 Dr. Bhagaban Das Reader, Department of Business Management Vyasa Vihar, Balasore-756019 Orissa T. Ramayah http://www.ramayah.com Associate Professor , School of Management ,University Sains Malaysia, Tel 604-653 3888 Dr. Wan Khairuzzaman bin Wan Ismail Assoc. Professor International Business School, UTM International Campus Jalan Semarak 54100 Kuala Lumpur, MALAYSIA Zainudin Hj Awang Faculty of Information Technology and Quantitative Sciences, MARA University Technology MARA Kelantan 18500, Malaysia ,Tel: 60-9-9762-302 Ravi Kiran Associate Professor, School Of Management & Social Sciiences, Thapar University. Dr.Suguna Pathy Head, Department of Sociology, VNSG University, Surat
AUGUST 2011
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Birasnav M Assistant professor, Park Global School of Business Excellence, Kaniyur, Coimbatore Mohammad Reza Noruzi Faculty of Management and Economics ,Tarbiat Modarres University, Tehran, Iran Dr. C.N. Ojogwu Phd Education Management - University of Benin, Benin City, Edo state, Nigeria. Senior lecturer - University of Benin. Dr. Nik Maheran Nik Muhammad General Conference Co-Chair, GBSC 2009, www.nikmaheran.com Dr. A. Abareshi Lecturer, School of Business IT and Logistics RMIT University, Melbourne, Australia Office: +61 3 99255918 Dr Ganesh Narasimhan Lecturer, Management Sciences ,Sathyabama University Board of Advisor - AN IIM Alumina Initiative & International Journal Economics, Management, & Financial Markets Denbridge press, New York, USA
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Contents
Title
CROSS-CULTURAL DIFFERENCES IN SOCIAL KNOWLEDGE CREATION AND EXCHANGE: AN EXAMINATION OF GLOBE'S DIMENSIONS OF SOCIETAL CULTURE ANDY BERTSCH , DR. JOHN GIRARD CONSTRAINTS TO FINANCIAL MANAGEMENT OF SECONDARY SCHOOLS IN OWEERI EDUCATION ZONE OF IMO STATE AS PERCEIVED BY PRINCIPALS AND BURSARS ORUWARI JOY .N GENERATION Y AND THEIR BUYING BEHAVIOR TOWARDS LOCAL DELICACIES (MALAY LOCAL KUIH) AZFAHANEE ZAKARIA, SYED MOHAMMED ALHADY ZAHERAWATI ZAKARIA, MOHD ZOOL HILMIE MOHD SAWAL SARAH SABIR AHMAD, NAZNI NOORDIN LAND CONFLICT AS AN IMPEDIMENT TO COMMUNITY DEVELOPMENT IN SOUTHWESTERN NIGERIA ABEGUNDE ALBERT AYORINDE ANALYSIS OF SERVICE COSTS FOR OPTIMAL CAPACITY DETERMINATION IN A QUEUING SYSTEM E.C. UBANI THE EFFECT OF RELATIONSHIP MARKETING DIMENSIONS BY CUSTOMER SATISFACTION TO CUSTOMER LOYALTY SHAHRAM GILANINIA, HASANALI SHAHI SEYYED JAVAD MOUSAVIAN PROVISIONS OF BANKRUPTCY IN THE COMMERCIAL SAUDI LAW AND ITS COMPATIBILITY WITH ISLAMIC JURISPRUDENCE DR. KHALID EID THE RIGHTS & DUTIES OF A MORTGAGE SECURED DEBT FROM THE POINT VIEW OF THE SAUDI LEGISLATOR DR. KHALID EID THE EFFECT OF JOB ENRICHMENT ON JOB SATISFACTION: A CASE STUDY OF FACULTY MEMBERS UZMA RASHID, SADIA RASHID SERVICE QUALITY EVALUATION IN GENERAL DEPARTMENT OF HEALTH INSURANCE OF FARS PROVINCE USING A SERVQUAL MODEL (CASE STUDY: SHIRAZ) MOHAMMAD HOSSEIN MOSHREF JAVADI , RAZIEHGOL
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Title EVALUATING & IMPROVING ELECTRONIC TRUST FACTORS IN E-GOVERNMENT (CASE STUDY: MASHHAD ELECTRONIC CITY) ZAHRA JAVIDIAN, SINA SOLTANI MOLLAYAAGHOBI A PROPOSED MODEL FOR EXPLANATION OF INFLUENTIAL FACTORS ON CUSTOMER SATISFACTION IN BANKING INDUSTRY MOHAMMAD REZA HAMIDIZADEH, NASRIN JAZANI ABBASALI HAJIKARIMI, ABOLGHASEM EBRAHIMI EMPOWERING PROVINCES THROUGH DECENTRALIZATION OF EDUCATIONAL POLICY MEASURES SADDAF AYUB RAJA MEASUREMENT OF THE DEGREE OF ORGANIZATIONAL COMMITMENT AMONG THE FACULTY MEMBERS OF PRIVATE SECTOR UNIVERSITIES IN PESHAWAR CITY. NAVEED FAROOQ , MUHAMMAD IRFAN, MUHAMMAD FAROOQ DEFENSE EXPENDITURE-GROWTH NEXUS: EMPIRICAL EVIDENCE FROM SELECTED SOUTH ASIAN COUNTRES MUHAMMAD IFTIKHAR UL HUSNAIN , FARZANA SHAHEEN ROLE OF SELF CONCORDANT GOALS IN OBTAINING INNOVATION AND CREATIVITY IN THE EMPLOYEES WASIQ EJAZ, SYED SAAD HUSSAIN SHAH JABRAN AZIZ, AHSAN RAZA JAFFARI, AMIR ZAMAN MOHSIN RAZA JAFFARI
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THE IMPACT OF HUMAN RESOURCE DIMENSIONS ON 182 ORGANIZATIONAL PERFORMANCE FROM AN INTERNATIONAL PERSPECTIVE SYED SAAD HUSSAIN SHAH, JABRAN AZIZ WASIQ EJAZ, AHSAN RAZA JAFFARI, AMIR ZAMAN, MOHSIN RAZA JAFFARI EMPLOYABILITY IN MNCS: CHALLENGE FOR GRADUATES ATIF ANIS RAO, SYED SAAD HUSSAIN SHAH JABRAN AZIZ , AHSAN RAZA JAFFARI WASIQ EJAZ, IHSAN UL-HAQ, SYED NEIMAN RAZA PRICE, VALUE AND SUPPLY OF MONEY AND ITS EFFECT ON KSE-100 INDEX MUHAMMAD AAMIR, ARSLAN QAYYUM ADEEL NASIR, SHABBIR HUSSAIN KANWAL IQBAL KHAN, KIRAN FAROOQ PROVIDE A NEW MODEL FOR APPRAISING PERFORMANCE OF SPORT ORGANIZATIONS SEYED HEYDAR MIRFAKHR-AL-DINI, ABD-AL-NABI KHATIBI AGHDA 189
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Title AN INVESTIGATION OF PERSONNEL'S ATTITUDE TOWARD MERIT PAY IN SOUTH OF SISTAN & BALUCHISTAN HOSPITALS MEHDI MOHAMMADI, JAFAR TORK ZADEH HOMAYOUN DADGAR, FARIDEH BARAHOUEI MOHAMMAD EBRAHIMI, REHMAN SAFDAR AN EMPIRICAL STUDY ON CUSTOMERS SATISFACTION TOWARDS BANKING SERVICES IN TRICHY. MAHALAKSHMI. V, DR. M. G. SARAVANARAJ TARGETING SENSITIVE GROUPS AND SOCIAL ISSUES: AN EXPLORATORY STUDY OF PAKISTANI MARKET NIDA ASLAM KHAN, HUMAYUN SULTAN ANSARI PRIVATIZATION AND PERFORMANCE OF BANKING SYSTEM IN PAKISTAN AHMED ARIF , SHOAIB AKHTAR NAUMAN WAHEED, SADAF BASHIR MOTIVES BEHIND CHANNEL CHOICE IN MULTICHANNEL AIR TRAVEL RETAIL CONTEXT AMONG PAKISTANI CONSUMERS SHAMAILA GULL, AMINA ASHRAF SYEDA NAZISH ZEHRA RIZVI ADDICTION IN INTERNET CHATTING: AN EMPIRICAL STUDY USING MODIFIED TECHNOLOGY ACCEPTANCE MODEL DR. SAM THOMAS QUALITY ASSESSMENT FOR ACADEMIC SERVICES IN UNIVERSITY OF ISFAHAN ACCORDING TO THE STUDENTS OPINIONS USING SERVQUAL MODEL DR. MOHAMMAD HOSSEIN MOSHARAF JAVADI BATOOL SAMANGOOE, MOHAMMAD HASSAN TANHAEI MEASURING CUSTOMER SATISFACTION IN FAST FOOD INDUSTRY A CASE FROM PAKISTAN FAST FOOD INDUSTRY USMAN ASIF, KASHIF JAVED & WAJID SALEEM
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BRAND TRUST: A TRUE GESTALT OF UNETHICAL ADVERTISEMENT 319 AND BRAND POSITIONING IN CONSERVATIVE ECONOMIES AMER RAJPUT ,, ABDUL HAMID ABU BAKAR, MUHAMMAD AMIR RASHID COMPARING THE IMPACT OF FINANCIAL AND NON-FINANCIAL 328 REWARDS TOWARDS ORGANIZATIONAL MOTIVATION ROSLIZA MD ZANI, NAZAHAH ABD RAHIM, SUTINA JUNOS, SHUHAIMI SAMANOL, SARAH SABIR AHMAD, FARAH MERICAN ISAHAK MERICAN, SHAKIRAH MOHD SAAD, INTAN NAZRENEE AHMAD
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Title PRO-ACTIVITY IN NPD AS A COMPETITIVE ADVANTAGE IN COMPLEX COMPETITIVE ENVIRONMENT A STUDY ON HOTEL INDUSTRY OF PAKISTAN AHMED NADEEM, HAROON RASHID, SHERAZ AHMED KHAN TEACHERS PERCEPTIONS OF PRINCIPALS EFFECTIVENESS IN HIGHER SECONDARY SCHOOLS OF PUNJAB KHUDA BAKHSH MALIK, DR.UMAR ALI KHAN,LIAQUAT HUSSAIN, ALLAH NOOR, DR ABDUR REHMAN DESIGNING 8-DIMENSIONAL CAPITAL STRUCTURE AND DIVIDENDS MOHAMMAD REZA HAMIDIZADEH, ABDULMAJID ABDULBAGHI IMPACT OF INNOVATION AND CREATIVITY ON PRODUCTIVITY ENHANCEMENT OF EMPLOYEES IN ISFAHAN TELECOMMUNICATIONS COMPANY AMIN SEDAGHAT ROSTAMI DR. MOHAMMAD HOSSEIN MOSHREF JAVADI THE EFFECT OF WORKING CAPITAL MANAGEMENT ON FIRMS PROFITABILITY: A REVIEW PAPER MOHAMMAD TAHIR, DR. MELATI BINTI AHMAD ANUAR THE INFLUENCE OF INTELLECTUAL CAPITAL AND INTERNAL AUDITING ON CORPORATE PERFORMANCE DR. SAUDAH SOFIAN, DEWI FARIHA EARNEST ORGANIZATIONAL AGILITY DEVELOPMENT IN ELECTRONIC ENVIRONMENT USING FUZZY LOGIC DARYOSH MOHAMMADI JANAKI, MAHDI MOHAMMADI JANAKI MACROECONOMIC EFFECTS OF EXTERNAL DEBT AND DEBT SERVICE ON ECONOMIC GROWTH IN PAKISTAN (A CASE STUDY OF PAKISTAN 1970-2010) WAHEED MURAD , DR. FAROOQ AZIZ THE MODEL FOR OPTIMIZATION OF MANPOWER SCHEDULING PLANS IN NEW INDUSTRIES WITH LINEAR PROGRAMMING MOHAMMAD TALEGHANI , MAHMOOD SAMADI LARGANI SEYYED JAVAD MOUSAVIAN QUANTIFYING THE ROLE OF MARKETING PRODUCTIVITY METRICS IN MARKETING PERFORMANCE MEASUREMENT ZUBAIR AZAM, IMRAN QAMAR
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Title THE EFFECTIVENESS OF SCIENTIFIC ATTITUDE TOWARD PHYSICS TEACHING THROUGH INQUIRY METHOD VERSES TRADITIONAL TEACHING LECTURE METHOD OF FEMALE STUDENTS AT SECONDARY SCHOOL LEVEL IN PAKISTAN SHAFQAT HUSSAIN , DR.MUHAMMADTAYYAB ALAM DR MUHAMMAD MUQSUD ALAM BUKHARI SARFARAZ AHMAD , NASIR AHMAD INNOVATIVE INTERFACE FOR ENHANCING OF THE LEARNING CAPABILITY OF CHILDREN ASHRAF ULLAH, SALAM ULLAH KHAN SADAQAT ALI KHAN BANGASH, KAMRAN KHANVTATARI PERCEPTION ABOUT CAREER AMONG SECONDARY LEVEL STUDENTS AIJAZ AHMED ASSESSMENT OF THE DEVELOPMENT PLAN OF VIABILITY OF ICT FOR THE OIL COMPANY EMPLOYEES AND PRESENTING AN ASSESSMENT MODEL HASSAN RASTEGARPOUR, NOSRAT RIAHINIA EXPLORING THE DEVELOPMENT OF INDUSTRIES: THE CASE OF PAKISTAN MUHAMMAD ASHRAF TRENDS OF MANPOWER MIGRATION FROM PAKISTAN IMRAN AHMED LAKHA DR. FAROOQ AZIZ THE IMPACT OF ADVERTISING ON BRAND LOYALTY WITH THE MODERATION OF CONSUMER BUYING BEHAVIOUR. A CONCEPTUAL FRAMEWORK AAMNA SHAKEEL ABBASI, ALI MUSLIM BIN AQEEL ALI NASEER AWAN STRUGGLE TO JUGGLE. GENDER AND WORK LIFE BALANCE MR. AQEEL YOUNIS , MS. SEHAR ZULFIQAR MS. HIRA ARSHAD, MR. MUHAMMAD IMRAN RELATIONSHIP BETWEEN SHYNESS AND CLASSROOM PERFORMANCE AT GRADUATION LEVEL IN PAKISTAN DR. SAEED-UL-HASAN CHISHTI, SAEED ANWAR SHAHINSHAH BABAR KHAN ROLE OF PRACTICAL WORK IN THE TEACHING OF CHEMICAL CONCEPTS AT SECONDARY LEVEL-A CASE STUDY SARFRAZ AHMED, DR.MUHAMMAD TAYYAB ALAM SHAFQAT HUSSAIN, DR. MAQSOOD ALAM BUKHARI
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Title HEALTH TOURISM, TOURIST SATISFACTION AND MOTIVATION MOHAMMAD TALEGHANI , EBRAHIM CHIRANI ATEFEH SHAABANI
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IDENTIFYING GAPS IN DIGITAL DIVIDE COMPARISON BETWEEN 556 LOCALITIES IN SG. PETANI, KEDAH, MALAYSIA NUR ZAFIFA KAMARUNZAMAN, ZAHERAWATI ZAKARIA, AZLYN AHMAD ZAWAWI , NAZNI NOORDIN, MOHD ZOOL HILMIE MOHAMED SAWAL, AZLAN BIN ABDUL RAHMAN, HANIR IDHAM BIN HAMZAH, MOHD MUHRIZ BIN NORDIN AN EMPIRICAL STUDY ON THE IMPACT OF MICROFINANCE INSTITUTIONS IN ENHANCING SHG IN KARUR DISTRICT, TAMIL NADU - INDIA S. RADHIKA, S. ANUPRIYA FACTORS AFFECTING THE AUDIENCES TRUST TO SMS ADVERTISING IN ISFAHAN CITY HOSSEIN REZAYI DOLAT ABADI BAHRAM RANJBARIAN, MOHSEN NADIAN THE EFFECTIVENESS OF USING A SUGGESTED PROGRAM BASED ON GAMES AND VISUALS ON ENRICHING ENGLISH VOCABULARY OF FIRST GRADE PREP SCHOOL STUDENTS DR. MOHAMMAD FAID MOHAMMAD 563
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DETERMINANT OF AUDIENCES SATISFACTION FROM 596 NEWS BROADCASTING PROGRAMS IN THE ISLAMIC REPUBLIC OF IRAN DR. FEREYDOUN VERDINEJAD , DR. MOHAMMAD HAGHIGHI DR. MOHAMMAD BAGHER SAROUKHANI, SHADI GOLCHINFAR THE DILEMMA OF POOR EDUCATION AT HIGHER LEVELS OF EDUCATION IN PAKISTAN AMIR RAZI, MUHAMMAD AAMIR SYED ATIF ALI, ZAIN HASSAN ACADEMIES: A NEED OR A WANT ? MUHAMMAD AAMIR , AMIR RAZI SYED ATIF ALI, ZAIN HASSAN JOB ATTITUDES AS A PREDICTOR OF EMPLOYEE PERFORMANCE: EVIDENCE FROM PUBLIC SECTOR OF PAKISTAN. MEHVISH ALI, KHANSA HAYAT NOSHEEN SARWAT , JAVERIA ASHFAQ QURESHI IMPACT OF JOB SATISFACTION AND ORGANIZATIONAL COMMITMENT ON EMPLOYEE PERFORMANCE, EVIDENCE FROM PAKISTAN JAVERIA ASHFAQ QURESHI, KHANSA HAYAT MEHWISH ALI, NOSHEEN SARWAT 609
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Title IMPACT OF STRATEGIC LEADERSHIP ON ORGANIZATIONAL PERFORMANCE, IN THE CONTEXT OF JOB SATISFACTION AND ORGANIZATIONAL COMMITMENT, EVIDENCE FORM EDUCATIONAL INSTITUTIONS OF PAKISTAN. NOSHEEN SARWAT, KHANSA HAYAT JAVERIA ASHFAQ QURESHI, MEHWISH ALI EFFICIENCY DECOMPOSITION IN DATA ENVELOPMENT ANALYSIS: AN APPLICATION TO INSURANCE COMPANIES IN IRAN KAMBIZ SHAHROUDI , MOHAMMAD TALEGHANI GOLJAHAN MOHAMMADI FACTORS AFFECTING ON THE SOCIAL ENTREPRENEURSHIP IN ORGANIZATION (CASE STUDY) NOOR-MOHAMMAD YAGHOOBI, ESMAIEL TOLUE OMOLBANIN AZADIKHAH THE EFFECT OF MODERN TECHNOLOGY ON ORGANIZATIONAL AGILITY (AN EMPIRICAL STUDY) NOOR-MOHAMMAD YAGHOOBI, OMOLBANIN AZADIKHAH TRANSFORMING WEB USABILITY DATA INTO WEB USABILITY INFORMATION. USING INFORMATION ARCHITECTURE CONCEPTS & TOOLS KAMRAN KHAN TATARI , SALIM UR-REHMAN ,WAHEED UR-REHMAN RELATIONSHIP BETWEEN PERSONALITY TRAITS AND MARITAL ADJUSTMENT OF TEACHERS HUMMARA AKRAM, DR. NAJMA I. MALIK STRATEGIC CONFLICT MANAGEMENT OF SECONDARY SCHOOL ADMINISTRATORS IN THE TABUK REGION, SAUDI ARABIA YOSEF MAWDH S. ALJHANI, JABER HASSAN, ISMAIL HUSSEIN AMZAT ANALYSIS OF THE FACTORS AFFECTING OF INTERNET BANKING: CASE STUDY OF CUSTOMERS OF MELLAT BANK IN ISFAHAN CITY ALI SANAYEI, ALI SHAEMI, MOSLEM SALAJEGHEH AN EMPIRICAL STUDY ON EMPLOYEE RETENTION STRATEGIES IN A BISCUIT MANUFACTURING COMPANY IN INDIA S. R. KAVITHA, S. R. GEETHA, V.ARUNACHALAM IMPACT OF TECHNOLOGY TRANSFER ON RESEARCH AND DEVELOPMENT ACTIVITIES IN DEVELOPING COUNTRIES DURING THE PERIOD 1999-2008. KHADIJEH NASROLAHI, BATUL RAFAAT BEHROOZ KAKAEI , MAHYAR SHABANINEJAD MASOULEH
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Title
COMPETENCY ASSESSMENT A GAP ANALYSIS N.ANITHA, DR.THENMOZHI INTERRELATIONSHIP BETWEEN CUSTOMER BASED BRAND EQUITY CONSTRUCTS: EMPIRICAL EVIDENCE FROM HOTEL INDUSTRY OF PAKISTAN PROF. DR. MUHAMMAD EHSAN MALIK, BASHARATNAEEM MILES AND SNOW STRATEGY TYPOLOGY: A CRITICAL COMMENTARY PROF. DR. MUHAMMAD EHSAN MALIK, BASHARAT NAEEM A REVIEW OF EDUCATIONAL VALUES OF THE MODERN MUSLIM THINKER: DR. ALLAMA MUHAMMAD IQBAL (R.A) IJAZ AHMAD TATLAH ZULFIQAR ALI LINKAGE BETWEEN LEADERSHIP AND READING: A THEORETICAL REVIEW IJAZ AHMAD TATLAH PROFESSOR DR.UZMA QURAISHI RELATIONSHIP BETWEEN DEMOGRAPHIC CHARACTERISTICS AND BURNOUT AMONG PUBLIC SECTOR UNIVERSITY TEACHERS OF LAHORE DR. NAYYAR RAZA ZAIDI, DR. RANA ABDUL WAJID FARHEEN BATUL ZAIDI A CRITIQUE ON SCIENTIFIC MANAGEMENT MUGHEERA MAQBOOL , AHMAD ZAKARIYA , AHMER NAVEED PARACHA AGILITY IN KNOWLEDGE-BASE ENTERPRISES AND AGILE KM; A NEW APPROACH TO SURVEY IMPORTANCE OF RECIPROCAL IMPACT BETWEEN KM & AGILITY SEYED MAHMOOD ZANJIRCHI , SAYYED HASSAN HATAMI NASAB THE STUDY OF RELATIONSHIP BETWEEN ORGANIZATIONAL STRUCTURE AND THE COMPETENCY OF EXPERTS IN IRAN NATIONAL GAS COMPANY DR.AMIRKHANI.AMIRHOSSEIN NAZARHASAN ABAD. RAANA IMPACT OF IRRIGATION ON THE CROPPING PATTERN ON THE COMMAND AREA OF CHASHMA RIGHT BANK CANAL (CRBC), IN DIKHAN. DR MAHMOOD SHAH, MALIK AMER ATTA DR MUHAMMAD WASIM AKBAR, WAJEEHUDDIN NOUMAN TAHIR ULLAH JAN
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Title
SURVEYING ETHICAL CLIMATE ON ORGANIZATIONAL HEALTH IN IRANS SMES GHADER VAZIFEH DAMIRCH , GHOLAMREZA RAHIMI RFID DEVELOPMENT FACORS EFECT IN SUPPLY CHAIN MANAGEMENT (CASE STUDY: IRAN TRACTOR MANUFACTURING CO) GHOLAMREZA RAHIMI , GHADER VAZIFEH DAMIRCH DETERMINING THE LEVEL OF INFLUENCING OF INTELLECTUAL CAPITAL EFFICIENCY ON BRAND VALUE OF THE COMPANIES ACCEPTED IN TEHRAN STOCK MARKET HOSSEIN REZAEI DOLAT ABADI , NAJMEH TAVAKOLI UNIVERSITY ROLES IN ACHIEVING IRAN'S 20-YEAR VISION PLAN CASE STUDY (UNIVERSITY OF EAST AZERBAIJAN PROVINCE) GHOLAMREZA RAHIMI ,GHADER VAZIFEH DAMIRCH IMPACT OF TRAINING ON JOB TURNOVER: EVIDENCE FROM CONTEMPORARY LITERATURE ABDUL HAKIM AHMAD DARDAR , DR.AHMAD JUSOH DR.AMRAN MD RASLI ANALYSIS OF CUSTOMER SATISFACTION AMONG INTERMEDIARIES IN THE B2B MARKETS: CASE STUDY OF CUSTOMERS OF BEHPAKHSH COMPANY IN ISFAHAN CITY ALI SANAYEI, ALI SHAEMI, MAHDI GHASEMI SHORIJE ECONOMIC CONDITIONS OF INDIA IN THE AGE OF MUSLIM RULERS DURING 12TH TO 16TH CENTURY DR. FAROOQ AZIZ , DR. SYED ABDUL AZIZ DR. TASNEEM FATIMA, SYED MUHAMMAD FAHIM CONSUMERS ONLINE SHOPPING CART USE AND ITS EFFECT ON FREQUENCY OF ONLINE BUYING (MALAYSIAN ONLINE INDUSTRIES) MAHMOUD MANAFI, ROOZBEH HOJABRI MEHRDAD SALEHI, PAGAH KHATIBI, REZA GHESHMI THE IMPACT OF E-SERVICES ON CUSTOMER DEPENDENCIES (TRANSPORTATION INDUSTRY IN IRAN) MASOOMEH SHAHBAZI MOGHADAM, ROOZBEH HOJABRI MAHMOUD MANAFI, MEHRDAD SALEHI, REZA GHESHMI DETERMINATION OF COMPOUND RATE OF RETURN OF EMERGING MARKETS: A CASE STUDY OF KARACHI STOCK EXCHANGE DR. MUHAMMAD ARSHAD HAROON, DR. QAMMARUDDIN MEHAR
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Cross-Cultural Differences in Social Knowledge Creation and Exchange: An examination of GLOBE's Dimensions of Societal Culture
Andy Bertsch, (DBA, Corresponding Author) Minot State University 500 West University Avenue, Minot, ND 58707, USA Dr. John Girard, PhD , Minot State University 500 West University Avenue, Minot, ND 58707, USA
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Abstract This paper continues to chronicle an exploratory, in-progress research project that compares the findings of existent cross-cultural research with those of Forresters Social Technographics research. The aim of the project is to determine if a relationship exists between cultural differences and social knowledge creation and exchange. This multiphase project has, thus far, included mapping Davenport and Prusaks information and knowledge creation theories to the six components of Forresters Social Technographics study (creators, critics, collectors, joiners, spectators, and inactives) and comparing the resulting Social Technographics results from 13 nations to Hofstedes four cultural dimensions (power distance, individualism, uncertainty avoidance, masculinity). The results of the comparison between Hofstedes scores and the Social Technographics were inconclusive as there existed no reasonable relationships between Hofstedes culture scores and a societys placement along the Social Technographics (Girard & Bertsch, 2011). The current phase, as included in this paper, shifted the focus from Hofstedes culture scores to the GLOBE Societal Values scores. The analysis included running correlation coefficients (Peassons r) for each relationship, testing for significance of each respective Pearsons r, and conducting regression analyses on each relationship. The results were mixed. Although there were several statistically significant correlations between the GLOBE Societal Values scales and the Social Technographics scores, only one relationship passed the R-square test. It may be that other cross-cultural models such as GLOBE Practice scales, Schwartz, Triandis, or others may yield different results. In this regard, further research is necessary. The next phase of the project will compare Social Technographics with the GLOBE Practice scores. Keywords: Global Knowledge Sharing, Cross-Cultural Research, Social Technographics Introduction For more than 20 years, organizational leaders have strived to institutionalize effective ways to create and share organizational knowledge. A variety of concerns, including downsizing, baby boomers retirement, terrorism, the global economic crisis, and a host of other organizational challenges, have forced leaders to share knowledge with both internal and external stakeholders. Many leaders have relied on the on the solid foundation provided by several seminal works including Working Knowledge (Davenport & Prusak, 1998), If Only We Knew What We Know (O'Dell & Grayson, 1998), and The Knowledge Creating Company (Nonaka & Takeuchi, 1995).
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Notwithstanding the best efforts of many pioneering leaders, few organizations have attained the desired level of knowledge creation and exchange. This is certainly not due to a lack of enthusiasm or commitment of resources on the part of executives, but rather the result of technology-focused, complicated, and expensive tools, techniques, and technologies. This technological focus was further hindered by an omnipresent culture of need-to-know rather than one based on need-to-share. Together, these factors prevented the transparency necessary to achieve organizational knowledge goals. The problem becomes even more complex for global organizations. This paper chronicles an exploratory, in-progress research project that draws together a series of recent projects with a view to understanding how global knowledge creation and exchange may be facilitated through social knowledge tools, techniques, and techniques. Literature Review Knowledge Management Generations In A Leaders Guide to Knowledge Management, the authors suggested that many rstgeneration knowledge management projects were based on collecting and classifying information (Girard & Girard, 2009). The belief seemed to be that if we developed huge, centralized, IT-based repositories of artifacts, then stakeholders would serve themselves. Unfortunately, this approach never delivered the promised user-friendly access but rather resulted in many very expensive partial databases of little value. Second-generation knowledge management projects, they argued, shifted the focus to codifying tacit knowledge and combining explicit knowledge to create new knowledge. This approach seemed plausible in theory; however, quickly it became apparent that codifying tacit knowledge was difficult and very expensive, both in terms of time and money. Further exacerbating the challenge was the issue of information overload that resulted from the combination efforts. Finally, Girard and Girard (2009) suggested that today we are seeing some very promising results from third-generation knowledge projects, which focus on connecting people and facilitating collaboration. Their projects focus on the social side of knowledge creation and exchange, referred to as Social Knowledge. Some organizations are now reaping the benefits of using social media tools such as wikis for collaboration and knowledge-sharing and commercial social networking tools, such as Facebook, LinkedIn, or Twitter for connecting people. These emerging tools and techniques provide exible, agile, and intuitive solutions for connecting people with people and facilitating coordination, communication, and collaboration. Social Technographics A characteristic of the first decade of the 21st century is the emerging power of everyday people. In their book Groundswell: Winning in a World Transformed by Social Technologies, Forrester analysts Charlene Li and Josh Bernoff (Li & Bernoff, 2008) describe part of this trend as a groundswell, which they define as a social trend in which people use technologies to get the things they need from each other, rather than from traditional institutions like corporations (p. 9). The groundswell may be useful in considering cross-cultural differences and the resultant impact on third generation knowledge projects.
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The groundswell concept arms ordinary people with unparalleled power, especially people that gather together and create communities. For centuries, groups of passionate people have yearned for the opportunity to influence decision makers. Of course, there have been many times in history when large groups congregated to spark change. However, the logistics with massing large groups can be very cumbersome, expensive, and difficult to communicate. The advent of Web 2.0, a World Wide Web based on collaboration rather than content, eliminated many of these obstacles. In their book Wikinomics: How Mass Collaboration Changes Everything, the authors describe how a low-cost collaborative infrastructure is empowering the many with weapons of mass collaboration (Tapscott & Williams, 2006, p. 11). Tapscott and Williams (2006) warn these weapons support a new level of collaboration that will turn the economy upside down and may well facilitate the destruction of organizations who fail to adjust. Li and Bernoff developed the Forrester's Social Technographics to categorize consumers based on their social computing habits. They use a ladder analogy with six rungs, which correlates to the six levels of social computing. Their model considers how adult Internet users utilize the Internet to get the things they need from each other, rather than from traditional institutions like corporations (Li & Bernoff, 2008, p. 9). Li and Bernoffs definitions of each dimension are in Table 1.
Table 1: Social Technographics Dimensions Adapted from (Li & Bernoff, 2008) Dimension Creators Critics Li and Bernoffs Definition Creators make social content go. They write or upload video, music, or text. Critics respond to content from other. They post reviews, comment on blogs, participate in forums, and edit wiki articles. Collectors organize content for themselves or others using RSS feeds, tags, and voting sites like Digg.com. Joiners connect in social networks like MySpace and Facebook. Spectators consume social content including blogs, user-generated video, podcasts, forums, or reviews. Inactives neither create nor consume social content of any kind.
Collectors Joiners Spectators Inactives
Although the Social Technographics concept was originally envisaged to model consumer behavior from a marketing lens, much can be learned from a knowledge sharing point of view. Internet users in five of the dimensions are actively creating and exchanging knowledge in the social space. Although the scope of this paper precludes a detailed analysis of information and knowledge creation, a brief overview is prudent. A seminal work in the field is Davenport and Prusaks (1998) Working Knowledge, in which they articulated five major ways in which data could be transformed into information. These are summarized in Table 2.
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Table 2: Data to Information Creation Tasks Adapted from Davenport and Prusak (1998) Dimension Context Categorize Calculate Correct Condense Transformation Task
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Put the data into context by communicating the reason for gathering the data Categorize the data by describing the breakdown or the essential components of the data Mathematically or statistically calculate the data Correct errors in previously reported data Condense the data by providing a summary instead of the entire collection of data
Similarly, Davenport and Prusak (1998) described how information may metamorphose into knowledge through a series of activities that increase its value as summarized in Table 3. Table 3: Information to Knowledge Creation Tasks Adapted from Davenport and Prusak (1998)
Dimension Compare Consequences Connects Conversation Transformation Task Compare information with previous information, primarily to determine what has changed in a particular situation Determine the consequences or repercussions of this information on decisions Consider how this information connects or correlates to other information Through conversation one may conclude what people think about the information
By combing the work of Davenport and Prusak with that of Li and Bernoff, one may deduce that the Social Technographics components cater to knowledge creation and exchange in the social dimension. A brief summary is presented Table 4. Table 4: Social Technographics Dimensions Adapted from Li and Bernoff (2008)
Dimension Creators Knowledge Sharing Activity Creators produce and share information and knowledge that is freely available to other users, the quintessence of need-to-share. Critics add value to the data, information and knowledge shared by creators. Their feedback, comments, and corrections often facilitate the metamorphosis of data to information or information to knowledge thorough conversation, connections, and comparison. Collectors provide access and provide the opportunity for other users to compare and connect information. Online communities facilitate conversation. Spectators consume the information and knowledge created by others. Inactives do not create or exchange social knowledge
Critics
Collectors Joiners Spectators Inactives
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The clear connection between the Social Technographics and Davenport and Prusaks knowledge creation processes provides a foundation from which we may explore the global environment. Of particular interest to this project are different levels of social computing by nation. For example, according to Li and Bernoff (2008), 34% of adult Japanese Internet users are classified as creators compared with only 9% of adult German Internet users. To date, Social Technographics data has been collected for 13 nations that will be considered later in the paper. The Cultural Component The first phase of this study (Girard & Bertsch, 2011) was based largely on the work of Geert Hofstede (1980), a pioneering researcher in the domain of cross-cultural research who argued there are four key dimensions of cultural differences: power distance, individualism, uncertainty avoidance, and masculinity. Hofstedes original publication (1980) was based on 116,000 surveys from 88,000 employees of IBM subsidiaries from 72 societies. However, only 40 countries were included in his published work; due, in part, because he only included societies that had more than 50 respondents. Hofstedes 1980 publication illustrating the concept of culture and its impact on management and business operations was significant. His work has become a heavily replicated and referenced cultural model. As of 2001, there had been 140 replications, and between January, 2000 and December, 2005, his work appeared as a reference in nearly 1,400 journal articles (Hofstede, 2001; Holt, 2007). Flaws in some of the replications have been identified by Hofstede himself as he is critical of replications that do not match the samples from each society, are small in size (small n from each society), or compare too few societies (Hofstede, 1996, 2001). Some are critical of Hofstedes methodology and findings. Hofstede based his work on surveys of IBM managers in 40 different countries. This alone has spurred a plethora of outcries. To some, a study of only one organization cannot be generalized onto the entire population of a society. The debate of whether nations are the appropriate units of measurement directly challenges Hofstedes practice of measuring the value systems of managers from a single organization and subsequent inference onto the national culture (e.g. ecological fallacy and reverse ecological fallacy). In addition, there are those who challenge the timeliness of Hofstedes collection of data (1967-1969, and 1971-1973) and whether the data is obsolete. Others have been critical of any study that uses survey instruments to assess cultures. For a full discourse of the Hofstede-to-Forrester analysis, see Girard & Bertsch (2011). This phase of the project turns to the Global Leadership and Organizational Behavior Effectiveness (GLOBE) research project, which is a comprehensive study of 61 countries (House, Hanges, Javidan, Dorfman, Gupta, & GLOBE Associates, 2004). This extensive study includes more than 17,000 participating middle managers from 950 organizations, making it perhaps the most large-scale international management research project that has ever been undertaken (Leung, 2008, p. xiii). Although similar in some ways to Hofstedes work, the GLOBE research project includes nine dimensions of societal culture as defined in Table 5.
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Table 5: GLOBE's Dimensions of Societal Culture Definitions adopted by GLOBE (Chhokar, Brodbeck & House, 2008)
Dimension Performance Orientation (PO) Definition The extent to which high level members of organizations and societies, encourage and reward group members for performance improvement and excellence. The degree to which individuals in organizations or societies engage in future-oriented behaviors such as planning, investing in the future, and delaying individual or collective gratification.
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Future Orientation (FO)
Gender Egalitarianism (GE)
The extent to which an organization or a society minimizes gender role differences while promoting gender equity and equality of genders. The degree to which individuals in organizations or societies are assertive, confrontational, and aggressive in social relationships. The degree to which organizational and societal institutional practices encourage and reward collective distribution of resources and collective action. The degree to which individuals express pride, loyalty, and cohesiveness in their organizations, families, circle of close friends, or other such small groups. The degree to which members of an organization and society encourage and reward unequal distribution of power with greater power at higher levels. The degree to which individuals in organizations or societies encourage and reward individuals for being fair, altruistic, friendly, generous, caring, kind to others, and exhibiting and promoting altruistic ideals. The extent to which members of an organization or society strive to avoid uncertainty by relying on established social norms, rituals, and bureaucratic practices to decrease the probability of unpredictable future events that could adversely affect the operation of an organization or society, and also to remedy the potential adverse effects of such unpredictable future events.
Assertiveness (A)
Institutional Collectivism (IC)
In-Group Collectivism (GC)
Power Distance (PD)
Humane Orientation (HO)
Uncertainty Avoidance (UA)
Methodology The decision between exploratory and conclusive research design hinges on whether the research problem needs to be defined more precisely, whether theory exists concerning the research question and context, and whether relevant courses of actions have been previously well defined (Hair, Babin, Money, & Samouel, 2003; Malhotra, 2007; Zikmund & Babin, 2007). For the present study, the primary objective is to provide insight into the relationships between GLOBEs Values scores and the Social Technographics scores. The authors admit that this is an ambiguous question heretofore unresolved and unexplored. As the authors seek to discover new information and new relationships (Zikmund & Babin, 2007) the sample is based on convenience another aspect of exploratory research. Although the data can be qualitative during exploratory research, quantitative scores are also acceptable (J. F. Hair, Jr., et al., 2003; Malhotra, 2007; Zikmund & Babin, 2007).
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Similar to the previous paper in this multiphase project, this study seeks to analyze the relationship between the GLOBE Societal Values scores and Forrester's Social Technographics scales. The previous research effort relied on the Hofstede scales and scores. The current research now focuses on exploring relationships between the Social Technographics scales and the GLOBE Societal Values scores. This exploratory effort will attempt to ferret out the effects, if any, on predicting a countrys position along the various rungs of the Forrester ladder using a valid cross-cultural values scale. The statistical techniques which will be employed to measure the association and potential relationships between the GLOBE Societal Values scores and the Forrester scores will include correlation and regression analyses (Harnett & Horrell, 1998; Lind, Marchal, & Wathen, 2010). In this regard, this study is exploring the relationship between culture and placement on the Forrester scale. Culture will be treated as the independent variable used to determine a countrys placement on the Forrester ladder which will be considered the dependent variable. The steps that will be followed to explore these relationships follows herein (Harnett & Horrell, 1998; Lind, et al., 2010): 1. Pearsons Coefficient of Correlation. Pearsons r will be used to determine the strength of any existing relationship between the GLOBE Societal Values scores and the Forrester scores. Caution will be in order as correlation is not the same as causation (for an example of such discussion, see Lind (2010, p. 462)). 2. Test for significance of Pearsons r. 3. Regression analysis in order to determine the reasonableness of predicting a countrys placement along the Forrester scale. 4. An analysis of the R-squared statistic to illustrate the possible effect, if any, of cultures impact on the respective countrys placement on the Forrester ladder. This study will employ an exploratory research design aimed at exploring the relationships between cultural values dimension variables (independent variables) and a countrys placement on the Forrester scales (dependent variables). The authors have chosen correlation and regression techniques to explore these relationships. Analysis To date, there are thirteen (13) countries where data exists in the Forrester model. Using the GLOBE Societal Values scales of Performance Orientation (PO); Future Orientation (FO); Gender Egalitarianism (GE); Aggressiveness (A); Institutional Collectivism (IC); In-Group Collectivism (GC); Power Distance Index (PD); Humane Orientation (HO); and Uncertainty Avoidance Index (UA), was developed.
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Table 6: Country Scores for Forrester and GLOBE Societal Values Scales
Country Creators Critics US Canada UK France Germany Italy Metro China Japan South Korea Australia Spain Netherlan ds Sweden 24 18 15 12 9 29 44 34 49 23 15 20 14 37 29 21 19 12 25 46 30 46 31 21 20 21 Collector Spectator Inactive Joiners PO FO GE s s s 21 17 6 6 4 7 37 11 19 14 8 8 8 51 57 38 24 21 33 32 26 48 50 24 38 37 73 64 50 51 38 52 79 69 76 64 56 64 59 18 21 37 40 52 36 17 23 9 22 38 27 32 A IC GC
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PD HO UA
6.14 5.31 5.06 4.32 4.17 5.77 2.85 5.53 4.00 6.15 5.35 5.11 4.15 4.17 597 2.70 5.64 3.75 5.90 5.06 5.17 3.70 4.32 5.55 2.80 5.43 4.11 5.65 4.96 4.40 3.38 4.86 5.42 2.76 5.67 4.26 6.01 4.85 4.89 3.09 4.82 5.18 2.54 5.46 3.94 6.07 5.91 4.88 3.82 5.13 5.72 2.47 5.58 4.47 5.67 4.73 3.68 5.44 4.56 5.09 3.10 5.32 5.28 5.17 5.25 4.33 5.56 3.99 5.26 2.86 5.41 4.33 5.25 5.69 4.22 3.75 3.9 5.41 2.55 5.60 4.67 5.89 5.15 5.02 3.81 4.40 5.76 2.78 5.58 3.98 5.80 5.63 4.82 4.00 5.20 5.79 2.26 5.69 4.76 5.49 5.07 4.99 3.02 4.55 5.17 2.45 5.20 3.24 5.80 4.89 5.15 3.61 3.94 6.04 2.70 5.65 3.60
As explained earlier, the first step in exploring the relationships between the variables (columns) provided in Table 7 is to run correlation coefficients (Pearsons r) for each relationship. Table 7 illustrates the Pearsons r correlation coefficients for each pair of variables. Table 7: Correlation Coefficients Creators PO - Values FO - Values GE - Values A - Values IC - Values GC - Values PD - Values HO - Values UA - Values -0.5277 0.2923 -0.7141 0.5934 -0.3435 -0.1353 0.3141 -0.2380 0.6000 Critics -0.2806 0.1900 -0.5901 0.6241 -0.4565 0.0420 0.4878 -0.0796 0.5473 Collectors -0.0773 -0.1393 -0.6075 0.6587 -0.2978 0.1398 0.6169 -0.2249 0.5278 Joiners 0.2639 0.2245 0.3260 -0.0009 -0.5763 0.5179 0.1931 0.1232 -0.2977 Spectators -0.4051 0.0917 -0.4860 0.6293 -0.5538 0.0729 0.4477 -0.2099 0.3008 Inactives 0.3471 -0.2013 0.3553 -0.5100 0.6444 -0.1939 -0.3978 0.1194 -0.1963
Table 8 reveals many weakly correlated relationships between the GLOBE Societal Values scale scores and the Forrester scales. In order to determine any significant correlations, a test of significance for each relationship is in order. Table 8 illustrates the respective t-statistic for each correlation coefficient.
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Table 8: Correlation Coefficients and Associated t-Scores Creators PO - Values FO - Values GE - Values A - Values CI - Values GC - Values PD - Values HO - Values UA - Values -0.5277 t=-2.0606 0.2923 t=1.0136 -0.7141 t=-3.3830 0.5934 t=2.4451 -0.3435 t=-1.2132 -0.1353 t=-0.4528 0.3141 t=1.0975 -0.2380 t=-0.8129 0.6000 t=2.4873 Critics -0.2806 t=-0.9696 0.1900 t=0.6419 -0.5901 t=-2.4240 0.6241 t=2.6495 -0.4565 t=-1.7016 0.0420 t=0.1395 0.4878 t=1.8533 -0.0796 t=-0.2650 0.5473 t=2.1686 Collectors -0.0773 t=-0.2572 -0.1393 t=-0.4664 -0.6075 t=-2.5367 0.6587 t=2.9037 -0.2978 t=-1.0345 0.1398 t=0.4681 0.6169 t=2.6000 -0.2249 t=-0.7656 0.5278 t=2.0611 Joiners 0.2639 t=0.9074 0.2245 t=0.7641 0.3260 t=1.1438 -0.0009 t=-0.0029 -0.5763 t=-2.3386 0.5179 t=2.0082 0.1931 t=0.6526 0.1232 t=0.4118 -0.2977 t=-1.0342 Spectators -0.4051 t=-1.4697 0.0917 t=0.3056 -0.4860 t=-1.8443 0.6293 t=2.6858 -0.5538 t=-2.2060 0.0729 t=0.2423 0.4477 t=1.6605 -0.2099 t=-0.7119 0.3008 t=1.0459
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Inactives 0.3471 t=1.2275 -0.2013 t=-0.6816 0.3553 t=1.2605 -0.5100 t=-1.9664 0.6444 t=2.7951 -0.1939 t=-0.6556 -0.3978 t=-1.4380 0.1194 t=0.3989 -0.1963 t=-0.6639
Using a standard t-test with degrees of freedom of n-2 (Lind, et al., 2010), the critical t-value is 2.20 for p<0.05. As a result, none of the GLOBE Societal Values scales are solely and significantly correlated with a countrys placement on the Forrester ladder. Of all the correlations, only those in Table 4 had a tvalue 2.20 and were deemed to be statistically significant. Table 9: Statistically Significant Correlation Coefficients and Associated t-Scores* Creators -0.7141 GE - Values A - Values CI - Values 0.6169 PD - Values 0.6000 UA - Values *(p<0.05) t=2.4873 t=2.6000 t=-3.3830 0.5934 t=2.4451 Critics -0.5901 t=-2.4240 0.6241 t=2.6495 Collectors -0.6075 t=-2.5367 0.6587 t=2.9037 -0.5763 t=-2.3386 0.6293 t=2.6858 -0.5538 t=-2.2060 0.6444 t=2.7951 Joiners Spectators Inactives
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Of the statistically significant relationships illustrated in Table 9 above, regression analyses were ran and Table 10 was created to illustrate the R2 value and the standard error for each relationship. Table 10: Correlation Coefficients (r) with t-Scores, R2 values, and Standard Error Creators GE - Values r =-0.7141 t =-3.3830 R = 0.51 SE = 9 A - Values r =0.5934 t =2.4451 R =0.35 SE = 10 CI - Values
2 2
Critics r =-0.5901 t =-2.4240 R = 0.35 SE = 9 r =0.6241 t =2.6495 R = 0.39 SE = 8

2 2
Collectors r =-0.6075 t =-2.5367 R2 = 0.37 SE = 8 r =0.6587 t =2.9037 R = 0.43 SE = 7

2
Joiners
Spectators
Inactives
r =0.6293 t =2.6858 R2 = 0.40 SE = 9 r =-0.5763 t =-2.3386 R = 0.33 SE = 10

2
r =-0.5538 t =-2.2060 R = 0.31 SE = 10

2
r =0.6444 t =2.7951 R2 = 0.42 SE = 9
PD - Values
r =0.6169 t =2.6000 R2 = 0.38 SE = 7
UA - Values
r =0.6000 t =2.4873 R2 =0.36 SE = 10
Hair, et al. (2006) suggests that R2 values less than 0.50 result in less than acceptable models. When a model yields an R2 value that is less than 0.50, more than 0.50 of the variance in the dependent variable is attributed to spurious variables or error (Joseph F. Hair, Jr., et al., 2006). With this in mind, only the GLOBE Societal Values score for Gender Egalitarianism yielded meaningful results in predicting a countrys placement on the Creators rung of the Forrester ladder as illustrated in Table 5. None of the other relationships as illustrated in Table 5 above have R-squared values above the 0.50 threshold. As a result of the single significant correlation and appropriate R-square between GEValues and placement on the Creator rung, below is the regression equation for predicting a societys position on the Creator rung of the Forrester ladder:
Creator Score = -19.5*(GLOBE GE-Values score) +116 (Formula 1)
As is the case with any independent/dependent relationship, a more appropriate range of a societys placement on the Creator rung should be developed. This could easily be accomplished using a typical confidence interval to create the upper and lower bounds:
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Upper Bound Creator Score: (Formula 1) + (t-score)*SE Lower Bound Creator Score: (Formula 1) (t-score)*SE
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(Formula 2) (Formula 3)
An appropriate t-score for Formulas 2 and 3 above would be 2.20 which is a typical tscore for degrees of freedom of n-2 at 95% confidence (alpha = 0.05). As stated earlier, the standard error (SE) for this particular data set is nine. To summarize the analysis of this study, several tables were developed to track the authors adherence to the following steps as stated in the methodology section of this paper: 1. 2. 3. 4. Creating Pearsons Coefficient of Correlation. Test for significance of Pearsons r. Regression analysis. R-squared analysis.
The final result was one significant and possibly meaningful relationship between Gender Egalitarianism Values (independent variable) and a societys placement on the Creator rung of the Forrester ladder. Conclusions Although the authors believe that culture influences behaviors, this study only revealed one significant relationship between GLOBEs Value scores and placement along the Forrester ladder. However, as stated in the methodology section, this exploratory research effort should not be interpreted as conclusive. Further research is appropriate. To that end, the authors suggest that researchers consider further exploration of the cultures effects on a societys placement on the various rungs of the Forrester ladder. It may be that other cross-cultural models such as GLOBE Societal Practice scales, Schwartz, Triandis, or others may yield different results.
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References Chhoka, J.S., Brodbeck, F.C., & House, R.J. (2008). Introduction to leadership across the world: The GLOBE book of in-depth studies of 25 societies. Mahwah, NJ:Lawrence Erlbaum Associates. Davenport, T. H., & Prusak, L. (1998). Working knowledge : how organizations manage what they know. Boston, Mass: Harvard Business School Press. Girard, J.P., & Bertsch, A. (2011). Exploring Cross-Cultural Differences in Social Knowledge Creation and Exchange: A Preliminary Examination. International Journal of Management & Information Systems. 15(1). Girard, J. P., & Girard, J. L. (2009). A Leaders Guide to Knowledge Management: Drawing on the Past to Enhance Future Performance. New York: Business Expert Press. Hair, J. F., Jr., Babin, B., Money, A. H., & Samouel, P. (2003). Essentials of Business Research Methods. New Jersey: Wiley. Hair, J. F., Jr., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R., L. (2006). Multivariate Data Analysis (6th ed.). Upper Saddle River, NJ: Pearson Prentice Hall. Harnett, D. L., & Horrell, J. F. (1998). Data, Statistics, and Decision Models. New York: Wiley. Hofstede, G. (1980a). Cultures Consequences: International Differences in WorkRelated Values. London: Sage. Hofstede, G. (1996). Images of Europe: Past, Present, and Future. In M. Warner & P. Joynt (Eds.), Managing Across Cultures: Issues and Perspectives. Boston, MA: International Thomson Business Press. Hofstede, G. (2001). Cultures Consequences: Comparing Values, Behaviors, Institutions, and Organizations Across Nations. London: Sage Publications. Holt, G. (2007). Organizational Culture and Performance: A Survey in Norway and Pakistan. Henley Management College, Henley-on-Thames. House, J.H. (2008). Preface to leadership across the world: The GLOBE book of indepth studies of 25 societies. Mahwah, NJ:Lawrence Erlbaum Associates. Leung, K (2008). Foreword to leadership across the world: The GLOBE book of indepth studies of 25 societies. Mahwah, NJ:Lawrence Erlbaum Associates. Li, C., & Bernoff, J. (2008). Groundswell : winning in a world transformed by social technologies. Boston, Mass.: Harvard Business Press. Lind, D. A., Marchal, W. G., & Wathen, S. A. (2010). Statistical Techniques in Business & Economics (14th ed.). New York: McGraw Hill Irwin. Malhotra, N. K. (2007). Marketing Research: An Applied Orientation (5th ed. ed.). Upper Saddle River, NJ: Pearson Prentice Hall. Nonaka, I., & Takeuchi, H. (1995). The knowledge-creating company : how Japanese companies create the dynamics of innovation. New York :: Oxford University Press. O'Dell, C., & Grayson, C. J. (1998). If only we knew what we know: identification and transfer of internal best practices. California Management Review, 40(3), 154174. Tapscott, D., & Williams, A. D. (2006). Wikinomics : how mass collaboration changes everything. New York: Portfolio. Zikmund, A. G., & Babin, B. J. (2007). Exploring Marketing Research (9th ed. ed.). Mason, OH: Thomson South-western.
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CONSTRAINTS TO FINANCIAL MANAGEMENT OF SECONDARY SCHOOLS IN OWEERI EDUCATION ZONE OF IMO STATE AS PERCEIVED BY PRINCIPALS AND BURSARS ORUWARI JOY .N
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DEPARTMENT OF CURRICULUM STUDIES ALVAN IKOKU FEDERAL COLLEGE OF EDUCATION, OWERRI. IMO STATE Abstract This study investigated the constraints to financial management of secondary schools in Owerri educational zone of Imo state as perceived by principals and bursars. Two research questions and two hypotheses were formulated to guide the study. A purposeful sampling technique was used to sample 40schools from the area of study, the principals and bursars in these schools formed the sample of the study. The researcher made use of structured questionnaire consisting of 25 items as instrument for data collection. The data were analyzed using, mean, Standard deviations and t-test statistics. The result of the analysis showed that poor knowledge of financial management skill by the bursar and accounting officers which always results in inadequate keeping of financial records, inadequate funding of schools which has created much difficulty to principals running of their schools, dishonest practices have many times resulted to interpolation of account books and embezzlement of school funds, Based on these findings, it was recommended among others that every effort should be made to appoint honest principals and bursar to avoid mismanagement and embezzlement of school funds, there should be increase in the allocation of funds to schools. Keywords: Constraints ; Financial Management ; Secondary Schools ; Oweeri Education Zone; Imo State ; Perceived ; Principals ; Bursars Introduction It has always been the desire and plan of every nation to give her citizens the best education she can afford within the limits of her resources. This is because education is considered a potent instrument for social, moral economic, technological and scientific progress. Nigeria is not exempted from this universal course of aspiration. The federal Republic of Nigeria (1981) in her National policy on education adopted education as an instrument par excellence for effecting national development. This position probably underscores the current huge financial investment in education occasioned by increases in both the Federal and State Government annual budget allocation to education. Education being an expensive social service requires adequate financial provision for successfully implementation of educational programmes. The cost of financing education has been rising steadily to the extent that government finds it increasingly difficult to finance it alone. As a result, it encourages the participation of local communities, individuals, companies, churches, organizations and others to assist. All these efforts to provide funds for educational programmes imply that the Secondary School principal should ensure prudent management of the available resources. The Secondary Scholl Principal is therefore the key person on whom the success of the secondary school system depends. Where financial management is weak, success is hardly ever achieved; no institution or organization has ever succeeded in history without utilizing properly its resources.
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Fledlers contingency theory of financial management (2001) suggests that the key factor in determining financial managerial effectiveness is the extent to which the leader can or cannot control and utilize the available resources. The central issue of financial policy then, is The wish utilization of fund and the central process involve the rational matching of advantages of potential use against cost of alternatives. Cunninghan (1998) stipulates that financial management refers to the managering ability of a manager to source for fund and effectively utilize the fund under his disposal for the achievement of the desired goal. The implication is that in financial management, there must be adequate fund raising activities before administering the available funds. Educational development in Imo State of Nigeria had always had financial problems. These problems are getting more and more severe partly because of the current economic predicament in the country and partly because of the ways the funds are managed in schools. Financial management has indeed been a nagging problem in the administration of secondary schools in Imo State. Principals have to be well versed in their knowledge and understanding of education finance. Burrough (2001) said that the downfall or progress of any business depends on the manner the functions are performed and the capability of the manager to control its finances. The researcher therefore wishes to investigate empirically the constraints to financial management of secondary schools in Owerri Education Zone STATEMENT OF THE PROBLEM The importance of funds and indeed of schools finance In the implementation of educational programme cannot be over emphasized. First of all, funds are utilized to set up infrastructures (classroom blocks, laboratory building, library blocks, etc) as well as procure teaching materials and equipments. Secondly, fund determines the number and quality of teaching and non-teaching staff to be recruited in the school system. Thirdly, without fund it will be impossible to provide and maintain most of the ancillary services in the school system. Indeed the importance of funds to educational institution has been well recognized and stressed by a number of authorities in education administration including Cunninghan (1998), Taiwo (2003), and Ezeocha (1995). Ezeocha in particular stated that finance is a factor that contributes significantly to the success of any educational institution. Despite the importance of finance to educational institutions, concern has been expressed by many principals, teachers and parents in Imo State, that secondary schools are no longer being adequately funded by the state Government. The chief Supervising Principal, Owerri Education Zone for instance, had in 1994 school year accused the State Government for poor funding of schools, also the principals of secondary schools in the State had in A.N.C.O.P.P.S. annual held in Kastina in April 1995 complained that some officials divert fund meant for education to other sectors. Again, inspite of the financial contributions by the State Government, laboratories and societies as encouraged by the State Governments, laboratories are not well equipped, libraries lack essential texts, maintenance on schools, damaged blocks are not done; even instructural materials and lesson notes are not adequately provided. This State of affairs suggests that there may be some constraints in the financial management of secondary schools in most of the education zone of the State. It is therefore the problem of this study to determine through the perception of principals
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and bursars the constraints to financial management of secondary schools in Owerri Eduaction Zone of Imo State. PURPOSE OF THE STUDY This study aimed at: 1. Establishing the specific constraints to effective financial management in secondary schools and the area of study. 2. Determining the problem associated with budget preparation. RESEARCH QUESTIONS 1. What problems are associated with budget preparation in the secondary schools? 2. What are the specific constraints to effective financial management of secondary schools as perceived by the principals and bursars? HYPOTHESIS H01: There is no significant different between the opinion of principals and bursars on the problems associated with budget preparation in secondary schools in Owerri Education Zone. H02: There is no significant different between the opinion of principals and bursars on the constraints of financial management of secondary schools in Owerri Education Zone. Methodology Design This is basically a survey research. It is designed to ascertain the constraints to financial management of secondary schools in Owerri education Zone of Imo State as perceived by principals and bursars. Area of Study The study was conducted in Owerri education zone in Imo-State and this zone is made up of 9 local government areas. Population of study The population for the study comprises secondary school principals and bursars in the 50 secondary schools in the three Local Government Areas of Owerri Education Zone spread out as follows: Sample and Sampling techniques Simple random sampling technique was used. It was based on Local Government Areas in Owerri Education Zone. The number of schools, bursars and principals were selected by proportional representation. The principals and bursars of the selected schools formed the sample of the study. Instrument for Data Collection The questionnaire was the key instrument used for the study because the study is concerned with the management of funds. The researcher considered the principals and bursars of schools as the best reliable source of data; besides, they are the accounting officers of their schools. The questionnaire was developed by the researchers relating to the topic under study. It Contains 25 items meant to answer the two research questions and the two hypotheses formulated for the study using the four likert points scale format, Strongly Agree (SA), Agree (A), Disagree (D), and Strongly Disagree (SD).
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Method of Data Analysis The two research questions were answered using mean and standard deviation. An acceptance criterion mean of 2.50 was used for the research questions. The Ttest statistics was used to test the two hypotheses at an alpha level of 0.05 Method of Data Analysis The two research questions were answered using mean and standard deviation. An acceptance criterion mean of 2.50 was used for the research questions. The Ttest statistics was used to test the two hypotheses at an alpha level of 0.05. Reliability of the Instrument To ascertain, the reliability of the instrument the instrument was administered twice on these respondents at an interval of two weeks. Two public schools in the area were used for the test - retest reliability method. The results of the separate exercise were correlated by applying the Pearson's Product Moment correlation statistics. The co-efficient of r = 0.76 was obtained and this was considered adequate enough in checking the consistency of the items in the instrument. Research Question one What problems are associated with budget preparation? Table 1 Mean Scores of Principals and Bursars on the Problem of Budget Preparation S/N ITEMS PRINCIPALS BURSARS 8 9 10 Schools prepare annual estimates of needs. The budget are prepared periodically The budget adequately covers major items of needs The budget is based on the funds available to the school Government regulations for the preparation of school budgets are always made available to the principals. Principals and their Bursar prepare the school budget Teachers take part in discussing the content of the budget. X 3.39 3.87 1.38 SD 0.24 0.33 0.77 DECISION Accept Accept Reject X 3.66 3.45 1.80 SD 0.56 0.85 1.01 DECISION Accept Accept Reject
11 12
3.23 1.95
0.93 0.50
Accept
3.33 3.73
0.84 0.53
Accept Accept
13 14
3.40 1.30
0.73 0.46
Accept Reject
3.75 1.55
0.52 0.84
Accept Reject
Table 1 above represents the views of principals and bursars of secondary schools on the problems association with budget preparation.
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The table shows that the mean scores of principals range from 1.30 to 3.87.While that of the bursars range from 1.55 to 3.73. These indicate that in the opinions of principals and bursars of secondary schools the problems associated with budget preparation include the fact that the budget does not adequately cover major items of needs. Government regulations for the preparation of budgets are not always made available to the principal and the teachers do not take part in discussing the contents of the budget. Research Question Two What are the constraints to effective financial management of secondary schools? Table 2 Mean Scores of Principals and Bursars on the Constraints to Effective Financial Management ITEMS PRINCIPALS BURSARS X 15 16 17 Inadequate funding of schools. Mismanagement of funds. Poor knowledge of financial management skills of bursars and accounting officers. Political interest Inadequate knowledge Poor attitude to work by accounting officers. Lack of storage facilities in the school for funds collected after banking hours. Environmental influences e.g. (SAP) Principals using monies collected and replacing them at a later date. Delay in the payment of salaries to parents. Dishonest practices of bursars 2.52 1.05 2.51 SD 0.42 0.73 0.54 DECISIONS Accept Reject Accept X 3.98 3.97 3.99 SD 0.63 0.84 0.45 DECISION Accept Accept Accept
S/N
18 19 20 21
2.50 2.53 2.52 2.51
0.63 0.48 0.42 0.54
Reject Accept Accept Accept
3.95 3.98 3.95 3.98
0.77 0.78 0.65 78
Accept Accept Accept Accept
22 23
2.52 1.02
0.42 0.74
Accept Reject
3.96 3.99
0.66 0.45
Accept Accept
24 25
2.50 2.51
0.63 0.54
Accept Accept
3.98 3.97
0.78 84
Accept Accept
It could be deduced from table 2 above that the mean score of principals and bursars on the constraints to financial management in secondary schools range from 1.05 to 2.52. These show that in the opinions of principals and bursars of secondary schools on the constraints to effective financial management in secondary schools in Ikeduru Education Zone include; inadequate funding of schools and inadequate financial management, poor knowledge of financial management by bursars and accounting officers, political interest, inadequate knowledge of accounting procedures by
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accounting officers in schools, poor attitude to work of accounting officers. Lack of strong facilities for funds collected after banking hours, environmental influence to parent and, delay in the payment of salaries dishonest practices of bursars. Hypothesis one Table 3 - the t-test analysis of the differences between the mean score of bursar and principals on the problems associated with budget preparation. Variables mean rejected n Prob Df t-cal t-table Result level Problems of budget preparation Bursar 2.92 0.68 40 0.05 1.58 0.20 1.96 Accepted Principals 2.72 0.56 40 From this table, we can see that the calculated t-value is 0.20 at 1.8 degrees of freedom and 0, 05 level of significance. Since the calculated value of 0.02 is less than the critical value of 1.96, the first null hypothesis is accepted. Therefore there is no significant difference between the opinion of secondary school bursars and principals with regards to the problems associated with budget preparation in secondary schools in owerri educational zone of Imo state. Hypothesis two Table 4- T-test analysis of the difference between the mean scores of bursars and principals on constrains to effective financial management in secondary schools. Variables Mean Sd N Prob Df t-cal t-table Result level Constraint to financial management Bursers 3.97 0.45 40 0.05 1.58 1.97 1.96 Rejected Principals 2.0 0.73 40 From this table, it can be observed that the calculate t-value is 1.97 at 1.58 degrees of freedom and 0.05 level of significance. Since the calculated t-value is greater than the critical (table) value of 1.96, the second null hypothesis of the study is rejected. There is therefore significant difference between the opinion of secondary school bursars and principals with regards to the constraints to effective financial management in secondary schools in Owerri Education Zone of Imo state. Discussion of Findings Research question one sought to establish the problems that are associated with budget preparation? The responses were analysed by computing and analyzing the mean means of all the items for the positive and negative responses with the mean rating of 2.5. thus the findings revealed that the budget does not adequately cover major items of need, government regulation for the preparation of budget are not always made available to the principles and that teachers do not take part in discussion the contents of the budget. The findings that teachers does not take part in discussion the content of the budget is
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expected, since class teachers role in the school do not include financial management. The responsibility of financial management in the school belong to the principal who are the seat of accountability of the school is supported by Ezeocha (1990). Ukeje, Akabogu and Ndu (1992). Ezeocha in particular noted that principal is the chief Executive of their schools responsible for, among other things, financial management of the school entrusted into their care. Research question two sought to find the constraints to effective financial management of secondary schools? The result of the above research question showed in table 2 that secondary school principals and bursar in owerri education zone agree overwhelming that the constraints to effective financial management of their school include poor knowledge of financial management by bursar and accounting officers, inadequate knowledge of accounting procedures, inadequate funding and mismanagement of funds, poor attitude to work by accounting officers, lack of storage facilities in the school for funds collected after bank hours, environmental influences, political interest, dishonest practices of bursars and delay of payment of salaries to parents. The mismanagement of fund and poor attitude to work by accounting officers may be attributed to the delay in the payment of teachers salaries and allowance in most part of the state. Adebayo (1994) stated that delay in payment of workers salaries and allowances lead to low morale, poor attitude to work and low productivity. Hypothesis one sought to find out if there was a significant difference between the opinions of secondary schools principal and bursars with regard to the problem associated with budget preparation in secondary school. Analysis of the above hypothesis showed that there was no significant difference between the opinion of principals and bursars of secondary schools in owerri education zone of Imo state on the problems associated with budget preparation. This finding is supported by the cluster mean scores of 2.29 and 2.72 indicating no significant difference. This no different opinion is very apparent because the two means are not statistically different and the calculated t-value indicated no significant difference. Hypothesis two sought to determine if there was a significant difference between the opinion of the secondary school principals and bursars with regards to constrains of effective financial management in secondary school in owerri education zone. Analysis of the this hypothesis as show in table 4 that there was significant difference between the opinion of principals and bursars of secondary school in owerri education zone of Imo state with regards to constraints to the effective financial management of their schools. The finding is supported by clusters mean scores of 3.97 and 2.0 indicating significant difference. This difference in perception of the two categories of the respondents is very obvious because the item and cluster mean scores are statistically different and the calculated t-value indicated significant difference. RECOMMENDATIONS The following recommendations have been made in the light of the finding of this 1. The state government should provide fund for the management of secondary schools in Imo State. Cunningha (1998) stated that finance is a factor that contributes significantly to the success of any education institution. 2. The state government should organize in services training programmes for bursars and accounting officers in her schools. This is necessary since such training will update their knowledge, skills and competencies on financial management.
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3. The government should also from time to time organize seminars and workshops for secondary school principals and bursars on the strategies for effective management of funds made available to their schools. 4. Staff salaries must be paid as at when due, in order to improve morale on the job and subsequently improve productivity. 5. The government should assist secondary school principals to provide storage facilities for all funds collected after official banking hours. This is to avert cases of theft and mismanagement of such monies.
References Adebayo A. (1994) principals and practices of public administration in Nigeria Ibadan. Spectors books limited. A.N.C.O.P.P.S. (1989): Conference paper, convention at Katsina. Burrough, A. (1997): Educational Planning, New York: the Macmillan Co. Compbell, R.F. & Co. (Editors) (2000): Introduction to Educational Administration (4th Edition)Boston: Allyn and Bacon, Inc. Cuningham W.A. (1998) Managerial Aproach, South Western Publishing Co. Ezeocha P.A. (1985): School Management and supervision, Owerri: New Africa Publishing Co., Ltd Nigeria. Fledler F. (2001): Theory and Research in Administration, York: The Macmillan Company. National Policy on Education (1981): Lagos NERC Press Hand. Taiwo, C.O. (2003): The Nigeria Educational System Past, Present and Furture, ThomasNelson (Nigeria). The Encylopaedia Britannica 1964.
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GENERATION Y AND THEIR BUYING BEHAVIOR TOWARDS LOCAL DELICACIES (MALAY LOCAL KUIH) Azfahanee Zakaria, (Corresponding Author) Syed Mohammed Alhady Zaherawati Zakaria Mohd Zool Hilmie Mohd Sawal Sarah Sabir Ahmad Nazni Noordin Universiti Teknologi MARA , Kedah, Malaysia Abstract
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Generation Y who are also known as the Milennials or Generations of the Millennial symbolize an important market segment in Asia. This is because this group of young people have a significant spending power and this interest the marketers. The current business scenario, organizations are facing heavy competition in attracting and retaining customers. This study aims to examine and identify the factors of buying behaviour among consumers in this generation group towards local Malay kuih or cakes of Malaysia. Malay Local Kuih or Malay Delicacies such as Kuih Karas, Kuih Bahulu and kuih karipap are now the least favourite as the choice as snacks by the Generation Y. These findings of the study will provide evidence and new knowledge both for the marketers and the academia for crafting new marketing strategies. It would also assist government agencies to plan strategies for people in the rural area who are actively promoting these cakes as their source of income. Survey method will be employed in this study. Questionnaires will be distributed to three hundred students attending pre-university and undergraduate programme at 3 branches of UiTM. These youth were intentionally chosen as they represents the Generation Y with the appropriate age group. No mature student will be included in the study. Product used for research purposes : Malay Kuih ie Kuih karas, Kuih bahulu, kuih karipap Keyword : Generation Y, Malay Kuih
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Introduction
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Generation Y is basically a customer segment which is currently receiving greater attention as compared to other generations. This is due to the fact that these young people have substantial discretionary buying power relative to their incomes. For example, in the banking sectors, the banks are trying to seek and get Generation Y as customers as this would allow the bank to have and retain a long term business. Generation Y is a particularly attractive segment as it is the largest demographic group in many developed countries and is also a highly lucrative segment (Josefowicz, 2003) Moreover, attainment young people at an early age often would be the basis for a relationship (Thwaites and Vere, 1995).Therefore for a business operator who wish to study and see what would make the Malay Kuih be a favourite by the Generation Y as to sustain business, one need to understand the needs and wants of Generation Y itself. Generation Y Generation Y are a group of youngsters who were born between 1977 and 1994. They represents an estimated 71-80 milllion consumers in the United States and the estimated spending power is estimated USD300billion.Generation Y also has been characterized as media and internet savvy, trend setting in fashion, being receptive to new products, and having the potential to become lifelong customers (Yingjiao Xu, 2007) They have been portrayed as customers who loves adventure and expect immediate gratification ( Cortes, 2004 & yingjiao Xu, 2007). It was also noted that generation Y are very likely to spend their cash as quickly as they acquire it and the amount is being spent on consumer goods and personal services ( Der Hovanesian, 1999 & Yiangjiao Xu, 2007). According to Morton (2002) Generation Y is racially and ethnically diverse in that 34 percent of its members represent a minority group compared with 27 percent representation of minority groups among the total population. This generation tend to use technology and be engage in multiple media activities. They are basically an individualistic group that values their personal identities and the customization of products identifies strongly with group orientations and activities involving friends. Generation Y also view themselves as special and enjoy such activities as listening to music, eating out, going to the movies, and watching television (Morton, 2002)
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Buying Behavior and Environment factor
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Among the environmental factors that influence the buying behavior are economic situation, inflation, infrastructure of the place people buy from, and government legislation. The economic condition is presently a sourcse of great concern as marketers attempt to determine the current buying behavior of consumers. Consumers are changing their buying behavior and greatly decreasing their overall spending (Lodes M. & Buff C.L, 2009) Retailers are known to design store environments in a manner that will enhance consumers positive feelings, under the assumption that this will lead to desired consumers behaviors, such as higher willingness to purchase or stay in the store longer (Yingjiao Xu, 2007). An individualsresponse to an environment often depends on situational factors as well such as their plans or purpose for being in the environment ( Yingjiao Xu, 2007) Consumer Lifestyle Consumer Lifestyle is always based on the social and psychological and it is influenced by demographical factors (Simona B, 2009). In order to have a clear understanding and to identify the social factors of consumer lifestyles, we can subgroups the factors into three minor indicator which is culture, social class and reference group while the psychological factors been influenced by personality, social conscience, attitudes perceived risk and acquisition importance to consumer ( Simona B., 2009) Generation Y now has become a materialistics and consumer culture as a result of technological innovation (Bakewell & Mitchell 2003) Brand Loyalty Brand Loyalty consumers are likely to have favourite brands and store and have formed habits while choosing these items. Brand conscious are measuring consumers orientation toward buying the more expensive, well known brands. They appear to have positive attitudes towards department and specialty stores, where brand names and higher prices are prevalent. The Milennials are brand loyal consumers. Milennials are loyal to a brand as long as it provides to their needs (DeBard, 2004)
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Malay Kuih
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These are delightful chewy and rich desserts that are made from natural ingredients like tapioca flour, sweet potato flour, bananas, palm sugar, coconut milk, glutinous rice etc. There are more than 100 different types of Malay kuihs and these recipes emerged and came from the Indonesian and Malay villages. In those days, the womenfolk discovered resourceful ways to make their desserts and snacks from natural ingredients or whatever they grew in their garden and grew on trees. These kuihs were steamed mostly, sometimes grilled - baking was nonexistent because they not only did not have any oven, electricity was scarce. Besides sweets, there are also savoury version which is often eaten or served during tea time. Independent variable Dependant Variable
LIFESTYLE
GENERATON Ys BUYING BEHAVIOR TOWARDS LOCAL KUIH
BRAND LOYALTY
Significance of the Study
The findings of the study will provide evidence to will provide evidence and new knowledge both for the marketers and the academia for crafting new marketing strategies. It would also assist government agencies to plan strategies for people in the rural area who are actively promoting these cakes as their source of income The overall objectives of the proposed research program are as follows: 1. 2. To determine whether Lifestyle of Generation Y significantly influence the Buying To determine whether Environment of Generation Y significantly influence the Buying Behaviour of Generation Y towards the local kuih or cakes Behavior of Generation Y towards the local kuih or cakes Conclusion With the great and high competition in business and products, consumers now have varieties of items to choose from. The results from the study would allow the marketers or products owners to plan a strategy on how to grasp the attention of the Generation Y towards their products ie the Malay local kuih.
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References
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Bakewell, C., Mitchell, V.-W. (2003), "Generation Y. Female consumer decisionmaking styles", International Journal of Retail & Distribution Management, Vol. 31 No.2, pp.95-106 Der Hovanesian, M. (1999), "Spending it, investing it coming on strong: the children of the baby boomers are affecting spending and investing as significantly as their parents did; the similarity ends there", Wall Street Journal (Eastern Edition), New York, NY, No.November 29, pp.12 DeBard, R. (2004), "Millennials coming to college", New Directions for Student Services, No.106, pp.33-45. Josefowicz, M. (2003), Gen-Y College Students, Financial services and the Web, Celent, New York, NY, Lodes M. & Buff C.L. ( 2009) Are Generation Y ( Milennial) Consumer Brand Loyal and Is their Buying Behavior Affected in an economic Recession? A Preliminary Study. Journal of Academy of Business and Economic. 9.3. Morton, R. (2002), Construction UK: Introduction to the Industry, Blackwell Science, Oxford Simona B.(2009). The Necessity of Studying Buying Behavior, Comsumption and Use of Individual Consumption Goods by Commerce Firms. Thwaites, D., Vere, L. (1995), "Bank selection criteria a student's perspective", Journal of Marketing Management, Vol. 11 pp.133-49 Yingjiao Xu. (2007) Impact Of Store environment on Adult generation Y Consumerss Impulse Buying. Journal of Shopping Center Research. 14.1.39-56.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS LAND CONFLICT AS AN IMPEDIMENT TO COMMUNITY DEVELOPMENT IN SOUTHWESTERN NIGERIA
Abegunde Albert Ayorinde (Ph.D.) Department of Urban and Regional Planning, Obafemei Awolowo University, Ile Ife, Nigeria.
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Abstract This study examines the opinions of key propellers of conflicts and ward leaders who were direct receivers of its impacts with a view to establishing causes of land conflicts and their effects on residents in southwestern Nigeria. Using qualitative technique of data collection, it purposefully selected 6 out of 8 communities with history of intercommunal clashes and targeted all the major conflict actors and 50% of the principal ward leaders for in-depth interview (IDI). Findings reveal that all the issues raised as causing conflicts were all related to land. Effects of the conflicts were also felt virtually in all studied settlements and cut across all socio-spatial parameters needed for community development. The study opines that if most causes of the conflicts were linked to land matters, then effective land management and control in the area would go a long way in reducing violent conflicts among residents in southwestern Nigeria. Key words: Land, Community development, Tradition, Resources, Southwestern Nigeria, Residents. 1. Introduction Land in Africa is more than the solid part of the earths surface. It is central to the peoples tradition (Herlin, 2003), socio-economic well being (Economic Commission for Africa (ECA), 2007), settlement citing and expansion (Economic Commission for Africa (ECA), 2009) and governance (UN-Habitat, 2010). Traditionally, Africas land is the abode of the dead, the host of the living, the resource keeper for the yet to be born (Ayo, 2002). Socio-economically, it is the only property that is in custody of all other earth resources needed for mans life and existence. For instance, agriculture that provides employment for more than 50 percent of Africas population is carried out on land and perceived as engine of growth to the region (Meijerink and Roza, 2007). Most mineral resources are located on/in land. In another dimension, land hosts virtually all natural resources needed for sustainability. Other artificial resources on earth are either placed or moved about on it for mans satisfaction. Land delimits a region area of its authority (The International Court of Justice (ICJ), 2002). In other words, a communitys territory is better defined by the sovereignty it has over a given area of land. Thus, to an average man in Africa, issues about land are issues of life, sustainability and development (Shackleton et al, 200). Thus, limitations imposed on land by certain government or group of people in Africa are always resisted and have resulted in many violent conflicts, sometimes, with perennial dimensions (http://www.idpproject.org). This is why land in Africa is highly entrusted into the
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elderly, royal fathers and heads of communities; with the hope that they would use their maturity and honourable positions to conduct sustainable land administration. Land management in Africa therefore attracts strong interests and attention, and these have affected relationships among people in their communities (Oyerinde, 2005). The indigenous way of land management among Africans could be why socio-cultural and traditional values in the region influence their land management and development. Some scholars have identified conflict on land in Africa as a battle for life, identity, socio-economic sustenance and territory establishment and preservation (Athey et al, 2008). This makes conflict on land in Africa to be age long. It has been dated to periods before civilization of Africa communities (Johnson, 1969). Many researchers are of the opinion that most conflicts in Africa can be linked to land related matters (Udonwa et al, 2004; Umeuduji, 1995; Umeuduji and Ushie, 2000; United Nations Popuation Fund UNPF, 2001 and Van, 1995). This could be why Gambari (2005) and Machel (2004) opined that violent conflict on land and its related resources is the most common disasters among people in African nations. Along this line, Smith (1994) had earlier observed that out of the total 79 conflict countries in the world, 65 are in the third world countries. It can be inferred that conflicts in African nations are often the root causes of their economic problems. Thus, land conflict poses great threat to their political stability, economic growth and physical development. This is because conflicts cripple economy, destabilize national politics, hinder innovation, destroy infrastructure, limit technology and negatively impact physical development. They also make the environment inconvenient for residents living within regions of their occurrences and beyond. In another dimension, conflict on land in Africa is a great limitation to the regions growth and the development of their communities. As land conflict is directly linked to development of African communities, there is imminent need for conflict studies that can proffer suggestions that are capable of transforming the stunted socio-economic lifestyles of the people and make the physical environment conducive for living. This study is an attempt to bridge this gap. It aims at understanding the nature of conflicts on land in Africa, the direct conflict stakeholders perspectives to its causes and effects of it. This study posits that the opinions of key individuals who are the main propellers of conflicts and direct receivers of its impacts are the right people to be contacted when considering conflict causal issues and social, economic and physical development effects on the built environment. In considering the role of land in conflicts in southwestern Nigeria, this study is concerned with inter-communal conflict among discrete communities in the region. It focuses on neighbouring towns that are located beside each other and yet engage in conflicts over land and its related resources. These groups of settlements shared in common, boundaries that were not clearly demarcated. This has made conflicts among them to be directly or indirectly related to land, infrastructure or other socio-economic resources located or expected to be cited in boundary regions that have proximities to concerned communities. In other words, common to these them is the inter-communal conflicts among the neighbouring discrete settlements. THE CONCEPT OF CONFLICT Definitions March and Herbert (1958) defined conflict as the breakdown in standard mechanism of decision making while Rummel (1979) perceived it as opposition of
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social powers. To Chaplin (1979), it is the simultaneous occurrence of two or more mutually antagonistic impulses or motives. Conflict is also seen as the struggle involving ideas, values, and or limited resources (Rummel, 1979). Deutsch (1973) and Cohen et al (1998) saw it as incompatible perspectives of ideas between two or more individuals or group of people. Such ideas may originate from groups beliefs, race, needs and institutional arrangement among others. In another dimension, opposing ideas may result in resource conflict, racism, poverty or nationalism among others (Barker et al, 1987; Chandrasekara, 2002). Whatever the source of ideas in an area, as human beings interact, conflictual behaviours manifest towards neighbours, nature and authorities. In other words, as people are organized into groups to seek a common goal, the probability of conflict generating increases. This is why Loomis and Zona (1965) opined that conflict is an ever-present process in human relations. Conflict, as perceived in this study is intra- or inter-groups arguments, oppositions, confrontations arising from incompatible perspectives, threatening sustainability of relationships, lives and properties in human environment. Types of Conflicts Conflicts in literature have been classified based on their origin or causes (Oyeshola, 2005), dimension or effects (Quist-Arcton, 2003; Machel, 2004, Robinson, 1973) and objectives of actors behind them (Coser and Rosenberg, 1964). Basically, conflicts can be destructive or beneficial. As noted by Quist-Arcton (2003), conflict can be harmful to groups but may also serve some potentially positive functions to others, depending upon the types of groups within and among which it occurs. In other words, a destructive conflict may produce positive result for others {Coser and Rosenberg, 1964; Coser, 1964; Robinson & Roy, 1974; Schaller (in Cox, 1974); Barker et al; 1987}. Constructive Conflict therefore improves the quality of decisions. It increases unity and cohesion within each group as members unite in a common purpose. As Mack (1969) suggests, conflict may define, maintain, and strengthen group boundaries, contributing to the group's distinctiveness and increasing group solidarity and cohesion. On the other hand, conflict also destroys groups, both in the sense of realignments resulting from shifts in the distribution of power and in the ultimate sense of the extermination of an unsuccessful party to conflict. Destructive conflict among other things is harmful to individuals or groups, increases bitterness, alienation, and divisiveness, and increases tension within or between groups. It disrupts normal channels of cooperation and become violent. In the work of Machel (2004), destructive conflict is categorized into three, based on the degree of its effects in human environment. These categories are high intensity, low intensity and tolerable violent conflicts. HISTORY OF CONFLICTS AMONG COMMUNITIES IN SOUTHWESTERN NIGERIA. In the early times, war was an expedition among major traditional towns in Africa, and those in South-western Nigeria were not exempted. It was therefore expedient for every community to have chiefs who were war-lords called baloguns. Many of the violent conflicts fomented by warring towns were to have spoils, subdue opposing kingdoms and expand empires (Johnson, 1969). These were how Oyo Empire, Ibadan Kingdom and Ekiti-paprapo Empire among others came to birth. The advent of colonial masters drastically reduced conflicts among communities as people were made to welcome socialisation and education. They promulgated law
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against violent conflict and illegal carrying of arms. Nigeria government at independence also raised national police force to combat crises and unlawful use of arms. The latter was lightly observed when key politicians raised tugs that did contrary to law, yet without penalties. The lapses created by government after independence resurged and re-fuelled forgotten strive among communities in late 20th century. Significant among these were the Nigeria civil war, Ife/Modakeke crises and political conflicts in different parts of Nigeria between first and forth republic era to mention but few. As noted by Ayo (2003), quest for socio-economic needs by the people to meet basic necessities of life resulted in bullying, exploitation and conflict among communities. Thus, neighbouring communities were at log-a-head in bids to claim right, autonomy and share in pooled resources (Ostrom, 2003). Some of these conflicts were within (intra) or between people of the same or neighbouring communities. These were very common among communities like OkeIho, Iseyin, Sagamu, Mushin among others in southwestern Nigeria. There are some other discrete towns that have been afflicted by inter-communal conflict. These include Emure and Ise in Ekiti State, Ife and Modakeke in Osun State, Iju and Itaogbolu, and Ilaje and Arogbo in Ondo State. Others are Irawo-Owode and Irawo-Ile in Oyo State. This study is much particular about the latter than the former conflicts in the study area. LAND ADMINISTRATION AMONG COMMUNITIES IN SOUTHWESTERN NIGERIA The centrality of land and its resources as causes of or recipient of conflicts and its effect in the space respectively has made land matters significant in literature on conflicts studies. Specifically on this study, land to people in southwestern Nigeria is more than the solid part of the earths surface as claimed by Lloyd (1962). Rather, it is the property of the community, shared by the villages, monitored by families, and used by individuals but never for non indigenes who hail from outside the central system (community) (Rayner, 1898). That could be why Tuladhar (2004) conceived that land belongs to a vast family of which many are dead, few are living and countless are yet to be born. In other words, land serves a variety of purposes to people of southwestern Nigeria. It is largely used for purposes such as agricultural and hunting activities, housing development, locating markets, constructing paths/roads, and raising sacred grooves. Rivers, streams and pools located on land also serve the people as sources of fishing, domestic water use and irrigation for the cultivation of vegetables during the long dry seasons. Land to southwestern Nigerians is the path to heaven for the departed relatives, the abode of ancestors and a devouring god to the defaulters and abusers of it (Ayo, 2002). In nutshell, a complex relationship exists between the people of southwestern Nigeria and land as a major source of livelihood and host of all beings. Land in southwestern Nigeria is based on three different categories; namely native law or custom of land tenure, statutory law and the received English law (Yakubu, 1985). Acquisition of land for the use under the customary land is normally through a grant by the chief of the community or head of the family. Alienation or transfer or terms of grant are restricted to strangers (Yakubu, 1985). In other words, existing land tenure system in southwestern Nigeria is incapable of addressing the continuous haphazard physical growth and stunted socio-economic development of cities and rural areas in the area. The 1978 Land Use Act (Federal Republic of Nigeria, 1978) statutorily converted all lands in any given state to public land use and vested them under the governorship of that state. In addition, the land reform paper for every
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community in sub-Sahara African nations was earlier published in 1975 as the worlds Bank rural land policy. It focused on land tithing, land redistribution and legal recognition of customary tenure and its subsequent integration into leasehold tenure (Ngobe, 2006). The objective of the world bodys land reform programmes have been equity and efficient distribution of secured land tenure. It is unfortunate that this reformation is not yet fulfilled among communities in African nations, particularly in the southwestern Nigeria. Both statutory land right and customary land tenure system have failed to promote community peace, orderliness and physical development, particularly in southwestern Nigeria. The latter ignores nonindigenes who wish to possess land for physical and socio-economic development of the community while the former is too bureaucratic and neglects virtues in the traditional system of land management. This has been the basis of making wars and unending conflicts among individuals and communities in southwestern Nigeria and other regions of Africa (Angaye, 2004). METHOD OF STUDY The research methodology adopted for this study was designed to collect data on the effects of communal conflicts on physical development in selected settlements in southwestern Nigeria. Available literature on recent communal conflict in the study area revealed that eight (8) settlements featured prominently among those experiencing recurrent communal conflict in southwestern Nigeria. These are Iju and Itaogbolu (Ondo State), Emure and Ise (Ekiti state) Irawo-ile and Irawo-owode (Oyo State) Ife and Modakeke (Osun state). The study focused on the settlements located in the earlier mentioned three States. The latter state was not included because of the volatile nature of the environment during pilot study. The reconnaissance survey clearly revealed that the residents were not at all ready to discuss issues of conflicts with non-residents. Where this was attempted, it was with great risk and threat to life. Data for this study were sourced through oral interview (Qualitative method). What implied this was the desire to know the root causes and effects of the conflicts as reported by those who were direct actors and recipients of the conflicts. To this end, the study, during reconnaissance survey identified the key actors and principal neighbourhood leaders of the zones most affected during the conflicts in each of the selected settlements. These became the discussants for this study. Each of those interviewed in this study was identified as In-depth Interview Discussant (IDI). Issues raised during the interviews include history of the selected settlements in relation to past communal conflicts, remote and immediate causes of these conflicts and their effects on residents and physical development in each of the studied settlements. Others are interactions among people in the pair of settlement in the area of trade, community development associations and activities, inter-marriage and social security and governance among others. In the course of identifying the conflict actors, the researcher sought the assistance of the kings of the communities who provided link with the conflict actors and principal neighbourhood leaders. During this research, the king of Iju was at large due to the conflict but some of his high chiefs who were on ground were contacted in lieu. These traditional leaders also assisted in contacting sampled conflict actors and principal neighbourhood leaders for interview. In other words, the conflict actors in each studied community were contacted and interviewed accordingly. As seen in Table 1, 14 conflict actors were interviewed in all the selected settlements. These include Emure (03), Ise (04), Irawo-Ile (2), Irawo-Owode (1) Iju (2), Itaogbolu (2).
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Since Principal Neighbourhood Leaders (PNL) were also targeted for quantitative study, information on political wards in each settlement was obtained from Independent National Electoral Commission (INEC) of each state (Independent National Electoral Commission, Nigeria, 2006). The information revealed that there were 37 political wards in the selected settlements. The study purposefully selected 19 wards (51%) that were directly affected by the effects of the conflicts or produced those actors that co-ordinated conflicts in the study area. These include Emure (06), Ise (06), Irawo-Ile (2), Irawo-Owode (1), Iju (5) and Itaogbolu (6). The study selected and interviewed each of the principal neighbourhood leaders who were identified as ward leaders in the study area. Table 1 reveals that the number of principal neighbourhood leaders and key conflict actors interviewed in all the selected communities were 33. Table 1: Selection of Conflict Actors and Principal Neighbourhood Leaders Interviewed as In-depth Discussants (IDI) in Southwestern Nigeria.
State Selected settlement Selected political words No of Principal Neighbourhood Leaders (PNL) Selected 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 19 Total PNL Selected per Community No of Conflict Actors and Wards 1 No of Conflict Actors per Community
Ekiti
Emure
Ogbontioro Imola Odo-emure1 Oke emure2 Ariyeisi Idamadu Figbo Oke-Odi Ogbese-oko oba Oraye Kajola Erinwa Oke Irawo-ile Isale Irawo-ile Irawo-owode Iju1 Iju3 Itaogbolu1 Itaogbolu3 37Political wards
1 3 1 6 2 1 1
Ise
4 2
Oyo
Irawo ile Irawoowode Iju Itaogbolu
2 1 2 2 19
1 2 2 14
Ondo
Total
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REPORTS AND DISCUSSIONS In-depth Interview (IDI) Reports from Key Conflict Actors (CA) on Conflicts on Land Related Matters in Southwestern Nigeria Table 2 reflects the opinions of key conflict actors/principal neighbourhood leaders on causes of conflicts in the study area. As seen in the key to the table, seven issues were identified by the CA/PNL as causing land conflict in southwestern Nigeria. These are:i. Location of local government headquarters in a certain piece of land that is not generally accepted by both residents of either of the communities studied in each State (local government location). ii. Political influence on certain piece of land, resources or properties resulting into governments unlawful issuance of certificate right of occupancy or license to a discrete community that lacked full indigenous right over such land or its related resources (politics). iii. Closeness of the two communities to each other at boundary zones, affecting urban expansion and resulting into arguments over natural or artificial resources at boundary zones (proximity). iv. Direct tussle over ownership of certain pieces or area of land within or outside the built-up area of the settlements (land matters). v. Unhealthy rivalry, jealousy and competitions due to sudden privilege or expansion of a discrete community within geographic space or ; endangering peace and tranquility of either of residents in the studied communities (rivalry). vi. Reference to certain historical antecedence or the practice of customs and traditions that enforced payment of tenement rate on land and its related resources on late settlers or neighbouring settlement. (Historical antecedent), and vii. Inequality in royalty resulting in unlawful exercising of authority over land and residents of another territory (royal seniority). The table evidently shows that virtually all the issues raised by the CA/PNL were directly or indirectly related to land. This confirms the argument of The New Internationalism (2011) and OReilly (2006) that conflicts in Africa are mostly caused by tussle over land and its related resources. On a general note, report from the conflict actors/principal neighbourhood leaders in the study revealed that location of local government secretariats on unpopular sites, crises over certain pieces of land matters and demand for isakole as influenced by historical antecedence were major causes of conflicts in all the studied settlements. The interwoven relationships among these three causal variables are revealed in the comments of some conflict actors in both Iju and Itaogbolu in Ondo State. According to an IDI discussant in one of these communities who was also the President of Secondary School Principals Association of Akure North Local Government; Itaogbolu crossed the river that separated the two communities to build houses on our land. They did this because of some facilities that the government located in the centre to serve the two communities. These facilities include court, hospitals, schools and electric power office. He further stressed that; This was possible because the family that owned the land at boundary zone received gifts from Itaogbolu and gave his community land to the outsider.
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On the other hand, a conflict actor from Itaogbolu, the neighbouring settlement argued that; When the Governor came to us to settle the conflict, Iju people told him that we committed two offences. First, they said we crossed the river to claim their land. Then, the local government headquarters which ought to be located in Iju was also located in Itaogbolu. The governor wondered and asked that if the land across the river belongs to Iju as they claimed and the local government council was situated on that same land that Iju was claiming, he wonder why they should be fighting against the location. These extracts all confirmed the argument that land issue, local government location and boundary problem are relevant to causing conflict in the study area. As noted by an old woman, a prominent Market Women Association leader and conflict actor in Iju who said that,
Conflicts on land will never cease. Man hails from soil, exists on land, bounds to fight for sustenance on it and destined to be buried in the soil.
On the problem on land matters, an IDI discussants in Irawo-ile in Oyo State, who identified himself as Bobagunwa of Irawo-ile reported that Irawo-owode was formerly part of Irawo-ile and had their farm location in the same place with their brethren in the mother-town (Irawo-ile). He further explained that when they separated from Irawo-ile, they still maintained their farms, but the land was no more theirs. The decision of Irawo-owode to sell part of the land and process certificate right of occupancy it led to conflict between the two settlements. The observation of another IDI in Irawo-owode who claimed that he was a former chairman of Independent Petroleum Marketers Association of Nigeria was alongside the report of the former IDI discussant from Irawo-ile. According to the report from Irawo-ile, the two communities had no complaint on these. The cruise of the matter was when all farmlands located close to Irawo-ile was taken over by them and determined not to allow Irawo-owode to share anything with them, including the intercommunal facilities that were all located in Irawo-ile. These extracts and comments all point to the fact that land matters are very important when considering conflict among communities in southwestern Nigeria. According to Table 2, historical antecedence that makes people to demand for isakole was common among residents of Ekiti and Ondo States. This could be why most CA/PNL from these states opined along this line. In the same vein, lack of one voice on where to locate the local government sectretariat and specific tussle over certain pieces of land caused conflicts both in Ekiti and Ondo States accordingly. The table reflects that the former causal issue was more reported in Emure in Ekiti and Iju in Ondo States respectively. Reports from conflict actors in some of the studied settlements corroborated the fact that historical antecedents caused conflict in the area. For instance, nearly all the CA/PNL in Ise were of this opinion. The vice-king of Ise, who was an IDI discussant, explained that Ise used to collect tribute from Emure but the failure of the latter to keep to this rent led to conflict over farmland. On the other hand, an IDI discussant in the discrete town- Emure named Balogun of Emure (chief of the warriors in Emure), aged 104 years commented along this line. He said that warlords of Ise used to invade Emure
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to collect tribute in the olden days over a land that did not belong to them. According to him, the Ise kingship title was called Arinjale, meaning someone who exceeded his boundary to occupy neighbours pieces of land. In the same vein, the latter cause of conflict was also well reported in Irawo-ile in Oyo and Itaogbolu in Ondo States. In the contrary, reports from Irawo-owode and Iju did not favoured the arguments of CA/PNL from their neighbouring discrete towns that land matter was a strong issue causing inter-community conflict in the study area. This could be that those who have supremacy over certain piece of land are not interested in identifying such as causing conflict or those who accused their neighbouring settlement of claiming their pieces of land did so for envy and jealousy as revealed in the table that most conflict actors in Iju in Ondo and those in Oyo States observed that there was envy and rivalry over land, property and sudden privilege identified with the neigbouring settlements in the study area. The study showed that royal seniority and political influence on land and properties were not popular causes of conflicts in the study area. The former was sparsely observed by conflict actors Oyo State while the latter was also only reported as significant by the same people when considering issues causing land related conflicts in the study area. Dispute between discrete neighbouring settlements over land and resources located in boundary regions was also reported to have caused conflicts in the study area. As seen in Table 2, most conflict actors in Ondo State and few of them in Ise in Ekiti State observed this. To CA/PNL in Emure, Irawo-ile and Irawo-owode, arguments over properties and land in inter-community boundary zone was not relevant in causing conflict in their environment. Of importance in this study is that crises over rightful owners of certain pieces of land and wrong location of local government secretariats were potent causes of conflicts in southwestern Nigeria. On the other hand, other issues that were not generalized were reported to be land related and causing conflict in some of the studied settlements. This could be why Agbosu (2000) and Ngobe (2006) argued that land matters in Africa to a large extent are more that individuals issues, they attract communities attentions. Implicit to these is that land matters are very cardinal when considering causes of communal conflict in southwestern Nigeria. Table 2: Opinions of Conflict Actors on Causes of Conflicts in Southwestern Nigeria State Settlement Opinions of Conflict Actors on Causes of Conflicts Ekiti Oyo Ondo Key + ++ Emure Ise Irawo-ile Irawoowode Iju Itaogbolu 1 ++++ ++ ++++ ++ 2 ++ ++ 3 ++ +++ + +++ 4 ++ ++ +++ + +++ 5 +++ +++ ++++ 6 ++ +++ +++ +++ 7 +++ +++ -
Where opinion was expressed by few discussants Where opinion was expressed by half of the discussants.
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+ + + Where opinion was expressed by many (most or nearly all) of the discussants. ++++ Where opinion was expressed by all of the discussants Where none of the discussants expressed opinion. IDI In-dept interview discussant 1 Local government location 2 Politics 3 Boundary proximity 4 Rightful ownership of certain land(land matters) 5 Rivalry and Jealousy 6 Historical antecedence 7 Royal seniority
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Effects of Conflicts on Residents in Southwestern Nigeria In this study, effects of conflicts were expressed by the IDI on eight different issues. These include urban land use and its development, housing, farmland and crops, economic interactions between communities through commerce and trade, infrastructure within settlements, residents lives and properties, inter-community social relations and community governance and security. Table 3 reflects the summary of reports from principal neighbourhood leaders in the study area. According to the report, the conflicts mostly affected economic and social interactions among discrete communities in southwestern Nigeria. This is because nearly all the IDI discussants reasoned along this line during the in-depth interview with them. The socio-economic interactions affected by communal conflicts in the area include shopping and trading, inter-marriage and inter community development associations while the socio-pacial facilities that were destroyed along this line include market and shopping centres and central business districts of some of the settlements. As commented by an IDI discussant who was called chief Asalu of Ise; Most people killed during the conflict were those whose foodstuffs had been poisoned unknowingly when they went to Emure markets for shopping. A young lady, a conflict actor and leader of Ise Young Stars Women Association, in her contributions during the interview, commented along the same line. She said that Emure stopped us from crossing the boundary for trading in their town. They also banned us in their markets. Our women who were caught doing these were beaten to comma. They came to our periodic markets and we knew, but never retaliated. This is because inter-trading cannot be stopped by little misunderstanding. On a general note, the conflict did not have much effect on the people in Emure and Ise (Ondo State) on their urban land, housing and farmland development. In the same vein, the IDI discussants from these settlements seemed not to have laid emphasis on the effects the conflicts had on their infrastructure and communities governance and security. In the contrary, the conflicts were reported to have affected settlements in other states on their urban land, housing and farmland development, infrastructure and communities governance and security. On housing and general urban development, IDI discussant in Iju noted that most houses, facilities and land overtaken by conflict at boundary zone have lost values and are becoming abode for hoodlums.
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Still on housing, it was reported that warriors from Irawo-ile invaded Irawo-owode in Oyo State at nights and overpowered the residents, burning houses, destroying infrastructure and killing people. In the corollary, nearly all residents in Irawo-Owode were forced to flee to nearby communities for safety. According to reports, some fled to settlements like Saki, Ago-Are, Igboho in Oyo state while some fled to neighbouring countries like republic of Benin, Togo and Sierra-Lone, among which few never returned till date. The abandoned properties were looted. An IDI discussant, who is a community leader in Irawo-ile expressed himself in tears that they were over powered because their population was not as much as that of their opponent. Extracts from his words in local language was that Emi ko mo pe arun ni kekere afi igba ti mo ri ogun. This could be interpreted as saying that I never knew that small stature was an illness until I saw war that conquered us because we were few in number. Effects of these on communities infrastructure and joint facilities can be read in the words of an IDI community leader in Irawo-ile, who said that Those who married from his enemys town have revealed their own houses addresses to the in-laws - foes. They would be the first to be attacked when conflict arises. He further stressed that he predicted an imminent end to all the inter-communal facilities that served the two settlements together. Effecvts of conflicts on urban and farm land were well reported by the IDI discussants in both Oyo and Ondo States. According to an IDI in Itaogbolu, conflict on land in the study area still persisted till the time of this study. This is because his report stated that Till date, Iju people still visit Itaogbolus farms. Whosoever they see are tied to trees and they harvest all their desired farm products. If the tied people proved heady, they are shot instantly. Our farm products are lost to other communities. As I am talking to you now, our people have rushed to farm to rescue their family members when we heard of such reports. This reveals that security of lives and properties were daisy in some of the studied settlements as at the time of this study. Table 3 reflects this. According to the table, conflicts posed great threats to community governance and social security in Irawoowode and Itaogbolu among others. This was not the case in Ekiti State. According to reports, the effects on governance came from social deviance observed in warlords during and after the conflicts. As reported by the discussants who sought anonymity, these warlords were said to have taken laws into their hands, thus making the community ungovernable for traditional rulers in the settlement. Conflict effects on lives and properties of residents in the study area were most reported in Irawo-owode, more in Ondo State and less in Irawo-ile and other settlements in Ekiti State. Whichever the case, there seemed not to be any settlement where conflicts on land in southwestern Nigeria had not claim lives of residents.
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Table 3: Opinions of Principal Neighbourhood Leaders on Effects of Conflicts on Residents in Southwestern Nigeria State Settlement Opinions of Conflict Actors on Causes of Conflicts Ekiti Oyo Ondo Emure Ise Irawo-ile Irawoowode Iju Itaogbolu 1 + + ++ ++++ ++++ +++ 2 ++ +++ + ++ ++ 3 ++ +++ + ++ +++ 4 ++ +++ +++ +++ + +++ + +++ 5 + + +++ ++++ +++ ++ 6 + + + +++ ++ ++ 8 7 +++ + +++ + +++ ++ +++ ++ + + +++ ++ +++ ++ +
Key + Where opinion was expressed by few discussants ++ Where opinion was expressed by half of the discussants. + + + Where opinion was expressed by many (most or nearly all) of the discussants. + + + +Where opinion was expressed by all of the discussants Where none of the discussants expressed opinion. IDI In-dept interview discussant 1 Urban land development 2 Housing 3 Farmland 4 Commerce and trade 5 Infrastructure 6 Residents lives and properties 7 Inter-community social relations 8 Community governance and security Qualitative Reports on Means to Conflict Resolution in Southwestern Nigeria The study sought the opinions of people interviewed on the way out of land conflicts between pair of settlement in each of the chosen states in the study area. In this analysis, suggestions raised by discussants during interview, that were relevant to the study were grouped into 10 categories. They are:1. Boundary Demarcation (BD) 2. 3. 4. 5. 6. Promotion of Inter-community Development Associations and Activities (PICDAA) Rotational Local Government Headship (RLGH) Separate Local Government for each Settlement (SLG) Indigenous Land Tenure System Should not be tampered with (ILTS) Boundary Zone to be taken over by Government (BZG)
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7. 8. 9. 10.
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Provision of Inter-communal Facilities at Boundary Zones/Conflict areas (ICF) Creation of Industry (CI) Trust and Equity between Settlements (TE) Promotion of Inter-communal Trade and Creation of Inter-communal Market Centres (ICTM)
According to reports depicted in Table 4, four of the suggested items above were endorsed across settlements among others. These are boundary demarcation (BD), Promotion of inter-community developments associations and activities (PICDAA) to encourage social interaction, given over of controversial pieces of land in boundary zones to the government (BZG) and creation of industries to employ the warring youths. The first and the last among these four items were accorded highest reports given by the discussants across settlements. However, survey showed that none of the IDI discussants in Oyo State reported the need to promote inter-community development associations and activities. A principal neighbourhood leader in Irawo-owode argued that PICDAA occur where there is trust. Extracts from the words reads; Little or no relationship occurs after exchange of bullets. Inter-community association is for those who have only exchanged words and not bullets during conflict. We cannot have inter-community development association meetings with those who have killed our children and spouses. The need for trust and equity on issues that touch each pair of settlements was also reported nearly across board. Specifically, nearly all the IDI discussants in Ekiti State opined for trust and equity to resolve the discord between discrete settlements. A conflict actor in Emure was specifically of the opinion that equity would make payment of tribute on land to early settlers to end. In the contrary, trust between the selected settlements in Oyo State has been affected by the conflicts. This is because very few of the IDI discussants of the two settlements concerned showed interest in this. In other words, trust and equity were well reported by most IDI discussants across settlements except in Oyo State and Itaogbolu in Ondo State. In the latter settlement, the IDI discussants in the settlement did not report on the need for trust and equity to aid conflict resolution in the area. In the same vein, promotion of inter-communal market and trade was also raised by discussants across settlements. However, the former opinion was less considered by the IDI discussants in Itaogbolu in Ondo State and those from Oyo State. Similarly, the latter opinion was also least suggested by IDI discussants in Oyo State and Iju in Ondo State. On rotation of local government leadership, the IDI discussants in Ekiti State did not indicate their interest in this. In other words, settlements in Ekiti State were in-different to conflict prevention and resolution through separate local government councils for each warring communities. This could be due to the fact that the studied settlements in Ekiti State were in separate local government councils already as at the time of this research. Those in Oyo state were not so. In Iju, half of the IDI discussants also reported
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along the local government headship in the area should be rotational. One of the IDI discussants who did not support this view argued that the issue of separate local government may not resolve tussle over land in the area, rather it may aggravate it. Extracts from his word was that; Any conflict resolution strategy that could not solve conflict over land should be lightly considered. Nearly all the discussants from Osun and Ekiti States reported that proliferation of inter-communal market and trade would resolve conflict in the study area. On the contrary, this opinion was least considered as panacea to conflict in Oyo and Ondo States. However, about half of the IDI discussants in Itaogbolu were in support of this opinion. Conservation of the traditional way of land tenure system was highly supported in Irawo-Ile as a means to avoid future conflict in the study area. They argued that land management and administration through customary tenure would be the only way to ensure peace and tranquility in their area, Along this line, an IDI discussant in Irawo-ile said in the local language that; Ore nje ore, ewo ni ti afipa gba. Eni fi pa gba ile a ri ija ile siwaju si. This can be interpreted to mean that Land can be given by the right owner as a gift to another person. Forceful submission of right over land will produce further conflicts. In addition, about half of the IDI discussants in Emure and Iju also believed that stripping residents of their customary rights over land would endanger the peace of the residents. Paradoxically, none of the IDI discussants in Irawo-owode and Itaogbolu reported that customary land right should be retained to aid conflict resolution in the study area. On provision of inter-communal facilities to prevent further conflict, none of the IDI and FGD discussants in Oyo and Iju (Ondo State) welcomed the idea. In Itaogbolu, nearly all the IDI discussants believed that inter-communal facilities could aid conflict resolution between settlements. On this, those in Oyo State had lost confidence in settlements coming together to establish joint facilities. In summary, there seemed not to be a generalized holistic approach to .conflcit prevention in the study area. Variations in opinions among residents is an indication that specific study and understanding of main causes of conflict and the request of the people concerned is highly imperative to conflict resolution in southwestern Nigeria.
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Table 4: Opinions of In-depth Discussants (IDI) on Future Conflict Prevention in Southwestern Nigeria
State Osun Settlement Ife FGD Discussants by group OM OF YM YF IDI Modakeke FGD OM OF YM YF IDI Ekiti Emure FGD OM OF YM YF IDI Ise OM OF YM YF IDI Oyo Irawo-Ile FGD OM OF YM YF IDI Irawoowode FGD OM OF YM YF IDI Ondo Iju FGD OM OF YM YF IDI OM OF YM YF IDI 1 ++ ++ + ++++ ++ ++ + ++ ++ ++ ++++ +++ ++++ ++++ ++++ ++++ ++++ +++ ++++ ++++ +++ +++ +++ +++ ++++ +++ +++ ++++ +++ +++ ++ ++ ++++ +++ ++++ + _ ++ ++ _ 2 ++ ++ ++ + ++ +++ ++ ++ ++ +++ +++ +++ ++ +++ +++ ++++ ++++ ++++ ++++ ++++ _ _ ++ + _ ++ _ ++ ++ _ _ ++ ++ ++ +++ + ++ +++ ++ +++ 3 _ _ _ ++ _ +++ ++++ ++++ ++++ ++ _ _ _ _ _ _ _ _ _ _ ++ ++ ++ ++ ++ ++ +++ ++ ++ ++ _ _ _ _ ++ ++ +++ +++ +++ ++ 4 + + + +++ ++ ++++ ++++ ++++ ++++ ++++ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ++ +++ ++ _ +++ +++ +++ +++ +++ 5 +++ +++ ++ ++++ + _ _ _ _ _ ++ ++ + ++ ++ ++ _ _ _ ++ +++ ++++ ++++ ++++ +++ + _ _ _ _ _ + + ++ ++ _ _ _ _ + 6 +++ ++ + +++ ++++ ++++ ++++ ++++ ++++ ++++ + + + + + ++ ++ + + +++ ++ +++ +++ ++ +++ ++++ ++++ ++++ ++++ ++++ ++ _ _ _ _ ++++ +++ +++ ++ +++ 7 +++ ++++ ++++ +++ ++++ ++++ ++++ ++++ ++++ ++++ +++ +++ +++ ++++ ++++ ++++ +++ ++++ +++ +++ _ _ _ _ _ ++ _ _ _ _ _ _ _ _ _ ++ + ++ _ +++ 8 +++ +++ ++ +++ +++ ++++ +++ ++++ ++++ ++++ +++ +++ ++ +++ ++++ +++ +++ +++ ++ ++++ +++ ++++ +++ +++ +++ +++ +++ +++ +++ ++ +++ _ +++ ++ + + ++ + +++ +++ 9 ++ ++ + + ++ +++ +++ ++ ++ +++ ++ ++ ++ ++ ++++ +++ +++ ++ +++ ++++ ++ + + + + + + + ++ + ++ _ ++ ++ +++ + _ _ _ _ 10 ++++ ++++ +++ ++++ +++ ++++ ++++ ++++ ++++ ++++ ++++ +++ +++ ++++ ++++ +++ +++ ++++ ++++ +++ _ + _ ++ _ _ _ ++ _ + _ _ _ + ++ + ++ + ++ ++
Itaogbolu
FGD
Key + Where opinion was expressed by few discussants ++ Where opinion was expressed by half of the discussants. + + + Where opinion was expressed by many (most or nearly all) of the discussants. ++++ Where opinion was expressed by all of the discussants Where none of the discussants expressed opinion. OM Old male FGD discussant (old men) OF Old female FGD discussant (old women) YM Young male FGD discussant (young men) YF Young female FGD discussant (young women) IDI In-dept interview discussant 1. Boundary Demarcation (BD) 2. Promotion of Inter-Community Development Association and Activities (PCDAA) 3. Rotational Local Government Headship (RLG) 4. Separate Local Government (SLG) 5. Indigenous Land Tenure System Should not be tampered with (ILTS)
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6. Boundary Zone to be Taken over by Government for Public Use (BZG) 7. Provision of Inter-Communal Facilities at boundary Zones/Conflict land (ICF) 8. Creation of Industry (CI) 9. Trust and Equity between settlements (TE) 10. Promotion of Inter-Communal Trade and creation of inter communal Markets (ICTM) CONCLUSION The study showed that information from conflict actors and principal neighbourhood leaders are germane to understanding causes and effects of conflict in the built environment. The discussants opinions on conflicts on right ownership of pieces of land were not generally reported across settlements. Other reports clearly showed that virtually all issues raised by the IDI discussants were all linked to land related matters. This is an indication that conflict and land issues in southwestern Nigeria are inseparable. Effects of the conflicts on selected settlements were strongly felt in Irawoowode, more in Irawo-ile, Iju and Itaogbolu and averagely felt in Ise and Emure accordingly. Reports on the effects of this were felt virtually on all the socio-spatial parameters across settlements. This showed that the past conflicts in the study area were capable of retarding the progress of development in all spheres of life in the study area. Issues of boundary demarcation, creation of industry for the warring youths and social interaction among residents of discrete communities through promotion of intercommunity development association were raised by the IDI discussants as means towards conflict resolution and prevention. The government of the land through the policy makers can attend to this when planning for the region. The study has been able to contribute to knowledge on how conflicts on land matters have affected community development in southwestern Nigeria. It posits that effective land management and control would go a long way in reducing violent conflicts in the study area. This can be done through thorough raising local committee on land in all local government areas. Such local committee on land should include the kings of notable communities, preferably those that have passed through conflicts; their conflict actors and selected ward leaders who would work together with the government officials on the way forward in preventing conflict, addressing crises on land and developing strategies toward effective land management in the region.
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References Abegunde, A.A. (2010). An evaluation of the impact of communal conflict on the physical development of selected settlements in southwestern Nigeria. A Ph.D. Thesis. Department of Urban and Regional Planning, Obafemei Awolowo University, Ile ife, Nigieria. Ayo, S.B. (2002). Public administration and the conduct of community affairs among the Yoruba in Nigeria. Institute for Contemporary Studies, Oakland, California. Agbosu, L.K. (2000). Land Law in Ghana: Contradiction between Anglo-American and Customary Perceptions of Tenure and Practices. Land Tenure Center, Working Paper no. 33, University of Winsconsin, Madison. Athey, S.; Calvano, E. and Jha, S. (2008). A theory of community formation and social hierarchy. Mimeo, Harvard University Angaye, G. (2003). Causes and Cures of Conflicts in Nigeria. http://www.nigerdeltacongress.com/garticles/causes and_cures_of_conflicts _in.htm Barker, L.L.; Kathy, J.W.; Kittie, W.W.; and Robert, J. K. (1987) Groups in Process: An Introduction to Small Group Communication, Third Edition. Prentice Hall, Englewood Cliffs, NJ, 1987. Chandrasekara W. S. (2006). Conflict impact assessment in development projects in Sri Lanka: a case study on Mawanella communal tension and conflict prevention in the Sabaragamuwa province. IMCAP, Faculty of Arts, University of Colombo Coser, Lewis A. and Bernard, Rosenberg (1964). Sociological Theory: A Book of Readings (Second Edition). New York: The Macmillan Company, 1964. Cohen, L.; Davis, R. and Aboelata, M. (1998). Conflict resolution and violence prevention: from misundertanding to understanding. The Fourth R (1998; 84:1, 38, 13-15) a Publication of the National Institute for Dispute Resolution. Deutsch, M. (1973). The Resolution of Conflict: Constructive and Destructive Processes. New Haven: Yale University Press Economic Commission for Africa (2007). Economic report on Africa 2007, relevance of Africans traditional institutions of governance. http://www.uneca.org. Economic Commission for Africa (2009). Economic report on Africa 2009; developing Africa agriculture through regional value chain. http://www.uneca.org/era2009/. Federal Republic of Nigeria (2006). Independent National Electoral Commission (INEC)ward and local government document. Information for 2006 Election. Office of INEC, Nigeria. Federal Republic of Nigeria (1978). The Nigeria Land Use Act of 1978. Federal Republic of Nigeria Gambari, I.A. (2005). Death in Darfur and Global Security: Can Africa handle Security Crises on its Own? Africa Notes Number 10. Woodrow Wilson School of Public & International Affairs Princeton University, New Jersey. Herlin S. J. (2003). Ancient African civilizations to ca. 1500. Department of History, University of Louisville, USA. Johnson, S. (1969). The History of the Yorubas. Lowe and Brydone (Printers) Ltd., London: Great Britain. Lloyd, P. C. (1962). Yoruba Land Law. London: Oxford University Press Loomis, C.P. and Zona, K.L. (1965). Modern Social Theories Princeton. D. Van
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Nostrand Company, Inc., 1965. Machel, G. (2004). Mitigating, Preventing, and Ending Conflicts in Africa: The Link between Conflict, Refugees, and Food Security. March, J.G. and Herbert, A.S. (1958). Organizations. New York: John Wiley. Meijerink, G. and P. Roza. (2007). The role of agriculture in development. Markets, Chains and Sustainable Development Strategy and Policy Paper, no. 5. Stichting DLO: Wageningen. Available at: http://www.boci.wur.nl/UK/Publications/ Ngobe, A. (2006). How Strong is the Case for the Modernization of Land Tenure in Africa? Focus on Zambias Privatization for land Rights. In Africa Region Casle Conference on Sustainable Land Management in Africa, 14-17 March 2006, Bagamoyo, Tanzania. Ostrom, E. (2003). How Types of Goods and Property Rights Jointly Affect Collection Action. Journal of Theoretical Politics 15(3): 239-270 Oyerinde, O.K. (2005). The Constitution of Order among the Yoruba of Nigeria. A Doctorate Degree Thesis, Department of Political Science, Indiana University, U.S.A. December 2005. Quist-Arcton, O. (2003). Nigeria: Elections, Oil, and Violence. Africa E-Journal. http://www.africaaction.org/docs03/nig0304a.htm Rayner (1898): Abdulai, R. T. (2006). Customary Land Tenure and Individual Ownership of Land in Ghana. In Africa Region Casle Conference on Sustainable Land Management in Africa, 14-17 March 2006, Bagamoyo, Tanzania Robinson, J.W. Jr. (1972). The Management of Conflict. Journal of the Community Development Society, Vol. 3, No. 2, pp. 100-105. Robinson, J.W. Jr. and Roy, A.C. (1974). Conflict Management in Community Groups. University of Illinois at Urbana-Champaign, North-Central Regional Extension Publication No. 36-5. Schaller in Cox, Fred, M., et al. (Eds.), (1974). Strategies of Community Organization, A Book of Readings. Itasca, Illinois: F.E., Peacock Publishers, Inc. Shackleton, S.; Shackleton C. and Cousins, B. (2000). Re-valuing the communal lands of southern Africa: new understandings of rural livelihoods. Natural Resources Perspectives. Number 62. Smith, D. (1994). War, Peace and Third World Development. Occasional Paper 16 War, Peace And Third World Development, International Peace Research Institute, Oslo, 1994 The International Court of Justice (ICJ) (2002). Land and Maritime Boundary between Cameroon and Nigeria (Cameroon v. Nigeria: Equatorial Guinea intervening). Press release of 2002. Available at www.icj-cij.org Tuladhar (2004): In Ngombe et al (2006). How Strong is the Case for the Modernization of Land Tenure in Africa? Focus on Zambias Privatization for land Rights. In Africa Region Casle Conference on Sustainable Land Management in Africa, 1417 March 2006, Bagamoyo, Tanzania Udonwa, N.E; Ekpo, M.; Ekanem, I.A.; Inem, A.V. and Etokidem, A. (2004). Oil Boom and AIDS Boom in the Niger Delta Region of Nigeria. In the Electronic Journal of Rural Health and Remote Health Research, Education, Practice and Policy. http://rrhdeakin.edu.au
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Umeuduji, J.E. and Ushie, F.A. (2000). Environmental Degradation as a Function of Petroleum Exploitation: The Case of the Niger Delta. Environmental Review A Multidisciplinary Journal for the Environmental Sciences. El Demak Ltd Publisher. Vol 3, No. 2 pp 274-280. United Nations Popuation Fund UNPF (2001): Population, Environment and Poverty Linkages Operational Challenges. 220 East 42nd Street New York, N.Y. 10017 Yakubu, M.G. (1985). Land Law in Nigeria. London: Macmillan Publishers. http://www.idpproject.org: Internally Displaced Project.
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ANALYSIS OF SERVICE COSTS FOR OPTIMAL CAPACITY DETERMINATION IN A QUEUING SYSTEM E.C. Ubani Department of Project Management Technology, Federal University of Technology, Owerri Nigeria
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Abstract This study examines and analyses service costs for the determination of the optimal system capacity and utilization needed in the operations of multi-channel queuing system for customers services. Managers are usually faced with the challenges of deciding on the capacity requirement (number of servers) to contain with the expected number of customers in a service station. A survey method was used to capture data from the focused and target commercial bank operators with a view of determining optimal system capacity that will enhance customers satisfaction and returns on investment. The data was analysed by subjecting it to iterative processes using appropriate multi-server infinite queuing table. The results of the analysis indicate that the optimal system capacity was found to be nine servers (channel) with operating cost of N10,603 per hour and a system utilization of 64.20%. Managers should always strive to enhance system performance by periodic in-depth analysis of system capacity requirement as well as striking a balance between cost of providing the service and cost of queuing. Keywords: Operating characteristics, Traffic Intensity, Service Cost Analysis, Queue Discipline, Arrival And Service Rates, Total Expected Cost, Utilization, Objective Function. Introduction The service characteristics and operating capacity of commercial banking facilities could be viewed as a queuing system in which, customers arrive into the system randomly, spend random service and queuing times, and then depart. Queuing is one of the familiar settings in which managers encounter probabilistic model in the management of systems that create goods and/or provide services. For instance, service or manufacturing system can usually be represented as a network of queues in which customers wait to be served, raw materials wait to be processed, and parts wait to be assembled. Therefore, it is important to be able to make predictions about the behaviour of a queuing situation so that we are in a position to either manage the system better or even to eliminate the undesirable effects of queues. Also, there is need to evaluate and analyse the traffic intensity and operating characteristics of queues so as to determine the optimal system capacity, type of queuing system structure to adopt and the number of servers to employ. These measures will go a long way in the improvement of service
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efficiency and customers satisfaction. The number of servers to employ, the total operating cost and expected benefit accruable from the system could be veritable factors in the managerial decision making process with respect to system design. The basic results of queuing model provide a convenient method of optimizing the objective functions, estimating system performance, providing basic statistics of likely queuing characteristics, traffic intensity, average workload and mean machine or service capacities available. In Nigeria, the Information and Communication Technology (ICT), and ebanking have not been fully developed and complied with in providing services to the customers, hence commercial banks are characterized by long queues due to low service rate. There are also problems of indecision with respect to the number of severs and service stations, and facilities to be employed in operations systems, hence there is a research gap. Queues or waiting lines are usually characterized by high cost of operation such as service and queuing costs. The objectives of the study therefore include: To determine an optimal capacity that will result to minimum services cost, enhance service system performance and ensure optimum number of servers in banking operations. These will reduce; queuing time and cost, queuing length, cost of providing the services and cost of providing the service facilities and at the same time ensuring appreciable returns on investment. Stevenson (2002) asserts that analysis of waiting lines is often used for designing service systems. According to him, analysis is useful in helping managers choose a capacity level that would be cost effective through balancing the cost of having customers waiting with the cost of providing additional capacity. It could also aid in the determination of expected costs for various levels of service capacity. To enhance the profit generating capacity by providing quality service to large number of customers with minimum operations cost and optimal system capacity The study will be of immense benefit to operations managers in-charge of customers services in commercial bank in designing optimal system capacity for high level of quality services. However, the study will be limited to the analyses of service
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satisfactions and returns on investment LITERATURE REVIEW
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costs through the determination of optimal capacity as they affect the customers
Optimization in a queuing system involves design and control decisions. Deshmukh and Jain (1976) posit that the design (or static) decision involves the selection of the input stream (e.g. the arrival rate or the waiting room capacity), the queue discipline (e.g. the priority classes), or the service mechanism (e.g. the number of servers or the service rate). Using the theory of stochastic processes or simulation, one analyzes the long-run probabilistic behaviour of different system structures and selects an optimal one (Deshmukh and Jain 1976). Also, cost analysis and optimal capacity could be used to assess and explore the performance of queuing system. Queues occur when people, parts, machines, computer programs or trucks arrive at service centres irregularly and the capacity of service centres cannot be expanded to exactly meet the needs of these arrivals. For instance, in manufacturing or service industries, parts manufactured on a machine system or customers arriving in a random order, wait in a buffer, if necessary, and are processed or served according to first-in-first serve rule. After processing or receiving services, they are released from the system. Similarly, queues are also formed when a customer wants a particular service, but arrives to find that the server is busy, so they cannot be served immediately. Other customers may as well be waiting for service in the queue. The new arrival could see the queue length and decides not to use the service, or may decide to wait and line up in the queue. The queues obtained in service stations can take many forms and characteristics as follows:Customers may form a single queue or they may form separate queue for each server. They may be served individually or in batches. Severs may be in parallel where each does the same job or in series where each provides part of the service and then passes the customer to the next stage. Service time may be constant or variable and customers may be served in order of arrival or some other orders such as order of urgency. It is a known fact that excessive long queues cause delay, increase in idle time, low profit margin and queuing cost as many customers will not wait for their turn. On
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long queues will increase the operation cost of the service.
Customer arriving Server or servers Customer leaving
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the other hand, employment of more servers and service facilities to take care of the
Figure 1: A general queuing system According to Waters (1989), queuing theory can be applied in many facets of human activities such as depositing or withdrawing money from bank, waiting for traffic light etc. However, it is generally undesirable for customers to wait in queues for a long time and a balance is needed between large number of servers and reasonable operating cost. Queues generally occur whenever the arrival rate is faster than the service rate. In addition, queues can take any of the following system structures; single phase, single channel; multiphase, single channel; single phase, multi-channel; and multiphase, multi-channel. THEORETICAL BACKGROUND The queue length depends on the; rate at which customers arrive to be served, the time taken for a server to deal with a customer (service rate) and the number of servers available. According to Walter and Willian (1978), two important variables in the analysis of queuing system are the arrival rate (in item per period) and service time (in period). Some of the important variables associated with queues include the number of items waiting and time spent waiting. However, items considered in the queuing analysis arrive in random order. Stevenson (2002) states that the operations manager typically looks at five measure of performance when evaluating existing or proposed system. Those measures are referred to as operating characteristic by waters (1989). They include: The average number of customers waiting, either in line or in the system. The average time customers wait, either in line or in the system. System utilization, which refers to the percentage of capacity utilized. The implied cost of a given level of capacity and its related waiting time. The probability that an arrival will have to wait for service.
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Of these measures, system utilization bears some elaboration. It reflects the extent to which the servers are busy rather than idle. On the surface, it might seem that the operations manager would want to seek 100 percent utilization. However, increases in system utilization are achieved at the expense of increases in both the length of the waiting line and the average waiting time. In fact, these values become exceedingly large as utilization approaches 100 percent. The implication is that under normal circumstances, 100 percent utilization is not a realistic goal. Even if it were, 100 percent utilization of service personnel is not good; they need some slack time. Thus, instead, the operations manager should try to achieve a system that minimizes the sum of waiting costs and capacity costs. Waters (1989) uses the following notations in the queuing/waiting line theory: = service rate, = arrival rate, n = number of customers. Considering the mean arrival rate and mean service rate , if the mean arrival rate is greater than the mean service rate, the system will never settle down to a steady state, but the queue will increase in length continuously. i.e. if > , queue length increases. This analysis assumes that a steady state is reached when > . The system utilization or average proportion of time the system is busy in a single server station is
. . 1
Here, busy is defined as having at least one customer either being served or in a queue. This could be viewed as the average number of customers being served at any time or utilization factor. Customers receiving services form a queuing system could be in a single server (channel) and multi-server (channel) queues respectively. The fundamental result of a queuing theory refers to as a single server deals with a queue of customers with both random arrival of customers and random service time. This model could assume; a single server, random arrival, random service time, first come, first sever discipline, the system has reached its steady state, there is no limit to the number of customers allowed in the queue, there is no limit to the number of customers who use the service and all arrivals wait to be served. The following notations are adopted from Stevensom (2002) for the model specifications required in the computation of performance measures for infinite-source problems in the queuing system.
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Symbol Lq Ls Wq Ws 1/ Po Pn M Lmax
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Represents Customer arrival rate Service rate The average number of customers waiting for service. The average number of customers in the system (waiting and/or being served). The system utilization The average time customers wait in line The average time customers spend in the system (waiting in line and service time). Service time The probability of zero units in the system The probability of n units in the system The number of servers (channels) The maximum expected number waiting in line.
The mathematics of queuing can be complex; for that reason, the emphasis here will not be on the mathematics but the concepts that underlie the use of queuing in analyzing waiting-line problems. The study shall rely on the use of formulas and tables for analysis. There are certain basic relationships that hold for all infinite-source models. Knowledge of these can be very helpful in deriving desired performance measures, given a few key values. It is necessary to review some of the basic relationships as follow: System utilization: This reflects the ratio of demand (as measured by the arrival rate) to supply or capacity (as measured by the product of the number of servers, M, and the service rate, ). p =
... M
The average number of customers being served: r =
The average number of customers: Waiting in line for service: Lq (Model dependent and could be obtain using a table or formula) and in the system (line plus being served): Ls = Lq + r ..... 4
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The average time customers are: Waiting in line: Wq = 1 Lq
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5 6
In the system: Ws = Wq +
All infinite-source models require that system utilization be less than 1.0; The models apply only to underloaded systems. The average number waiting in line, Lq, is a key value because it is a determinant of some of the other measures of system performance such as the average number in the system, the average time in the line and the average time in the system. Hence Lq will usually be one of the first value to determine in tackling the problem of optimum capacity determination in queuing system. The arrival of customers can be assumed to be poisson distributed while service time assumes exponential distribution. According to Waters (1989), random occurrence could be described by a poisson distribution where the probability of (r) number of events P(r) is calculated as P(r) = e r .... 7 r
Formulas for other performance measures are:

Average number in line Probability of zero units in the system
Lq =
2 ( )
Po = 1 9 Pn = Po
n
Probability of n units in the system
10
n
Probability of less than n units in the system P< n
=1
.. 11
On the other hand, if the mean arrival rate is greater than the mean service rate or if the queue lengths are unacceptably long, the service offered can be improved by increasing the number of servers M. Here, customers arrive and join a single queue, whenever a server becomes free, the next customer in the line is served. The assumptions are that:- n identical servers, random arrival, random service time, first come first served discipline, the system has reached its steady state, there is no limit to the number of customers who use the service, all customers wait to be served and the total service rate is greater than the total arrival rate.
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Through Waters (1989) states his own notations for operating characteristics of a multi-server (channel), this study considered and adopted the formulas for multi-channel queuing model presented by Stevenson (2002) as indicated below:
Po ............... 12 = ( M 1)!( M ) 2
M
Average number in line
Lq
M 13 Probability of zero nits in the system M !1 M 1 Average waiting time for an arrival not immediately served Wo = 14 M
M 1 Po = n =0
+ n!
Probability that an arrival will have to wait for service
Pw =
Wq Wo
. 15
REVIEW OF COST ANALYSIS IN QUEUING SYSTEM
The design of a service system often reflects the desire of management to balance cost of capacity with the expected cost of customers waiting in the system. (Note that customer waiting cost refers to the costs incurred by the organization due to customer waiting). In designing service system for banking operations, the costs of facilities and servers must be balanced against the cost of customers that will be in the system, both while waiting to be served and actually being served. According to Buffa and Dyer (1977), when the arriving units are customers, clients, or patients, the cost of making them wait is less obvious. If they are customers, excessive waiting may cause irritation and loss of goodwill and eventually sales. Placing a value on goodwill, however is not a straightforward exercise. In public service operations and monopoly situations, the valuation of waiting cost may even be more tenuous because the individuals cannot make alternate choices. In these situations, Buffa and Dyer (1977) aver that where objective costs cannot be balanced, it may be necessary to set a standard for waiting; for example, to adjust capacity to keep average waiting time at or below a given number of minutes.
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The optimal capacity (usually in terms of number of channels) is one that minimizes the sum of customer waiting costs and capacity or server costs. Thus, the goal is
Minimize Total cost = Customer + waiting cost Capacity . 16 cost
The simplest approach to a cost analysis involves computing system costs, that is, computing the costs for customers in the system and total capacity cost. An iterative process is used to identify the capacity size that will minimize total costs. Capacity is incremented by one unit at a time (e.g., increase the number of channels by one) and the total cost is computed at each increment. Because the total cost curve is U-shaped, usually, the total cost will initially decrease as capacity is increased and then it will eventually begin to increase. Once it begins to increase, additional increases in capacity will cause it to continue to increase. Hence, once that occurs, the optimal capacity size can be readily identified. The computation of customer waiting costs is based on the average number of customers in the system. This is perhaps not intuitively obvious; instead, it might seem that customers waiting time in the system would be more appropriate. However, that approach would pertain to only one customer as it would not convey information concerning how many customers would wait that long. It is then very crucial to determine the cost of applying any number of servers in a queuing model so as to optimize the operation cost of service centres, enhance customers satisfaction with respect to time of service and returns on investment
TOTAL EXPECTED COST AND COST BALANCE
Most managers recognize the trade off that must take place between the cost of providing good services and the cost of customers waiting time. They want queues that are short enough so that customers do not become unhappy and either storm out without being served or received services and never to return. However, the customers may be willing to allow some waiting in the line if it is balanced by a significant savings in service. Service costs seem to increase as a firm attempts to raise the level of service. Cost of waiting time decreases as service improves in speed.
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Total expected cost Cost of providing service Cost of waiting line Service level
Optimum service level
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Figure 2. Cost of queuing system
At this juncture, it is pertinent to classify the cost associated with queues into two broad categories as follow:i. Service cost which include:- servers cost i.e. the money paid to people required to provide the service, the cost of better equipment or facility and the cost of provision of more service points. ii. Queuing cost which include:- cost of the idle time due to waiting, particularly important where the queues are formed by firms own employees e.g. lost sales due to customers going elsewhere on seeing long queue. It must not be assumed that the best situation is to plan for no queue at all. The cost of providing and maintaining service facilities must be compared with the cost of some queuing. The more service facilities that are provided inevitably mean that they will be idle for some of the times. The balance between service and queuing is often a matter of judgment. Also, the cost of operating each type of queuing system structure and the benefit accruable from them is a matter of cost analysis.
METHODOLOGY
The study used a survey technique, area and random sampling procedures. It was motivated by the existence of long queues in the banks and such deserves thorough analysis so as to determine the number of servers require to optimize the objective function of the bank and enhance the level of service for customers satisfaction. The survey was conducted with time study instrument and covered a total of 20 operating commercial banks located in the South East geopolitical zone of Nigeria. A random sample of 4 commercial banks was selected from each of the 5 states in the zone. The method of data analysis was adopted from Stevenson (2002). The critical variables collected are the mean service rate of the bank staff, mean wage paid to servers per hour, cost of service facility per hour, the mean arrival rate of the customers, and
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average number of customers each day etc. The data was presented and numerically analysed as shown below. The service costs here were limited to wage paid to servers and cost of service facility.
DATA PRESENTATION AND ANALYSIS
The following mean estimates of data were recorded from the commercial banking services and operations.
(i) (ii) (iii) (iv) (v) (vi) Average number of working hour per day Average cost of service facility Average daily wage paid to each server Average number of customers per day Average service rate Mean arrival rate = = = = = = 8 hours = 480 minutes N8000 per day = N1000 per hour N4000 = N500 per hour 1200 150 customer per hour 26 customers per hour
DETERMINATION OF OPTIMAL CAPACITY AND SERVICE COST ANALYSIS
There is no steady state for the system since > . From a table of infinite source values for Lq and Po, and with the calculated value of
; M values were
obtained and used for the computation of total cost used in the determination of minimum cost and corresponding optimal capacity. The number of servers that give the minimum cost establishes the optimal capacity for the system. M and Lq values were deduced from the table, given,
150 = = 5.8 . From the 26
table, numbers of servers M provided are 6, 7, 8, 9, 10, 11, 12, Lq values are; 26.373, 2.648, 0.823, 0.303, 0.116, 0.044, and Po values are 0.001, 0.002, 0.003, 0.003, 0.003, 0.003.
Table 3: Service cost analysis and optimal capacity determination
Numbers of servers M Servers wage per hour (x N500) Average number of customers in the system
L s = Lq +
Cost of service facility per hour (x N1000)
Total cost (N)
Systems utilization
6 7 8 9 10 11 12
3,000 3,500 4,000 4,500 5,000 5,500 6,000
26.373 + 5.8 = 32.173 2.648 + 5.8 = 8.448 0.823 + 5.8 = 6.623 0.303 + 5.8 = 6.103 0.116 + 5.8 = 5.916 0.044 + 5.8 = 5.844 0.017 + 5.8 = 5.817
32,173 8,448 66,623 6,103 5,916 5,844 5,817
35,173 11,948 10,623 10,603 10,916 11,344 11,817
96.15 82.42 72.12 64.10 57.69 52.45 48.08
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Service cost = servers wage + cost of facilities. From the analysis, the optimal capacity is 9 servers at the minimum total service cost of N10,603 per hour and system utilization of 64.10%. From the cost analysis above, an optimal system capacity can be design with nine servers as indicated in the table above. Nine servers indicated the least total operating cost of N10,603 per hour.
DISCUSSION OF RESULT
There are many applications where analysis of queues could be beneficial. The objective of this analysis usually includes some balance between a high quality service level with a large number of servers (which is expensive but keep queues short) and a low quality service with few servers (which is cheap, but causes long queues and can lead to lost of customers). However for banks that maintain the system performance measures approximately or equal to the one that resulted in this analysis, minimum cost of operation will be achieved with 9 servers. In order to operate optimally in service stations, the number of sever in a system will depend on the estimated mean length of the queue and the available service capacity. If the queue length is short or/and the service rate and capacity are high, there is no need for employment/adoption of multiserver queuing system in order not to increase the operation cost of the services. The profits and benefit realizable in a queuing system structure are functions of total operating cost of the service station. Under optimal condition, many servers implies higher quality service level and higher operating cost. This is only ideal where the queue length is always long enough to optimally utilize the capacity of the facilities, and profit contribution per customer is reasonable.
CONCLUSION AND RECOMMENDATIONS Determination of optimal capacity is very necessary for the application of multiservers queuing system structure in a service station. Mere guess work will not provide the cost effective strategy necessary to optimize the objective function of the organization. This is so because queue lengths in most service stations fluctuate from day to day; some days very long, while in some days very short or no queue at all. The number of servers to employ is therefore a matter of judgment. In such a situation, this paper recommends that such a peak and valley values of queues length in which organizations experience an different days should be studied, analyzed and simulated for a period not less than one month. The analysis would help in the determination of
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optimal capacity and the number of servers for enhanced service delivery in the organization. With the utilization of 64.10%, it is easy to demonstrate that full utilization is undesirable, but managers often have difficulty justifying utilization rates which are far below 100%. The analysis can help managers to determine and justify the level of system utilization. The result is in conformity with Mendelson (1985), who states that taking delay cost into account, seemly low utilization ratios are often optimal. In practice, queuing problems can be very complicated with different distributions for arrival and service times, arrival rates which vary over time, interconnected queues, varying availability of servers, and so on. The models of such systems are often very complicated and difficult to solve. Fortunately, there exist computer application packages/softwares to handle some queuing problems. An example is the quantitative modeling (QM) for windows package. This allow the descriptions of queues to be specified and the operating characteristics or performance measures are calculated automatically.
PROCESS DESIGN CONSIDERATIONS IN PROJECT QUALITY
MANAGEMENT
At the strategic level, the major decisions concerning the production and operations are those concerned with the design of physical processes for producing quality goods and services at the required quantity, within budget and schedule. These decisions encompass the selection of a process, choice of technology, process flow analysis and layout of the facilities. According to Telsang (2005) process design is a macroscopic decision making of an overall process route for converting the raw materials into finished products. The important decisions in process design are to analyse the workflow and select the workstations for converting raw materials into finished products. Technology which is a key factor in process design is referred to as the application of knowledge to solve human problems. Technology in a narrower sense is defined as set of procedures, tools, methods, procedures and equipment used to produce goods and services. Managers should be aware of the knowledge of performance characteristics of technology that they manage. The performance characteristics include possible effects of technology on inputs, outputs, process flow and costs, which can be evaluated by the managers.
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Process selection is a higher level strategic decision as it affects layout, cost, quality and flexibility of operations. Telsong (2005) asserts that process once selected with bind the organization with equipment, facilities and particular type of labour force, which limits future strategic actions. Process design decisions such as choice of technology, process selection etc provide the necessary process capability that could enhance project quality management. Stevenson (2000) defines process capability as the inherent variability of process output relative to the variation allowed by the design specification. Specifications provide a range of acceptable values established by engineering design or customer requirement. Process variability which is natural or inherent variability in a process can significantly impact quality (Stevenson 2000). Process variability is the key factor in process capability. For a process variability that exceeds specifications, a manager might consider a range of possible solution such as (i) redesign the process so that it can achieve the desired output (ii) use an alternative process that can achieve the desire output (iii) retain the current process but attempt to eliminate unacceptable output using 100% inspection (iv) examine the specifications to see whether they are necessary or could be relaxed without adversely affecting customer satisfaction.
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References
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Buffa E.S. and Dyer (1977) Management Science/Operations Research. Model Formulation and Solution Methods. John Wiley & Sons New York. Cadle J. and Yeates D. (2008) Project Management for Information System. Fifth Edition. Pearson Prentice Hall www.pearsoned.co.uk. Deshmukh S.D. and Jain S. (1976) Capacity Design and Service Quality Control in a Queuing System. Operations Research Northwestern University, Evanston, Illinois. Vol. 25 No. 4. Mendelson H. (1985) Pricing Computer Services: Queuing Effects Communication of ACM, Vol. 28 No. 3. Render B. and Stair R. (1982) Quantitative Analysis for Management (2nd Edition) Allyn and Bacon Inc. Massachusetts, U.S.A. Stevens R. (1998), Systems Engineering; Coping with Complexity, Prentice. Hall Inc. Eaglewood, Cliff, New Jersey. Stevenson W.J. (2002) Operations Irwin.www.mhhe.com. Management; Seventh Edition. McGraw-Hill,
Walter J.G. and Willian E.B. (1978); Engineering Modelling and Computation, Houghton Miffin Company. Waters C.D.J. (1989); A Practical Introduction to Management Science; Addison-Wesley Publishing Company. Wu L.G. (1990) Manufacturing System Design and Analysis, Willy Publications Illosin U.S.A.
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The Effect of Relationship Marketing Dimensions by Customer Satisfaction to Customer Loyalty Shahram Gilaninia (Corresponding Author) Assistant professor , Department of industrial management, Rasht Branch, Islamic Azad University, Rasht, Iran Hasanali Shahi Master of Islamic Azad university , Department of Business management, Rasht Branch, Islamic Azad University, Rasht, Iran Seyyed Javad Mousavian Master of Islamic Azad university , Department of Business management, Rasht Branch, Islamic Azad University, Rasht, Iran Abstract According to private banks activation and markets fragmentation communications and information development at the international level and customers being more informed and expert today customers absorption and maintenance in banking industry has been complicated by many degrees and only those banks whose activities main pivot is customer absorption and maintenance benefit from a good position in competition arena. In such situation this question is raised whether using relational marketing in country banking industry can influence customers loyalty through customers satisfaction. The aim of this research is examination of stronger dimensions of relational marketing upon insurance customers loyalty which is considered on the basis of a model offered by Doisy including reliance commitment communications and confliction control. Current research is of causative type and research statistical assembly includes total customers of Ardabil province bank branches. Questionnaire gathered data were examined by using LISREL software in structural equation modeling style and all of the assumptions were confirmed. Keywords: Marketing Relationship, Customer Satisfaction, Customer Loyalty, Structural Equation Modeling Introduction Current arena is the period of accelerated and unpredictable evolutions and companies confront with the most difficult and unprecedented competition conditions due to existence of such factors like uncertain boundaries among markets more fragmentation of markets shortened product consumption period accelerated variation of customers purchasing paradigms and customers being more expert (Wong and shoal,2002,34-50). In this direction only those organizations whose activities main pivot is providing customers requirements and satisfying their needs will benefit from a good position in competition arena since elevated level of customer satisfaction leads to his more loyalty (Lavlak&Rait,2003). Today customers absorption and maintenance in the country banking industry has been complicated due to activation of private banks companies and development of communications and information at the international level which gives this opportunity to people to compare various insurance companies all over the world (Amirshahi,2007). So banks nature necessitates appropriate strategies and solutions to absorb and maintain customers. Because durance and existence of these companies depends upon their customers and the more they try to maintain their customers the
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more successful they will be in long term. The main viewpoint of customer maintenance is that one should acquire customer satisfaction by continuously offering him superior value (Kotler,2001,8). One of these ways is using relational marketing (Bose&Bansel,2007,63-70). Relational marketing is a strategy to surmount services intangibility especially in the case of services like insurance that estimation is difficult for customers even after use and purchase (Crosby & Stephen ,2001 ,404). In spite of emphasize upon relational marketing importance and existence of various studies around relational marketing main topic to make this concept applicable still is ambiguous.
Literature review Considering this fact that suppliable services in commercial banks are almost the same and to most banks it is difficult to make these services distinct from rivals services so many of world banks have moved toward relational marketing approach (So&Speece,2000). The concept of relational marketing for the first time was pointed out in an American literature in berry article, 1983. Berry considered relational marketing as a strategy to absorb maintain and strengthen relation with customer (Wong&sohal,2002) ( Kotler&Armstrong,1999). Gronrooz has defined relational marketing as the process of identification creation maintenance strengthening and in the case of necessity terminating relationship with customers and other beneficiaries in a reciprocal profit so that all group goals are realized in this regard (Gronroos,1994). Although there are different interpretations of relational marketing concept by various researchers its advantages and influences upon organizations performance improvement should not be concealed from views. For example results obtained from seen and others examinations show that foundations or roots of relational marketing such as reliance social relations communications mutual values sympathy and reciprocal attempt has had positive and significant impact upon sales growth market share and ROI in these companies(Sin et al.,2002). Kastler describes loyalty as a constant commitment towards family country or friends and believes that for the first time this term entered marketing literature with commercial name emphasizing upon loyalty (Kotler,2003). In conceptual sense customer loyalty includes three dimensions of behavioral perceptual and synthetic. Behavioral dimension of loyalty emphasizes customer behavior in repetition of purchase. Perceptual dimension means extend of desired and appropriate inclination towards a supplier of service. At last synthetic viewpoint of loyalty combines perceptual and behavioral dimensions definitions of loyalty (Zins,2001). Different researchers have considered various foundations for relational marketing. Chew in his search has introduced three classes of variables as relational marketing foundation for banking industry which includes financial connection social connection and structural connection (Chiu,2005). Seen and his colleagues in a research identified reliance communications mutual values sympathy and reciprocal attempt as most important roots of relational marketing (Sin & et al.,2002). Rashid in his research has introduced reliance commitment social relations sympathy positive experiences fulfilling commitment and communications as primary variables which form relational marketing (Rashid,2003). Relational marketing aim is creation and maintenance of durable relations between company and its customers so that it is satisfactory for both sides (Ndubisi et al.,2005,49). According to many researches carried out in the field of relational marketing in each of these researches key dimensions has been considered
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including reliance equality commitment sympathy proficiency communications home relational marketing fulfilling promise good experiences social connections customer satisfaction conflict control and taking part in relational marketing. In this research we focus on stronger dimensions which have already been identified Doisy in 2007 introduced them like this: reliance (Morgan and hanta, 1994 ; Wang and sohan, 2002 ; wolotso, 2002 ; Rashid, 2003), commitment (Morgan and hanta,1994 ; Rashid, 2003 ; dobisy, 2004 ) communication (kerasby, 1990; morgan and hanta, 1994; Rashid, 2003 and dobisy, 2005) and confliction control (dyvir, 1987 and dobisy in2005 ) (Ndubisi et al,2007,99). According to moon and minor viewpoint loyalty variable is the extent of customers adherence to a particular brand good or service and purchase aim is defined in the future (moon and minoz, 1382,422). There are three approaches to measure loyalty: behavioral, perceptual and synthetic approaches. Behavioral measures assume repetition of purchasing behavior as loyalty index. Perceptual measures deal with loyalty sense and synthetic measures measure loyalty by means of customers preferences for a product, inherent inclination to exchange, purchase repetition and total amount of purchase (Bowen,2001). In this study to measure customer loyalty perceptual approach is applied. Research problems According to private banks activation, competition development and communication and information development at international level, today absorption and maintenance of customers in the country banking industry has been complicated by many degrees that itself led to reduction of banks interest. Richard and Sesser, 1990, declared that a decrease of 5% in customer number will lead to banks loosing 50% of their profit. According to carried out studies, 5% increase in maintenance of current customers will increase company profit by 25 to 125% (Beerli & et al, 2007,235-275). So, customers loyalty is a significant factor in banks business success. Important point is that loyal customers bring about various advantages, such as company profitability improvement, marketing expenditure reduction, company sales increment, having customers with low price sensitivity and etc. .(Kandampully&Suhartano, 2006,346-351) Oliver defines loyalty as a profound commitment to frequent purchasing or encouraging others to buy products or services (Oliver,1999,33-34). Relational marketing ia a strategy to surmount services intangibility especially in the case of services like bank that assessment is difficult for customer even after purchase and use (Crosby & stephens,2001 ,404). According to interviews done with banks managers, to find dimensions of relational marketing influencing upon customers loyalty is one of the challenges before them. In this study, reliance, commitment, communications and conflict control are considered as dimensions of relational marketing based on Doisy model, 2007. Reliance shows the extent to which one side of relationship can count on the other side promises and pledges and is defined as an inclination to rely on and trust in addressee (Wong and shoal,2002,34-50). Commitment: one sided intention and determination to continue or maintain relation with the other side (Rashid,2003,742-750). Communication: all of the formal and informal contacts that lead to exchange of meaningful and pertinent information between sellers and buyers and eventually conflict control is defined as supplier capability in minimizing negative results of apparent and potential confliction (Ndubisi,2007,98-100). So this study deals with relational marketing dimensions through impacts of customers satisfaction upon extent of their loyalty in Ardabil province banks and main issue is as the following:
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Does relational marketing have any impact upon the extent of bank customers loyalty through effectuality? Conceptual model On the right side of model, relational marketing dimensions include reliance, commitment, communications and conflict control which are independent variables in research. In between, customer satisfaction variable is placed as modifying variable and on the left customer loyalty is placed as dependent variables. And the assumption is that reliance, commitment, communications and conflict control have impacts upon satisfaction and loyalty of customer (Ndubisi et al,2007,101). Trust
Commitment Customer satisfaction Customer loyalty
Connection
Conflict
Figure 1. Proposed framework

Research questions Given the above theoretical model, to achieve the research objectives, answer the following questions to be considered. 1- Does Trust dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction? 2- Does Commitment dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction? 3- Does Connection dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction? 4- Does Conflict dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction? 5- Does customers satisfaction influences the extent of bank customers loyalty? Hypotheses Given the above theoretical model, to achieve the research objectives, the following hypotheses can be raised include: 1- Trust dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. 2- Commitment dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction.
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3- Connection dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. 4- Conflict dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. 5- Customers satisfaction influences the extent of bank customers loyalty. Methods and data collection This study is the type of field research and the library.Statistical populations are the total number of customer in the bank of Ardabil about 119000 in 2011 year and considering that the population is limited and unclear, Morgan is used to determine the sample size table. For 119000 the number of cases, the sample size is 384 people and 384 questionnaires were distributed of which 379 units were collected and analyzed. Also in this research the distance scale is measured in this study was to test the hypothesis test of structural equation modeling was used.
Questionnaire validity and reliability Validity or credibility of the answer to this questions that measuring to what extent the desired trait measures. (Sarmad and et al, 2002) In the survey questionnaire to determine if the data needed to test the research hypotheses can gather, the views of faculty advisors are used. To determine the reliability of the final distribution of a preliminary study by distributing questionnaires among 40 customers of banks, and then through the Spss software, Cronbach's alpha coefficient was calculated over the value of is 79 percent. So we can say that the questionnaire has suitable and good reliability.( Table 2)
Table 2. Questionnaire Reliability Case Processing Summary
N Cases Valid Excluded Total
a
% 100.0 .0 100.0
40 0 40
Reliability Statistics
variable Trust commitment Connection Conflict Satisfaction Loyalty
Cronbach's Alpha .801 .850 .802 .708 .734 .837
Results of the test research hypotheses The results of this study are presented in two parts: descriptive and inferential statistics. The results are shown in table 3 and 4.
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A) Results of the descriptive statistics
Table 3. Descriptive Statistics
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Trust commitment Connection Conflict Loyalty
N 379 379 379 379 379
Mean 20.46 12.61 13.49 10.84 22.66
Std. Deviation 6.18 4.29 4.43 3.26 3.64
Minimu Maximu m m 6.00 30.00 4.00 20.00 4.00 20.00 3.00 15.00 3.00 15.00
B) The results of inferential statistics Research causative model test
Figure 1.The standard test
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Figure 2. Structural equation modeling in situation of (t-value)
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Table 4. Confirmatory factor analysis: Measurement model
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Indicators
Value 1830/54 339 0.077 0.73 0.74 0.77 0.72 0.69 0.64 5/39
2
df RMSEA CFI IFI GFI AGFI NFI NNFI PGFI
d

f 2
GFI: Good of Fit Index AGFI: Adjust Goodness of Fit Index CFI: Comparative Fit Index NNFI: Non Normed Fit Index RMSEA: Root Mean Square Error of Approximation
H1: Trust dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. By referring to t-value amounts table it is shown that t-value amount equals 4/49 which is more that absolute value 1/96 so assumption 1 is confirmed and impact of Trust upon the extent of bank customers loyalty through influencing customers satisfaction is 0/ 27. H2: Commitment dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. By referring to t-value amounts table it is shown that t-value amount equals 2/01 which is more that absolute value 1/96 so assumption 2 is confirmed and impact of Commitment upon the extent of bank customers loyalty through influencing customers satisfaction is 0/ 15. H3: Connection dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. By referring to t-value amounts table it is shown that t-value amount equals 3/02 which is more that absolute value 1/96 so assumption 3 is confirmed and impact of Connection upon the extent of bank customers loyalty through influencing customers satisfaction is 0/ 27. H4: Conflict dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. By referring to t-value amounts table it is shown that t-value amount equals 4/35 which is more that absolute value 1/96 so assumption 4 is confirmed and impact of Conflict
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upon the extent of bank customers loyalty through influencing customers satisfaction is 0/ 23. H5: customers satisfaction influences the extent of bank customers loyalty. By referring to t-value amounts table, t-value amount is shown to be 7/91 which is more than absolute value 1/96, so assumption 5 is affirmed. And the impact of customers satisfaction upon the extent of bank customers loyalty is 0/9. Table 5: Research finding
Research hypotheses standard assessments value - t Hypotheses status
H1: Trust dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. H2: Commitment dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. H3: Connection dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. H4: Conflict dimension have any impact upon the extent of customers loyalty through influencing customers satisfaction. H5: customers satisfaction influences the extent of bank customers loyalty.
Examination of model equations
0.30 0.17 0.30 0.26 0.9
4.49 2.01 3.02 4.35 7.91
confirmed confirmed confirmed confirmed confirmed
R = 0.80
loy = 0.90*satis
Examination of defining coefficient of model by using above equation shows that 80 percent of loyalty variations are defined by satisfaction variable which is a good amount. satis = 0.30*trust + 0.17*commit + 0.30*connection + 0.26*conflict , R = 0.62 Also examination of the model defining coefficient indicates that 62 percent of satisfaction variations are defined by variables reliance, commitment. Communications and conflict control. Examination of obtained defining coefficients shows that research model primarily covers key variables influencing loyalty.
Summary and conclusions According to results obtained from structural model, since all of the assumptions were confirmed it can be concluded that: i. Reliance dimension has an indirect impact upon the extent of bank customers
loyalty up to 27% So it is suggested that banks instruct their employees to exert
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adequate accuracy in accomplishing their duties, also, banks should apply modern technologies to fulfill their promises and pledges in order to abide by their commitments towards customers and fulfill their pledges as soon as possible. ii. Commitment dimension has an indirect impact upon bank customers loyalty up to 15%, so it is suggested that banks do some measures to create commitment and make their services compatible with each customer needs, for this sake, it is suggested that bank management and employees identify each customer needs by establishing long term and stable relationship and do some measures to support customers with required and special services. iii. Communication dimension has an indirect impact upon bank customers loyalty up to 27%. So it is suggested that banks make their attempts to increase customers loyalty for creating effectual relations and it is suggested that banks , at the time of supplying new services, deliver necessary information on time through various media. Banks supports customers with pertinent and reliable information through providing and distributing customers guide booklets. iv. Conflict control dimension has an indirect impact upon bank customers loyalty up to 23%. So it is suggested that banks hold some special trainings about how to confront with customers and pay some appreciative bonus to their employees and promote key variables such as reliance, commitment and communication. v. Customers satisfaction variable has a direct impact upon bank customers loyalty up to 9%. So it is suggested that banks recognize variables like relational marketing dimensions which influence customers satisfaction and examine or improve it to increase their customers satisfaction.
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References Beerli, A. Martin, J.D. and Quintana, A (2004),"A Model of customer loyalty in the
Retail Banking Market", European Journal of Marketing Vol, 38 No. 1/2, pp. 235-275. Bowen, J.T. and Chen. S.I. (2001)," The relationship between Customer loyalty and customer satisfaction", International Journal of contemporary Hospitality Management, Vol.13 No.5, pp .213-217. Crosby, Lawrence A. & Stephens, Nancy (2001),"Effects of relationship marketing on satisfaction, and prices in the life insurance industry", Journal of marketing research, Vol.XXIV.pp404. Gronroos, chiristian (1994), "Keynote paper From Marketing Mix to Relationship Marketing towards a paradigm shift in marketnif", management Decision, Vol. 19 No. 2, pp, 332-339. Kandampully, J and suhartanto, D. (2000)"Customer loyalty in the hotel industry: The role of customer satisfsction and Image, international Journal of contemporary Hospitslity management, Vol, 12No, 9, pp .346-351. Lavlak,Kristofer., Rait, laren.(2003). The principle of marketing and services , translator: Tajzadeh,Tehran,first edition. Moven,jan si., S minor, mishel.(2007). Consumer behavior , translator: Ardastani,ettehad publication,first edition. Ndubisi, N.O. (2007)"Relationship marketing and customer loyalty" Marketing intelligence & planning, vol.25No.1p98-106. Oliver, R.L. (1999),"Whence consumer loyalty?" Journal of marketing, Vol.63, pp.3344. Rashid, Tahir (2003)"Relationship marketing: case studies of personal experience of eating out", British food journal, Vol.105, No.10.pp.742-750. Sarmad, Zohreh, and Bzargan,Abbass and Elhe,Hejazi, A, 2002, "Research in the Behavioral Sciences", published by the AGAH, Fifth Printing. Wong, A.and shohal, A. (2002).An examination of the relationship between trust, commitment and relationship quality, International Journal of retail & Distribution Management, Vol.30No.1, pp.34-50.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Provisions of bankruptcy in the commercial Saudi law and its compatibility with Islamic jurisprudence
Dr. Khalid Eid Al-Taif University
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Abstract This paper focus on Provisions of bankruptcy in the commercial Saudi law and its compatibility with Islamic jurisprudence. It also focus on link of bankruptcy provision and its relation with Islamic jurisprudence. Keywords: Provisions ; Bankruptcy ; Commercial Saudi law ; Compatibility ; Islamic Jurisprudence Introduction Commercial transactions is met with great concern by legislatives all around the world due to its importance as it is linked totally to the macroeconomic on the state level and to microeconomics on the individual & organizational level, also it is considered as a capital circulator inside the community . As we reached the globalization age with all in it from open economy to the emerge of world trade organization there are more commercial and economic transactions exchange between countries and organization all over the world, also it resulted in the spread of multinational corporations in the world, the huge advance in information & telecommunication technology led to the emerge of E-Commerce as a reason of all this many countries amended their laws and in some cases they legislated new ones in order to rule disputes resulting from those activities specially as they facilitated the capital transition process in addition that the markets are overcrowded with services and commodities in an unprecedented way. It is known that the goal from the commercial transaction is to gain profit, a goal that should result in achieving economic growth and social prosperity. But the truth must be said that every coin have two faces and every action have two effects one positive and the other negative, thats why the word profit has an opposite the word loss, the merchant may not be the reason of the loss but external factors that overcomes his well, thats why the merchant is vulnerable during his work to massive financial shocks leaving him unable to complete his trade tasks like buying merchandise and fulfilling his debts, and then there is no escape from declaring his bankruptcy. This research will focus on the reasons of the merchant bankruptcy and its kinds, in addition to the effects on debtors and who are alike under the Saudi commercial law and its conformity with the law scripts related to this research with Islamic jurisprudence. Research importance: The culture of nations plays an important role in all their life aspects, many times we have seen some outrageous acts done by some nations seen by them as something desirable but not acceptable and outrageous from the point view of another nation this disagreement in point views results from cultural variance between two nations, because of that heads of state represented by the legislative and executive councils have an obligation when they are forming the laws and systems that organizes the life,
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transactions and individual interrelations with each other and the government itself to consider cultural values built in the individuals. In a state like kingdom of Saudi Arabia that obtains gods holy shrine which attracts people from all around the world its legislative laws must have the highest compatibility with Quran scripts, the prophet Hadeeth (sayings) and the opinions of Muslim Scholars. From here comes the importance of this research as it searches the compatibility between the law scripts related to bankruptcy as mentioned in the Saudi commercial law and the Islamic resources from Quran and prophet Hadeeth/sayings and Islamic law jurisprudence.
Research objectives: This research aims for the following: 1. To make acquaintance to merchant bankruptcy provisions in accordance to Saudi commercial law known as commercial court system for the kingdom of Saudi Arabia. 2. Foucusing on the view of Islamic legislations and Islamic jurisprudence from jurisprudence provisions of bankruptcy point of view. 3. Searching in the level of compatibility between Saudi commercial law and the Islamic jurisprudence in the bankruptcy field. Research methodology: This research was accomplished in the descriptive approach method based upon the scripts of the Saudi commercial law and the jurisprudence provisions related to merchant bankruptcy. Research problem: The bankruptcy declaration might have some positive effects, at most thy are negative on the creditors and whom are alike because of that this problem of the research will focus on creditors and others alike from the point view of Saudi commercial law in comparison with Islamic jurisprudence. Previous studies: 1. Al-khadmi study (2011) addressed:Banktrupcy provisions in Yemeni Islamic and law jurisprudence, comparison study. This study aimed to make a comparison between jurisprudence provisions and especially upon seizure provision upon bankruptcy in the Islamic jurisprudence and between the related Yemeni laws like the commercial law and the civil law .the researcher came to the following result: The seizure upon the bankrupted is something explicitly proved in the sunna and in the khalifas doings, the wisdom from the seizure whether in the Islamic jurisprudence or in the Yemeni law is to conserve the others rights from being lost ,noting that the seizure doesnt take place unless it is ruled by the judge, it is also required to prove that the bankruptcy of the debtor by legislation and law means, and then he is prohibited from taking action in his money in all that could harm his creditors . After the ruling of bankruptcy is taken, the ruler takes the act of selling the money of the bankrupted and divide the outcome by share percentage, also the differed debts wouldnt be solved legist lively until its due, and when the debit is due before the
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outcome is divided then the creditors enter the division with their shares alongside the other creditors. 2. Al-dhabi study (2010) addressed: retail & wholesale bankruptcy. The research aims to differentiate between bankruptcy and the financial distress. The researcher says that the meaning of bankruptcy in in Arabic language is the lack of money existence and transition from financial ease to financial hardship, and in law it means a law declaration issued from the specialty court declares that normal person or a juristic person has become completely unable to pay his debts. And then the researcher adds that bankruptcy could be caused from various reasons like mismanagement, compelling circumstances the human being could not face like natural disasters and wars. The difference between bankruptcy and financial distress from the point view of the researcher is that bankruptcy is a legal declaration of complete incapability of debt paying ,on the other side the financial distress is facing difficulties in paying due debts that does not stand for the level complete incapability of debt paying, also the most important variance between these two cases is that bankruptcy results in seizure procedures in the mean time the financial distress doesnt have such procedures. Abu-Alshamat study (2010) addressed: bankruptcy provisions in the Syrian law and some other Arabic laws This study aims to uncover the areas of converge in the applicable commercial laws in some of the Arabian countries especially in legal scripts is related to bankruptcy. The researcher says that the Syrian legislator managed to process the bankruptcy provisions in the commercial law no.149 issued in the date 22scd of June 1949 where most of its provisions were quoted from the French law with all its modifications till the date the Syrian law was issued. The Syrian Legislator was keen to approximate between this law and the ones issued in the Arabic countries, where we find most of the subjects and the bankruptcy as one of them are similar to the Lebanese, Iraqi and Egyptian on a high level. The Syrian Legislator aimed from this to unite the legistlation in the Arabic countries and to remove the conflicts between them, and here the researcher indicates that the Syrian Legislator taken the bankruptcy provisions and the preventive magistrate from the fifth book of the commercial law materials 774-576, in Kuwait the bankruptcy provisions and the preventive magistrate were taken from the commercial law issued in the year 1962 from its materials no.800-555, in Tunisia the commercial magazine that contains the Tunisian commercial law issued in the year 1959 was allocated to study the reserved magistrate and bankrupting ,it is also the case in morocco and Egypt the bankruptcy provisions were mentioned in their commercial law. The researcher considers this kind of various laws as a similarity where the bankruptcy provisions and the preventive magistrate were mentioned in the commercial laws in those countries instead of being distributed on various laws in order to prevent mixing and confusion, in the bankruptcy declaration of the merchant the Syrian legislator sets a condition to the ruling by bankruptcy declaration and that demands that the debtor must
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be a merchant and he has to be fully stopped from paying his debts, and then the Syrian Legislator defines the merchant as a person that takes commercial business as a career, and in this we have a big similarity with the Saudi Legislator for the merchant as mentioned in appendix no.1 chapter 1 from the commercial court system for the kingdom of Saudi Arabia which defined the merchant as a person who works in commercial business and have taken it as a career. Maashi study (2005) addressed the effects of bankruptcy declaration ruling on debtors. The study aims to illustrate the legal effects on the creditors as a result from the debtor bankruptcy declaration ,the researcher defines the creditors as a group of right owners whom there rights emerged from there previous transactions with the bankrupted person ,there might be a long term contract between the bankrupted before he is bankrupt and one of the right holders(creditors) and the relations become interfered between rights and liabilities even after bankruptcy declaration, as an example that this right holder had trusted the bankrupted merchant on some money or merchandize or some assets before the merchant is bankrupted and he didnt receive its price, so he requests for his merchandize or money that he trusted before ,and here the creditors must take a decision . And here comes the dispute between creditors .some would request to revoke the contract because the debtor is bankrupted in the same time bankrupting agent would see an interest to execute the contract in the favor of the creditors ,creditors may request from the right owners to prevent any selling depriving the group of creditors from adding it to be added for the public right ,another group could demand its right to redeem all that they own from the bankrupted in relation to their pre agreement with the bankrupted. If the claimed debt was merchandize that was delivered to the bankrupted before being bankrupted and he sold it without receiving its price then the relation becomes between the owner and the buyer where law material no.313 from the Algerian commercial law says that owner in this case can raise a an indirect law suit on the buyer. Al-shubaili study (2010) addressed: companies bankruptcy and there financial distress in the jurisprudence and the system The study aims to differentiate between bankruptcy and bankrupted, the relation between them where the researcher says that bankruptcy is done by debtor himself by taking more debts than what he owns ,on the other side the bankrupted is a judge ruling that the person is broke, and here he says that the first one is a cause of the second and then he indicates about the relation between those two terms from a jurisprudence point of view it is a general relationship and a full private one and thats because the companys bankruptcy from a jurisprudence point of view have a consequence of company liquidation in order to pay its debts noting that not all liquidations are caused by bankruptcy where it could be an optional liquidation by partners will and it might be compulsory by bankruptcy.
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So the liquidation could be voluntary and could be caused by bankruptcy, also bankruptcy could end by liquidation, and the company might continue its work under bankruptcy. 6. Edward study (2011) addressed: how bankruptcy affects creditors The study aimed to compare the effects that result from bankruptcy on creditors and debtors where the researcher mentions that bankruptcy could have long-lasting effects on debtors but creditors might also feel those effects ,when the creditors customers get bankruptcy it is more probable that the creditors wont get paid back even those who get paid might not get paid the full amount ,and they have to obligate for court ruling whether they agreed on the ruling or not ,then the researcher moves to another kind of talk on another kind of creditors which are the secured creditors the ones that have the privilege to have a part or share from the debtors assets and they get a priority payment when debtors assets is liquidated . But for the ordinary creditors they expect to have a part of their rights upon court ruling. 7. Claessems and klapper (2005) addressed: bankruptcy around the world, explanation of its relative use The study aimed to discover the relative importance to the country properties, and the effect of various kinds of the creditors right holders that could help to explain bankruptcy. The study was implicated on 35 countries through the data collected whether from government resources or nongovernmental from those countries about bankruptcy cases and the extent of bankruptcy law usage o those cases which rules either to liquidate the company or restructuring the company. The researchers reached the following: In order to correct the path of the comprehensive development and to resist the macroeconomic shocks the directed growth economies was more probable to use the official bankruptcy system from the bank directed economies. Also from the results of the study that there is an increase in the number of bankruptcy cases in the countries that have quick and efficient procedures to establish new business organizations, and that the mid and small companies have less use for official bankruptcy procedures.
1-Bankrupcy definition and its kinds: Islamic jurisprudence defined the bankrupted as the one that doesnt have money and could not serve his needs ,the word in Arabic(muffless)that means bankrupted came from the term (fillss)which means pence or cent this term was named on the person who doesnt have but cents and it is the lowest rate of money position ,and the bankrupted in the scholars terms the one who have more debts than money, and his outcome is more than his income ,and may be it was called like this because the lack of his money after his debt payment, and he could be named like this because he is prevented from the usage of his money unless the trivial sum of it, like cents or pences ,and the people start saying about him he doesnt have any money but cents (fills) (al-hanbaly,2006) . In the book of (sunnan ibn majah al-qazwini) for the imam aby alhasan al-hanafy known as al-sandy a hadeeth/saying from the prophet whom who find his merchandize with someone who was bankrupted then he has a right to take it more than anybody else.
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The meaning of the prophet hadeeth/saying in mentioning (someone) the one he sold his merchandize to and didnt get his money, and the prophet means by mentioning (bankrupted ) a person that got broke and he has no money and his situation transformed from the ease to hardship. In language it is said that bankrupted is the one who doesnt have assets or merchandize, in religion it defines the bankrupted as the person that couldnt pay his debts because of money shortage. And the prophet saying (he has a right to take more than anybody else) Means that he can take his right without being or waiting like other creditors. If we looked at the definition of the bankrupted in the commercial court system of the kingdom of Saudi Arabia then we would find it is compatible with the religion definition where the law material no.103 from the tenth chapter Saudi commercial court defines it that the bankrupted is someone whom his debts have consumed all his money till the level he couldnt pay them anymore, also the material no.120 from the same chapter indicated to the prophet saying mentioned above with the sentence if the merchandize of the trustee was found within the assets or the money of the bankrupted with his name on it then it is delivered to him as it is (material 120). Materials 105,106 and 107 specified the kinds of bankruptcy in relation to the bankrupted as the following: The real bankrupted That is the one that happens upon the merchants will he who works in the business trade with a known capital considered sufficient ,and he had organized ledgers and didnt waste his money in an exaggerate way but force majeure conditions led to bankruptcy like fir drowning or phenomenon losses.
Delinquent bankrupted He is the squanderer merchant who covered his inability of paying his creditors at the time, and kept running his business until his capital was consumed even if he had organized ledgers. The fraud bankrupted: The term bankrupted is named upon him only to the purpose of distributing his assets to his creditors at the end he is a fraudulent, he is the one who tricks conspiracies in his capital or managed to input in his ledgers debts with the name of another person in a dishonest way or he issued pay orders or other delusional ways to transport his capital and assets to another one by asset transfer, or hided some of his money and worked in trade with scam delusion on merchants even if he was squanderer or not ,have official ledgers or not he is a scammer (material 107).
In the Islamic jurisprudence there is no such term as the fraud bankrupted or the Delinquent bankrupted, but there is terms such as bankruptcy and insolvency ,in addition to concept of neglecting and mismanagement ,trespassing and fraud, in this there is a clar indication that the two materials no.105,106 from the Saudi commercial
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law derived the two terms above from Islamic jurisprudence and in that the prophet may peace be upon him says if the rich stalled his debts then his punishment is legal(almasri,rafeeq,2010).
2. Provision of bankruptcy declaration:
Declaration means to announce the bankruptcy, where material no.108 from the Saudi commercial court mentioned (the bankruptcy declaration either to be requested by the bankrupt or from one of his creditors). And the bankrupted have to present all his ledgers in addition to the debt paying orders to the council scheduled with an asset statement from the date he started his business till the date he is bankrupted with all the loss and expenses and all his liabilities and assets, at the moment the council has to stop him and put him under police monitoring (material no.109). The researcher views that this act is a kind of bankrupt seizure which is a something proved in the Snna and the khalifa doings <the wisdom of it is to preserve the rights of the others from being wasted, the seizure in Islamic law (Sharia) is one of the controls that the Islamic law had a high level of care because it is related to money which is considered to be one of the necessities of life ,the definition of seizure is to preserve money from being lost or manipulated and to take care and have an efficient management to retrieve rights back to their rightful owners as a path of prosperity and wealth (Abu hadi,2010). If we viewed material no. (110) from the Saudi commercial court system then we would find a big similarity with Islamic law where as mentioned in the Saudi commercial law the court decides to make seizure and to declare his bankruptcy and considers his oral and doing behavior non-executable from the date of bankruptcy decision . And so the seizure on the bankrupt is not effective till the judge rule in condition that it is proved the bankruptcy of bankrupted by legislative and legal methods, then he is bounded from acting in his money anyway that could harm the creditors. The deep care of the Islamic law to seizure subject comes from its concern on creditors rights, the prophet said: whom who find his merchandize with someone who was bankrupted then he has a right to take it more than anybody else.(al-zamel,page 208). The bankrupted is the person whos money have gone and he has nothing left but the cents, which is less than money, or the one who is prevented from the usage of an excisable money, if he had debts more than his assets, this is the bankrupted, the one that cant use the money but in necessities, and upon this his creditors filed for bankruptcy because they were afraid that he cant fulfill his debts (al-zamel,p 209). Materials (118,119) from the Saudi commercial court indicated that the council secretary spends on the bankrupted needs from the assets that were in seizure if the bankrupted was delinquent or real, also material no.119 precise that the real estate rents and the salaries of the staff and clerks in addition to wifes dowry all are considered preferred debts ,and here we find that the Islamic law is concerned upon the people that
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the bankrupted was responsible to support financially ,,and we can see that there is a similarity between the Islamic law and the Saudi law scripts. Then the Saudi Legislator mentions the mechanism of bankruptcy declaration in the material no.111 from the commercial court system of the kingdom of Saudi Arabia that says bankruptcy declaration is announced by court editing announcements that is spread in the streets and public places in order for people to look at, and any other areas that the bankrupted deals with by sending the declarations to the governor of that city. The Islamic jurisprudence allows declaring bankruptcy as to the definition of sheikh Fozan an Islamic scholar the provisions of seizure and bankruptcy in Islamic law is to prevent a person from acting in his money ,and where is the bankrupted is the person whos debts are more than his money then the creditors request from the governor or the ruler to make seizure upon him and divide his money upon them is an obligatory task to be done from the ruler side, and that means there is an agreement between Islamic law and the commercial court system of Saudi Arabia upon allowance of bankruptcy declaration never the less that the Saudi court materials did create the mechanism of declaration.
3. Effects of bankruptcy on creditors:
In all over the world the Legislator were keen to secure trust worthy and safety to the commercial transactions in addition to preserve the rights of the individuals, because of that we find most of the laws containing one or more law or system called bankruptcy system that aims to protect the debtor from his creditors and to protect the creditors rights from bankrupted debtor in addition to protect the creditors from each other . Like other laws the Saudi commercial court in its legislative materials focused on protecting these laws in materials 112 to 130 due to the importance of these rights, and thats because from the moment the bankruptcy is declared a group of creditors is formed each one of this group is racing against each other in order to claim his rights ,as a result of this racing there rights could be lost or even though the ordinary expenses of the debtor is lost or even entering in a stage were non legal to be taken from any side, here we find the Saudi Legislator keen to empower the authority for the court where he said the court has to assign a deputy from its side called secretary council ,and the group of the creditors must elect two representatives from them or claim agents hat are known with there integrity to the court called creditors secretary, and the court have to inform them with that formally ,and to assign a place of meeting with them and to precise what belongs to the debtor and what is upon him. The bankruptcy doesnt only mean the debtor is someone who cant pay his debts with what is left with him, the bankruptcy may be caused by accumulating credit offered from the debtor to other debtors ,and he was incapable of collecting those debts, as a result some Islamic scholars allowed debt exchange where the bankrupted sells a debit upon him with a debit for him but with a condition and that is that the two debts are due and the clearance are signed between the two parties ,where the due debts are considered a kind of bartering, thats why scholars called this procedure (debt barter) it is defined as the clearance of a debt on the bankrupted in exchange of another debt for
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the bankrupted needed to be collected from a third party. (Islamic Comprehensive library). In accordance with this the material no.113 from the commercial court system mentioned that it is an important duty of the secretary council and creditors secretaries to detect the assets of the debtor and his credits by placing them in precise in an organized ledger ,and if any of the bankrupted debtors rejects to pay the amounts requested from him then it is the duty of secretary council and the creditors secretaries to present him to trial whether it is by the knowledge of one of them or by naming a lawyer ,the court has the right to call the bankrupted and to ask him about any necessity that is needed ,also he have the right to name agents and staff and employees whenever needed, the researcher believe that it is in the interest of the bankrupted firstly and secondly in the favor of the creditors ,the debt exchange process can be less efficient because some debts may be postponed on the other hand the material113 from the Saudi commercial court system is an immediate bankrupts debt collection process . The Islamic scholars opinions has varied in the definition of the creditors group ,some considered them a group of people united with one goal ,and some defined it as an association that consists of creditors to one debtor in search for a centralization in the case of bankruptcy or legal settlement(maashi,2005). Ruling provisions ,shafei ,hanabela and hanafiah all agree that if the debt consumes and overcome the money of the debtor and creditors requested to put on seizure then the governor or ruler is obligated to declare his bankruptcy, but the malekiah on the other hand has put a condition to allow such procedure is that the creditors cant reach their rights unless taking this kind of action of seizure, they who say of the allowance of this procedure have taken a proof from Sahaba saying(Moath):that prophet may peace be upon him had taken the action of seizure against him ,sold his assets and divided the outcome between his creditors. The scholars have taken the conditions seizure and defined them to 5 conditions: 1-It is a condition to for the scholars that allowed seizure on the bankrupted to be requested from creditors or who represent them, so if they claimed their debts and didnt claim seizure then the seizure doesnt take place. It isnt necessary for all creditors to request seizure only one of them can make the claim even if the others refused to make such a claim. And if the debtor requested bankruptcy and seizure upon him the judge mustnt respond till the claim is requested from creditors this is in the malikieh and hanabelah, in shafeia it is allowed for the judge the governor or the ruler to make seizure by any of the parties request. 2. The debt that resulted in the seizure claim must be a due or current debt. 3. The debts on the bankrupted must overcome his money, where the malekiah says the debt is not equal to his asset, the shafeia says even if it is equal on one condition if he is generating income then a seizure must not take place.
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4. The debt that results to a seizure must be for human beings not like the debt that is religiously known as zakat, vows or anything similar. 5. The debt must be due and not in process, the shafeia saying (world website for Islamic economy,al=thaher). Seizure effect on the bankrupted: 1. The rights of the creditors become related to what he owns ,and so he is prevented from acting with this money. 2. Stoppage of the claiming with new debts after bankruptcy ruling. 3. The postponed debt becomes due. 4. The assets of the bankrupted is sold and divided between creditors and claimers.
Conclusions From the above we conclude the following: 1. That the Islamic law is lenience by sayings and doings it is keen to preserve peoples rights whether they are strong or week everybody is equal infront of it ,we see that be giving the creditors their rights and also the bankrupted debtor all preserved by islam. 2. Most of what came in the Saudi commercial courts law scripts are agreed with by Islamic law. 3. The Islam is a religion that doesnt flatter anyone because this person is a ruler a head of state or a governor proved by Moaths saying above. Recommendations: 1. It is necessary for the scholars of this age to develop opinions that fit this age having proofs from Quran that fits every age and time. 2. There must be a general agreement between the Islamic scholars opinions to prevent misinterpretation and illogical search opinions. 3. To set annual conferences for the (ifta) scholar committees in Islamic financial institutions to reach an understanding for basics and foundations to organize the work of these committees.
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References Al-Khadmi, Ahmad Hmad (2011).provisions of bankruptcy in the Islamic jurisprudence and the Yemeni law, comparison study. Search supplementary for masters degree. Al-dabi, Faisal suliman (2010) .retail and wholesale bankruptcy. published research on the world website of Islamic economy. Abu al-shamat, farouq (2010).bankruptcy provisions in the Syrian law and in some Arabian countries.research published in the Arabic encyclopedia. maashi,sameera(2005). Bankruptcy ruling effect on the creditors.a research presented for masters degree in law science,aqeed al-haj hakhdar batna university,faculty of law and political science Algeria. Al-shubeili,yousef(2010).companies bankruptcy and financial distress in the jurisprudence and law,a presented research for the third jurisprudence conference of the Islamic financial institutions ,published in the Furqan magazine. Al-hanbaly,ishaq burhan al-den ben mohammad ben Abdullah(2000). Al-mobdee fe sharh al-moqne Islamic office. Al-hanafy,aby al-hasan known as al-sandy (no date).the explanation of sunnan ibn majah al-qazwini,dar al-jeel,Beirut. Material no.103 and 120 from the commercial court system of the kingdom of Saudi Arabia. 105 from the commercial court system of the kingdom of Saudi Arabia. Al-fdool,saif(2011).difference between bankruptcy and insolvency,published research in al-fdool magazine no.12 date 09/05/2011. Al-masri,rafeeq(2010).fraud bankruptcy,published research in the website of d.rafeeq younis al-masri. abu-hadi,ahmad ismail(2010).seizure upon the underaged and the fool the bankrupted in the Islamic jurisprudence and the Yemeni law. Al-zamel,abd-almohsen ben abdallah(2004).shareh boloogh al-maram,mosque of the sheikh alislam ibn taimieh. Al-fozan,saleh www.islam.qa.com. Islamic comprehensive library www.rewayat.com. The world wide website for Islamic economy,mahasen al-thaher. Edwards, Claessens, Stign and Klapper, Leora (2005). Bankruptcy around the World: Explanation of its Relative Use. WorldBank. Edwards, Ciele (2011). How Bankruptcy Affects Creditors.
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The rights & duties of a mortgage secured debt from the point view of the Saudi legislator
Dr. Khalid Eid Al-Taif University Abstract This paper focuses on rights & duties of a mortgage secured debt from the point view of the Saudi legislator. This research aims to discuss the rights & duties of the mortgagee through the following headlines: Define the mortgage concept, conditions and deed terms.The mortgaged asset execution procedures. Keywords: Rights & duties ; Mortgage ; Secured debt ; Saudi legislator Introduction The definition of mortgage in language is constancy & permanence or confinement, so when we say that someone mortgaged a thing that means he added in it the constancy & permanency character, and when we say someone mortgaged something to a mortgagee then we mean that he confined the thing to the person who gave him the loan (anees and others, 1994, 378).
The definition of mortgage in terminology as defined by the jurists is a deed that makes money or an asset a guarantee for a given debt, the French civil law defined it as an agreement where the debtor gives the creditor an asset as a guarantee (albajandory, 2005). Upon the previous the purpose of the mortgage is to guarantee the right the creditor has from the debtor, the mortgage deed makes the asset a guarantee for a debt, in case this debt was not paid the amount of it can be collected from this guarantee, the asset mortgage is the asset that is placed as a guarantee for a debt in case the debt was not repaid then the mortgaged asset will be collected from this guarantee. The obvious meaning of those two cases must include a deed, for example if someone borrowed from someone else an amount of money and in exchange he confined his car to the creditor, and the deed mentioned in the case of non-payment then the owner ship of the car becomes the creditor, then it becomes an obligation, at the second case the mortgaged asset is sold and the creditor collects his claiming amount from the money of the selling. We must indicate that the mortgage is allowed by Islamic law where it is mentioned in holy Quran, the prophet Sunna and the scholars consensus, where the mighty Allah says{ And if you are on a journey and cannot find a scribe, then let there be a pledge taken (mortgaging); then if one of you entrust the other, let the one who is entrusted discharge his trust (faithfully), and let him be afraid of Allah, his Lord. And conceal not the evidence for he, who hides it, surely his heart is sinful. And Allah is AllKnower of what you do}, Surat al-baqara 283.
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Aisha (may god bless her) reported that the Prophet (May peace be upon him) bought food from a jew with a payment due date and he mortgaged his armor in exchange (narrated by Bukhari & Muslim). Al-daelej (1470) H. indicates the reason of difference between the four scholars in definition of the mortgage goes back to their difference in some terms of the mortgaged, or the mortgaged with, or the deed but the most probable definition they have is the mortgage is an allowed deed and has to have a guaranteed asset in exchange on the mortgagor or a guaranteed asset that the amount of debt can be collected from all or partial when debt cant be repaid . In Saudi legislation the definition of commercial mortgage came in law material number one from the commercial mortgage law the commercial mortgage is the one that is decided on transferable asset for a debt that is considered commercial on the debtor, and the mortgage is commercial for all the parties that have rights and obligations in relation with this mortgage (law material number one, commercial mortgage law).
Research importance:
In an unstable economical environment , and in the highlight of the growing need of investment expansion as a result of the globalization that led to a race between economic organization of their different kinds to have the highest return ratios , and the expansion of their market share on the level of global village the need for finance expanded , the investment became bonded with finance, and for the financer to reserve his rights he restricted the finance claimer with deed or deeds some are short and most of them are long-term in order to cope with the necessary period of the financed investment project, those deeds handle one kind or more from the money or asset mortgage that the debtor have or will have in a particular date that is related to investment causes in order to be used in the case of debt repaying difficulties . From here comes the importance of this research as it searches the rights of the creditors and the obligations as a result of executing the mortgage deeds. In some cases the reader could see that the creditor wont have any legal obligations but reality imposes on him mandatory legal duties, if some one borrowed a an amount of money from a bank, and mortgaged in exchange a real estate that he owns then he stopped paying in the due time for a particular reason , then the mortgagee will sell the real estate in official ways through legal methods if the selling price was more than the debt amount then the mortgagee will be obligated to give the surplus to the mortgagor.
Research objectives: This research aims to discuss the rights & duties of the mortgagee through the following headlines: 1. Define the mortgage concept, conditions and deed terms. 2. The mortgaged asset execution procedures.
1. 2.
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Previous studies: 1.Mabrouky study, (2010) addressed: commercial store mortgage. The researcher started by defining the both the official mortgage and the possessive mortgage, and defining the location of commercial store mortgage between them, she clarified that the official mortgage is a deed where the creditor obtains an asset right on a real estate in order to recollect his debt, where he advances on other creditors in the rank of recollecting his debt from the price of this real estate in whatever hand it was.
The mortgage of the commercial store is presented from the side of the merchant to the side of the mortgagee as guarantee of priority in recollecting his rights, in the case where the mortgagee didnt take the procedures of executive custody that is followed by the procedures of public selling without the role of other ordinary creditors of discussing with him the selling price of the commercial store. The researcher indicates that the commercial store mortgage doesnt perform a strong guarantee to the mortgagee as the strength of the official mortgage on real estate, because the execution on the mortgaged is done when the debtor couldnt repay his debts, then the commercial store will be in a bankruptcy or deficit situation, which makes the right of the mortgagee incomplete. 2. Wasel, (2009). Addressed: asset guarantee . The study aimed to clarify the effect the right mortgage has on its parties & the others, where the researcher indicates that the mortgage deed creates rights & duties between the parties of the deed, we will display all that concerns our study from the rights & duties of the mortgagee, where the researcher mentioned that the mortgage deed imposes on the mortgagee to take care of the mortgaged asset by its maintenance and any necessary fixings, if he neglected in those duties then he will be responsible in front of the mortgagor on anything wrong that could happen to the mortgaged asset also he will be responsible of its nature of use & the purpose it was created for, and he must not use it for a personal interest without the approval of the mortgagor, in those cases the estimated amount of use will be discounted from his expenses on the mortgaged asset or from the interests if the debt was imposed to interests , if anything left after those discounts then it will be discounted from the original debt. If the mortgagee misused, mismanaged exploited the mortgaged asset then the mortgagor have the right to put it under legal custody. If the mortgaged asset was flawed or its value was decreased for a reason was not caused by the mortgagee, and if the mortgagee feared the mortgaged asset is not sufficient any more to fulfill his debt then he is allowed to raise a claim in order to sell the mortgaged asset in public action or at market price , the mortgagor also have the right to object and claim of retrieving his mortgaged asset on a condition of substituting it with another asset estimated by the judge to see if it is sufficient or not. 3. Abdullah study (2010). Addressed: Saudi real estate mortgage law. The study highlighted the expected advantages of real estate mortgage law such as contributing in activating the real estate market and the stock markets in the kingdom of
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Saudi Arabia, because of its nature as a guarantee method that preserves the rights of both creditors and debtors. The researcher indicates there are law materials in this law that gives it a special privilege upon other systems & laws that are applied on other Arabic countries, such as the sixth material that allowed the real estate mortgage even if it was a common share, either if it was by all the asset owners or by one of them his whole share or some of it. In the first case it is allowed for the mortgagor to even if the mortgaged have been divided or not after it was sold because it cant be divided or sorted, but in the second case the mortgage transfers to the share of the mortgagor after the sorting takes place. In both cases mortgagee cant claim the divide or sort of the common share real estate unless under the approval of the mortgagor before his right is proven in recollection, but after his right is proven in recollection the mortgagee has the right to sell the common share as it is and he is allowed of requesting division or sorting even if the mortgagor didnt approve. The researcher expects this law will lead to advantages such as: - Making the citizen able to own an appropriate residence. - Contributing in increasing the quality of residency because e of the long term financing which urges the real estate corporations to take care of the quality as guarantee to retrieve past mortgages and make profit. - This law will reinforce the bond and security markets and spreads tranquility between mortgagees and creditors. 4- Hernanes, (2011). Addressed: "Sales of Mortgages by Public Auction The study aimed to clarify the procedures taken by the mortgagee on the mortgaged real estate in order to recollect his right in the debt he gave, where the researcher indicates that the basic right for the mortgagee might be harmed if some violations was done by the mortgagor in the mortgage deed whether if it was a result of some reservations in the deed or it was done by the notary or the court , when those violations happen then the mortgagee must make a written notification at the most during thirty days from the breach and to delete it from the deed in order to halt the mortgage deed violations of the mortgagor and to close any gap that allows him to manipulate the deed terms, if he didnt respond within thirty days then the mortgagee have the right to transit to the next step which is to demand the selling of the mortgaged asset in the public auction . 5- Fernandes, (2011). Addressed: "Secured Creditors in the Law of Dominican Republic." The study aimed to clarify the available procedures to the mortgagees before reaching the phase of official procedures in the case of the mortgagor insolvency to repay the non-performed debts, is there any quick procedures in this case as mortgage, assets custody and the issuing of a restraint order to prevent the use of or transition of those assets.
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The researcher indicates that mortgage procedures take a long time that could reach 12 months although its the best guarantee for a creditor to secure his debt is the real estate mortgage. And so the best available guarantee methods for the creditor especially the transit assets is the possessive mortgage which started its application on the farming equipment , then gradually transited and expanded through juridical precedence to include factory machinery , transportation mean. Sharby study, (2004). Addressed: mortgage effects on the mortgagee & mortgagor. The study aims to clarify when the mortgagee can use the claim on the mortgaged real estate, the researcher distinguished between two cases to verify the rights of the mortgagee which are: A. before debt due date: in this case the mortgagee right is limited in monitoring anything that could harm or breach his right, if this happened then he have the right to take necessary conservative measures in order to keep the real estate from being damaged. B. After debt due date: if the debt is due and the mortgagor didnt repay his debt then the mortgagee is allowed to execute on mortgaged real estate following the law procedures, also he is allowed to execute on all the assets of the mortgagor if the mortgaged real estate wasnt sufficient.
Conceptual main framework: Mortgage and the terms of the deed: As we mentioned before the mortgage is complete by a deed organizes the relation between two parties the mortgagee and the mortgagor, from the basics of this deed we mention the following:
1. The formation, where the deed formation must be offer & acceptance. 2. The creditors both must be qualified the mortgagee & mortgagor to act in money and to be adults and not under custody to act in their money. 3. Place of mortgage, the mortgaged asset or the money , its required conditions are the following: - To have a value because it is not right to mortgage something without having a money value, in Islamic jurisprudence for example it is not allowed to place forbidden assets like pigs & liquors. - The asset placed as a mortgage must be something that can be delivered & isnt something that couldnt be delivered such as a fleeing bird or an astray animal. - The mortgaged must be known because the unknown couldnt be received. - The mortgaged must be the asset , its not right to mortgage a use of the asset such driving a car or living in a home, the reason of mortgage is to collect the debt when the mortgagor cant repay , and that couldnt be in the service.
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The mortgaged must be taken in the same meeting as it is said by God Almighty in ayah 283 from Surat Al-Baqara that we privileged in mentioning it before. Law material no. 4 paragraph B from Saudi mortgage law indicated to that where it said: the estate must be known in a way that it couldnt be unknown. 4. the mortgaged with - the debt - , its conditions: - The debt must be fixed in the patrimony of the mortgagor before the mortgage because the mortgage follows the right. - The mortgaged with must be a fixed debt in the patrimony. - The debt must be known to the mortgagee & the mortgagor, law material no.9 from the Saudi mortgage law mentioned that there must be a clause on the mortgaged with to be in exchange of a fixed debt in patrimony. The kinds of mortgage is divided by modern laws into two sections the insured mortgage and the possessive mortgage, the Islamic jurisprudence allowed the possessive mortgage but it didnt prevent the insured mortgage because the purpose of this mortgage is to guarantee the debt and make the mortgagee feel secure on his debt. - The legal mortgage: The insured mortgage is defined as the right of a following asset that implicates on specific estate as an insurance of repaying the debt, giving his owner the right to follow the estate in what ever hand, the right to recollect his debt from price of the estate or the money that substituted it, the insured mortgage could be by a consensual agreement that emerges by a deed between mortgagee and the mortgagor, or could be a mandatory agreement by a decision of special authorities as a guarantee to specific peoples rights like the disqualified or incompetents rights, marriage rights and the state rights (Alrojoob, 2010). - The possessive mortgage: Defined as the guarantee of a debt repayment by an assets right on something results in a right for the mortgagee of putting this thing under custody, until his debt is paid and have the advance and priority privilege on the rest of creditors. In order for the possessive mortgage to be legal it must be recorded where material no.1 from the Saudi mortgage law says the estate mortgage gives the mortgagee a material right on a specific estate where its recording is a must by law . Some of the scholars called it the official mortgage, and when they defined it they didnt contradict with definition of the insured mortgage. (Al-khateeb, 2007). The possessive mortgage takes one of those kinds: A. The estate mortgage that in order to be effective must have in addition to ownership transiting the legal restriction must be imposed on its deed. B. The transit mortgage which in order to be effective must I addition to owner ship transition the deed must be written in a fixed date paper , the mortgaged amount and the mortgaged asset mentioned clearly , this fixed date determines the rank of mortgagee. C. Debt mortgage it isnt effective till the acceptance of the mortgagor and declaring this mortgage belonged to him (al-Jamal, 2011).
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Executive procedures on the mortgaged asset:
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The legislators differentiate in all over the world between civil and merchant business, because of that the execution of mortgaged asset in deed to is to guarantee the civil debt where it requires from the mortgagee to have a ruling from the judge to be executed on the mortgaged asset, in the commercial guarantee mortgage deed the mortgagee has to revise the executive legal department when the mortgagor doesnt pay his debt in order to make a legal notification for the debtor, most of the laws almost limited the time from making this notification in a period that doesnt exceed eight days in order for the official executive to sell the mortgaged things in public auction to recollect the mortgagee debt from the selling price in the concession method. Law material no.19 from the Saudi mortgage law system indicated a similar approach where it mentioned , if a debt is matured then it must be paid , if the mortgagor paid his debt he can collect his mortgaged asset, if he didnt then mortgaged will be sold by a request from the mortgagee, the mortgagee is advanced and have a priority of rank from the other creditors in recollecting his debt from the value price of the sold mortgaged asset and within procedures, if the mortgagee still has some unpaid debt still left then this amount will have a share like other creditors , this indicates that the law gave the mortgagee a registered right to take procedures which the Saudi legislator called the obligatory estate acquisition and then to sell it if the mortgagor didnt pay his debt in the maturity date after he received the legal notification as in the law. Where the mortgage is linked to the debt then the payment of the debt ends the mortgage but during the deed period of the possessive mortgage the legislator obligated the mortgagee to preserve the mortgaged asset and to treat like if it was owned by its ordinary owner, but if the mortgaged was a commercial paper then the mortgagee has to take all the procedures required by law to protect the fixed right in the paper and to recollect its value at maturity date. In concern of the notification period the Saudi legislator limited it to five days where material law no.16 says the following it is not allowed to execute the ruling issued from the court of Ombudsman to sell the mortgaged asset until the five days period have passed from the day of notifying the mortgagor and the sponsor of the asset if there is one, with the necessity to verify the place time and location of the public auction, if there is multiple mortgaged assets then the mortgagee can choose which asset to sell, unless there is no agreement to say differently, or if it could harm the mortgagor, in all cases the selling must only be to the same amount of the debt. From here we see that the Saudi legislator has taken in his consideration the personal, family and social situations of the mortgagor, for an example if the mortgage had many assets such as a land, car, home of the mortgagor and his family then the selling priorities starts with the car if that was not sufficient then land and for the home it is considered one of the things that harm the mortgagor. Also some legislation gave the mortgagee & mortgagor the right to request for the sell of the transit asset where the right of the mortgagee transits to the price of
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selling according to public provisions of the mortgage (law material no.14107, Jordanian civil law). Also law material no. 1406 from the same law allowed the selling of the mortgaged if the chance was appropriate to sell it in a profitable & suitable price after taking permission of the court, which determines the selling conditions and rules in the issue of price deposit in order to preserve the rights of both part0ies and prevent any harm to be done for them or the others. In order to know the steps of execution on the mortgaged estate we indicate to the law material no.401 from the Egyptian law which mentioned that the execution starts by announcing the estate acquisition alert to the mortgagor as a person or to his home including the following data: - Statement of the executive order its date& debt amount to pay. - Warn the mortgagor if he doesnt pay the announcement or notification will be registered as a mandatory estate sale. - The description of the estate with verifying its location, space, limits, number of pieces, the name of the land its numbers where the estate is located and anything else that is good to specify it in order to apply the law of county real estate, and the mortgagee is allowed to make a petition of licensing for the clerk to collect the needed data so he can describe the estate and its continents and he can accompany anyone that could help him, this procedure cant be protested on. - Appoint a place for the initiated mortgagees procedures in the town where the head quarter of the executive court is located. Any paper that doesnt contain the first and third statement is considered void.
Results & recommendations:
We conclude from this study that the legislators in most of the world have shown a big concern on the rights of the mortgagee in the limits of his debt , also they were keen to keep the mortgagor unharmed as a result of his tumble or stoppage of paying his debt, also they differentiated between the commercial debt that needs to be ruled as quick as possible because of the acceleration of the commercial movement taken in concern the need of merchants to retrieve their money as soon as possible in order to preserve the their trade continuity .
Results:
The Saudi legislator gave the following rights to the mortgagee: 1. The right to initiate mandatory estate acquisition procedures if the mortgagor didnt pay his debt in the precise due date. 2. Selecting the assets that should be sold when there is multiple mortgaged assets in a way that wouldnt hurt the mortgagee. 3. If the mortgagee feared the mortgaged asset isnt sufficient any more to fulfill his debt then he can raise a hypothyecary action to demand the selling of the mortgaged asset at public auction.
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Also the Saudi legislator imposed on the mortgagee the following duties: 1. The mortgagee must preserve the mortgaged asset in the case of the possessive mortgage. 2. if the mortgaged asset was a commercial paper then the mortgagee must take all the procedures that are required by law in order to protect the fixed right of the paper. 3. If he neglected in making necessary maintenance for the mortgaged asset he then will be responsible in front of the mortgagor on anything that happens to the mortgaged asset. 4. The mortgagee is not allowed of to use the mortgaged asset unless approved by the mortgagor. 5. If the mortgagee misused, mismanaged or exploited wrongfully the mortgaged asset then the mortgagor have the right to place the money under the management of the legal custodian.
Recommendations:
The researcher recommends the following: 1. The legislators must obtain more flexibility in the executive cases on mortgaged assets as god almighty:{ says And if the debtor is in a hard time (has no money), then grant him time till it is easy for him to repay, but if you remit it by way of charity, that is better for you if you did but know}. 2. the researcher sees that reviving money with money is better than executing on the mortgaged asset where if the mortgagee was capable of entering in partnership with the mortgagor in trade or a business that can be useful for them both without the need to sell the mortgaged assets.
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References Surat Al-Baqara, 283. Surat Al-Baqara, 280. Anees & others (1994). Al-mojam al-waseet, sixth edition. Al-bajandori, Mohammad, (2005). The role of receiving in mortgage deed, published in Iranian boza magazine. Al-daelej, Mubarak Ben Mohammad (1450) H. mortgage in Islamic jurisprudence, first edition. Saudi commercial mortgage law: first material, forth material, ninth material, sixteenth material, nineteenth material. Jordan civil law, materials 1046, 1047. Mabrouki, amal (2009). A research about commercial place mortgage, published in the law & legal sciences forums, Algeria. Wasel, Mohammad (2009). Asset guarantees, a published research on www.arab.educdz.com Abdullah, yusri awad (2010). Saudi mortgage law project, published research in the law forum Sharby, rabeeha (2004). Mortgage effects on the mortgagee & mortgagor, Ministry of Higher Education and Scientific Research, Institute of Legal and Administrative Sciences, aljafla. Al-rjoob, Ahmad (2010). The possessive mortgage & the insured mortgage deed, a published research in the al-jamaheer newspaper, Sunday 03/01/2010 printout, Aleppo. Khateeb, medhat (2007). Initiate the official mortgage, a published research in Arabia 4 surf forums. Al-jamal, yahia (2011). Possessive mortgage basics, justice center for Arbitration and legal advice. Hernandez (2011). Sales of Mortgages Held by Public Auction. Belcanto Business
Studio. Fernandez, Mary (2011). Secured Creditors in the Law of Dominican Republic. The Business Law Resource for Latin America.
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THE EFFECT OF JOB ENRICHMENT ON JOB SATISFACTION: A CASE STUDY OF FACULTY MEMBERS
UZMA RASHID CECOS UNIVERSITY Of IT AND EMERGING SCIENCES, PESHAWAR, PAKISTAN SADIA RASHID FACULTY OF FEDERAL URDU UNIVERSITY OF ARTS, SCIENCE AND TECHNOLOGY, ISLAMABAD, PAKISTAN
Abstract Satisfaction has been extensively studied in the management literature due to its importance to the physical and mental well-being of the employee, therefore it is a topic of major concern for many researchers and is an important organizational variable that should be understood and constantly analyzed for the efficient working of any organization. As teaching require a great deal of diligence and commitment, so in teaching it is more important to have mental commitment and loyalty than only physical presence. The purpose of this study was to provide empirical evidence as to the job satisfaction levels of academic faculty in Pakistan and to determine as to whether job enrichment factors are reliable predictors of their job satisfaction. The study concluded with the fact that faculty members overall job satisfaction increases through enriching their jobs. Further, it has been found that responsibility and achievement contributes more to the satisfaction level of faculty. Whereas, career development was found to be insignificantly contributing to the job satisfaction of teaching staff. Suggestions for university management and authorities are also discussed. Key words: Job satisfaction, job enrichment, career development, achievement, responsibility. 1. INTRODUCTION Job satisfaction is the most investigated topic in the fields of industrial-organizational psychology, social psychology, organizational behavior, personnel and human resource management, and organizational management (Gruneberg, 1979; Cranny, Smith, & Stone, 1992). Job satisfaction is of wide significance to researchers as it affects most organizational members, since most people spend a considerable part of their lives at work. An understanding of the factors involved in job satisfaction is crucial to improving the happiness of workers at workplace (Okpara et al., 2005). Research shows that happy employees are productive while unhappy ones are not therefore; success of the organization depends on the satisfaction of their workforce (Lise & Judge, 2004).
Nowadays educational institutions have to work harder to fulfill the gradually increasing expectations, of themselves, and also of their faculty (Bilge, 2006). However, in recent years, a clear increase has been observed in the number of studies related to the job satisfaction and concerned variables of academic faculty which enhances their job
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satisfaction. Job enrichment is one of the approaches through which jobs can be improvised and making them more appealing and satisfying to employees. Job enrichment or vertical job loading is where individuals can gain more on-job responsibility, achievement, development chances, self-sufficiency and appropriate management of the tasks they perform (Riches, 1994, p.240). Job enrichment makes job more interesting and helps employees gain control over their work. Therefore, the present analysis considers the job satisfaction of academic staff, and the different enrichment factors i.e. Achievement, Responsibility, and career development, which effect their job satisfaction. In this paper an attempt is made to explore, how employees job enrichment leads to employees job satisfaction Therefore, the aim of this study is to determine the relationship between job enrichment variables (i.e. responsibility, achievement, career development) and job satisfaction of employees and to make necessary recommendations to the management about factors affecting facultys satisfaction..
2. LITERATURE REVIEW Literature has many definitions of job satisfaction. After analyzing the published works, Cranny et al. (1992) concluded that: "there appears to be general agreement that job satisfaction is an affective (that is, emotional) reaction to a job that results from the incumbents comparison of actual outcomes with those that are desired (expected, deserved, and so on)" (p. 1). Weiss and Cropanzano (1996) used emotion as a basis in defining job satisfaction as an emotional experience at work .Needs, values and expectations of the workers are determinants of job satisfaction including job characteristics and its context. Spector (1997) defines job satisfaction as It is the extent to which people like (satisfaction) or dislike (dissatisfaction) their jobs (p. 2). Spector (1997) further explained that some people find job as the vital part of their lives and therefore enjoy working and some people do jobs to meet their financial needs only and do not like their work. Job satisfaction is in regard to ones feelings or state of mind regarding to the environment of the work (Shamima Tasnim, 2006). In simple words, it is the degree to which one feels good about their job they perform. Job satisfaction is imperative to employees, employers and researchers who study organizations, as it allows investigators and employers to properly analyze the different aspects of job satisfaction in the organization and develop ways to improve those aspects.
Job satisfaction in organizations can be of interest for two main reasons. Firstly, job satisfaction is significant for all those who are interested in the subjective evaluation of working conditions of organizations such as responsibility, task variety, achievement, communication necessities, career progression because job satisfaction is strongly caused by such conditions. Secondly, job satisfaction is important because it is related to consequential variables such as absenteeism, inefficiency, counterproductive behavior, or lack of leadership (Dormann & Zapf, 2001). It is an established fact that an employee with a high level of job satisfaction has a positive attitude towards the job, while an employee who is dissatisfied with the job has a negative attitude. When people speak of employee attitude, they generally are referring to job satisfaction (Robbins & Coulter, 2004). For any company or institution job satisfaction of total workforce is of utmost importance and with a group of satisfied workers organizations can successfully implement their plan and achieve set goals.
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While the dimensions of job satisfaction of individuals appear fairly clear, the causal agents of such satisfaction are far less so. Certainly, variables such as opportunity to participate in decision making (Daly, McCroskey, & Falchion, 1976) job enlargement (Argyris, 1964), job enrichment (Herzberg, 1966), working environment (Barnowe 1972), career development (Nel et al, 2001) and achievements on job and the internalexternal feedback one receives for his or her performance (Hackman & Lawler, 1971), all have some effect on job satisfaction of employees. In her study Darboe (2003) concluded that a job is not only life supporting by life-enhancing, and enriching because most people continue to work even if their monetary needs are met, as for most people work satisfies their various needs, such as a need for individual recognition, achievement, or the pleasure one derives from working with other people. (p. 84). Landy (1989) was of view, that, enriched jobs provide a maximum amount of internal satisfaction to employees. Oldham and Hackman (1980) proposed that jobs that are enriched would lead to high intrinsic motivation. Job enrichment is said to be a qualitative change to a job that increases the degree of autonomy, feedback, and importance of the job, enabling workers to have greater control and feedback in their work environment (Hackman &Oldham, 1976). Based on the previous studies and literature, Houston (2000) predicted that private organization employees give more importance to job stature, distinction, prestige and advancement opportunities. Also Herzberg (1966) proposed that an opportunity for advancement is a key motivator, and is positively related with job satisfaction (Ellickson, 2002; Wright & Kim, 2004; Ting, 1997).Employees look for fair pay structure and promotion/advancement policies and practices in an organization. Promotion and career development opportunities provide prospect for personal growth, more responsibilities, and reputed social status. Individuals who perceive that promotion decisions are made in a fair and just manner are likely to experience great motivation and satisfaction at work place (Witt and Nye, 1992). Oldham and Hackman (1980) was of view, that, when responsibility and roles of an employee are increased in the job, they provide autonomy and freedom to employees as how to plan the work and determine the procedures to be used in carrying out that work. Myers (1964) stated that challenging job which allows a feeling of achievement, responsibility, growth, advancement, enjoyment of work itself, and earned recognition motivate employees to work effectively. Employees in an organization become dissatisfied when opportunities for meaningful achievements are eliminated from the job. Also, company goals could only be best accomplished by providing opportunities for employees to achieve their personal goals. Most research relating to job satisfaction has been done in the business sector and attempts have been made to adapt these findings to higher educational sector and little empirical data is available on job satisfaction of academic institution in general(Okpara, Squillace & Erondu, 2005). So far, University settings have not received so much attention because generally it is presumed that university faculty embarks high level of job satisfaction (Pearson & Seiler, 1983). Findings indicate that educational faculty want work tasks, that is, responsibility that enhance their personal interests and allow autonomy in task selection and decision-making; they want a feeling of achievement, feedback from supervisors; they want clarity as to what is expected of them and collegial working environment, they want compatible salaries with their skills and
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qualification, and want promotions to be awarded fairly (Kelly, 1989). Low job satisfaction and dissatisfaction act as barriers to the full utilization of abilities and goal achievement. Satisfaction gained by the faculty from the work and working environment promotes teaching and research quality (Chen, Yang, Shiau & Wang, 2006). Schmidt (1976) in his study suggested that university members relate job satisfaction to achievement, recognition and advancement only. According to Finkelstein (1984) when faculty change jobs they dont look for compensation package (income), their decisions are exclusively influenced by seeking opportunities for professional growth through compatible, challenging and more responsible work activities Rice and Austin (1988) suggest that faculty development programs are contributing factor to increase the satisfaction and morale of faculty members. Castillo and Cano (2004) deducted that faculty members were most satisfied with the content (achievement, recognition, work itself, responsibility, advancement and possibility of growth) of their job and least satisfied with the context (company policy, supervision, relationship with supervisors, work conditions, relationship with peers, salary, personal life, status, job security) in which their job was performed. Additionally, the vast majority of research conducted in the field of job satisfaction and factors causing it have been conducted in developed countries. Evidence in this area from developing or less developed nations is unfortunately seriously lacking and is a gap which needs to be filled. In doing so the study will give insight into which enriched facets of the job results in satisfaction of the academic faculty.
3. THEORETICAL FRAMEWORK Having discussed the literature on job enrichment and job satisfaction, it is necessary to explore the different enrichment variables that will reflect workers attitudes towards their job. To understand these attitudes researchers have produced comprehensive theories on job satisfaction to provide a framework for understanding the factors influencing job satisfaction. The theory considered in this research is Frederick Herzbergs Motivation-Hygiene Theory (Two-Factor Theory). Herzberg in its TwoFactor Theory categorizes motivation into two factors: motivators and hygiene, motivators create satisfaction while hygiene factors create dissatisfaction (Herzberg, 1968). Motivators (or Intrinsic Factors) are job-related factors that encourage development and motivate employees to the highest level of satisfaction and are an integral part of the work and include aspects such as the nature of the job, the persons sense of achievement, responsibility, personal development and growth, recognition for a good work done and feedback (Schultz, 1982).While Hygiene (or extrinsic factors) create dissatisfaction in employees. Our aim is to measure the satisfaction of employees; hence, Motivators or intrinsic factors are taken into consideration. Hill (1986) used Herzbergs two-factor theory for explaining faculty job satisfaction. Hill argued that, the principal sources of satisfaction should be things intrinsic to the work such as teaching responsibilities, scholarly achievements and creativity, and especially the nature of the work and the development opportunities provided.
An important factor to create job satisfaction is advancement opportunity for employees in the academics. Career developments are the opportunities for promotion and development within the organization or field of work. (Conway & Briner, 2002; CoyleShapiro, 2002). Bergmann, Bergmann, & Grahn (1994) found that properly designed
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employee benefit packages and opportunity for progression is another variable found to be an important factor of job satisfaction. After studying the literature on job satisfaction and career development the following hypothesis has been developed. Hypothesis1: There is positive relation between career development and job satisfaction. Herzberg and colleagues (Herzberg, Mausner, & Snyderman, 1959) focused largely on causes of work satisfaction and, mainly on ways in which the job could be designed to make the work itself enriching and challenging. Intrinsic factors such as responsibility, growth, recognition and opportunities motivate employees to high levels of performance and job satisfaction; more than simply making a good salary (Nel et al., 2001). Responsibility given to employees makes them feel acknowledged which brings internal satisfaction to workers leading to increased organizational efficiency. It is found that high job satisfaction is experienced, when an employee is engaged in a variety of activities that challenges his/her skills and abilities (Ellis & Bernhardt 1992:180; Steers & Porter 1991:426). Therefore; the following hypothesis has been developed Hypothesis2: Responsibility positively influences job satisfaction. When employees perceive their jobs to be exigent and fascinating, as well as intrinsically rewarding, they are more likely to experience higher levels of job satisfaction. The human relations school has accumulated the evidence that career stagnancy and dull task environment alienate employees (Shepard, 1977). In an organization tasks and activities that generate the sense of achievement are taken into consideration by the employees. Studies have revealed that employees with a high need for achievement will set higher goals than will those with lower achievement needs. Khojasteh (1993) found that employees are more concerned with achievement in their workplace. On the basis of given literature the following hypothesis is developed Hypothesis 3: Achievement is positively related to job satisfaction. The current study is different from the previous ones, because in this research, the relationship between job enrichment factors and job satisfaction has been examined and how these effect job satisfaction of academic faculty. In this research each dimension of job enrichment is separately dealing with job satisfaction such that job enrichment dimensions are taken as independent variables and job satisfaction as a dependent variable. Career Development Responsibility Job Satisfaction
Achievement
Figure 1: A Schematic model
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4. METHODOLOGY
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4.1 Sources of Data Primary and secondary data have been used for the purpose of this study. Primary data is collected through structured self-administered questionnaires. Faculty members of different ranks of different universities were requested to fill the questionnaire. Secondary data were collected from available books, publications, journals, past recent literature, and articles on job satisfaction of individuals of different professions, including academic institutions. 4.2 Sample A cross-sectional analysis is conducted utilizing Likert Type scale to analyze the effect of factors (career development, achievement, responsibility) of job enrichment on job satisfaction. The scope of the study only covers Academic Faculty (Teaching Staff) of Universities at Peshawar & Hazara Division, Pakistan. A convenient sampling technique was used for data collection. A total of 200 Survey questionnaires were distributed among the faculty members of the different universities, out of which 175 were returned. 4.3 Measures The overall questionnaire consists of three sections and Likert Type scale has been used ranging from 1 (strongly disagree) to 5 (strongly agree) to measure the dependent and Independent variables. The first section is about dependent variable job satisfaction. Six-item has been used to measure overall job satisfaction adopted from Agho et al, 1993; Aryee, Fields & Luk, 1999. The second section is about independent variables of job enrichment, that is, career development, achievement, and responsibility. Career development contains 4 items adopted from Development experiences of Wayne, Shore & Liden, 1997. Achievement contains five-items adopted from Growth Satisfaction of Greenhaus, Parasuraman & Wormely, 1990. Responsibility has been adopted from Job Diagnostic Survey, developed by Hackman and Oldham and contains four-items measuring responsibility. The Third section of the questionnaire consisted of questions pertaining to the demographic characteristics of the academic staff. 4.4 Statistical Techniques Used Data is collected in a period of one month. Data was coded and analyzed by using Statistical Package for Social Sciences (SPSS), version 18.0. Since it is the case of measure of association and there is one dependent and three independent variables so multiple regression is used as a statistical test. Also correlation test was applied to find out the relationship between stated variables. Descriptive statistics is used to analyze the demographic data of respondents.
5. RESULTS AND FINDINDS
5.1 Demographic Characteristics of the Respondents Of the 175 respondents 47.4% were female and just slightly over half the respondents 52.6% were male. The greatest percentage of respondents, that is, 58.3% were in the age range of
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20-30, 26.3% were in the age range of 31-40, 11.4% were 41-50 years old, and the remaining 4% were in the age range of 51 and onwards. Private Sector University recipients were 36.6% and 63.4% were from Public Sector University. Of the 175 respondents, 80.0% were lecturers, 9.7% were assistant professors, 2.3% were associate professors, 5.7% were professors and 2.3% were research assistants. Of the given sample 20.6% of the recipients have a job experience of less than 1 year, the highest percentage of experience, that is, 54.3% is between 1-5 years, 14.3% of recipients have experience between 6-10 years, 5.1% of respondents have experience between 11-15 years, and 5.7% have more than 16 years of experience. Graduates are 10.9% in this study, 57.7% are post graduate, 14.9% are MS/M.Phil, 13.1% are PhD and 3.4% of the respondents have Post Doctorate Degree. 5.2 Reliability Questionnaire reliability was estimated by calculating Cronbachs alpha. Reliability for the overall instrument was 0 .778, generally considered acceptable for a reliable measurement tool in social sciences, which suggests a strong positive item-homogeneity in this measurement instrument 5.3 Regression and Correlation The multiple regression analysis was performed to determine the extent to which the job enrichment factors, that is, achievement, career development and responsibility will explain the variance in job satisfaction amongst faculty members. The Multiple Linear Regression Model with three explanatory variables have R value of 0.318, expressed as a percentage this means that our hypothesized model, that is, job enrichment factors (achievement, career development, and responsibility) explains 31.8% of the variance in the job satisfaction. Furthermore, the F-statistic assesses the overall significance of our model. The value of F-statistic is 26.528 with p<0.05. Therefore, it is concluded that our model is highly significant, thus we can assume that there is a linear relationship between the variables in our model. (see table.1) Table 3 presents the correlation between job enrichment factors career development, responsibility achievement, and test variable job satisfaction, where r =0.374, r = 0.537, r =0.407 respectively. 5.4 Hypotheses Testing Hypothesis 1: The beta value shows that 1 unit increase in the value factor career development would increase 0.068 units (6.8%) in job satisfaction, other variables being held constant. Career Development shows statistically insignificant contribution in explaining the job satisfaction with p>0.05. While t-statistics of Career Development also account for insignificant positive variation in dependent variable, that is, Job Satisfaction (t = 0.868, p>0.05). (see table 2) Resultantly, the null hypothesis is accepted and research hypothesis is rejected.
Hypothesis 2: The beta value shows that 1 unit increase in the value factor responsibility would increase 0.416 units (41.6%) in job satisfaction, other variables being held constant. Responsibility, amongst the independent variables makes the strongest unique contribution to explaining the job satisfaction with p< 0.05. The tstatistics shows, that, Responsibility accounts for significant positive variation in job
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satisfaction (t = 5.212, p<0.05). (see table 2). Consequently, the null hypothesis is rejected and research hypothesis is supported.
Hypothesis 3: The beta value shows that 1 unit increase in the value factor achievement would increase 0.168 units (16.8%) in job satisfaction, other variables being held constant. While Achievement also made a statistically significant contribution with p<0.05, in explaining the dependent variable. The t-statistics also shows, that, the Achievement accounts for significant positive variation in job satisfaction (t = 2.222, p<0.05). (see table 2). As a result, the null hypothesis is rejected and research hypothesis is supported. 6. CONCLUSION AND RECOMMENDATIONS
Job satisfaction in academic faculty can be attained through enriching their jobs, which will ultimately bring creativity and innovation in their routine works, benefiting the students. The career progressive, achievement oriented, challenging responsibilities and collegial environment along with other fringe benefits enhance intrinsic satisfaction among faculty that leads to improved teaching, high quality research and publications in educational institutions. The relationship between job enrichment factors and job satisfaction is hypothesized and empirically tested. The results are consistent with hypothesis but career development is found to have no relationship with job satisfaction as compared to responsibility and achievement which have strong positive relation. The reason could be that no proper environment is provided to the employees with regards to their career development. In fact most of the Pakistanis prefer to have better pay package along with career development programmes, due to poor socio-economic conditions in the country. It is suggested that university management should involve the faculty members in decision-making process, especially aspects that have a direct influence on their performance and satisfaction levels. University policies and practices should be as such that they reflect some of the interests and concerns of the academic faculty. This will build a more trust based relationship between university management and teachers, creating job satisfaction. After all, the satisfaction of faculty with management is surely to the advantage of all individuals involved. University management should assess and evaluate their faculty members performance to know their strengths and weaknesses from time to time. In case of weaknesses proper training facilities should be provided to effect improvements and modifications in their behavior, knowledge, skills and attitude. Faculty members achievements should, however, be awarded in the form of appraisal, acknowledgment and incentives. University management should provide adequate funds to support faculty development programs which can be a contributing factor to increase the satisfaction and morale of faculty. They should be provided facilities such as travel support to attend research meetings, professional development seminars and workshops to encourage them to see their work in its wider context, and to persevere with their own educational development. It will ultimately prepare them for higher work and greater responsibility and attune their outlook and methods with the new and growing needs of changing time.
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7. LIMITATIONS
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There is a limitation in our empirical study, due to short time span and financial constraints convenience sampling was used that might limit the external validity of our results and findings cannot be generalized. Although the current study examined several job enrichment variables, these variables were assessed in the context of academic faculty. As a result, differences between this sample and other organizational cultures may exist, resulting in decreased confidence when it comes to making generalizations. Therefore, future research might want to reproduce and extend the current study in a wider work environment.
Table 1: Model Summary MODEL R R Square Adjusted R square 0.306 F Sig.
0.564
0.318
26.528
0.000
a. Predictors: (Constant), Responsibility, Achievement, Career Development b. Dependent Variable: Job Satisfaction Table 2: Coefficients VARIABLES Constant Career Development Responsibility Achievement 0.068 0.416 0.168 Standardized Beta t-statistics 8.250 0.868 5.212 2.222 Sig. 0.000 0.387 0.000 0.028
a. Predictors: (Constant), Responsibility, Achievement, Career Development b. Dependent Variable: Job Satisfaction Table 3: Correlations Career Development Achievement Responsibility Job Satisfaction Career Development Achievement Responsibility Pearson Correlation .374** Sig. (2-tailed) Pearson Correlation Sig. (2-tailed) Pearson Correlation Sig. (2-tailed) Pearson Correlation Sig. (2-tailed) ** Correlation is significant at the 0.01 level (2-tailed). .000 .407** .000 .467 .000
**
.537** .000 .547** .000 .498** .000
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References Argyris, C. (1964) Integrating the Individual and the Organization. New York: Wiley. Bergmann, T. J., Bergmann, M. A., & Grahn, J. L. (1994). How important are employee benefits to public sector employees. Public Personnel Management, 23, 397-406
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Straw, B. M., & Cummings, L. L. (Eds.), Research in organizational behavior (Vol. 18). Greenwich, CT: JAI Press. Bilge, F. (2006). Examining the burnout of academics in relation to job satisfaction and other factors. Soc. Behav. Personality 34 (9): 1151-1160. Barnowe, J.T. (1972) The relative importance of job facets as indicated by an empirically derived model of job satisfaction. Survey Research Center, University of Michigan, Ann Arbor. Cranny, C.J., Smith, P.C., & Stone, E.F. (1992). Job Satisfaction: How People Feel About Their Jobs and How It Affects Their Performance. New York: Lexington Books, An Imprint of Macmillan, Inc. Conway, N., & Briner, R. (2002). Full-time versus part-time employees: Understanding the links between work status, the psychological contract, and attitudes. Journal of Vocational Behavior, 61, 279-301. Coyle-Shapiro, J. A. M. (2002). A psychological contract perspective on organizational citizenship behavior. Journal of Organizational Behavior, 23(8), 927-946 Chen, S.H., Yang, C.C., Shiau, J.Y., & Wang, H.H. (2006). The development of an employee satisfaction model for higher education. TQM Mag. 18 (5): 484-500. Castillo, J.X., & Cano, J. (2004). Factors Explaining Job Satisfaction Among Faculty. Journal of Agricultural Education, Vol.45, No.3 Daly, J.A., McCroskey, J.C., & Falcione, R.L. (1976). Communication apprehension, supervisor communication receptivity and satisfaction with superiors. Paper presented at the annual meeting of the Eastern Communication Association, Philadelphia. Dormann, C., & Zapf, D. (2001). Job satisfaction: A meta-analysis of stabilities. Journal of Organizational Behavior, 22, 483-504. Darboe, K. (2003). An empirical study of the social correlates of job satisfaction among plant science graduates of a Midwestern University. Lanham, MD: University Press of America. Ellis, N. H. & Bernhardt, R.G. (1992). Prescription for teacher satisfaction: Recognition and Responsibility. The Clearing House, 3, 179-182. Ellickson, M. C. (2002). Determinants of job satisfaction of municipal government employees. Public Personnel Management, 31(3), 343-358. Finkelstein, M.J. (1984). The American Profession. A Synthesis of Social Inquiry Since World War II. Columbus: Ohio State University.
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Gruneberg, M.M. (1979). Understanding Job Satisfaction. London: The MacMillan Press Ltd. Herzberg, F. (1966.).Work and the Nature of Man. Cleveland: World.
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Hackman, J. R., & Oldham, G. R. (1976).Motivation through the design of work: Test of a theory. Organizational Behavior and Human Performance, 16,250-279 Hackman, J.R., & Lawler, E.E. (1971). Employee reactions to job characteristics. (Monograph) Journal of Applied Psychology, 55, 259-286. Houston, D. J. (2000). Public Service Motivation: A Multivariate Test. Journal of Public Administration Research and Theory, 10(4), 713-727. Herzberg, F. (1968). One more time: How do you motivate employees? Harvard Business Review, 46, 36-44. Hill, M.D. (1986). A theoretical analysis of faculty job satisfaction/dissatisfaction. Educational Research Quarterly 10, 3644. Herzberg, F., Mauser, B., & Snyderman, B. (1959). The Motivation to Work. New York: John Wiley. Khojasteh, M. (1993). Motivating the Private vs. Public Sector Managers. Public Personnel Management, 22 (3), 391 401. Kim, S., & Wright, B.E. (2004). I.T Employee Work Exhaustion: Toward an Integrated Model of Antecedents and Consequences. Paper presented at the annual meeting of the Academy of Management, August 8-11, New Orleans. Kelly, J.D. (1989). Gender, pay, and job satisfaction of faculty in Journalism. Journalism Q. 66 (2): 446452. Lise, S. M. & Judge, T. A. (2004). Employee attitude and job satisfaction. Human resource management. 43(4):395-407. Myers, M.S. (January/Ferbruary, 1964) Who Are Your Motivated Workers?. Harvard Business Review, XLII), 73-88. Available from Harvard Business Review, Soldiers Field, Boston, Mass. 02163. Nel, P.S., Gerber, P.D., Van Dyk, P.S., Haasbroek, G.D., Schultz, H.B., Sono, T., & Werner, A. (2001). Human Resources Management. (5th ed.). Oxford University Press, Cape Town Okpara, J.O., Squillace, M., & Erondu, E.A. (2005). Gender differences and job satisfaction: a study of university teachers in the United States. Women Manage. Rev. 20(3): 177-190. Oldham, G. R. & Hackman, J. R. (1980) Work Redesign, Addison-Wesley Publishing Co. Pearson, D.A., & Seiler, R.E. (1983). Environmental satisfiers in academe.Higher Educ. 12 (1): 35-47. Riches, C. (1994). Motivation in Bush, T. and West-Burnham, J. (1994) The Principles of Educational Management. London: Pitman Publishing.
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Rice, E. R., & Austin, A. E. (1988). Faculty morale: What exemplary colleges do right. Change 20(3): 5158. Robbins, S.P., & Coulter,M. (January 14, 2004). Management, Eight edition, Pearson Prentice Hall.
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Spector, P.E. (1997). Job satisfaction: Application, assessment, cause, and consequences. Thousand Oaks, CA: Sage Publications, Inc. Schmidt, G. L. (1976). Job satisfaction among secondary school administrators. Educational Administration Quarterly, 12(2), 68-86. Shepard, J.M. (1977). Technology, Alienation, and Job Satisfaction. Annual Review of Sociology, 3, 1-21 Schultz, D. P. (1982). Psychology and industry today. New York: Macmillan Steers, R.M., & Porter, L.W., (1991). Motivation and Work Behaviour. (4th ed.). New York. Tasnim, S. (Spring 2006).Job Satisfaction among Female Teachers: A study on primary schools in Bangladesh. M.Phil. The University of Bergen, Norway. Ting, Y. (1997). Determinants of job satisfaction of federal government employees. Public Personnel Management, 26(3), 313-334. Weiss, H. M., & Cropanzano, R. (1996). Affective effects theory: A theoretical discussion of the structure, causes and consequences of affective experiences at work. Research in Organizational Behavior.1996. Witt, L., & Nye, L. (Dec, 1992). Gender and the relationship between perceived fairness of pay or promotion and job satisfaction. Journal of Applied Psychology, 910-17.
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Service Quality Evaluation in General Department of Health Insurance of Fars Province Using a SERVQUAL Model (Case Study: Shiraz)
Mohammad Hossein Moshref Javadi (Ph.D.) Faculty Member of Management Department, University of Isfahan, Iran RaziehGol Graduate Student of Management,Payam-e Noor University, Shiraz, Iran
Abstract Considering the significance of the Service-Providing sector, the improvement of service quality in this sector has always been of a special significance. This goes far enough to regard the high-quality service as one of the most important challenges of service-providers in this century. So, to improve and evaluate the quality of their services, all service-providers have to identify the needs and expectations of their customers at the first step. SERVQUAL model is one of the most important models widely used to evaluate the quality of services of service-providers on a customeroriented basis. This model has been used in this study in order to evaluate the quality of services provided by Health Insurance Organization of Fars Province (Shiraz). Considering its applied purpose and its data collection method, this study is a descriptive and survey-based type The instrument used in this study is a Servqual standard questionnaire. The research population was all of insured people in Shiraz city. The questionnaire was distributed among and completed by a statistical sample composed of 400 insured people in Shiraz Health Insurance Organization. Number of Samples was gained from Krejcie & Morgan Table. The collected data was analyzed by SPSS17. To investigate the hypotheses, Wilcoxon test was used and to investigate the difference in the preferences of the insured, Freedman Test was applied as well. The results of this study revealed that there is a significant difference between the expectations of the insured and their perceptions of the service quality dimensions (tangibles, reliability, responsiveness, assurance and empathy). There is also a significant difference in prioritization of these dimensions according the insured. Considering the average scores, the dimension of reliability was the most important one, and the dimensions of responsiveness, assurance, empathy and tangibles ranked next, respectively. Conclusion: Based on these results, the expectations of the insured do not conform to their perceptions of the situation and their expectations have not been met in all dimensions of service provision. Keywords: Quality, Service Quality, SERVQUAL Model, Insurance. Introduction & Significance of the Problem: Service quality and customers satisfaction have become the strategic issues for serviceproviders today. In this competitive world, providing high-quality services is necessary for all service-providers. Through providing high-quality services, the organization will benefit the advantages such as customers satisfaction, customer's loyalty, attraction of new customers, etc (Rust &Zahoric, 1993). Service-providers will not benefit from a successful enterprise if they do not pay a specific attention to service quality (Bai et al, 2007). Customers and consumers are always looking for those providers that provide much better services and products (Darabi&Makki, 2008). Being aware of the concept
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of service quality and trying to improve it has resulted in providing high-quality services and the improvement of service quality will result in the customer satisfaction. Regarding the remarkably low quality of services in Iranian organizations, that can be observed nearly in all organizations, and due to the necessity of paying a special attention to this problem, this study aims to evaluate the service quality in one of the most important service-providing organizations (Health Insurance) that plays a significant role in the economy and health status of the country, using Servqual model.
Review of the Literature A) Service Quality Its not simple to offer a comprehensive and exact definition of service quality, compared to product quality. Gronoos defines service quality as the extent to which the customers perceptions of service differs from his/her expectations (Otavio&Euriane, 2009). Parasuraman defines service quality as the sustainable compatibility with the customers expectations and identification of his/her expectations of a certain service (Parasuraman et al, 1988). Dimensions of Service Quality Parasuraman, Zeithaml& Berry identified 10 different dimensions for service quality in their studies on which the customers judgment on service quality is based. These dimensions include: 1. Facilities and physical appearance of the provider; 2. Reliability of the offered service; 3. Willingness and eagerness of the personnel for being responsive to the customer; 4. The skill and conversance of the personnel; 5. Courtesy of the personnel; 6. Honesty, secrecy and reliability of the personnel; 7. Security; 8. Availability of services; 9. Communication with customer; 10. Understanding the customer (Parasuraman, 1985). B) Service Quality Evaluation Models 1. SERVQUAL Model Considering 10 dimensions of quality in service providing sector, Zeithaml, Parasuraman and Berry tried to prepare an instrument for measuring the customers' perception of service quality (Chen &Liou, 2009). In 1988 and after analyzing and screening these criteria and standards, these 10 dimensions were summarized into 5 dimensions:
Tangibles: That is the appearance of physical facilities and equipment, the personnel, and the communication devices existing in service-providing places (Seyedjavadin & Keimasi, 2005) Reliability: That is the ability to do and provide the promised services in an appropriate, accurate and reliable manner; doing what is expected by the
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customer and this means that the customer is provided with services on due time and in the way he/she was promised and with no fault. Assurance: That is the knowledge and presence of mind as well as their ability to attract the confidence of the customers; Empathy: That is showing and paying special and empathetic attention to the customers; Responsiveness: That is the willingness to help the customer and to provide him/her with instant services. Keeping the customers waiting, especially for no good reason, will result in customers dissatisfaction and negative perception of service quality.
In such a way, they used these dimensions as a basis for creating a scale for evaluating service quality. This scale, that is known as SERVQUAL, includes 5 dimensions and 22 components that is used for measuring the expectations and perceptions of the customers about the dimensions of service quality (Zeithaml et al, 1996). Five different dimensions of SERVQUAL, that are obtained by systematic analyses of customers scores from several interviews on service industries, in fact show basic criteria and standards of the customers for evaluating the service quality. Therefore, it seems logical that all of these dimensions are of remarkable significance to the customers. For this purpose, in SERVQUAL model the customers are asked to express the degree of significance of any of these dimensions by a score between 1 (totally insignificance) and 10 (greatly significant) (Bakhtiari&Sohrabi, 2007).
Figure 1 SERVQUAL Model
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2. Service Quality Gap Model The interaction between service provider and service-buyer results in the formation of 5 basic gaps in the process of high-quality service-provision. The main purpose of service quality improvement is to minimize the fifth gap (quality gap) (Streeter & Selber, 2006). 3. SERVPERF Model This model is offered following the criticism of some scientists on SERVQUAL regarding the evaluation of the customers opinion on the quality of the provided service, not the gap between his/her expectations and his/her opinions on the received services. 4. Normal quality Model Just like SERVQUAL, this model tries to analyze the gap. However, in SERVQUAL model, the gap between the customers perceptions of the performance and his/her expectations is evaluated, and in this model, the gap between the customers perceptions of the performance and its ideal level is measured (Pishdad&Gheisari, 2006). Research Methodology Considering its applied purpose and data collection method, this study is considered a descriptive and survey-based type. The statistical population included all literate insured people (holders of high school diploma or higher degrees) for health insurance policy who had employees, other jobs, self-employed villager and nomad insurance policy booklets in the city of Shiraz. The samples include 384 persons. To avoid a decrease in the size of the sample, 400 questionnaires were prepared and distributed among the insured members of health insurance policy who came to General Department of Health Insurance of Shiraz Medicine Approval and Cities Agencies Division at a certain period of time. The samples were selected based on a random sampling method. To collect the data, SERVQUAL Standard questionnaire was used. This instrument included 22 pairs of questions that were prepared based on 5-option Likret Scale where 1 indicates strongly disagree and 5 indicates strongly agree it includes 5 dimensions of service quality: tangibles (questions 1-4), reliability (questions 5-9), responsiveness (questions 10-13), assurance (questions 14-17), empathy (questions 1822). Cronbach's and coefficient was obtained for tangibles, reliability, responsiveness, assurance and empathy, to be 0.83, 0.88, 0.91, 0.93, 0.85, respectively and for total questions to be 0.88. To analyze the data, the statistical software of SPSS17 was used and to investigate the homogeneity of the data, Klomogrov-Smearnov test was used. Also, Nonparametric Wilcoxon Test was used to analyze the hypotheses and Freedman Test was used to investigate the difference in the preference among 5 dimensions of service quality. Findings The descriptive data indicated that the highest percentage (38%) of the respondents were 30 years old or younger. 56.5% were female and 43.50% were male. 39.1% of the respondents held high school diplomas, 21.1% associate degree, 29.7% bachelor, and 10.2% masters degree and higher. 56% of the respondents had civil servants insurance booklet, 13.5% other jobs insurance booklet, 15.6% self-employed insurance booklet
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and 13% villagers insurance booklet. Most respondents (58.8%) were covered because they had realized the significance of being insured. According to the insured people, the dimension of reliability had the highest significance among other dimensions and followed by responsiveness, assurance, empathy and tangibles. 62.5% of the total respondents believed the dimension of the tangibles, 71.56% the dimension of reliability, 69.79% the dimension of responsiveness, 72.66% the dimension of assurance, 66.35% the dimension of empathy to be totally necessary for a great insurance organization. Most respondents have evaluated the conditions related to the dimensions of tangibles, responsiveness, reliability, and empathy to be at an average level. The conditions related to the dimension of assurance has been evaluated to be higher than average. The hypothesis of the normality of the data was investigated by Kolmogorov-Smirnov test. Except for the dimension of empathy, the significance of the tests for other dimensions was less than 0.05 and this shows that the data was not distributed normally and it was not homogeneous. So, nonparametric tests were used for data analysis (Table 1).
Table 1 The Results of Kolmogorov-Smirnov Test for Homogeneity Dimension Tangibles Reliability Responsiveness Assurance Empathy Situation Ideal Existing Ideal Existing Ideal Existing Ideal Existing Ideal Existing Mean 17.57 12 22.71 16.82 18.23 13.15 18.42 14.11 22.40 16.18 SD 3.06 3.9 3.83 4.97 2.74 4.1 2.74 4.01 3.7 4.99 P Value 0 0.042 0 0.023 0 0.011 0 0.002 0 0.123
Freedman test was used to investigate the difference in the preference among 5 dimensions of service quality. The analyses reveal that there is a significant difference in prioritizing the dimensions. Considering the score means, reliability was of the greatest significance followed by responsiveness, assurance, empathy and tangible respectively.(Table 2).
Table 2. Ranking the Dimensions according to the Insured Dimensions Tangibles Reliability Responsiveness Assurance Empathy Mean 3.73 2.21 2.69 2.99 3.38 0 P Value
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Wilcoxon Test was used to analyze the difference between the expectations of the insured and their perceptions of service quality for the dimensions under investigation in Shiraz Health Insurance Organization. As P<0.05 for all tests, it can be said that there is a significant difference between the expectations of the customers and their perceptions of the dimensions of tangibles, reliability, responsiveness, assurance and empathy (Table 3).
Table 3. Results of Wilcoxon Test for analyzing the difference between expectations and perceptions Dimensions Tangibles (Expectations Perceptions) Reliability (Expectations Perceptions) Responsiveness (Expectations Perceptions) Assurance (Expectations Perceptions) Empathy (Expectations Perceptions) Statistical Value of the Test -14.449 -12.954 -13.922 -13.507 -14.025 P-Value 0 0 0 0 0
Discussion & Conclusion The purpose of this study was to evaluate the service quality in General Department of Health Insurance of Shiraz. At an error level of 5%, the results of the test reveal that the expectations and perceptions of the insured did not match in all dimensions of tangibles, reliability, responsiveness, assurance and empathy. This indicates that there exist dissatisfaction level of the insured with the quality of the services provided by General Department of Health Insurance of Shiraz. When investigating the opinions of the insured regarding which dimension of the service quality played the most significant role, it was revealed that reliability was the most significant dimension according to the respondents and followed by responsiveness, assurance, empathy and tangibles, respectively. This dimension reflects the adequacy and capability of an organization in conveying a sense of reliability and security to the customers.
In the study of Rezayigolabadi in Iran Insurance Co. the dimensions of empathy and responsiveness were the most significant ones according to the respondents and the tangibles had the lowest significance. Referring to Zeithaml et al, the dimensions of responsiveness, assurance and empathy were placed after reliability. Zeithaml, Parasuraman and Berry concluded that regardless of the kind of services provided to the customers, reliability is considered as the most significant aspect in providing the customers with services. On the other hand, the organizational facilities and appearance were the least significant dimensions compared to other dimensions of quality. Three other dimensions gained different ranks depending on the type of service.
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According to the perceptions of the insured about the quality of services, the most desirable dimension of quality was the dimension of service assurance that results from polite manner of the personnel and their knowledge in answering the questions of the insured. After that, the highest percentage of the respondents considered the dimensions of reliability, responsiveness, empathy and tangibles as desirable, respectively. The results of the study of Hosseini et al. revealed that the quality of the dimension of empathy was at the highest level and the dimension of assurance at the lowest level. A comparison of the results shows that the customers have no similar conceptions about the dimensions of service quality. This may be due to the different nature if the services, different attributes of the customers and different facilities of the service-providing organizations. Finally, considering the dissatisfaction of the insured with the quality of the provided services, it is suggested that the managers of this organization should apply a strategic and dynamic approach to manage the quality of their services so that the perception of the customers may be higher than their expectations and the quality will be considered as a source for improving and differentiating their services from those of their rivals.
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References: Allan,Y.(2003).customer satisfaction measurement practice in Taivan hotels, Hospitality Management, 3, 1-11. Bai, ch., Lai, F., & Li, D. (2007).An empirical assessment and application of servqual in mainland china ,s mobile communication industry, International Journal of Quality & Reliability Management, 3(24), 244-262. Bakhtiari, H &Sohrabi R. (2007). Evaluation of instrumental services quality for the evaluation of analytical investigation of (SERVQUAL) service quality evaluation model, The Third National Conference on Performance Management, JahadDaneshgahi Scientific Conferences Center. Chen C.W., Liou, T.S.(2009).Subjective appraisal of service quality using fuzzy linguistic assessment, International Journal of Quality & Reliability Management, 8(23),929 -930. Darabi, M &Maleki A (2008). Different measurement methods for customers satisfactionAutomobile Engineering & Related Industries Monthly, 1st Year, 3. Otavio, J.o., &Euriane, C. F.(2009).Adaptation and application of the SERVQUAL scale in higher education. UNESP So Paulo State University Department of Production Engineering POMS 20th Annual Conference Orlando, Florida U.S.A. n.14-01. Parasuraman, A., Zeithaml, V.A., & Berry, L.L.(1985).A conceptual model of service quality and its implications for future research, Journal of Marketing,4(49), 41-50. Parasuraman, A., Zeithaml, V.A. and Berry, L.L. (1988). SERVQUAL: A multiple item Scale for measuring consumer perceptions of service quality, Journal of Retailing1(64),12-40. Pishdad S. &Gheisari K (2006).Service quality assessment in information technology Department and a Case Study in Transportation Industry, ModiriatDanesh Quarterly, Vol. 74, 47-53. Rust, R., &Zahorik, A. (1993). Customer satisfaction, customer retention, and market share. Journal of Retaling, 2(69), 193-215. Seyedjavadin S.R. &Keimasi M (2005). Service Quality Management, NegahDanesh: Tehran Streeter, C., &Selber, K. (2000). A customer-oriented model, for managing quality in human services.Administration in Social Work, 2(24), 1-14. Zeithaml, V., Bitner, A., &Mary, J. (1996).Service marketing, Singapore: McGraw Hill.
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Evaluating & Improving Electronic Trust Factors in E-Government
(Case Study: Mashhad Electronic City)
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Zahra Javidian Department of IT Engineering, Tarbiat Modares University, Tehran, Iran Sina Soltani Mollayaaghobi Department Of Engineering, Arak Branch, Islamic Azad University, Arak, Iran
Abstract The importance of communication to relationships between governments and citizens forms the basis of the argument that information and communication technologies present a significant opportunity for transformation and social change. E-Government is defined as the use of technology to re-engineer the citizen-government relationship and is a key driver for the modernization of government and the improvement in this relationship. But there is a big obstacle in front of e-government application that is citizen trust to nontraditional transactions namely e-trust. This study aims to measure electronic trust in Mashhad electronic city and suggests some service elements toward its improvement using QFD model. The research was conducted among 18 managers of E-city and 84 citizens using a questionnaire comprised of 30 items and 11 dimensions. We found that there is a significant difference between Managers and other citizens points of view about study indicators and there are 11 service elements in house of quality that led to development of electronic trust among study sample. Keywords: E-Government, Mashhad Electronic city, Quality function deployment Introduction Leith and Morison (2004) capture the centrality of communication by identifying key aspects of the government-citizen relationship. These include the nature and balance of dialogue and its terms; the origin and direction of communication flows; whether communication of information is a form of persuasion by rhetorical or other means; effects on the citizen; how ideas of consultation and dialogue presented within e-government models accord with the nature and role of discursive democracy and the extent to which the Habermasian concept of ideal speech is reproduced in the space created by e-government. This discussion suggests a number of factors that make communication through e-government as the medium central to government-citizen relationship. These include the importance of dialogue enabled by portals that facilitate information flows. This is a major transformation from traditional government communication. As Leith and Morison (2004) put it, In its fullest form the e-government revolution would effect a transformation in government Chadwick and May (2003) examined the shift towards egovernment in the United States, Britain, and the European Union and presented three heuristic models of interaction between states and citizens that might underpin the practice of e-government. They identified the managerial, consultative, and participatory models of the relationship between government and citizens. They concluded that the democratic potential of the Internet has been marginalized as an executive-driven, managerial
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model of interaction that took precedence over consultative and participatory models. In tracing the core ideas and approaches associated with putting government online, the study observed that the way e-government will develop depends on understandings about the relationship between government and citizens. This relationship depends on the style of government and what shape the policy choices, managerial strategies and cultural responses will take. Advanced countries led the development of e-government and have largely shaped its evolution from establishing informational web presence to developing government-wide online information systems. Although e-government is a recent development, taking shape only in the last decade, its adoption around the world has proliferated significantly rapidly. Research on e-government has also grown considerably. Some trends have emerged in the research on e-government (Heeks and Bailur, 2006; Reece, 2006; Calista and Melikisti, 2007). These include prescriptive studies taking a logical mapping approach to make sense of online content, its impact on society, and descriptive studies that examine the implementation of e-government into government practices and the possible outcomes (Reece, 2006). Prescriptive studies attempted to assess the possible impact of the Internet without data and, for the most part, presented only a logical mapping between online characteristics and society. These prescriptive studies mainly offered a hyperbolic view of e-government suggesting that the impacts of the Internet were characterized by greater information flows and a capacity for its faster retrieval and use. In addition Trust has been regarded as having the ultimate importance in any form of business transactions, termed the variable most universally accepted as a basis of any human interaction of exchange (Gundlach & Murphy, 1993, p.41). Especially when individuals confront a situation in which they cannot fully control the action of others in a business transaction, a high complexity of decision making occurs which can actually inhibit intentions to perform any action of exchange (Gefen, 2000). In reducing the complexity in the decision making process, trust is one of the most effective methods that can act as a focal aspect in interacting with any business party (Luhman, 1979). According to previous research in the field of trust, there is a significant relationship between IT application and e-trust. So, this study is a preliminary investigation of citizens about their attitudes in e-government. The study main question in that what is the difference of citizens and managers point of view about e-trust and what are the best factors toward improving these perceptions.
Literature review E-Government Descriptive studies have proceeded from the position that the Internet has a significant impact on government and politics. With the rate of adoption increasing in government practices, comprehensive studies have been done since the early 1990s to describe the depth and scale of e-government. Such studies, according to Reece (2006) have, in many cases, fallen short of offering an explanatory analysis, developing a theory, identifying variables, or posing any hypotheses. Instead, these studies have mostly attempted to present comprehensive descriptions of e-government landscapes and the current practices of government agencies (La Porte et. al, 1999; Pina et. al., 2007). These efforts have included government reports assessing e-government systems and societal effects, industry studies on best practices, consulting groups reporting on e-government activities, and academic
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studies analyzing characteristics of national websites (West, 2000). Descriptive studies address questions on demand (what end-users want) and supply sides of e-government that should be studied as statistically relevant developments. Although descriptive studies do not explain or examine causal processes associated with e-government growth, they make important contributions to the research. These include insights into best practices and benchmarks for implementers of e-government, developing datasets for further research, classification schemes that further our understanding of the field, phases of web development, characteristics of the digital divide, and the development of methods such as web content analysis. Research on egovernment has begun to move in the direction of theory development through explanatory studies of how e-government functions and how variables are interacting (Chadwick and May, 2003; Kumar and Best, 2005). These studies also examine and attempt to explain the relationship between e-government phenomena and larger literatures in various fields (political science topics such as pluralism, public policy, political communication etc). Kumar and Best (2003) studied the correlation between the presence of Internet facilities in a village in India and the rate at which villagers obtained services. Wong and Welch investigated the relationship between website openness and accountability in 14 countries on five continents. Carter and Belanger (2005) developed a model of factors that included the Technology Acceptance Model (TAM), the Diffusion of Innovations theory and web trust models to explain factors which predict citizens intention to use e-government services. Reece (2006) acknowledges that theories of e-government have yet to emerge in spite of research efforts at explanatory or causal studies. Electronic government, defined as the use of information technology to enable and improve the efficiency with which government services are provided to citizens, employees, businesses and agencies (Carter and Belanger, 2005), has been adopted by governments around the world as new technological developments and digitalization allow easier production, transmission and exchange of information. The adoption of e-government continues to be a dominant topic in studies focusing on developing countries. Perspectives drawn from these studies claim that e-government leads to citizen empowerment through improvement of government service delivery to citizens (Kumar and Best, 2006), plays a major role in the transformation of public sector operations (Welch et.al, 2004), enhances government accountability (La Porte, de Jong, 2000; Demchak, 2000; Demchak, Friis, and La Porte, 2000), and creates greater efficiency in service delivery, access of information for citizens (West, 2004; Pina et. al., 2007). In addition, they also make the claim that e-government can provide opportunities for cross collaboration and information resource sharing between governments, businesses, citizens and other stakeholders (Silcock, 2001). Scholars do not fully agree on the nature, extent and significance of changes brought about by e-government. Some studies argue that e-government reproduces the same patterns of communication associated with conventional practices in traditional bureaucratic systems (Information Society Commission, 2003). Others have argued that electronic communication opens up more channels of communication and gives citizens greater access to government officials than was possible with communication under traditional bureaucratic systems (Coursey and Norris, 2007). The assumptions and claims about the contribution of electronic government to restructuring service delivery by public agencies at different levels are varied across studies. Some
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scholars assume that the technologies will lead to change, while others suggest that the use of technology is socially constructed and would mostly be shaped by the ways each government adapts its processes to new ICTs. Heeks and Bailur (2007) presented a framework for understanding perspectives and impacts associated with IT introduction and its underlying issues to aid the understanding of changes in public agencies. Their framework included perspectives on technological impacts and causes of those impacts. Technological determinists have associated the introduction of ICTs with positive impacts while social determinists suggested that human choices within social structures determine the impacts of the introduction of ICTs. They concluded that positive and negative impacts can accompany the introduction of ICTs into the public sector and this could affect users in a number of ways. On the other hand, they associated the causes of those impacts with human agency shaped by social contexts.
E-Trust Trust is considered a critical component in online retailing as well (Hart & Johnson, 1999; Stewart, 1997; Urban, Sultan & Qualls, 2000). Exchanges where trust acts as a critical component are described as having a high level of performance ambiguity (e.g., evaluations of service performance are highly ambiguous), significant consequentiality (e.g., service performance has significant consequences for the value derived by the consumer), and greater interdependence (e.g., when consumers participates in the process) (Sitkin & Roth, 1993). Online retailers possess many of these characteristics since their performance evaluation is mainly based on the customers interaction experience with the retailers website. The retailers performance is almost invisible during the transaction, and consumers become highly dependent on the online retailer when providing credit cards and personal information. Gefen (2000) asserted that trust is an important precondition of online retailing since trust can encourage customers to be engaged in activities where a person is exposed to a risk without the ability to control the related behavior. In the previous research, trust was characterized as confidence and reliability towards the subject and was explained with two different components, credibility and benevolence. Morgan and Hunt (1994) defined trust as the perception of confidence in the exchange partners reliability and integrity (p.23). Moorman, Deshpande and Zaltman (1993) also defined trust as a willingness to rely on an exchange partner in whom one has confidence (p.82). Gabarino and Johnson (1999) further conceptualized trust as customer confidence in the quality and reliability of the service offered (p.71), encompassing both confidence and reliability. In addition to the importance of confidence and reliability in the conceptualization of trust, two different aspects were determined to explain trust; one is credibility, the focal partners intention and ability to keep promises, and the other is benevolence, evidence of the focal partners genuine concern for the partner through sacrifices that exceed a profit motive (Ganesan, 1994). Therefore, e-trust in this study is defined as a customers belief or confidence that the word or promise by the merchant can be relied upon (i.e., credibility), and the seller will not take advantage of the consumer's vulnerability (i.e., benevolence), based on the study of Geyskens, Steenkamp, Scheer, and Kumar (1996). Through trust, customers reduce the complexity of understanding others into manageable comprehensible units, making an otherwise unjustifiable belief about the future subjectively justifiable (Lewis,
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1985; Luhman, 1979). Eventually, trust encourages long term orientation (Fukuyama, 1995; Ganesan, 1994; Morgan & Hunt, 1994), increases the acceptance of interdependence (Schurr & Ozanne, 1985; Zand, 1972), creates commitment (Moorman, Zaltman, & Deshpande, 1992; Morgan & Hunt, 1994; Zand, 1972) and also reduces perceived risk (Fukuyama, 1995; Morgan & Hunt, 1994).
Research Methodology & findings Data Collection Tool and Issues of Validity and Reliability In order to collect the required data for ensuring E-trust, the questionnaire applied by (Connolly & Bannister, 2007) containing 30 questions and 11 dimensions was applied. But this scale transformed into a 6 dimensions scale after factor analysis. We distributed this scale between 18 managers and 84 citizens using judicative sampling. Our results showed as below: Table 1 show that Managers overall perception is significantly more that citizens score. But the main question is that what dimensions have to consider as QFD input. In this study we select lowest score dimensions from citizens point of view as QFD input to transform those into service elements. These conclude Perceived Security Control, Perceived Privacy Control, Experience and Legal Framework.
Quality Function Deployment (QFD) While all the quality models provide guidance for either the assessment of the current process or the achievement of a better process, they all share one common characteristicthese models defines "what to do" but leaving "how to do it" to individual companies. It is desirable to have a means to guide the companies in the development of action plans for SPI. These actions should be based on the software process requirements from relevant sources. Quality Function Deployment (QFD) is an appropriate tool for the translation of customer needs into products. Thus, it is helpful in serving the purpose of deriving action plans for SPI from software process requirements. QFD, which was developed in the late 1960s in Japan by Professor Shigeru Mizuno and Yoji Akao, was introduced to the rest of the world, including European countries and the United States, in the early 1980s. It is a methodology for building the voice of the customer, both spoken and unspoken, into a product. The difference between QFD and other quality methodologies resides in the fact that, unlike traditional quality systems which aim at minimizing negative quality in a product, QFD adds values to the product by means of maximizing the positive quality. Nowadays, QFD has been applied to virtually every industry and business, including software development (Xiaoqing et al, 2007).
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Table 1: Comparative analysis of Managers & Citizens Score Mean Comparison Managers Citizens Mean Mean SIG FD Statistic Mean D
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Decision Significant Difference Significant Difference Significant Difference Significant Difference Significant Difference Significant Difference Significant Difference
Dimensions Perceived Security Control Perceived Privacy Control Cultural Environment Experience Third Party Recognition Legal Framework Overall
0.000 0.000 0.002 0.000 0.001 0.001 0.001
101 101 101 101 101 101 101
-2.431 -3.091 -2.653 -1.726 -2.936 -3.081 -2.232
2.68 1.26 0.8 2.58 0.99 1.28 1.6
4.87 3.42 4.32 4.76 5.01 4.44 4.47
2.19 2.16 3.52 2.18 4.02 3.16 2.87
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Figure 1: Factor analysis Using Lisrel Software
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Figure 2: House of quality (E-trust dimensions into SE)
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Relationship Strong 9 Medium 3 Weak 1
Strong positive relationship Positive relationship
Determination of achievement
Using customized service Cheap service delivery Users as stockholders
Increasing trust to government Hard rules for new entrants Increasing e-brand reputation
Government responsiveness
Improvement Elements
Mashhad E-city situation

3.76 3.21 2.11 3.42
Government Control &
Hard Fine for offenders
Perceived Security Control Perceived Privacy Control Experience Legal Framework Difficulty degree for achievement Costs of achieving Mashhad E-city situation Other E-cities situation Absolute value Relative value
9 9 9 9 1 3
IT socialization
E-trust Dimensions
9 3 3 3
9 1 1
9 9
9 3
9 9
3.52 4.27 3.99
3 3
3 9
1 9
9 3
3 9 3
4.15
3.1 3.6 2.3 3.1 74
4.3 3.6 3.7 2.3 87
2.5 2.4 4.1 3.4 69
4.1 3.8 2.7 3.6 40
3.8 3.1 3.2 3.5 35
4,3 2.1 1.4 1.9 119
2,2 2.8 3.6 2.6 73
3.5 3.1 2.7 4.1 68
3.3 1,8 2.9 3.9 61
3.2 2.6 1.3 2.4 81
4.1 3.8 2.4 3.3
83 11
790 %100
11
15
10
Conclusion E-satisfaction has gained increasing importance in the marketing literature in recent times (Evanschitzky, Iyer, Hesse, & Ahlert, 2004; Szymanski & Hise, 2000; Yi & La, 2004). Based on the conceptualization of Oliver (1999), who viewed satisfaction as the customers evaluation of every transaction experience, this study defines e-satisfaction as a pleasurable fulfillment accumulated over multiple transaction experiences resulting in formation of an overall evaluation of the online retailer. Satisfied customers tend to have higher usage of service (Ram & Jung, 1991), possess a stronger repurchase intention, and are often eager to recommend the product or service to their acquaintances (Zeithmal, Berry & Parasuraman, 1996) than those who are not satisfied. According to Winter (2001), customer satisfaction is in the center of the firms goal of relationship programs in the online retailing
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Other E-cities situation

3.87 4.01 3.52 3.47
Indicators importance
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context. This context in e-government is a consequence of trust to internet connections and vendors. This study found that some service elements like Users as stockholders, Government Control & Supervision and Hard rules for new entrants with most absolute value can make more trust between Mashhad e-city citizens. In addition there is a significant difference between managers and citizens pint of view about trust in electronic environment. References Akao Y., Hayazaki T. "Environmental Management System on ISO 14000 Combined with QFD." Transactions of the Tenth Symposium on QFD. Novi, Michigan. ISBN 1-889477-109 Carter, L., and F. Belanger. 2005. The Utilization of E-Government Services: Citizen Trust, Innovation, and Acceptance Factors. Information Systems Journal 15(1): 5-25. Chadwick, C., and C. May. 2003. Interaction between States and Citizens in the Age of the Internet: E-government in the United States, Britain, and the European Union. Governance: An International Journal of Policy, Administration, and Institutions 16(2): 271 300. Chadwick, S. 2001. Communicating Trust in E-commerce Interactions. Management Communication Quarterly 14(4): 653-658. Connolly, Regina, and Frank Bannister (2007). Consumer Trust in Electronic Commerce: Social & Technical Antecedents, World Academy of Science, Engineering and Technology, Vol. 34 . Sitkin, S.B., & Roth, N.L. (1993). Explaining the limited effectiveness of legalistic "remedies" for trust/distrust. Organization Science, 4(3), 367-392. Coursey, D. and Norris, D.F. (2008), Models of E-Government: Are They Correct? An Empirical Assessment, Public Administration Review Vol. 68 Issue 3, pp.523-536, 14p May /June 2008 Demchak, C., Friis, C. and La Porte, T.M. (2000), Webbing Governance: National Differences in Constructing the Face of Public Organizations. In Garson, G. D. ed., Handbook of Public Information Systems, (New York: Marcel Dekker Publishers, 2000). Evanschitzky, H., Iyer, G.R., Hesse, J., & Ahlert, D. (2004). E-satisfaction: a re-examination. Journal of Retailing, 80(3), 239-247. Fukuyama, F. (1995). Trust: The Social V irtues and the C reation of Prosperity. New York, NY: Free Press. Information Society Commission (2003), eGovernment: More Than an Automation of Government Services, www.isc.ie/downloads/egovernment.pdf Gabarino, E., & Johnson, M.S. (1999). The different roles of satisfaction, trust and commitment in consumer relationship. Journal of Marketing, 63(2), 70-87. Ganesan, S. (1994). Determinants of long-term orientation in buyer-seller relationships. Journal of Marketing, 58(2), 1-19. Geyskens, I., Steenkamp, J-B., Scheer, L.K., & Kumar, N. (1996). The effects of trust and interdependence on relationship commitment: a trans-Atlantic study. International Journal of Research in Marketing, 13(4), 303-317. Gefen, D. (2000). E-commerce: the role of familiarity and trust. Omega, 28, 725-737. Kumar, N., L. Scheer, and J. Steenkamp. 1995. The Effects of Supplier Fairness on Vulnerable Resellers. Journal of Marketing Research 32(1): 54-65. Lewis, J.D. & Weigert, A. (1985). Trust as a social reality, Social Forces, 63(4), 967-985. La Porte, T.M., de Jong, M., and Demchak, C. C., (1999), Public Organizations on the World Wide Web: Empirical Correlates of Administrative Openness. Presented at the National Public Management Research Conference Program, Bush School of Government and Public Service, Texas A & M University December 3, 1999 Luhmann, N. (1979). Trust and Power. Chichester, UK: Wiley.
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Moorman, C., Deshpande, R., & Zaltman, G. (1993). Factors affecting trust in market relationships. Journal of Marketing, 57(1), 33-47. Moorman, C., Zaltman, G. & Deshpande R. (1992). Relationships between providers and users of market research: the dynamics of trust within and between organizations. Journal of Marketing Research, 29(3), 314-328. Morgan, R.M., & Hunt, A.D. (1994). The commitment-trust theory of relationship marketing. Journal of Marketing, 58(3), 20-38. Hart, C.W., & Johnson, M.D. (1999). Growing the trust relationship. Marketing Management, 8(1), 9-19. Heeks, R. (2002) Information Systems and Developing Countries: Failure, Success, and Local Improvisations, The Information Society, 18:101112, 2002 Heeks, R. and Bailur, S., (2007), Analyzing e-government research: Perspectives, philosophies, theories, methods, and practice Government Information Quarterly, Vol. 24, pp. 243-265. Oliver, R.L. (1999). Whence consumer loyalty? Journal of Marketing, 63(4), 33-44. Pina, V., Torres, L. and Royo, S. (2007) Are ICTs Improving Transparency and Accountability in the EU regional and Local Governments? An Empirical Study. Public Administration, Vol. 85. No. 2, pp. 449-472. Ram, S., & Jung, H.S. (1991). How product usage influences customer satisfaction. Marketing Letters, 2, 403-411. Reece, B., (2006). E-Government Literature Review. Journal of E-Government, Vol. 3 (1). 2006. Silcock, R. (2001). What is e-government? Parliamentary Affairs, Vol. 54, pp. 88-101. Szymanski, D.M., & Hise, R.T. (2000). E-satisfaction: an initial examination. Journal of Retailing, 76(3), 309-322. Urban, G.L., Sultan, F., & Qualls, F. (2000, Fall). Placing trust at the center of your internet strategy. Sloan Management Review, 42(1), 39-48. Winter, R.S. (2001). A framework for customer relationship management. California Management Review, 43(3), 89-105. West, D. 2005. Digital Government: Technology and Public Sector Performance. Princeton, NJ: Princeton University Press. West, D. 2004. E-Government and the Transformation of Service Delivery and Citizen Attitudes. Public Administration Review 64(1): 15- 28. Xiaoqing (Frank) Liu, Yan Sun, Praveen Inuganti, Chandra Sekhar Veera, and Yuji Kyoya. "A Methodology for the Tracing of Requirements in Object-Oriented Software Design Process Using Quality Function Deployment," Software Quality Professional Journal, September 2007, Volume 9, Issue 4. Yi, Y., & La, S. (2004). What influences the relationship between customer satisfaction and repurchase intention? Investigating the effects of adjusted expectations and customer loyalty. Psychology & Marketing, 21(5), 351-373. Zand, D.E. (1972). Trust and managerial problem solving. Administrative Science Quarterly, 17(2), 229-239. Zeithmal, V.A., Berry, L.L., & Parasuraman, A. (1996). The behavioral consequences of service quality. Journal of Marketing, 60(2), 31-46.
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A proposed model for explanation of influential factors on customer satisfaction in banking industry
Mohammad Reza Hamidizadeh Associate professor of Business Administration Department, Shahid Beheshti University Nasrin Jazani Associate professor of Business Administration Department, Shahid Beheshti University Abbasali Hajikarimi Associate professor of Business Administration Department, Shahid Beheshti University Abolghasem Ebrahimi Ph.D candidate of Marketing, Shahid Beheshti University
Abstract
Understanding the antecedents of customer satisfaction is a critical issue for both academics and bank marketers. Previous research has identified service quality, perceived value and expectation on customer satisfaction. The current paper reports findings from a survey which looked into the impact of service quality dimensions (including hardware and software), perceived value, and image on customer satisfaction. A sample of 551 respondents took part in this study. Findings indicate that perceived hardware and software quality appear to be linked to customer satisfaction. Findings also indicate that perceived value has a significant impact on customer satisfaction. However, image cannot influence perceived value and customer satisfaction.
Keywords: Perceived quality, Perceived value, Image, Customer satisfaction
1. Introduction
Customer satisfaction is an important theoretical as well as practical issue for most marketers and consumer researchers (Meuter et al., 2000). Customer satisfaction can be considered the essence of success in todays highly competitive world of businesses. Thus, the significance of customer satisfaction and customer retention in strategy development for a market oriented or customer focused firm cannot be understand (Kohli and Jaworski, 1990). Consequently, customer satisfaction is increasingly becoming a corporate goal as more and more companies strive for quality in their products and services (Bitner and Hubbert, 1994). A review of the literature suggests that our understanding of the relationship between customer satisfaction judgments and service quality perceptions remains a problematic issue (Taylor and Baker, 1994). A stream of research has argued that customer satisfaction judgments are casual antecedents of the service quality judgments (Bitner, 1990). A review of the literature also suggests that expectations for service quality and perceived value are likely to be based on perceptions of excellence, whereas satisfaction judgments are likely to be based on a board range of non-quality issues (Taylor and Baker, 1994; Fornell et al., 1996). Finally, the literature indicated that image can directly influence customer
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satisfaction (OLoughlin and Coenders, 2002). This paper aims to present a model for explanation of influential factors on customer satisfaction in the context of banking industry. The next section provides a theoretical background for the proposed model. The research results are presented, findings discussed and limitations identified. 2. Theoretical background There is considerable evidence in the literature supporting the relationship between a companys financial performance and the level of satisfaction reported by its customers (e.g. Anderson, Fornell, & Lehmann, 1994; Anderson & Rust, 1997; Bolton, 1998). For this reason, it is often argued that customer satisfaction should be the ultimate goal of all firms (Morgan, Anderson, & Mittal, 2005). Empirical evidence supports this view, showing that customer satisfaction reduces the likelihood of defection and/or is positively associated with retention (Anderson & Sullivan, 1993), repurchase intention (Mittal, Pankaj, & Tsiros, 1999), and loyalty (Oliver, 1997). Boshoff and Gray (2004) underline that satisfaction is not inherent in the product or the service itself but, instead, satisfaction primarily consists in the consumers perceptions of the attributes of the product or service as they relate to that individual. Thus, different consumers will express varying levels of satisfaction for the same experience or service encounter (Ueltschy, Laroche, Eggert,&Bindl, 2007). Literature proposed three elements as the antecedents of customer satisfaction that can be described as fellow: 1) Perceived Quality: two general types of perceived quality have been specified, product quality (hardware) and service quality (software/humanware) (Fornell et al., 1996). Perceived product quality is the evaluation of recent consumption experience of products. Perceived service quality is the evaluation of recent consumption experience of associated services like customer service, conditions of product display, range of services and products etc. Kristensen et al., (1999) demonstrated the importance of delineating these two aspects of perceived quality in a post office context. Both hardware and software are expected to have a direct and positive effect on overall customer satisfaction. 2) Perceived value: The literature in this area has recognised that customer satisfaction is dependent on value (Howard & Sheth, 1969). Value is the perceived level of product quality relative to the price paid or the value for money aspect of the customer experience. Value is defined as the ratio of perceived quality relative to price (Anderson et al., 1994). Value is expected to have a direct impact on satisfaction (Anderson & Sullivan, 1993; Fornell, 1992) and to be positively affected by perceived quality (both hardware and software). To ensure that the effects of a price-quality relationship are not confounded, quality and value are measured relative to each other (Anderson et al., 1994). 3) Image: Image refers to the brand name and the kind of associations customers get from the product/brand/company. This construct was first introduced in the Norwegian Customer Satisfaction Barometer model (Andreassen & Lindestad, 1998). New research indicates that it is an important component of the customer satisfaction model (e.g., Martensen et al., 2000). It is expected that image will have a positive effect on customer satisfaction and loyalty. In addition, image has been modelled to have a direct effect on perceived value (e.g., Kristensen et al., 1999; Martensen et al., 2000). The impact of quality on image (or vice versa) is not usually estimated. According to Johnson et al., (2001), image has been modelled to affect perceptions of quality (Andreassen &
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Lindestad, 1998). However, in most research papers this affect is not modelled, thus we consider image and product and service quality to be all exogenous factors. 3. Hypothesis development and the research model As mixed findings are observed in prior studies as described in the literature review, null hypotheses are proposed to test the relationships between the variables, as shown in Figure 1: H1: Perceived quality (hardware and software) is positively related to customer satisfaction. H2: Perceived quality (hardware and software) is positively related to perceived value. H3: Perceived value is positively related to customer satisfaction. H4: Image is positively related to customer satisfaction. H5: Image is positively related to perceived value.
Perceived hardware and software H2
H1
Perceived value H5 Image H4
H3
Customer satisfaction
Figure 1. Theoretical framework

4. Research methodology
The framework embraces information on four dimensions, including perceived hardware and software quality (32 items), image (13 items), perceived value (4 items) and customer satisfaction (3 items) all measured by using a seven-point Likert-type scale. The advantage of using an interval scale is that it permits the researchers to use a variety of statistical techniques which can be applied to nominal and ordinal scale data in addition to the arithmetic mean, standard deviation, product-moment correlations, and other statistics commonly used in marketing research (Malhotra, 1999). A selfadministered questionnaire was used to collect data from prospective customers who referred to private and governmental banks in the area of Tehran. The questions are based on a review of the literature and specific product contexts, and the questionnaire was pre-tested and revised. The questionnaires were distributed based on a cluster sampling method and collected at private and governmental bank branches in Tehran. Six hundred questionnaires were distributed and 551 useable samples were obtained after excluding the incomplete ones, yielding a 92% response rate from those who agree to participate. Cronbachs alpha was used to verify the internal consistency reliability.
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The customer satisfaction shows a significant internal consistency of 0.804. Cronbachs coefficients of perceived hardware and software quality, image, and perceived value were 0.88, 0.84 and 0.86, respectively. The reliabilities of the different measures in the model range from 0.80 to 0.88, which exceed the recommended threshold value of 0.70 (Nunnally, 1978). Data analysis involves descriptive statistics and structural equation modeling using AMOS structural equation program. AMOS is designed to estimate and test structural equation models (SEMs). SEMs are statistical models of linear relationships among latent (unobserved) variables and manifest (observed) variables. For this research AMOS is used to investigate the causal relationships, where the path coefficients are tested for significance and goodness-of-fit. The path diagram of the structural model specified (see Figure 1) is proposed based on the past literature in Section 2. The matrix of construct correlations appears in Table 1.
Table 1. Correlations of constructs Mean Standard Deviation 3.52 0.795 Quality Image Satisfaction Value
Quality
Image
Satisfaction Value
1 -.079 P= 0.063 0.232 P=0.000 0.161 P=0.000
2.74 3.39 3.38
0.976 0.557 0.488
-.079 P= 0.063 1 -0.062 P=0.143 -0.037 P=0.384
0.232 P=0.000 -0.062 P=0.143 1 0.471 P= 0.000
0.161 P=0.000 -0.037 P=0.384 0.471 P= 0.000 1
Note: p 0.01, p0.01

5. Structural equation modeling (SEM) results
Regarding SEM applications, Hair et al. (1998) asserts that there are three most basic measures of absolute fit of the model: the likelihood-ratio chi-square, the goodness-offit index, and the root-mean-square residual. In the present study, the chi-square value of 3.479 with 2 degrees of freedom was found to be statistically significant at (p<0.00) level (Table 2). The comparative fit index (CFI) value of 0.985 is at a marginal acceptance level, as is the root mean square residual (RMSR) value of 0.20. The root mean square error of approximation (RMSEA) has a value of 0.067, which falls inside the acceptable range of 0.08 or less. Thus, all of the absolute fit measures indicate that the model is marginally acceptable at best (see Figure 2). Apart from the models general fit for the data, it is also important to test its parameters. The significance tests for the structural model parameters are the basis for accepting or rejecting the proposed relationships between exogenous and endogenous constructs (Hair et al., 1998). The four exogenous constructs (perceived value, perceived hardware and software quality, image, and customer satisfaction) were proposed to be the antecedents of purchase intention. The estimated model results provided strong support for all four hypotheses (Table 3). H1, H2, H3, H4, and H5 which underlined the positive and direct role of perceived value, perceived hardware and software quality, image, in affecting customer satisfaction were accepted as their coefficient was significant and had the appropriate sign. Therefore, as far as the present empirical research is concerned, perceived value,
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perceived hardware and software quality, and image have a direct significant influence on customer satisfaction.
Table 2. Goodness of fit measures for the estimated model Goodness-of-fit measure Absolute fit measures Likelihood-ratio chi-square (2) Degrees of freedom Non-centrality parameter (NCP) Goodness-of-fit index (GFI) Root mean square residual (RMSR) Root mean square error of approximation (RMSEA) Expected cross-validation index (ECVI) Incremental fit measures Adjusted goodness of fit index (AGFI) Normed fit index (NFI) Parsimonious fit measures Parsimonious norm fit index (PNFI) Parsimonious goodness of fit index (PGFI) Model (AIC)
Estimated model
3.479 2 2.479 0.997 0.20 0.067 0.039 0.969 0.980 0.163 0.100 21.479
.63
Quality z2
.10 .11 1
.23
z1
.23
Value
.51
Satisfaction
-.01 .95 -.02
Image
Figure 2. Path coefficients for research variables
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Table 3. Hypothesis results for the structural model Research hypothesis Estimate H1:Perceived quality customer 0.111 satisfaction H2: Perceived quality Perceived value 0.097 H3: Perceived value customer satisfaction 0.507 H4. Image customer satisfaction -0.019 H5. Image Perceived value -.012
* Significant at the level of p< 0.001
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SE CR 0.026 4.218
Conclusion
Supported* Supported* Supported* Not supported Not supported
0.026 0.043 0.021 0.021
3.770 11.844 -0.902 -0.585
6. Discussion, conclusion and implications In service industries, the association between consumer satisfaction and the attributes of service has proved difficult to pinpoint because of the intangible nature of services. On the other hand, the quality level of service provided has been shown to have a significant impact on customer satisfaction. This paper examined the impact of influential factors on customer satisfaction in banking industry. Results indicate that perceived quality has a positive and significant impact on perceived value and customer satisfaction. Further, perceived value has a positive and significant impact on customer satisfaction. However, image cannot influence perceived value and consequently, customer satisfaction. These findings have several implications for bank managers. Managers should try to improve the quality of hardware such atmosphere, seats, location, parking lot, and personnel appearance. In addition, they should improve the quality of software such quality of personnel communications with customers, reduction of waiting time, acceleration in providing service, and paying attention to time management and project management. In addition, managers can decline the cost of using banking services to attract more and more customers. It leads to positive word of mouth about service providers and as a result, loyal customers. Providing a customer satisfaction measure system in banking industry can help to indentifying the shortages of service quality. This paper also has several directions for future research. This study can be performed in other service industries such as hospitality and transportation industries. Additionally, it is recommended that the role of information technology on customer satisfaction be considered in the banking industry. As a limitation of current study, this study performed in the area of Tehran that generalizability of findings will be restricted.
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References
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Anderson, E.W., & Rust, R.T. (1997). Customer satisfaction, productivity, and profitability: Differences between goods and services. Marketing Science, 16(2), 129 145. Anderson, E.W., Fornell, C. and Lehrmann, D.R. (1994), Customer Satisfaction, Market Share, and Profitability: Findings from Sweden. Journal of Marketing 58, 53- 66. Anderson, E. W. and Sullivan, M. (1993), The Antecedents and Consequences of Customer Satisfaction for Firms, Marketing Science 12, 125-143. Andreassen, T. W. and Lindestad, B. (1998), Customer Loyalty and Complex Services, the Impact of Corporate Image on Quality, Customer Satisfaction and Loyalty for Customers with Varying Degrees of Service Expertise, International Journal of Service Industry Management 9, 7-23. Bitner, M. J. and Hubbert, A. R. (1994), Encounter satisfaction versus overall satisfaction versus quality, in Rust, R. T. and Oliver, R. L. (Eds), Service Quality: New Directions in Theory and Practice, Sage, London. Bitner, M. J.(1990), Evaluating service encounters: the effects of physical surroundings and employees responses, Journal of Marketing, Vol. 54 pp. 69-82. Bolton, R.N. (1998). A dynamic model of the duration of the customers relationship with a continuous service provider: The role of satisfaction. Marketing Science, 17(1), 4565. Boshoff, C., & Gray, B. (2004). The relationships between service quality, customer satisfaction and buying intentions in the private hospital industry. South African Journal of Business Management, 35(4), 2737. Cameran, M., Moizer, P. and Pettinicchio, A. (2010), Customer satisfaction, corporate image, and service quality in professional services, The Service Industries Journal, Vol. 30, No. 3, pp. 421435. Fornell, C. (1992), A National Customer Satisfaction Barometer, the Swedish Experience, Journal of Marketing 56, 6-21. Fornell, C., Johnson, M. D., Anderson, E. W., Cha, J., and Bryant, B. E. (1996), The American Customer Satisfaction Index, Nature, Purpose and Findings, Journal of Marketing 60, 7-18. Hair, J.F., Anderson, R.E., Tatham, R.L. and Black, W.C. (1998). Multivariate Analysis. 5th ed., Prentice Hall International, Englewood Cliffs, NJ. Howard, J. A. and Sheth, J. N. (1969), The Theory of Buyer Behavior, New York, Wiley. Johnson, M. D., Gustafsson, A., Andreassen, T. W., Lervik, L. and Cha, J. (2001), The Evolution and Future of National Customer Satisfaction Index Models, Journal of Economic Psychology 22, 217-245. Kohli, A. K. and Jaworski, B. J. (1990), Market orientation: the construct, research propositions, and managerial implications, Vol. 54, pp. 20-35. Kristensen, K., Martensen, A. and Grnholdt, L. (1999), Measuring the Impact of Buying Behaviour on Customer Satisfaction, Total Quality Management 10, 602-614. Malhotra, N.K. (1999). Marketing Research: An Applied Orientation. 3rd ed., PrenticeHall, Englewood Cliffs, NJ.
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Martensen, A., Grnholdt, L. and Kristensen, K. (2000), The Drivers of Customer Satisfaction and Loyalty, Cross-Industry Findings From Denmark, Total Quality Management 11, 8544-8553. Meuter, M.L., Ostrom, A. L., Roundtree, R. I. and Bitner, M. J. (2000), Self-service technologies: understanding customer satisfaction with technology-based service encounters, Journal of Marketing, Vol. 64 No. 3 pp. 50-64. Mittal, V., Pankaj, K., & Tsiros, M. (1999). Attribute performance, satisfaction, and behavioural intentions over time: A consumption system approach. Journal of Marketing, 63(2), 88101. Morgan, N.A., Anderson, E.W., & Mittal, V. (2005). Understanding firms customer satisfaction information usage. Journal of Marketing, 69(3), 131151. Nunnally, J.C. (1981). Psychometric Theory. Tata McGraw-Hill, New Delhi. Oliver, R.L. (1997). Satisfaction: A behavioral perspective on the consumer. New York: McGraw- Hill. Taylor, S.A. and Baker, T. L. (1994), An assessment of the relationship between service quality and customer satisfaction in the formation of consumers purchase intentions, Journal of Retailing, Vol. 70, No. 2 pp. 163-178. Ueltschy, L.C., Laroche, M., Eggert, A., & Bindl, U. (2007). Service quality and satisfaction: An international comparison of professional services perceptions. Journal of Services Marketing, 21(6), 410423.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Empowering Provinces Through Decentralization of Educational Policy Measures
SADDAF AYUB RAJA
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Research Scholar, International Islamic University,Islamabad

Abstract
This study attempts to empower provinces through decentralization of educational policy measures. As decentralization involves the transfer of all or part of the decision making , responsibilities and management vested in the central authority towards another regional, provincial or local authority. Objectives of the study were: to clarify the concept of decentralization, to investigate the factors of decentralization in different educational policies of Pakistan, to identify different areas of decision making about education for provincial empowerment. Documentary analysis of Educational Policies of Pakistan was used as a method for this research study. Findings of the study showed that all educational Policies of Pakistan discussed decentralization but the detailed discussion was made in National Educational Policy (2009).It was suggested that seminar, workshop and field trips should be organized for students and teachers at school, college and at university level. For strong coordination, it was suggested that learning and teaching strategies should focus on cultural harmony.
Key Words: Decentralization, Educational policies, Strategies for Empowering Provinces Introduction:
Decentralization embraces the transfer of authority and responsibility for public functions from the central government to subordinate or quasi-independent government organizations or the private sector. It involves the transfer of all or part of the decision making , responsibilities and management vested in the central authority towards another regional, provincial or local authority (districts, municipalities, communities or towards schools themselves. The regional and local authorities may change and/or adapt educational priorities, curricula, teaching methods and educational management while managing their budget and the expenditure. The central authorities exercise only indirect control and monitoring of the local units but may set up machinery to regulate and evaluate local policies. Decentralization may be limited to the material and financial management of educational institutions, but also concern curriculum design. Types of decentralization include political, administrative, fiscal, and market decentralization. Political, administrative, fiscal and market decentralization can also appear in different forms and combinations across countries, within countries and even within sectors. Decentralization is the result of the process of political democratization, people want to be consulted and involved in decision making that concern them directly. It also helps in clarifying lines of accountability. Decentralization allows for the mobilization of resources at the local level through special taxes or community participation that would not be available otherwise.
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Review of the Related Literature:
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According to the Braun and Grote (2000) Decentralization is the transfer of authority and responsibility for public functions from a central government to subordinate governments. Governments are typically heterogeneous and complex entities that may consist of central, provincial, and local layers. Centralization and decentralization are modes of governance i.e. ways in which control is exercised and decision-making operates within the government. Decentralization involves devolution of different decision-making powers and responsibilities to sub-units of the government. Jimenez & Tan (2007) conducted his study on Decentralized and Private Education: The Case of Pakistan. He discussed the models of finance and provision of education, Government intervention in education in Pakistan, current policies: their rationale and implications. Kamat (2002) conducted his study on Deconstructing the rhetoric of decentralization: The State in Education Reform. He described decentralization as a mechanism of reconstruction and relates it with the new state of Globalization. Recommendations of the study were that current education reforms are systematically reorganizing state and civil society in the context of globalization. Braun & Grote (2002) conducted his study titled as decentralization serve the poor?He described decentralization and how to measure it,what are the driving forces of decentralization? And how decentralization effects on poverty? He concluded that political decentralization often benefits the poor, because involving civil society in planning, monitoring and evaluation public programs and policies is crucial steady progress Jamil (2006) conducted his study on decentralization and devolution in Pakistan: Educational Implications of the praetorian Interpretation. He mentioned the background: contextualizing decentralization in Pakistan and then Education Sector Reforms-Action Plan 2001-04.He pointed out some challenges that must be met if educational decentralization is to produce positive outcomes such as linking district realities with national restructuring efforts, devolving powers and authority to district mangers and local governance partners in the communities. Schneider (2003) conducted his study on Decentralization :Conceptualization and Measurement. He discussed conceptual confusion in decentralization research, conceptualizing and measuring the decentralization concept. He identified the dimensions of decentralization and its indicators with measures. Fakhir (2005) conducted his comparative study of Provincial Educational Administration System in Pakistan. The main objectives of the study were to: examine the existing setup of educational administration in all provinces and suggest some measures for improvement in all provincial educational administration systems in Pakistan.He concluded that there are too many complications in administrative and financial matters and financial powers are insufficient.
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Objectives of the study: study:
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Following objectives were formulated for conducting this
to clarify the concept of decentralization to investigate the factors of decentralization in different educational policies of Pakistan, to identify different areas of decision making about education for provincial empowerment.
Methodology:
Documentary analysis of Educational Policies of Pakistan was used as a method for this research study.
Findings and Discussion:
Decentralization of Educational Policy measures are reflected in many policies of Pakistan as discussed below: The Report of the Commission on National Education (1959) stated that if education administration is to operate effectively it must be organized and staffed in such a way as to respond to problems not only with efficiency but also with professional competence. The commission assigned leadership role to the Ministry of Education stating that "it must provide leadership and the expert advice that are needed to initiate and sustain educational efforts at all levels and in many specialties. This report proposed the establishment of separate sections with considerable autonomy and responsibility which was a concept of devolution of authority but unfortunately it remained unnoticed. New Education Policy (1970) suggested that decentralization of the administration of educational institutions so as to allow community participation and ensure academic freedom and administrative/ financial autonomy needed by educational institutions for their proper development. More specially, the policy suggested autonomous zonal college authorities, Education Service Boards; governing/advisory bodies of all institutions from secondary school upward; staff councils in secondary schools and colleges to manage day-to-day affairs; powers of spending funds placed at the disposal of the head of institutions and making ad-hoc appointments; teachers and students councils for student's welfare; National Council of Education as Standing Advisory Body. The New Education Policy (1972-80) went a step forward and suggested "to assist in the formulation, implementation and evaluation of education policies and practices. Consultation and policymaking Education Councils will be set up at national, provincial, district and institution levels .
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The National Education Policy (1979) stated "the existing institutions, structures and modes of operation cannot accommodate effective implementation of policies. The Federal Ministry of Education and Provincial Departments of Education, the Directorates of Education and other agencies under them will, therefore, be recognized to eliminate wastage and to ensure operational efficiency in term of policy objectives. As a matter of principle, all key posts in education administration will be manned by qualified and experienced educators. Educational administration will be further decentralized for effective supervision and management of education. Policy statement of National Education Policy (1992-2002) says that the managerial and administrative skills of educational personals will be improved through professional training in techniques and methods of educational administration. The process of decision-making will be decentralized. Educational development plans shall be effectively coordinated and monitored. Management of district level education will be improved by associating the local community. The Academy of Educational Planning and Management will be further strengthened to enable it to expand its training programs and extend it to the provinces. The National Education Policy (1998-2010) envisages employing a large number of competent and committed learning coordinators (LCs) and staff for supervision. It also aims at expansion and strengthening of centre/cluster school scheme for making management and supervision of schools more effective. District Education Officers (DEOs), Deputy District education officers (DDEOs), Assistant District Education Officers (ADEOs), Learning Coordinators (LCs), and Village Education Committees (VEC) shall be imparted training in management and VEC organization so as to improve the quality of administration and teaching in the school.The Policy asserts on the capacity development of Federal and Provincial departments regarding planning, management, monitoring and evaluation for achieving policy targets. It also focuses on the decentralization of selected management functions in elementary education towards the district, the school, and the community, and on effective organization of efforts of local bodies and communities. It was suggested in the National Educational Policy (2009) that steps should be taken for widening access and raising quality for education through setting National Standards ,Provincial and Area Governments plans , monitoring and inspection system at Provincial and District Governments Inter-Provincial/Area exchange of students and teachers and mechanism for strong at the Federal and Provincial level to ensure harmony between different sub-sectors of education. It was suggested that steps should be taken for mobilizing resources for education by proportional allocation to different sub sectors. Consensus on needs and priorities by the Federal and Provincial Area Government, foreign assistance through development of comprehensives sector plans by Provincial Area Governments. It was suggested that to develop a Whole of Sector View at Federal and Provincial level of education sector-wide planning should be coordinated by the Ministry of Education in order to bring together responsibilities for different sub-sectors of education, training and learning. To overcome fragmented
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Governance in the field of education, it was suggested that their respective role and responsibilities should be mapped and the Federal role shall be of a facilitator and cocoordinator. The Federal Ministry of Education should be the focal point for development of the National Education Policy. An overarching framework should be developed to aggregate the initiatives taken by Education Ministry, Provincial/areas education departments and organizations. Decentralization should be pursued at each level of governance to move decision making closer to the point of implementation and shall eventually move to the school level, The Provincial level Govt should have the choice of medium of instruction (Curriculum Development). The Provincial and Area EMIS shall cater to the data needs of all tiers of the local governments. It should also provide data to NEMIS for national aggregation on a routine and timely basis. Awareness campaigns shall be launched, at the District, Tehsil and Union levels, to sensitise communities about their role in school education.
Conclusion:
From the above findings and discussion, it was concluded that almost all educational Policies of Pakistan discussed decentralization. But the detailed discussion was made in National Educational Policy (2009).It should be implemented soon as it was realized that it is the demand of prevailing situation in Pakistan for empowering Provinces. If Policy action steps would not be taken then there would be more chances of clashes within the Provinces and it will affect the National integrity of Pakistan. Policy actions such as widening access, coherence for quality ,mobilizing resources for education, develop a whole of sector view for education should come under the Provinces for implementing decentralization of education system in Pakistan as it is the only solution for empowering provinces.
Recommendations:
From the above conclusion of the study, it was suggested that for widening access and raising quality for education, National Standards should be determined at school, college, teacher educational institutions .It was suggested that for achieving educational targets, Provincial and District Governments should establish monitoring and inspection system to ensure educational services in all institution at every level. For Inter-Provincial/Area exchange, it was suggested that seminar, workshop and field trips should be organized for students and teachers at school, college and at university level. For strong coordination, it was suggested that learning and teaching strategies should focus on cultural harmony. It was suggested that for mobilizing resources of education, proportional allocation such as elementary, secondary, college, vocational, technical ,teacher education and scholarship should be evolved by the provincial area governments. For organization/ fragmentation of education at Federal and Provincial level, it was suggested that it should be managed by one organization. For governance,
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responsibilities should be made cleared through national consultative processes involving all sectors of educational stakeholders. EMIS should maintain the data on all tiers of the local governments. It should also provide data for national aggregation on quarterly and annually basis. For awareness, it was suggested that campaigns should be launched including all sections of society such as politicians, businessman, social workers to sensitize communities about their role in school education.
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References:
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Braun,V.J& Grote,U(2000).Does Decentralization serve the poor? Germany: University of Bonn Centre for Development Research. Fakhir,S(2005),Comparative study of Provincial Educational Administration system in Pakistan, PhD Thesis, University f Arid Agriculture, Rawalpindi. Government of Pakistan, (1959), Report of the Commission on National Commission Education on 1959, Karachi: Ministry of Education. Government of Pakistan.(1970).New Education Policy 1970.Islamabad: Ministry of Education. Government of Pakistan.(1972).The Education Policy (1972-80). Islamabad: Ministry of Education. Government of Pakistan.(1979). National Education Policy 1979. Islamabad: Ministry of Education. Government of Pakistan.(1992).Education Policy 1992.Islamabad: Ministry of Education. Government of Pakistan, (1998), National Education Policy 1998-2010, Islamabad: Ministry of Education. Government of Pakistan,(2009),National Education Policy 2009, Islamabad: Ministry of Education. Jamil,B.R (2006).Decentralization and devolution in Pakistan: Educational Implication of the pracetorian Interpretation. Jimenez,E & Tan,P.J(2007),Decentralization and Private Education: the Case of Pakistan, Vol 23,No 2,1987,pp 173-190. Kamat,S(2003).Current Issues in comparative Education, Teacher Education: Columbia University Schneider,A(2003).Decentralization :Conceptualization and Measurement In Studies in Comparative International Development,Vol 38,No 3, pp32-56.
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Measurement of the Degree of Organizational Commitment among the Faculty Members of Private Sector Universities in Peshawar City.
Naveed Farooq (MS-HRM) Lecturer, National Universities of Modern Languages Islamabad Muhammad Irfan Lecturer, National Universities of Modern Languages Islamabad Muhammad Farooq Lecturer, Agriculture University Khyber Pukthan Khawa
Abstract This study was conducted with an objective to measure the degree of organizational commitment among the faculty members of private sectors universities in Peshawar city. A sample size of 115 faculty members from a total nine private sectors universities located in Peshawar city was randomly selected. The data was collected on socio demographic features include gender, age and qualification of the faculty. Descriptive statistics and Cross tabulation were used to measure the overall level of organizational commitment among the faculty members of private sectors universities in Peshawar city. In the study it was found that overall level of organizational commitment of the respondents were medium and based on gender commitment was high in female that of their male counterpart. Based on qualification master degree holders were more committed to their organization as compare to MS/MPhil or PhD degree holders. Commitment based on age, it was found that an age group consist of 36 to 45 years was more committed than those of their junior or senior fellow in age. Key words: Organizational Commitment, Private sector Universities, Peshawar, Cross tab, Gender, Age, Qualification, Descriptive. 1. Introduction Commitment to job is one of the most important factor affecting the development and reputation of the organization. However commitment is influenced by different factors e.g. salary, qualification, age, experience, co-workers and supervisory relationship and other facilities available to the employees of organization. It is a general perception that universities in private sector are having insufficient qualified staff to cope with the requirement of higher education commission responsible for the recognition of their degrees. Therefore most of them acquired the services of retired personnel's from public sectors universities to justify their existence. Since these universities are mostly established on commercial
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level of commitment among the faculty members of these universities.
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purposes and imparting education to the students therefore this study was conducted to determine the In 1990s organizational commitment remained a foremost topic in the filed of management sciences and a need was felt to develop a theory for the same. Organizational commitment was considered a multidimensional phenomenon keeping in view past history, associates and effects (Mayer et al, 2002). In the view of Yousaf (2000) there is variety in the publication regarding organizational commitment of different occupational group which include university teachers as well. Some year ago in less develop country teaching was consider as low paying and low status job but recently due to attractive package it has become a reputable profession. In our country both private and public sectors universities are imparting education to the society. As the salary package, working environment, ownership change, work load and other incentive and benefits are different from one institute to another and cause differences in the degree of organizational commitment. In the view of Evans (1998) there are different factors which add as causes of lesser organizational commitment within the occupation such as low grade, low compensation, rising trend in inflation and improvement in the prevailing education system. In the same way Firestone and Rosenblum (1988) suggested that the productivity of teachers depend on their level of commitment, committed faculty members can give better performance.The committed faculty members have strong relationship towards their university, pupils and devoted to their subject. Teaching as an occupation required closeness, independency, uniformity towards the professional standards and ethics of occupation. According to Somech and bogler (2002) teachers who are committed show such behaviors which help the institution to achieve its objective and expected to do more for the growth and reputation of institution and to remain a productive member of their organization in the long run. 2. Problem statement Measurement of the degree of Organizational Commitment among the faculty members of private sectors universities in Peshawar. 2.1 Objectives of the Study To determine the level of organizational commitment among the faculty members of private sector universities is the focused area of the research. To investigate the relationship on the basis of demographic characteristics i.e. Gender, Age, Educational level and Organizational Commitment of university Faculty.
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3. Significance of the study
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This thesis may assist to determine the level of Organizational commitment along with age, qualification and experience among the faculty members of Private Sector universities in Peshawar city. By reporting the level of organizational commitment in Private sectors universities will help the administration to design attractive HR policies and standard operating procedure so that their faculty members have high level of job satisfaction and commitment. Human resource has remained the most negligible area of different educational institution so it will help to design attractive human resource policies. The emerging problem of the organization is to retain the skillful and knowledgeable employees in which most organization failed. This thesis may help the administration of private sector universities to enhance the motivational level of faculty members and to make them productive employees of the organization. 4. Literature Review Becker (1960) introduced the concept of organizational commitment. According to his organizational commitment, individuals have to surrender some of the benefits while leaving from one organization to another. Employees can enjoy benefits if they keep on with the same organization. So in this case the commitment means continuance of service in the same organization, as employees enjoying different benefits while working there. This was termed as "consistent lines of activity" (p. 33). Mostly organizations offer side bets in the form of pension, old age benefits and some other on the job benefits which mostly dependent on the stay of employees and if they switch from the organization then they have to quit these benefits. These benefits bind individuals with the organization. There are two basic types of commitment identified by Salancik (1977) and Mowday et al,(1982). One is attitudinal and the other is behavioral commitment. In the attitudinal commitment the research has been directed to identify the past history and conditions of the commitment that develop the organizational commitment (Steers 1977). The contribution of attitudinal commitment was to find out the past correct history and results of commitment. In the opinion Mowday et al, (1982) the consideration of people in the attitudinal commitment is to see as the organizational objectives are consistent with individuals inspirations and goals. Mayer and Allen (1991) suggested that attitudinal commitment which is due to behavioral commitment influence employees to adjust or to change commitment. The concept of attitudinal commitment has a relationship to exciting and mental link with organization which is a sign of devotion, loyalty and accepts the organization objectives. The focus of Fperre and lawler study was to find out that the exhibition of one time behavior is repeated or not and to find out what change the attitude of employees (1980). Similarly Mowday et al, (1982) concluded that behavioral commitment bound employees with organization. In the opinion of Meyer and Allen (1996), due to behavioral commitment that action which comes from behavior performed again and again.
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The research conducted by A. Khatibi et al, (2009) to see the connection between job satisfaction and Organizational commitment in National Olympic & Paralympics Academy. The finding of the said research state that there is negative relationship between organizational commitment and work stress as stress in job increases it leads to lower level of organizational commitment. In the opinion of commitment. Lee et al, (2000) describe organizational commitment as spontaneous learning of the employee in the organization. In the same momentum Reyes (2001, p. 38) said that organizational commitment is positive association to the objectives and goals of the organization and become the flag-bearer of the organization not for the personal benefits but for the benefits of the organization. 5. Methodology The selected population for the said research is the faculty members of private sector universities in Peshawar city. There are 9 private universities exist in Peshawar i.e Sarhad University, Iqra National University, City University, Abasyn University, Preston University, Cecos University, Gandhara University, Fast University and Qurtaba University. 5.1 Sampling Procedure and Sample Size A total sample size of 115 was taken from 9 private sectors universities in Peshawar. Questionnaires were distributed among the faculty members of private sector universities in Peshawar and probability random sampling technique was used for the data collection. 5.2 Organizational Commitment Questionnaire Organizational commitment is defined as the degree at which an individual accepts and internalizes the goals and values of an organizational and plays an effective role to achieve these goals and values. Questionnaire used in this research for the measurement of the commitment was designed by Allen and Meyer (1991) and was used in study The Relationship between Job Satisfaction and Organizational Commitment among High School Teachers in Disadvantaged Areas in the Western Cape Town. The total number of questions in questionnaire is 18 in which 6 questions represent each factor of commitment. The instrument used Likert scale ranging from1 to 5 were used to judge the commitment. In which 1 represent strongly disagree, 2 indicate disagree, 3 shows neither agree nor disagree, 4 signify agree while 5 shows strongly agree, which includes the three kinds of commitment which are Affective Commitment, Continuance Commitment and Normative Commitment. Ying (2010), organizational commitment is necessary for the improvement of
technological advancement, which consists of affective commitment, normative and continuance
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5.3Reliability
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To check the reliability of the study the reliability coefficient was used. The Cronbachs Alpha of the organization commitment is 0.62. Although the Likert scale is well established technique but still for conformity of the study reliability was calculated. 5.4 Socio demographic profile of Sample Questions regarding socio demographic were incorporated in the questionnaire. These questions were regarding the age of respondents, to know their qualification and their experience in current organization as well as there total experience. Mostly the participants of the study were young faculty members. The range of age was from 23 to 70 years, which include minimum age of 23 and maximum 70, with most of them lying in the 25-30 year age group. Respondents for this study were the male and female faculty members of private universities. The response rate of female faculty was 15 percent of total respondents. The reason for relatively low percentage could be attributed to the fact that a few females were willing to participate while in contrast the response of male was high, 85 percent of the sample size. Majority of respondents hold Master degree which were 80 percent of sample size and those who have completed their Ms/MPhil degree they were 15% of the sample size. The remaining 5% hold PhD degree. 6. Data Analysis Data analysis is based on 115 questionnaires received from the faculty members of private sectors universities in Peshawar. The participants include both male and female of the universities. The faculty members held different level of education and they were differing in age. 6.1 Cross Tabulation As cross tabulation is useful for summarizing categorical variables, it is appropriate to run cross tabulation between organization commitment and gender, age and qualification. As this study has operational zed organizational commitment as three-component model, the cross-tabulation analysis is undertaken for all the three components of organizational commitment, i.e. affective, continuance and normative commitment as well as overall organizational commitment. Observed scores were utilized instead of theoretical maximum (5 X 18 = 90) and minimum (1 X 18 = 18) for cross tabulating organizational commitment. The maximum and minimum score of organizational commitment obtained from the analyze data which is 79 and 35 respectively. Based on the collection of score the low, medium and high commitment categories were established as 3550 (low), 51-65 (medium), and 66-74 (high). By keeping in view the above values the cross-tabulation of organizational commitment in term of gender, qualification and age is produced below: Table.1 for Cross tabulation explain the number of cases gender wise in each category for organizational commitment in private sector universities of Peshawar. The total participants for both categories are 115
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faculty members of private sector universities in which 102 are male and 13 are female participants. Among 102 male participants 66 have medium level of organizational commitment while 18 have low and 18 respondents have high level of organizational commitment. The female category explain that total 11 participants have medium level of commitment and 1 have low and in the same fashion 1 respondent have high level of organizational commitment. To conclude the table for organizational commitment with the help of cross tabulation we can say that 77 respondents both male and female have medium level of Organizational commitment while 19 respondents have high and 19 have low level of organizational commitment. Table. 2 for cross tabulation of organizational commitment shows the number of cases in each category defined by organizational commitment and qualification wise in private sector universities in Peshawar. The respondents who held Master degree are 92 in which 17 respondents have high level of organizational commitment while 14 respondents have low level of commitment and 61 respondents out of 92 have medium level of organizational commitment. The second category is those respondents who held Phil or MS degree. They are 17 in number in which only 1 respondent have high level of Organizational commitment and 3 candidates have low level of Organizational Commitment the majority of participants have medium level of Organizational Commitment, they are 13 respondents. The last category are those respondents who held doctorate degree, they are 6 in number in which 1 respondent have high level of Organizational Commitment while 3 have medium level of organizational commitment and 2 participants have low level of organizational Commitment. At the end we can say that in term of Qualification the participants falls in medium category of organizational commitment. Table.3 explained three categories of age. The first category consists of those respondents who are at the age of 35 and below. In this category the total number of respondents are 106 in which majority have medium level of organizational commitment i.e.72 and 18 respondents are those who held low and 16 held high level of organizational commitment. The second category consist of those participants who are between 36-45, they are 5 participants in which 3 have medium and 2 have high level of organizational commitment while no one have low level of organizational commitment. In the last category there are 4 respondents in which 2 have medium and 1 have low and 1 respondent have high level of organizational commitment. 7. Discussion and Conclusion The data analysis through cross tabulation describes gender wise number of cases in each category for organizational commitment in private sectors universities of Peshawar. The result shows that in term of gender female are more committed as compare to male. The result of this research has resemblance with the research conducted by (Cramer, 1993; Harrison & Hubbard, 1998; Mowday , 1982) also support that as compare to men, women are more devoted and committed to their organization. Similarly loscocco (1989) did research in manufacturing industry and recommended that female employees are more
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committed as compare to male counterpart. He took 3559 blue- color workers as a sample size and found that females are more committed. In contrast the finding of Nissim Aranya, Aharon Valency and Talma Kushnir found that male is more committed as compare to female employees. As in our culture there are barriers for women to enter the organization once they over come these barrier and secured a position in the organization then they remain committed to their organization. Teaching is considered the most prestigious and prominent profession in our culture therefore as compare male, female are more committed. The result of the data describe that in term of qualification those respondents who held Master and MS/M Phil degree hold medium and high level of organizational commitment. In contrast those participants who held doctorate degree hold lower level of Organizational commitment. This study is also supported by the other researcher results like ( Luthans in 1987, McClurg in 1999, Mowday in 1982, voster in 1992). The result of above studied exhibit that highly educated employees hold lower level of Organizational commitment. They gave logical reason that highly educated employees have high expectations and once these expectations did not fulfill the employees slack the level of commitment. They also concluded that highly educated employees are more committed to their profession and alternative jobs are available for them due to high qualification in the market, which leads lower level of organizational commitment. McClurg,s selected 24 various agencies for his research where he collected the data from 200 temporary employees and found that less qualified employees are more committed towards their Organization ( 1999). Although the research held in Western Cape exhibit that there is no significant relationship between Organizational commitment and qualification. It is the general phenomena that when individual spend most of the time in the organization they becomes more committed towards their Organization. It is due the reasons that the investment contributed/made by them with their organization in sufficient time period. Young employees have not contributed too much time and energy towards the organization as compare to old employees. The data analysis through cross tabulation describes age wise number of cases in each category for organizational commitment in private sectors Universities of Peshawar also describe the same phenomena. The result of the data explain that no individuals have lower level of organizational commitment in age group 36-45 and only one respondents held lower level of Organizational Commitment in the next group which consist of those respondents who are at the age of 46 or above. The first group consist of young employees who are at the age of 35 or below. In this group 18 respondents held lower level of organizational commitment. Recent study also shows the same relationship between age and organizational commitment. The result of the study shows that the respondents who young are held lower level of organizational commitment while those are old held high level of organizational commitment. It is link with international research finding ( Cramer, 1993; Dunham, Grube and Castaneda, 1994; Lok & Crawford, 1990; Luthans, 1992; Meryer & Allen, 1997; Mowday 1982, Sekaran; 2000). The entire above researcher found that organizational commitment increase wit age.
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8. Scope of Future Research
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This research can be enhanced and encompassed to a maximum level to other Universities in the province. Similar research can be conducted to find out the level of Organizational commitment among the faculty members of Public sector Universities. Furthermore we can compare the level of commitment of both the staff of private and public sectors Universities. It is advisable that the finding of this research can be compare among different sectors and culture. The outcomes of the research can be expanded to other South Asian Countries. Usually the relationship among the portfolio of demographic and psychographic variable cause or may cause variation in the degree of organizational commitment. The portfolio of demographic and psychographic includes pay, gender, education, Co-workers and supervisory relationship, family stress etc. Therefore while analyzing the degree of commitment the above forehead variables should be taken into considera i.e. population
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References
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Aranya.N., Kushnir.T., and Valency.A.(1986). Organizational commitment in a male dominated profession. Human Relations, 39, 433-448. Becker, H. (1960). Notes on the concept of commitment. American journal of Sociology, 66, 32-42. Evans, L. (1998). Teacher morale, job satisfaction and motivation. Paul Chapman Publishing Ltd, London. Farrell, D., & Rusbult, C. E. (1981). Exchange variables as predictors of job satisfaction, job commitment, and turnover: The impact of rewards, costs, alternatives, and investments. Organizational Behavior and Human Performance, 27, 78-95. Farrell, D., & Peterson, J. C. (1984). Commitment, absenteeism, and turnover of new employees: A longitudinal study. Human Relations, 34,681-692. Firestone, W. A., & Rosenblum, S. (1988). Building commitment in urban high school. Educational Evaluation and Policy Analysis, 10, 285-299 Harrison, J. K., & Hubbard, R. (1998). Antecedents to organisational commitment among Mexican employees of a U.S. firm in Mexico. Journal of Social Psychology, 138(5) 609-624. Khatibi.A. Asadi.H. and Hamidi.M.(2009). The relationship between job satisfaction and organizational commitment in National Olympic and Paralympic Academy. World journal of sport Sciences 2(4):pp 272-278,2009. Lee, Y. D., Chung, C. M., & Lin, Y. L. (2000). A research on the measuring of employees' organisational commitment in Taiwanese business. Journal of National Cheng-Kung University, 35, 133-157. Meyer. J. P., & Allen, N. J. (1984). Testing the Side-bet Theory of organizational commitment: Some methodological considerations. Journal of Applied Psychology, 69, 372-378. Meyer, J. P. & Allen, N. J. (1991). A Tree-component conceptualitazation of organizational commitment. Human Resource Management Review, 1, 61-89.
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Meyer, J. P., Stanley, D. J., Herscovitch, L., & Topolnytsky, L. (2002). Affective, continuance, and normative commitment to the organization: A Meta analysis of antecedents, correlates and consequences. Journal of Vocational Behavior, 61, 20-52. Mowday, R.T., Poerter, L. W., & Steers, R. M. (1982). Organizational linkages. New York: Academic Press. Mowday, R. T. Porter, L. W. & Steers, R. M. (1982). Employee-organization linkages. The psychology of commitment, absenteeism and turnover. New york: Academic Press, Inc. Reyes, P. (2001). Individual work orientations and teacher outcomes. Journal of Educational Research, 83(6), 327-335. Salancik, G. R. (1977). Commitment and the control of organizational behavior and belief. New directions in organizational behavior, edited by B.M. Staw and G.R. Salancik. Chicago: St. Clair Press.
Somech, A., & Bogler, A. (2002). Antecedents and consequences of teacher organizationa and professional commitment. Educational Administration Quarterly, 38, 555-577.
Steers, R. M. (1977). Antecedents and outcomes of organizational commitment. Administrative Sciences quarterly, 22, 46-56. Yousaf, D. A (2000). Organizational Commitment: A mediator of the relationship behaviour with job satisfaction and performance in a non western country. Journal of Managerial Psychology, 15 (1), 6-24
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Annexure Table.1 Organizational Commitment and Gender wise Cross tabulation.
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Gender * OC-Category Cross tabulation Count OC-Category High Male Gender Female 18 1 Low 18 1 Medium 66 11 Total 102 13
Total
19
19
77
115
Table.2 Organizational Commitment and Qualification wise Cross tabulation.
Qualification * OC-Category Cross tabulation Count OC-Category High Masters Qualification MS/Phil PhD Total 17 1 1 19 Low 14 3 2 19 Medium 61 13 3 77 Total 92 17 6 115
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Table.3 Organizational Commitment and Age wise Cross tabulation. Age-Category * OC-Category Cross tabulation Count OC-Category High 35 and Below Age-Category 36-45 46 and Above Total 16 2 1 19 Low 18 0 1 19 Medium 72 3 2 77 Total 106 5 4 115
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DEFENSE EXPENDITURE-GROWTH NEXUS: EMPIRICAL EVIDENCE FROM SELECTED SOUTH ASIAN COUNTRES
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Muhammad iftikhar ul Husnain Ph.D Scholar at School of Economic Sciences, Federal Urdu University of Arts, Science and Technology, Islamabad. Farzana Shaheen Lecturer at School Of Economic Sciences, Federal Urdu University of Arts, Science and Technology, Islamabad.
Abstract The primary focus of this study is to analyze the impacts of defense expenditure on economic growth in South Asian countries-Pakistan, India, Sri Lanka and Nepal-for the period 1975-2008. Ordinary Least Square method is used to estimate the regression coefficients. The results confirm the conventional wisdom that in developing countries defense expenditure affects growth negatively. Results remain consistent whichever source is used to finance defense expenditure. However, tax financed defense expenditure has less negative effect followed by bond financed and money financed defense expenditure. This suggests that to finance defense expenditure taxes are the least costly option with the governments in developing countries. In addition, the cuts in defense expenditure can leave space to allocate more resources towards human capital that in turn will stimulate economic growth. Key Words: Defense Expenditure, Growth, Tax, Debt, Seigniorage 1- Introduction: A remarkable finding that, Countries with heavy defense burden generally has the most rapid rate of growth, and those with lowest defense burdens tend to show the lowest growth rates (Benoit, 1978, p. 271), opened a new horizon for the researchers to investigate the complex relationship between defense expenditure and economic growth. Following this a vast majority of research has targeted defense expenditure-growth nexus in recent past. The results are diverse and inconclusive. The diversity of results is due to the country specific factors, nature of data, different proxies used to represent defense burden and different methodologies employed in the analysis. In broader sense three schools of thought can be mentioned that emerge from this empirical literature. The first school is of the view that national defense is a consumption good that reduces saving and crowds out private investment and affects growth negatively. In addition defense expenditure diverts resources from productive uses to unproductive uses (Smith, 1980; Lim, 1983; Heo, 1999; Klein, 2004; Karagol and Palaz, 2004). The second school believes that defense expenditure increases purchasing power and brings improvements in human and physical capital in addition to direct technology benefits that enhance economic growth (Benoit, 1978; Beenstock, 1998; Sezgin 2001; Atesoglu, 2002; Yildirim, Sezgin and Ocal, 2005). Contrary to first two schools of thought, the third school argues that defense expenditure has neither positive nor negative effect on growth (Biswas and Ram, 1986; Al-Yousif, 2002). In the presence of above arguments, in any country, the possibility of positive, negative or no effect of defense expenditure on economic growth cannot be simply ruled out without a rigorous and thorough empirical investigation. South Asian region does provide a good case for the study due to its comparatively higher defense expenditure and vital geo political situation. Handful of studies can be found that have targeted defense expenditure-growth nexus in case of developing countries [Note 1] but this study departs from the previous empirical literature in the following respect. The previous studies did not include source of financing of defense expenditure in the analysis that has led to the less reliability of regression coefficients. The inclusion of source of finance of the defense expenditure into the regression analysis is expected to increase the reliability and preciseness of the estimated parameters. In addition, it may have broader implications for the policy makers by helping them to choose most appropriate source to finance indispensible defense expenditure. The rest of the study unfolds as follows: In section 2 literature review is presented. Section 3 provides a historical perspective of defense expenditure growth in the sample countries. Section 4 comprises data
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and methodology. In section 5 results are discussed. The last section, 6, concludes with some policy implications. 2- Literature Review Each country has to allocate a portion of its resources to its defense requirements depending upon its geopolitical importance. However, economists are divided on the role of defense spending. The opponents of defense expenditure hold their ground on the following two arguments: (a) defense expenditure crowds out private investment; (b) defense expenditure cause higher deficit that, if financed through excessive borrowing, hurts private investment by increasing the interest rate in the credit market. On the other hand, proponents of defense expenditure believe that it is an effective fiscal policy tool to stabilize fluctuations in the economy. Generally, it is believed that demand side models find negative correlation between defense expenditure and economic growth while the supply side models either find a small positive impact or no impact at all. Moreover, the results remain consistent despite difference in time periods and estimating techniques (Sandler and Hartley, 1995). Halicioglu (2004) investigates the linkage between military expenditure and the level of economic growth in Turkey for the period 1950-2002 by using co-integration technique. The study supports the existence of a positive long run relationship between aggregate military expenditure and aggregate output in the country. A rise and fall in military expenditure has been closely associated with the changes in equilibrium level of output in Turkey in the study period. This result is in line with the findings of many other studies on the issue regarding Turkey. Using panel data econometrics techniques, Yildirim, Sezgin and Ocal (2005) analyze the impact of military expenditure on economic development in the Middle Eastern countries for the period 1989-1999 and conclude that, in general, defense expenditure stimulates economic growth in these countries. In addition, the factor productivity differentials are positive suggesting the more efficiency of the military sector than civilian sector because more modern technology is used by the military sector in these countries. The findings are in accordance with the empirical literature that supports the positive effect or no effect of military expenditure on economic growth. Smith (1980) provides a comprehensive analysis regarding defense expenditure and investment in 14 OECD nations for the period 1954-1973 and reports negative effect of military spending on investment that favors the crowding out hypothesis of the defense spending. He finds that the estimated coefficient on defense expenditure is not significantly different from -1. Khilji and Mahmood (1997) use time series data from 1972 to 1995 for Pakistan to analyze the impact of defense expenditure on economic growth employing four different models. They suggest that there exists bidirectional relationship between defense expenditure and economic growth. Pakistan defense burden is negatively associated with Indian defense burden and positively with the government budget. In a broader sense defense burden negatively affects economic growth in Pakistan. 3- Trends of Defense Expenditure in Pakistan, India, Sri Lanka and Nepal Defense expenditure is indispensable for any societys development that further depends on the provision of security and stability as prerequisites. Therefore, all countries allocate resources towards their military requirements with varying degree. South Asian countries have also been making huge expenditure to mitigate their defense needs due to internal as well as external security concerns over the years. Civil wars in these countries, the dispute of Kashmir between the two bigger economies of the region, Pakistan and India, are the major cause of this high level of defense expenditure. In addition, the strategic importance and vested interest of the super powers in this region have increased its importance many fold. However, the presence of large military spending in these countries is difficult to justify economically on security grounds as it squeezes the space for developmental expenditure that is the engine of economic growth for any economy. [Note 2] Therefore, this region has to solve the dilemma guns versus butter. This section gives a brief scenario of defense expenditure growth in these countries for the period 1975-2010. Pakistan allocates the highest share of its GDP on defense expenditure in South Asia followed by India, Sri Lanka and Nepal. Defense expenditure in Pakistan and India is decreasing and shows similar trend over time. However, in Sri Lanka defense expenditure does not exhibit a specific trend while in Nepal it is showing a trend contrary to that of Pakistan and India. [Insert Figure 1here] Figure 1 clearly shows that Pakistan has seen unprecedented increase in defense expenditure in 70s and 80s mainly due to the decade long military rule and increased hostility in relations with India in this era. Up to 1990 Pakistan defense expenditure was, on average, as high as 6% of GDP, a very high ratio from all respects. Since early 90s a continuous and gradual decline in defense spending can be seen mainly on
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account of revival of democracy in Pakistan and efforts to resume dialogues with India to reach a political solution on decades long dispute of Kashmir on the part of policy makers. However, it is feared that the arrested trend in military expenditure may rise again as Pakistani forces are busy in proxy war against Taliban in its north-western parts and end to this war cannot be predicted in near future. India also directs a huge amount of its resources towards its defense needs. However, on average, Indian defense expenditure express a gradual decrease over the last 35 years. Currently the share of defense expenditure has shrunk from 2.75 percent of GDP in 1980s to 2.21 percent of GDP in 2008. At present both the nations, Pakistan and India, are spending almost the similar share of their GDP on defense expenditure. Sri Lankan defense expenditure has been more volatile in the region during the last four decades. Till 1990, on average, defense expenditure was less than one percent of GDP. However, from 1991 to 2000 defense expenditure rose up to more than 3 percent of GDP. The government commitment to handle civil war gave birth to this high level of defense expenditure in the country. The last decade has seen a sharp decline in defense expenditure in Sri Lanka. Contrary to other economies of the region, defense expenditure in Nepal shows a continuous increase over the last four decades. Despite this, it is still able to manage its defense expenditure less than 2 percent of GDP. 4- Data and Empirical Design The data [Note 3] employed in this study comes from four sources-WDI, GFS, IFS and Pakistan economic survey. Variables have been categorized into fiscal and non fiscal variables. The variables of interest, the fiscal variables, include defense expenditure and the budget constraint. Per capita real GDP is the dependent variable [Note 4]. Four conditional variables include inflation, investment, population growth and trade openness. 4.1- Budget Constraint and Regression Specifications Simply speaking government generates revenue from three major sources viz., taxes, debt and seigniorage. Therefore, budget constraint becomes an identity as under: is the total government expenditure including interest payments on debt. is tax Where revenue , is the seigniorage used to finance budget deficit and is the debt financing or rest of the budget financing [Note 5]. If all components of equation (1) are included in the regression analysis, the problem of multicollinearity may arise. The solution is to omit (at least) one of the components of budget constraint from the regression equation. The excluded element becomes an implicit source of financing of expenditure as it can change freely. This taxonomy has been adopted from Ahmed and Miller (2000), Miller and Russek (1997), Bose, Holman and Neanidis (2005) and Husnain (2010). 4.2- Debt Financed defense Expenditure According to the taxonomy discussed previously we omit debt component of budget constraint and keep other sources of financing in this specification.
is the per capita GDP, is the vector of conditional variables, is the residual Where expenditure obtained by subtracting defense expenditure from total expenditure. In this specification debt is excluded and hence it becomes the implicit source of finance. is supposed to measure the effect of debt financed increases in defense spending on growth. 4.3- Money Financed Defense Expenditure Excluding revenues generated from printing of money makes it the implicit source of finance and the specification can be written as:
Where growth.
is supposed to capture the impact of seigniorage financed increases in defense expenditure on
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4.4- Tax Financed Defense Expenditure To know the impact of tax financed defense expenditure, we exclude tax revenue component of budget financing from our equation. We can write this specification as under:
is expected to capture the effect of tax financed defense expenditure on growth. [Insert Table 1here] 5- Results and Discussion A smart look at the results reported in table 4 shows a very consistent story in case of conditional variables. Population growth, as prior expectations, affects growth negatively. This finding is in line with the conventional wisdom that population growth hurts growth in developing countries. Empirically this finding is supported by Siddiqui and Malik (2001), Naqvi (2010) and Akram (2010). However, the findings of Husnain (2010) contradict this result when he reports that population growth has positive but insignificant effect on economic growth in the same sample. The negative association between population growth and per capita GDP may be due to the fact of low marginal productivity of labor, a common phenomenon, in developing countries. Trade openness, as expected, stimulates growth in the sample countries which shows the improved competitiveness and productivity of these economies as a result of trade flows. Husnain (2010) also reports the positive effect of trade openness on economic growth in south Asia. Bose, Holman and Neanidis (2005) point out the positive effect of trade variable on economic growth both for developed and developing countries. Investment is positively associated with per capita real GDP that reveals the complementary role of infrastructure in economic development of this region supporting the findings of earlier empirical studies that consider capital formation as an engine of economic growth (Siddique and Malik, 2001). This can be explained in terms of either underinvestment on the part of private sector or the greater marginal productivity of public sector resources. It suggests that scarce government expenditure should be directed to increase new human capital along with the maintenance of the existing stock of human capital Husnain (2010). Inflation shows negative but insignificant relationship with economic growth. Generally it is accepted that moderate inflation help boost economic activity while high inflation creates distortions, particularly uncertainty, in the economy that impede economic development (Padvano and Galli, 2001; Romero-Avila and Strauch, 2008). In case of defense expenditure, very interesting findings emerge from the analysis. The role of defense expenditure has been detrimental to growth over the years in this region. The findings are robust as the coefficient remains highly significant across all specifications. This result supports the findings of many of the empirical studies addressing the same issue. For example, Lim (1983), Faini et al (1984), Linden (1992), Klein (2004) among others report the negative effect of defense expenditure on economic development. However, a handful of empirical studies as Benoit (1973, 1978), Deger (1986), Biswas (1993) and Sezgin (2001) contradict these findings by reporting positive effect of defense spending on growth. Further analysis exhibits that defense expenditure, when financed through seigniorage, hurts growth most followed by debt financed and tax financed defense expenditure. It suggests that to finance defense expenditure taxes are the least costly means available with the government. Number of plausible explanations can be listed for this robust negative effect of defense expenditure on growth; however, these explanations cannot serve as an alternate to a rigorous analysis of the defensegrowth nexus. First and foremost is the relatively higher share of defense expenditure in this region which absorbs a large proportion of the limited financial resources and so slow down growth. Secondly, defense expenditure, among others, has led to high fiscal deficits and mounting debt burdens that in turn have affected growth negatively over the years. Thirdly, the possibility of substantial reduction in aggregate saving cannot be rejected due to military expenditure that must ultimately be harmful to growth and development. Beyond that specific research agenda a key message emerges from this analysis generally for developing countries and particularly for south Asian economies that had they lowered defense expenditure they would have faced more manageable fiscal deficits and debt burdens and achieved higher levels of growth and development. In current scenario the only panacea to major issues prevailing in the region seems a political will and determination on the part of policy makers to address these issues. Furthermore, good Where
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governance within country can ensure optimal utilization of the scarce resources that in turn could stimulate growth process. 6- Concluding Remarks The aim of the study was to analyze the impact of defense spending financed though different sourcestaxes, debt and seigniorage-on growth for the period 1975-2010. Ordinary Least Square method was used to estimate regression coefficients. The results reveal that defense expenditure inhibit growth. However, the tax financed defense spending hurts growth least followed by debt financed and seigniorage financed defense expenditure. The currently excessive borrowing of governments from central and commercial banks to mitigate rising military expenditure can have heinous affects on growth in coming years. The results are in conformity with the conventional wisdom that in developing countries military burden is negatively associated with growth. The military spending needs gradual but consistent cuts as it will make possible allocation of more resources towards human capital that in turn will stimulate growth. However, the size of cuts is hard to quantify in the presence of current security concerns of the country that demands for more military expenditure. Only political solutions to internal and external disputes can ease the pressure of defense spending in this region. However, it should be noted that drastic reductions in defense expenditure would do more harm than good. As an alternate overhauling of the tax system can be more effective to address the issue of resource crunch that is expected to have positive effect on growth through reduction in fiscal deficit and improvement in physical as well as human capital. The results of the study are limited in scope and cannot be generalized across countries due to difference in specific features of the countries. It seems premature to reach a conclusive decision on the basis of these findings without further research. One way to analyze defense-growth nexus may be to enlarge the sample size. Similarly longer time series data, provided available, can produce more reliable results. Secondly, the disaggregation of military expenditure into different components (i.e. the allocation between equipments, R&D, personnel and other budget items can be useful to analyze their individual impact on growth. Thirdly, micro-economic analysis focusing on the growth and performance of civilian and defense firms seems more inserting topic for future researcher.
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References Ahmed, H., & Miller, S. M. (2000). Crowding-out and Crowding-in Effects of the Components of Government Expenditure. Contemporary Economic Policy, 18(1), 124-133. Akram, N. (2010). Public Debt and Pro-Poor Economic Growth: Cross country Analysis with Special Reference to Pakistan. PhD thesis, Federal Urdu University of Arts Science & Technology, Islamabad. Al-Jarrah, M. A (2005). Defense Spending and Economic Growth in an Oil-Rich Country: The Case of Saudi Arabia. Pakistan Economic and Social Review, XLIII (2), 151-166. Al-Yousif, Y. K. (2002). Defense Spending and Economic Growth: Some Empirical Evidence from the Arab Gulf Region. Defense and Peace Economics, 13 (3), 187-197. Atesoglu, H. S. (2002). Defense Spending Promotes Aggregate Output in the United States: Evidence from Cointegration Analysis. Defense and Peace Economics, 13(1), 55-60. Beenstock, M. (1998). Country Survey XI: Defense and the Israeli Economy. Defense and Peace Economics, (9), 171-222. Benoit, E. (1973). Defense and Economic Growth in Developing Countries, Lexington: Lexington Books. Benoit, E. (1978). Growth and Defense in Developing Countries. Economic Development and Cultural Change, 26, 271-280. Biswas, B., & Ram, R. (1986). Military Spending and Economic Growth in Less Developed Countries: An Augmented Model and Further Evidence. Economic Development and Cultural Change ,34(2), 361 372. Biswas, B. (1993). Defense Spending and Economic Growth in Developing Countries. Boulder, CO: Westview Press. Bose, N., Holman, J. A., & Neanidis, K. C. (2005). The Optimal Public Expenditure Financing Policy: Does the Level of Economic Development Matter. Centre for Growth and Business Cycle Research, Discussion Paper Series. http://www.ses.man.ac.uk/cgbcr/discussi.htm Deger, S. (1986). Military Expenditure and Third World Countries: The Economic Effect, London: Routledge and Kegan Paul. Faini, R., Annez, P., & Taylor, L. (1984). Defence Spending, Economic Growth, and Growth Evidence Among Countries over time. Economic Development and Cultural Change, 32 (3), 487498. Fischer, S. (1982). Seigniorage and the Case for National Money. Journal of Political Economy, 90 (2), 295-313. Global Monitoring Report (2010), Education For All (EFA), UNESCO. Halicioglu, F. (2004). Defense Spending and Economic Growth in Turkey: An Empirical Application of New Macroeconomic Theory. Rev. Middle East Econ. Fin., 2(3), 193-201. Heo, U. (1999). Defense Spending and Economic Growth in South Korea: The Indirect Link. Journal of Peace Research, 36(6), 699-708. Husnain, M. I. (2010). Expenditure-Growth Nexus: Does the Source of Finance Matter? Empirical Evidence from Selected South Asian countries. 26th AGM and conference of the PSDE, PIDE, Pakistan (28th-30th December, 2010). Karagol, E. & Palaz, S. (2004). Does defense Expenditure Deter Economic Growth in Turkey? A Cointegration Analysis. Defense and Peace Economics, Taylor and Francis Journals, 15(3), 289-298. Khilji, N. M., & Mahmood, A. (1997). Military Expenditures and Economic Growth in Pakistan. The Pakistan Development Review, 36(4), 791-808. Klein, T. (2004). Military Expenditure and Economic Growth: Peru 1970-1996. Defense and Peace Economics,15(3), 275-288. Lim, D. (1983). Another look at Growth and Defense in Developed countries. Economic Development and Cultural Change, 31(2), 377-384. Linden, M. (1992). Military Expenditure, Government Size and Economic Growth in the Middle East in the Period 1973-85. Journal of Peace Research, 29(3), 265-270. Looney, R. E. (1997). Excessive Defense Expenditure and Economic Stabilization: The case of Pakistan. Journal of Policy Modelling 19 (4), 381406. Miller, S. M., & Russek, F. S. (1997). Fiscal Structures and Economic Growth: International Evidence. Economic Inquiry, 35(3). Musgrave, R. (1969). Fiscal Systems. (Yale University Press: New Haven). Naqvi, S. N. H. (2010). The Evolution of Development Policy: A Reinterpretation, Oxford: Oxford University Press.
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Padovano, F., & Galli, E. (2001). Tax Rates and Economic Growth in OECD Countries (1950-1990). Economic Inquiry, 39, 44-57. Romero-Avila, D., & Strauch, R. (2008). Public Finance and Long-Term Growth in Europe: Evidence from a Panel Data Analysis. European Journal of Political Economy, 24(1), 172-191. Sandler, T., & Hartley, K. (1995). The Economics of Defense. Cambridge University Press. Sezgin, S. (2001). An empirical analysis of Turkeys Defense-Growth Relationships with a MultiEquation Model (19561994). Defense and Peace Economics, 12(1), 6986. Siddiqui, R., & Malik, A. (2001). Debt and Economic Growth in South Asia. The Pakistan Development Review, 40(4), 677-688. Smith, R. (1980). Military Expenditure and Investment in OECD 19541973. Journal of Comparative Economics, 4(1), 1932. Yildirim, J., Sezgin, S., and Ocal, N. (2005). Military Expenditure and Economic Growth in Middle Eastern Countries: A Dynamic Panel Data Analysis. Defense and Peace Economics, 16(4), 283-295. Endnotes [Note 1] See for example (Benoit, 1973, 1978; Lim, 1983; Looney, 1997; Klein, 2004; Al-Jarrah, 2005). [Note 2] One-fifth of Pakistans military spending would be sufficient to finance the universal education (Education for all (EFA) global monitoring reports, 2010). [Note 3] Annual data is used in the analysis. [Note 4] Per capita GDP is usually regarded as the single most representative index of development (Musgrave 1969). [Note 5] New issues of interest bearing debt make a major part of rest of budget
financing (Bose, Holman and Neanidis, 2005).
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Annexure Figure 1: Defense Expenditure in Selected South Asian Countries (as % of GDP)
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Source: Government Finance Statistics (various issues).
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Table 1: Estimation Output Using Ordinary Least Square Method
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______________________________________________________________________ Tax Finance Debt Finance Money Finance1 ______________________________________________________________________ Defense Expenditure -0.630* -0.803* 0.871*** [-3.39] [-3.01] [-1.89] Other Expenditure 0.622 [-1.12] Openness 0.340* [3.17] [3.38] Population -0.183 [-3.65] [-1.18] Investment 0.193* [3.31] [4.12] Inflation 0.832 [1.45] [1.54] F-test 2.23 2.30 2.19 R-Square 0.386 0.443 0.402 _____________________________________________________________________ *, *** mean significantly different from zero (two tailed test) at 1%, and 10% level respectively and t-statistics are
in parenthesis.
-0.291* [-3.05] 0.313*
-0.404***
[-1.75] 0.291* [3.75]
-0.342*
-0.381* [-2.77]
0.258*
0.201*** [1.81]
0.332
0.543 [1.09]
We use Fischer (1982) procedure to estimate magnitude of seigniorage in our base line regression.
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Role of Self Concordant Goals in Obtaining Innovation and Creativity in the Employees
Wasiq Ejaz MS Scholar, Iqra University Islamabad, Pakistan Syed Saad Hussain Shah MS Scholar, Iqra University Islamabad, Pakistan Jabran Aziz (Corresponding Author) MS Scholar, Iqra University Islamabad, Pakistan Ahsan Raza Jaffari MS Scholar, Iqra University Islamabad, Pakistan Amir Zaman MS Scholar, Iqra University Islamabad, Pakistan Mohsin Raza Jaffari Independent Researcher - Pakistan
Abstract In todays fast-paced economy innovation and creativity is an issue of services and products. The organizations are now giving very more importance to the creativity and innovation as a competitive advantage. The self concordant goals are the employees set goals to achieve the organizations objectives. The employees feel much happier and motivated in achieving self set goals which are related to their interests and beliefs. Ongoing research paper identifies how self concordant goals can affect the
innovation and creativity environment in the organization. The data has been collected through the detailed interviews of managers working in the banking sector. The result indicated a significant relationship between self concordance goals and innovation & creativity. Key Words: Innovation and creativity, self concordance, competitive advantage, interests and beliefs, motivated 1. Introduction: The need of creativity in products, services, procedures and processes is much more important than ever. It is not important for a specific sector, but equally vital for the enterprises, public sector organizations
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and the new ventures. In this era of modern business methods, innovation is considered as an important key for the success of organization. Only thinking the creative ideas are not important only, but implementation of those ideas by developing new products and services and by creating new ways of working is important. The innovation in the organization could be improved by improving employees creativity. Creativity can be said as the seed or base of the innovation (Conti et al. 1996). There could be many competitive advantages, but taking creativity and innovation as the competitive advantage distinguish the organization from others. Creativity and innovation may play a key role in maintaining organizations competitive advantage. It is the responsibility of the managers to create an environment, which supports the individual creativity and innovation in the work matters. By giving the employees autonomy and empowerment, the way to innovation can be created in the firm. Empowerment brings motivation, understanding and confidence to commence innovation and also helps in putting the ideas into practice. To motivate the employees for getting the creativity and improving organizational innovation is a very burning challenge the organizations are facing these days (Anderson, 1998; Mumford, 2000). The affective communication system in the organization can also help in implementing the innovation and creativity culture in the organization. There is a need of encouraging and creative environment and culture in the organization to run effectively the problems related to the creativity. Creativity lift up new ideas and Innovation brings those new ideas to reality. Tom Hopkins, in his book Official guide to success, said that the profit of great ideas comes when you turn them into reality. When an individual sets his own goals by keeping in view his interests and understanding, there are more chances that it leads to the success for achieving them. The self concordance of goals shows the real interests, desires, values and beliefs of the individual. If a person chase the organizations goals by adjusting them with his own, that could be affected for achieving the overall organizational aims. Sheldon & Elliot (1998) said self concordance as persons goal-oriented concept. The self concordant goals will get a pure attention and efforts from the employees as they are more realistic and have some gratifying affect on the employees. Sheldon & Elliot (1999) linked self concordant of goals with positive attainment and satisfaction associated with its achievement. It could be helpful in the creative and innovative environment of the organization, to give employees the autonomy of setting their goals by themselves.
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The purpose of this paper is to find out the relationship between the innovation and creativity with the goals, which are self concordant. It will find out whether the organizations, which gives the autonomy to their employees in setting their own goals, leads to the creativity and innovation or not. It will conduct a brief research on some banks operation in Islamabad and Rawalpindi. 2. Literature Review: In this globalization environment, it is very important for the organizations to change and adapt in order to keep them self competitive (Hall, 1996; Hammer and Champy, 1996; Higgins, 1996; Hinings and Greenwood, 1988; Hurst, 1995; McKenzie, 1996). So to move on with the rest of the competitive world, the managers must stop using the traditional wisdom and depend on new behavior (Hall, 1996). In this period of globalization and struggle, creativity and innovation are to be considered as the key factors for the continued existence, success and dominance of the organizations (Peter Cook, 1998). According to the different authors and professionals, to achieve the competitive strategic advantage, it is important to consider innovation as a key for that (Higgins, 1996). As West and Farr (1990) explained that innovation is the planned activity within a role, group or organization of ideas, products or processes, designed especially to benefit the individual, the group or organization. Innovation is a situation of being, one that varies from being unruly to environments that are quietly caring (Christensen, 1997). It is the adoption of an idea, policy, program, process or product, which is new to the organization (Hage, 1999). According to Rogers (1995), innovation is an idea, practice or a thing that is supposed to be a new by an individual or group. Gurteen (1998) defines creativity as production of ideas, whereas innovation is putting these ideas in to actions by exploratory, refining and executing. Innovation is an environment or a culture which exists in a company and creates value addition (Buckler, 1997). Innovation is a process where ideas are produced and changed for success to business products and services (Majaro, 1988). Creativity is the process used in developing an idea for a new invention (Amabile 1983, 1997, and 1998). Innovation and creativity are usually considered to be vital
competencies for civilizing organizational continuing power (Amabile, 1988; Kanter, 1983; Tushman and OReilly, 1997; Utterback, 1994; Woodman et al., 1993). In order to improve the probability of long-term staying power, organizations should focus on supporting entity creativity in the workplace (Amabile, 1988; Cummings et al., 1975; Woodman et al., 1993). Amabile (1996) has recommended that individual creativity nourish organizational innovation and, equally, that the work environment impacts individual
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creativity. Nishibori (1972) focuses on the importance of including creativity, physical activity and sociality on the human work. Creativity is vital for the organizational innovation because it gives a long term survival and success to the organization (Kanter, 1983; Tushman and OReilly, 1997; Utterback, 1994). According to Laursen and Salter (2006), the essential part of innovation process is to manage the search for new ideas that have commercial potential. Creativity can improve communication, promotes learning and exploration of the problem and facilitates in developing new ideas and solutions (Tannenbaum, 1997). According to Mc Fadzean (1997), the environment and culture of the organization much be encouraging and creative thinking to run effectively the problem solving meeting. Creativity and innovation needs the support of senior management of the organization (Jones and McFadzean, 1997). Hall (1996), stress the need of atmosphere of enjoyment and fun in the surroundings. Such type of environment may be created by dropping distractions and creating relaxation (Alder, 1993; Briggs and Nunamaker, 1996). The organizational culture is considered as one of the most important factor that can arise the innovation behavior among the employees of the organization (Ahmed, 1998; Ekvall, 1996; Martins and Terblanche, 2003; McLean, 2005; Mumford, 2000). Some of the determinants of organizational culture which manipulates creativity and innovation as defined by Martins and Terblanceh (2003) are approach, organization, support, motivational behaviors and open communications. The innovation has a positive affect on the performance of the organization by mean of profitability, growth and effectiveness (Damanpour & Gopalakrishnan, 2001; Prajogo, 2006). Various researches have identified that to enhance personal creativity and innovation, job enrichment and proper autonomy is considered as imperative factors (Ford & Kleiner, 1987; Oldham & Cummings, 1996; Tierney & Farmer, 2004). Self-concordance refers to the degree to which actions such as work-related responsibilities or goals convey individuals' real interests and values (Sheldon & Elliot, 1999). It is the extents to which people follow their set of personal goals with approach of intrinsic interest and self likeness, rather than with feelings of introjected responsibility and external pressure (Csikzzentmihalyi, 1993; Brunstein & Gollwitzer, 1996; little, 1993; Deci & Ryan 1991). Own goals can give sense and grounds to an individuals motivational experience (Little, 1983; Emmons, 1989, 1996; Klinger, 1996). When the goals are pursued because of either intrinsic or identified motivation are known as self concordant and will be incorporated with the self (Deci & Ryan, 1985; Sansone & Harack-iewicz, 1996). Sheldon & Elliot,
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(1997) proposed that people who single out goals that are concordant with their principles, interests, and ethics are happier than those who pursue goals for other. It is the responsibility of the managers or the leaders to create such environment so that employees set their goals as per the organizations goals. When a leader provides a significant motivation for the work to be completed, self-concordance is increased (Ryan & Deci, 2000). Self-concordant goals are possibly to receive continuous effort over time, be more realistic, and as such are more pleasing. On the other hand goals pursue only because of external demands or because of feelings of shame and unease are assumed to come from nonintegrated areas of the self. Because they are less integrated and representative of firm interests, the motivational strength behind nonself-concordant goals is likely to weaken and make them less manageable and less satisfying. Different authors have found that the self directed motivation was linked with the goal direction, attainment and satisfaction associated with goal achievement (Sheldon & Elliot, 1999). The idea of self concordance is proposed as a best way of getting goals (Sheldon & Houser-Marko, 2001). The people who set their own goals which are concordant with their interests, values and ideas are much happier than those who attain goals for other reason like extrinsic or self-protective reasons (Sheldon & Elliot, 1998). As stated by Church (1997), the people who recognize themselves positively, by creating high respect and low neuroticism, are mostly able to pursue their self concordant goals to a greater degree as compare individuals having negative self view. By setting the personal goals, the people can motivate themselves (Bandura, 2001). When a person achieves his goal, he really feels good and motivated (Emmons, 1996). The contribution of Sheldon and Elliot (1999) is very significant on the study of self concordance. They presented a self-concordance model, which basic theme is that the goals which are self concordant leads to goal attainment and well-being. The self concordance model shows four reasons for pursuing goals. External reason, Introjected reason, Identified reason and intrinsic reason. Ryan & Deci (2000) states self concordance model as a theory of self regulation based in self determination theory. The people with a positive self-interest have a tendency to trail self-concordant goals and that these self-concordant goals make them happy (Elliot & Sheldon, 1998; Elliot et al., 1997). Inhabitants with encouraging self-regard bend to be more satisfied with their work and life (Judge & Bono, 2001; Judge et al., 1998, 2000). Houser-Marko (2001) gives support that
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self concordance lead to an upward spiral of well-being, which in turn leads to stronger belongings over time.
3. Research Model & Hypothesis: The studys main variables are innovation & creativity and self concordant goals. These two variables are construct variables with multi- dimensions. This research is essentially exploratory in nature based on a review of the existing knowledge. An empirical investigation using actual manager interviews is also conducted in this research in order to find out the limitations and postulations found in the existing knowledge. Based on the theoretical background of the study, the main hypothesis concerned with the relationship between innovation & creativity and self concordant goals. The hypothesis would be stated as follow:
H 1: There is significant positive relationship between innovation & creativity and self concordant goals. 4. Methodology: The researcher has interviewed 15 managers from different successful banking organizations. The interviews are centered on main issues. The interviews were conducted using the different important questions related to the organizations environment of supporting innovation and creativity. Different questions were carried out on the importance of self concordance of goals. The managers are asked the level of autonomy which they give to their employees to set their own goals and its affect on the innovation and creativity. The satisfaction attached in setting ones own goal is also discussed in detail. Questions related to the innovation and creativity in the organization are also asked, which are adapted from different researches. 5. Result and discussion: Based on the interviews conducted with the managers of different banks, it is observed that the most of the managers are in support of this fact that self concordant goals have a positive affect on the organizational innovation and creativity environment. It also leads the employees performance in an affective way as they are more frequently fulfilling the organizations goals, which they have adopted by themselves. As the previous research suggested that the people or employees setting their own goals similar with their interests, values and ideas are much happier. This statement is also proved to be correct
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after interviewing different managers and knowing their experience in that. The individuals analyze their interests, values and ideas before setting the goals. When they are fully aware of what they have in their minds and what they could give to the organization, they set the self concordant goals which leads to the success for them and organization. Creativity is the construction of new and noble ideas which comes through the mind of the employees when they are facilitates to set their own goals and try their own way to achieve them. It helps in getting new creative ideas as to achieve them set goals; they will take more interest and motivation. When the ideas are constructed or produce, next step is to put those ideas into the reality. Innovation is the way which puts these ideas into reality or practical by exploration, refining them and at the end executing them in a perfect manner. The employees feel very motivated and keen when they see their creative ideas practically implemented in the organization. This brings the sense of achievement in the employee which leads to the motivation and commitment with the organization. When the employees are given free hands to set their own targets and goals, they set the goals which are achievable and give them satisfaction. Due to this reason, few of the managers are against this fact that self concordance goals leads to the innovation and creativity. They are of the view that it leads to the dysfunctional of the organizational goals as every individuals try to achieve the goals in which they are interested, not the management. They are of the view that the goals should be set in coordination with the employees and do not give all the autonomy to the employees for setting the goals. This debate requires a detail research to say something in a better way. So the hypothesis stated above that there is significant positive relationship between innovation & creativity and self concordant goals is accepted in this research based on the interviews conducted with the mangers of the top banks of Pakistan. So the research suggests that, by involving the employees in setting their own goals which are according to their interests and values, leads to the innovation and creativity in the organization. It the responsibility of the mangers to create such environment which facilitates the employees so set their own goals accordingly to the organizations targets and objectives. The managers must give employees confidence and motivation to adopt the organizational goals by realizing their own. Also the existence of creative and innovate environment in the organization is very essential for the prosperity of the ideas among the employees. The limitation in this paper is its limited area of research. The future researchers can study the relationship of the self concordance with the innovation & creativity in detail by including the employees in the research, along with the managers.
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References
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John Steele and Mike Murray (2004), Creating, supporting and sustaining a culture of innovation, Engineering, Construction and Architectural Management Volume 11 Number 5 2004 316 322. Pervaiz K. Ahmed (1998), Culture and climate for innovation, European Journal of Innovation Management Volume 1 Number 1 1998, 3043. John Man (2001), Creating Innovation, Work Study Volume 50-Number 6-2001, 229-233. Paul Her big and Steve Dun phy (1998),Culture and Innovation, Volume 5 Number 4, 1998. Kasia Zdunczyk and John Blenkinsopp (2007), Do organizational factors support creativity and innovation in Polish firms? , European Journal of Innovation Management Vol. 10 No. 1, 2007 pp. 25-40 q Emerald Group Publishing Limited 1460-1060 DOI 10.1108/14601060710720537 Elspeth McFadzean (1998), Enhancing creative thinking within organizations Management Decision 36/5 [1998] 309315 MCB University Press [ISSN 0025-1747] Maria Elmquist, Tobias Fredberg and Susanne Ollila (2009), Exploring the field of open innovation, European Journal of Innovation Management Vol. 12 No. 3, 2009 pp. 326-345 q Emerald Group Publishing Limited 1460-1060 DOI 10.1108/14601060910974219 Yoshio Kondo (2000), Innovation versus standardization, The TQM Magazine Volume 12. Number 1. 2000. 6-10 Trudy C. DiLiello; Jeffery D. Houghton (2006), Maximizing organizational leadership capacity for the future; Toward a model of self-leadership, innovation and creativity, Journal of Managerial Psychology Vol. 21 No. 4, 2006 pp. 319-337 q Emerald Group Publishing Limited 0268-3946 DOI 10.1108/02683940610663114 C. Brooke Dobni (2008),Measuring innovation culture in Organizations: The development of a generalized innovation culture construct using exploratory factor analysis, European Journal of Innovation Management Vol. 11 No. 4, 2008 pp. 539-559 q Emerald Group Publishing Limited 1460-1060 DOI 10.1108/14601060810911156 Naranjo Valencia; Valle and Daniel (2010), Organizational culture as determinant of product innovation, European Journal of Innovation Management Vol. 13 No. 4, 2010 pp. 466-480 q Emerald Group Publishing Limited 1460-1060 DOI 10.1108/14601061011086294
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J. Roland Ortt and Patrick A. van der Duin (2008),The evolution of innovation management towards contextual innovation, European Journal of Innovation Management Vol. 11 No. 4, 2008 pp. 522-538 q Emerald Group Publishing Limited 1460-1060 DOI 10.1108/14601060810911147 Rebecca M. Guidice; Sheng Wang (2009),The indirect relationship between organizational-level knowledge worker turnover and innovation: An integrated application of related literature, The Learning Organization Vol. 16 No. 2, 2009 pp. 143-167 q Emerald Group Publishing Limited 0969-6474 DOI 10.1108/09696470910939215 Sanghamitra, Bhattacharyya and Job (2007),Creativity and Innovation for Competitive Excellence in Organizations, Indian Institute of Management Kozhikode http://hdl.handle.net/2259/439 Neil Anderson & Rosina M. Gasteiger, Helping Creativity and Innovation Thrive in Organizations: Functional and Dysfunctional Perspectives, Chapter prepared for: Research Companion to the Dysfunctional Workplace: Management Challenges and Symptoms
Judge et al. (2005), Core Self-Evaluations and Job and Life Satisfaction: The Role of Self-Concordance and Goal Attainment, Journal of Applied Psychology 2005, Vol. 90, No. 2, 257268 00219010/05/$12.00 DOI: 10.1037/0021-9010.90.2.257 Copyright 2005 by the American Psychological Association Emot (2009), Acting in our interests: Relational self-construal and goal motivation across cultures, 33:7587 DOI 10.1007/s11031-008-9113-1 Published online: 16 December 2008 Springer Science Business Media, LLC 2008 Regina conti (2000), College goals: Do self-determined and carefully considered goals predict intrinsic motivation, academic performance, and adjustment during the first semester?, Social Psychology of Education 4: 189211, 2000. 2001 Kluwer Academic Publishers. Chatzisarantis et al. (2008), The Effects of Self-Discordance, Self-Concordance, and Implementation Intentions on Health Behavior, Journal of Applied Bio behavioral Research, 2008, 13, 4, pp. 198214. 2008 Copyright the Authors Journal compilation 2008 Wiley Periodicals, Inc. Sheldon and Houser-Marko (2001), Self-Concordance, Goal Attainment, and the pursuit of Happiness: Can There be an Upward Spiral? Journal of Personality and Social Psychology 2001, Vol.80, No.1, 152-165
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Sheldon and Elliot (1999), Goal Striving, Need Satisfaction, and Longitudinal Well-Being: The SelfConcordance Model, Journal of Personality and Social Psychology 1999, Vol.76, No.3, 482497 Sheldon et al. (2004), self-concordance across cultures journal of cross-cultural psychology, Vol. 35 No. 2, March 2004 209-223 DOI: 10.1177/0022022103262245 2004 Western Washington University Daniel Burke & P. Alex Linley (2007), Enhancing goal self concordance through coaching , International Coaching Psychology Review. Vol. 2 No. 1 March 2007. Koestner et al. (2006), Bolstering Implementation Plans for the Long Haul: The Benefits of Simultaneously Boosting Self-Concordance or Self-Efficacy, PSPB, Vol. 32 No. 11, November 2006 1547-1558. DOI: 10.1177/0146167206.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS The Impact of Human Resource dimensions on Organizational performance from an International Perspective
Syed Saad Hussain Shah MS Scholar, Iqra University Islamabad, Pakistan Jabran Aziz (Corresponding author) MS Scholar, Iqra University Islamabad, Pakistan Wasiq Ejaz MS Scholar, Iqra University Islamabad, Pakistan Ahsan Raza Jaffari MS Scholar, Iqra University Islamabad, Pakistan Amir Zaman MS Scholar, Iqra University Islamabad, Pakistan Mohsin Raza Jaffari Independent Researcher - Pakistan
Abstract
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This study will try to investigate the impact of International human resource management dimensions on the overall organizational performance. As now a days HR is part and parcel of any activity took into account in an organization and the major goal of the HR is to increase the performance of organization so the study will be focused on the two dimensions which are employee development and employee performance; as we know that for any organization good employees always act as a backbone of the company, in this scope it is necessary to take a closer look on the employee development in an organization therefore employee development will be viewed in terms of three items employee training, security and internal promotion, secondly employee performance will be viewed in terms of reward system, design of work and employee participation. It will be examined whether these dimensions shows a positive or negative impact on the organizational performance using a Meta analysis based on previous researches taken place on these HR dimensions internationally. The scope of this study will determines which sort of HR dimension is important for their company to focus and improves the performance of employees as well as the company from an international perspective. Keywords: Employee Performance, Organizational Performance, Employee Development, Training, Reward System, Promotion.
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1. Introduction
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Employees are always viewed as competitive advantage for any business (Barney, 1991; Pfeffer 1994) so HR dimensions must be made in such a way that they utilize employees in best possible way to increase performance of organization. The research paper will try to focus the impact of employee performance and development on the organizational performance based on the results and findings of the previous researches taken place in this regard. Many researches figured out that increasing the performance of employee and development of employee leads to increased performance of the organization. 1.1 Problem Statement It is to be investigated how HR dimensions like employee performance and employee development aid for the organizational development and increases the overall performance in this aspect. 1.2 Significance of study This study deal with advancement in the literature by differentiating between the HR dimensions needed to better performance of the organization, the current research paper will also help to identify how to manage the different human resources issue taking place located internationally and what common HR practice or dimension has been established in scope of Organizational superior performance. 2. Literature Review According to past researches different constructs has been utilized. The employee development and employee performance are used as independent variables and the Organizational performance is used as dependent variable. Moreover some more dimensions of the two independent variables are shown as employees training; security and promotion are set as dimensions for employee development while reward system, design of work and participation are marked as dimensions for employee participation. Employee Development and Organizational Performance: Employee development is basically a continuous learning regardless of present requirements of organization as employee is developed to get and seek knowledge for future of the organizational superior performance (Jacobs and Washington, 2003). It may be looked as one of the most critical dimension of HR to determine the company performance. For employee development training has been considered as one of the part of HR practice and marked as superior performance HR practice (Delaney and Huselid, 1996). Moreover a positive relation is observed between the training of employee and organizational superior performance (Koch and Mc Grath, 1996), as training allows employees to have multidimensional
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skills. In respect to employee development security of employees is marked as part of superior performance HR practice (Pfeffer, 1995). Moreover a positive relationship is seen between employees security issues and the Organizational performance (Delery and Doty, 1996). Promotions also act as important factor for employee development and according to a research company who promotes employee internally develops motivation in employee to word even harder and develops the employee capabilities and as a result Organizational performance increases (Lepak and Snell, 1999). Employee Performance and Organizational performance: This dimension of HR is important when far-reaching use of teamwork is required and when employee has given the authority to take decision on its own which results in superior performance HR practices (Arthur, 1994; MacDuffie, 1995), so it shows that the design of working is important for task specially if you provide authority to employees then this sort of design of work allows to have high performance work system as participation of employees enhances in this regard. So employee participation has a significant impact on the satisfaction and performance in working environment (Wagner, 1994) as low level employees sometimes contribute to bulk of information necessary for organization and in team work environment every employee participates to increase overall performance of the task assigned to them. On the other hand it is recommended for employee development that performance based compensation such as rewards are marked as superior performance of HR practices (Huselid, 1995). 3. Research Model Research model consists of two independent variables namely as employee development and employee performance that impacts on the dependent variable organizational performance. The overall relationship of constructs in the model are shown as,
Training Security Promotion Organizational Performance Reward Employee Performance Design of Participation 184 Employee Development
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4. Methodology
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Past researches are used for Meta analysis to test the model. On basis of the past researches the result is compiled accordingly and also viewed in terms of independent variables and dependent variable. Research papers shows relationship of employee development with Organizational performance and similarly employee performance with Organizational performance that depends on the further dimensions of each dependent variable i-e employee development that has been viewed in terms of training of employees, security issues and promotion and tried to find out the relationship with the dependent variable. Moreover employee performance is also viewed in terms of rewards system, design of work and participation by employees that is having relationship with the dependent variable i.e. organizational performance. 5. Result and Discussion Based on the results and findings of the past studies it is concluded that the independent variables employee development and employee performance shows a significant positive relationship with the dependent variable Organizational performance. The following explained researches contribute to the above result. (Hung, 2001) found that training of employees leads towards organizational performing better. Training and learning organization helps to have a competitive advantage globally (Weldy, 2009). Internal promotion allows employees to remain motivated and increase overall performance of organization (Takahashi, 2006). Another research shows that employee shows a positive attitude when promoted internally (Bradley, 2006).Satisfaction with job security results in organizational commitment and job performance (Yousef, 1998). Moreover another research shows integrated system in an organization allows information shared between departments, as well as critical building functions can be centralized so improved security and efficiency results in organizational performance (Taylor, 2005). So the above variables training, internal promotion and satisfaction makes employee development dimension of HR and shows a positive relationship with the dependent variable organizational performance. According to previous researches it is contributed that organizational strategy is based on TQM and TQM results in Organizational performance if TQM is associated with rewards for employees (Allen, 2001). Another research indicates that rewards must be integrated into the organizational strategy to increase
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performance of the Organization (Brierley, 1993). Employee participation increases Organizational effectiveness (Wang, 2003), furthermore employee participation in planning and implementation results in betterment of Organizational performance (Ramstad, 2008). The design of work and managerial structure is necessary in order to develop employees performance (Garg and Rastogi, 2005) as mentioned in another research it is made clear that nature of growth method and implementation of work is necessary for employee performance (Ramstad, 2008), so the design of work is significant with Organizational performance if design is made up to the mark. As a result the above variables reward system, design of work and employees participation results in employee performance dimension of HR and shows a positive relationship with the dependent variable organizational performance. 6. Future Recommendations Study recommends some key factors for managers to be follow such as investigating for HR practices results in increase in overall organizational efficiency. Second Organizations must have to focus on HR dimensions specially when going international. Mainly employee development and employee performance, working in team work and decentralized decision making results in significant positive effect on the organizational overall performance. So in short the HR dimensions discussed in this paper are the most important HR practices for an organization to be focused on. It is recommended that organization should make such type of strategy by considering the above stated HR dimensions; in addition significant rewards should be given to employees who participated well in the organization design framework. Similarly employees should be promoted more internally to get motivated by having intensive training sessions and their security issues should be well managed which results to meet goals and increases performance of the organization.
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References
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Ronald Jacobs and Christopher Washington. 2003. Employee development and organizational performance: A review of literature and directions for future research. Human Resource Development International, Volume 6, Issue 3, pages 343 354. Arthur, Jeffrey B. 1994. Effects of human resource system on manufacturing performance and turnover. Academy of Management Journal, 37: 670-687. Barney, Jay B. 1991. Firm resources and sustained competitive advantage. Journal of Management, 17: 99-120. Delaney, John T. & Mark A. Huselid. 1996. The impact of human resource management of perceptions of organizational performance. Academy of Management Journal, 39: 949-969. Delery, John E. & Harold Doty. 1996. Models of theorizing in strategic human resource management: tests of universalistic, contingency and configurationally performance predictions. Academy of Management Journal, 39: 802-835. Huselid, Mark A. 1995. The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal, 38: 635-672. Koch, Marianne J. & Rita G. McGrath. 1996. Improving labor productivity: Human resource management policies do matter. Strategic Management Journal, 17: 335-354. Lepak, David P. & Scott A. Snell. 1999. The human resource architecture: Towards a theory of human capital allocation and development. Academy of Management Review, 24(1): 31-38. MacDuffie, John P. 1995. Human resource bundles and manufacturing performance: Flexible production systems in the world auto industry. Industrial Relations & Labor Review, 48: 197-221. Pfeffer, Jeffrey. 1994. Competitive Advantage through people: Unleashing the power of the work force. Boston: Harvard Business Press. Pfeffer, Jeffrey. 1995. Producing sustainable competitive advantage through the effective management of people. Academy of Management Executive, 9:55-69. Wagner, John A. 1994. Participations effect on performance and satisfaction: A reconsideration of research evidence. Academy of Management Review, 19: 312-331. Kiyoshi Takahashi. 2006. Effects of wage and promotion incentives on the motivation levels of Japanese employees. Career Development International. Vol. 11 Iss: 3, pp.193 203.
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Lisa M. Bradley. 2006. Perceptions of justice when selecting internal and external job candidates. Personnel Review. Vol. 35 Iss: 1, pp.66 77. Mike Taylor. 2005. Integrated Building systems: strengthening building security while decreasing operating costs. Journal of Facilities Management. Vol. 4 No. 1, pp. 63-71. Darwish A. Yousef. 1998. Satisfaction with job security as a predictor of organizational commitment and job performance in a multicultural environment. International Journal of Manpower, Vol. 19 Iss: 3, pp.184 194. Tung-Chun Huang. 2001. The relation of training practices and organizational performance in small and medium size enterprises. Education + Training, Vol. 43 Iss: 8/9, pp.437 444. Teresa G. Weldy. 2009. Learning organization and transfer: strategies for improving performance. Learning Organization. Vol. 16 Iss: 1, pp.58 68. Elise Ramstad. 2008. Promoting performance and quality of working life simultaneously. International journal of productivity and performance management, Vol. 58 No. 5, 2009 pp. 423-436. Yuan Wang. 2003. Trust and decision-making styles in Chinese township-village enterprises. Journal of Managerial Psychology, Vol. 18 Iss: 6, pp.541 556. Richard S. Allen, Ralph H. Kilmann. 2001. The role of the reward system for a total quality management based strategy. Journal of Organizational Change Management, Vol. 14 Iss: 2, pp.110 131. Susanne J. Brierley. 1993. Take Forth Your Human Resource Agenda Manage Performance and Reward. Health Manpower Management, Volume: 19 Number: 3. Pooja Garg and Renu Rastogi. 2006. New model of job design: motivating employees performance. Journal of Management Development, Vol. 25 No. 6, 2006 pp. 572-587.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Employability in MNCs: Challenge for Graduates
Atif Anis Rao MS Scholar, Iqra University Islamabad,Pakistan Syed Saad Hussain Shah MS Scholar, Iqra University Islamabad, Pakistan Jabran Aziz (Corresponding Author) MS Scholar, Iqra University Islamabad, Pakistan Ahsan Raza Jaffari MS Scholar, Iqra University Islamabad,Pakistan Wasiq Ejaz MS Scholar, Iqra University Islamabad, Pakistan Ihsan Ul-Haq MS Scholar, Iqra University Islamabad, Pakistan Syed Neiman Raza MS Scholar, Iqra University Islamabad, Pakistan
Abstract:
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Organizations need to develop their human capital keeping in examination the resource based view, which acts as the essence for employability. In todays world of competition employability became a challenge since it is very difficult for both to sustain in the current scenario without adequate learning process. This exploratory research conducted to assess and fill the gap between employer requirements and graduates delivering the skills. The greater the gap lesser would the employability of graduates. This is mandatory for both individuals and organizations to increase employability, for this purpose graduates curriculum should be mapped with the current market demand. Teachers should also be well aware of market conditions and potential of their students, and know that how to enhance their potential. Students employability skills also strengthen through quality work-integrated learning programs, cooperative learning, and mentoring programs. Employer contribution is also necessary for achieving the result of organizations, and also enhancing the lifelong employability for graduates. Keywords: Employability, Employability skills, Graduate, Curriculum, Teacher skill, Employer;
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1. Introduction
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There are three types of resources which are discussed under the heading of resource-based view of a firm these resources act as source of competitive advantage: 1) physical capital, 2) organizational capital and 3) human capital (Peter Holland, Cathy Sheehan, Barney and Wright, 1998). Increasing levels of technological sophistication and the speedy transfer of information have diminished the competitive advantage that was once available through the first two resource bases. Products are now more readily copied, and processes replicated differentiation; thus rests with the people who generate new ideas or with those who deliver the product. There is increasing recognition, therefore, the potential of the latter of the three resources that is human capital; it makes a considerable and lasting impact on sustainable competitive advantage (Barney and Wright, 1998; Wright, McMahan and McWilliams, 1994). According to the concept of resource based view, firms are trying to carry on and develop their human capital which is the essence of employability. Heijde and Heijden (2006) defined employability as acquiring creating and fulfilling work through the use of competencies. According to Forrier and Sels (2003), employment chances in internal and external market, in line with conceptualization. The major concern for the employer is to finding the right person for the right job. But the area of concern for employer is the skill gap which is the difference between skills what an organization wants and what an applicant possess (Robinson, 2000; Davies, 2000). It is a very critical and important decision for a young person that which career he must choose for profession, because career matching is a process in which a person analyses himself/herself personal needs and capabilities before selecting a job (Gokuladas, 2010). If he/she gets the job which suites him/her best then he/she must be satisfied and enjoys the job and give his best. In this globalization era education especially business education facing challenges because first the globalization demands cross-cultural communication skills and global thinking. Second they need the managers and employees who have the savvy to discuss with their business counterparts and the last thing is that the foreign higher education competition which also have pressure while it is compared with the past (Zhiwen, Beatrice, & Heijden, 2008). Multinationals are the giants in the industrial sectors, everyone is trying to be employed in the multinationals, because of career growth, development opportunities and
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better pay scale, as compared to small medium enterprises (SMEs) (Moy & Lee, 2002). It is observed that the job opportunities in SMEs for young graduates are greater than the opportunities in MNCs (Teo and Poon, 1994). But because of the charm of MNCs students always preferring MNCs over SMEs as their first career job (Gokuladas, 2010). It has also been observed that working conditions are more supportive in SMEs (Gupta & Wang, 2007), but graduates are still motivated to join the multinationals. On the part of MNCs the multinationals are looking for knowledgeable and trained employees. Multinationals are reluctant in assigning jobs to the individual who is raw and does not have any experience, on the other hand multinationals are always in search of young talented people who does have some basic skills (Moy & Lee, 2002). Because of diversity in workforce multinationals always prefer those employees who have better understanding of the foreign language. This study is mainly focusing on the employability of a fresh graduate in MNCs who enters in the market just after completing his/her degree. This main emphasis of this paper is on the problems when graduate start finding suitable job. The problem a graduate face is the difference between the expectation of an employer and needs and wants of the organizations and the skills which graduate possessed and delivering at work place. This article is focusing on finding the problem why this gap exist between skills and expectation and try to figure out the proper solution for this that how can be this gap can be minimized and employment opportunities of graduates can be enhance. 2. Literature Review The globalization emphasize on the knowledge economy thats why employability becomes the central driver of the thinking business. This approach increases the attention for universities and universities are also focusing on producing employable graduates through the development of skill and abilities in graduates (Gracia, 2009). To manage this entire scenario the role of higher education is also get importance and governments are now more focusing on higher education to make the graduate employable (Mason et al., 2009; Gracia, 2009). Employability is capability of a person that shows how a person gains and retains employment and gets new employment if required (Hillage and Pollard, 1998; Wickramasinghe, & Perera, 2010). If it is viewed in perspective of fresh graduate it can be defined as the ability of a person to get a job according to his
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/her educational standard (Wickramasinghe, & Perera, 2010). Employability is mainly focused on a persons skill, knowledge and attitude. These are the skills, which develop the attitude and action in the person which enable him to work along with his fellow workers and supervisors and these skills develop him so that he can take initiative and make critical decision (Robinson, 2000). It is not just about vocational training and academic skills. It also depends upon labour market and institutions, because a person with the same capability has different opportunity in different market. Employability skill is a set of accomplishments that embrace skills, understanding and personal attributes to make a person to more likely to secure and be flourishing in his/her selected occupation for the benefit of him/herself, the workforce, and the economy (Knight, & Yorke 2004). Employability skills are basically divided into three main categories 1) basic academic skills, 2) personal qualities and 3) higher-order thinking skills. These skills are further divide as basic academic skills includes (Reading, Writing, Listening, Math, and Oral Communication), personal qualities includes (Responsible, Self Confidence, Self Control, Social Skills, Honest, Adaptable and Flexible, Team Spirit, Punctual and Efficient, Self Directed, Good Work Attitude, Cooperative, Self Motivated, Self Management) and higher-order thinking skills includes (Learning, Reasoning, Thinking Creatively, Decisions Making, Problem Solving) (Robinson, 2000). In this challenging business environment it is not sufficient that you have possessions the skills but dont have the ability to transfer those skills. The employer is more concerned how a graduate transfer those possessed skill to perform his/her work (Wickramasinghe, & Perera, 2010). Although, it is very difficult to find empirical studies that examined and compare employability skills that employers, university lecturers and graduates value to bring to the workplace when graduates are applying for entry-level graduate jobs. And also studies that compared the level of skills possessed by graduates by the time of applying for the first job (graduate responses) and the level of skills expected by employers when selecting for entry-level graduate jobs (employer responses). Despite of the fact that education is growing enormously and quick changes are taking place around the world in every field at the same time the stakeholders are not satisfied with the curriculum and teaching staff and students skills and abilities. They have the reservation regarding outdated curricula, lack of staff
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and neglecting the students skills. Students are also complaining about the system which is sort of a teacher centered and exam oriented due to which their chances to acquire the job are less because they dont have practical knowledge (Zhiwen, Beatrice, & Heijden, 2008). Employers are very much concerned with the performance of the graduate and also not satisfied with it and criticize the system that graduate can get the good scores in the exam but they are not performing well on the job because of they dont have transferable skills and their ability is low (Zhang, & Liu, 2006). For individuals, employability depends on Knowledge, skills and attitudes are their assets they possess The use and deployment of these assets The presentation of these assets to the employers The context (e.g. personal circumstances and labor market environment) within which they seek work Improved education systems have resulted in motivation of developing young people for labour market. The interest for education in working age (15-64 years) has increased. The share for tertiary education has increased to 3.6% and for at most secondary education; it is down by 5.3% (Employability, n.d). Higher education is gaining interest of policy makers in many countries, in education-to-work transition of graduates and the extent to which they are employable. Universities are offering lots of courses to attract the viable number of students, but due to complex academic structure it is difficult to involve employer in course validation and design process. Due to which the gap create between demand of an employer and the graduates come into the market (Rae, 2007). The other thing is that the number of students entering into the market after passing their degree increase massively and job opportunities are less. At graduate-level, the structured work experience and employer involvement in course design have a positive effect in getting jobs in the labour market. However, this involvement does not significantly affect their performance in market (Mason et al., 2009). In the employers perspective, employability is work readiness; it means the possession of skill, knowledge and understanding of commercial aspects, which enable a graduate to make a valuable contribution to the success of his organization. Especially, in
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the field of science and technology employers are more concerned about work experience and commercial understanding when they are selecting a graduate. As an employer, they cannot afford to give lengthy training to an inexperienced employee, because of commercial pressures (Mason 1998, 1999). Graduates must be aware of relevant, fruitful drivers and ability to think in business terms. They must possess decision making ability and show latent leadership qualities. The reason behind the concept of not considering SMEs as desirable employer is that the graduates have totally different views regarding the employment in SMEs and MNCs. In most of the countries MNCs are considered as first choice by graduates (Moy & Lee, 2002). The reason behind this tilting behavior towards MNCs is based on these nine attributes on which a graduate is focusing are; pay, fringe benefits, working condition, long term career prospects, marketability, job security, managerial relationship, responsibility given, authority, and involvement in decision making (Mun, Yeap, & Leen, n.d; Moy & Lee, 2002; Heaton, McCracken & Harrison, 2008). On the other hand multinationals are looking for these four characteristics in the graduate who is looking for his first job 1) theoretical knowledge 2) the ability to apply this knowledge in the real world 3) level of soft skills (communication, interpersonal etc.) 4) factors related to attitude of graduate (openness to change, motivation, flexibility) (Forfas, 2008). Key issues for the MNCs employer while selecting the graduate are competences, remuneration, and skills. As the fast changes taken place in environment therefore employer is reluctant to spend more resources on development of new graduates (Thomas, 1998). According to Heaton, McCracken & Harrison, (2008) employer emphasize on that the universities should play central role in developing competencies and skills in graduates. However, employers have the complaint regarding work readiness of graduates. They also contribute in the form of time and resources that graduate adjust in the culture before starting career with organization. Work-based placement is a vital technique for effective induction; short training is also more realistic approach for graduates. These techniques work as bridge between graduate capabilities and employment. Previous researches show that the decision making power is influenced by some factors while selecting first job and one of them which influence most in decision making is perception of the graduate regarding the job (Gokuladas, 2010). Perception plays critical role in our life especially in future decisions. Factors
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that are playing their part in developing the perception are information acquired during childhood, from family members, friends, guiding counselor, peers and teachers. It also influenced by the experiences of life, environment and mass media (Julien, 1999). Culture also helps the individual in perceiving the world. Positive perception of the graduate increases the chances of employability. Perception divided the career choices into three dimensions 1) interpersonal (i.e. influence of parents and considerable others) 2) extrinsic (e.g. job availability, paying well or prestigious profession), 3) intrinsic (e.g. job interest, work that is satisfying personal needs, etc.). Understanding of the world of work which means how organization works, how an employee does his job, and what are organization objectives (Coopers & Lybrand, 1998). To fulfill those requirements universities have to make modifications in course content introduce new courses and teaching methods and expand opportunities for work experience. All these procedures should be adopted to enhance the development of employability skills and lifelong learning. Some universities try to embed these skills within the course, and other offer stand-alone skill courses (Coopers & Lybrand, 1998). Factors contribution towards employability Personal Flexibility: Personal flexibility is the capacity of adaptability of an employee to changes in internal and external labour market, which may not relate to ones current job domain. Occupational Expertise: This relates to the expertise that requires in performing a job adequately. It also assesses the requirements of the job, and climate of the organization. Anticipation and optimization: Attempt to achieve the best result for organization, and prepare for and adapt future changes in personal and creative manner.
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Corporate sense:
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It is the contribution and performance in different work groups. It includes organizations, teams, occupational communities and other networks, characterized by sharing of responsibilities, knowledge, experiences, feelings, failures, goals, etc. Balance: It is a compromise between opposing employers interests and ones own, opposing work, career, and private interests (employee), and between employers and employees interests (Heijden et al, 2009). Teacher skill: The skills which a teacher must possess to guide graduates in problem solving and good communication skills, and must have the awareness of practices used in industry. Employer participation: An employer can affect employability of graduate if he plays its role in academic programs. He offers mentors and gives feed back according to market conditions. 3. Methodology This study is focusing on the employability of management graduates who got the degree from universities of Pakistan. The methodological approach has been essentially qualitative. For this purpose three samples are selected; (1) graduates; (2) employers; and (3) university lecturers. Interviews were semi-structured and used a standard set of questions included in the questionnaire. However, interviewees encouraged, to share their point of view regarding different matters, explain how and why they arrived at their conclusions and described relevant experiences. The thematic analysis of data from the literature, interviews and responses to the discussion paper is drawn together in this report and used to develop a set of recommendations.
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4. Conclusion
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This article conclude that there is gap exist between the employer wants and the deliverance of the graduates skills. Employer is not ready to experimenting things; they expect that employee should perform at his best. They are also reluctant to spend many resources on graduates training program; therefore, they are selecting the fresh graduates lesser as compare to experienced ones. Employers are inclined to selecting those graduates who have some basic knowledge about working in organization, have better communication and presentation skills and those who have the capability of transferring their knowledge into output. The findings reveal that student is also anxious about the skills which teacher and employer wants that a student must possess. All the techniques involved in the process show that the important employability skills are problem solving skills, team work, and self confidence. 5. Recommendations Curriculum mapping is a tool to make explicit that how employability skills and graduate attributes addressed in the content of a given course or program. Curriculum mapping is a foundation stone for employability skills, which needs to be supported by quality delivery and assessment strategies. It ensures that students develop an understanding of employer expectations and skills to meet those expectations. Employer will see the effectiveness of this approach in terms of increasing a learners employability skills in coming years. Developing the students employability skills requires teaching staff with suitable skills, resources and awareness of current industry practice. Students employability skills will also be strengthened where students have access to relevant work experience through quality work-integrated learning programs, cooperative learning or mentoring programs. Graduate must also provided by the opportunity of career counseling. Career counseling is a technique which should be considered in the university level, because it makes them well-informed and help a lot for graduates in deciding their career. Graduate also face the problem while presenting him/her-self in the interviews. To overcome these issues higher education institute and teachers specifically must emphasize to improve these skills. Employers play an important part in developing undergraduates employability skills through their participation in work integrated learning programs, offering mentors, providing scholarships and
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cadetships, and engaging with universities careers services and academic programs. On the other hand work-based placement and short training programs are also beneficial for graduates in attaining their initial job. Good perception about the job is enhancing the employment opportunity for graduates and employee wants to stay with the organization. If graduate believe that the company trained him in good manner, pay well, company give opportunity to work in the area of interest, there is opportunity of growth, and job is secured then employability increase. Communication among the stakeholders in a campus recruitment process was observed to be important especially with knowledge workers. Recruitment is commonly viewed as an element in the socialization process prior to organizational entry. During this stage, employers attempt to attract the type of employee who is most likely to be successful in the organization. Employability of graduates can be enhanced, if universities conduct seminars related to market situations and market demands. Universities must try to increase the interaction with the MNCs and arranged their visits in institution so that students interact with them and be aware of the requirements of these multinationals. Job fair also helpful in increasing employment opportunity for graduates. Graduates are also more satisfied if these kinds of activities exist in the institution, and students are more willing to join these institutions. Soft skill training is also a useful tool to affect the employment opportunity of the graduates. It significantly improves the employability of the management students.
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References
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Davies, L. (2000). Why kick the L out of Learning? The development of students employability skills through part-time working, Education Training, 42, 436-44. Forfas, (2008). MNE perception of certain Irish graduate. A Study for the Expert Group on Future Skills Needs, the Higher Education Authority and Forfs, [Online] http://www.forfas.ie/media/egfsn071221_employers_survey_graduates.pdf, (July 29, 2010) Gokuladas, V.K., (2010). Factors that influence first-career choice of undergraduate engineers in software services companies: A south Indian experience. Career Development International, 15(2), 144-165 Gupta, A.K. and Wang, H. (2007), Getting your China and India strategy right, Wall Street Journal, Gracia, L., (2009). Employability and higher education: contextualising female students' workplace experiences to enhance understanding of employability development. Journal of Education and Work, 22(4), 301 318 Heaton, N., McCracken, M., & Harrison, J., (2008). Graduate recruitment and Development Sector influence on a local market/regional economy. Education + Training, 50(4), 276-288 Hinchliffe, G., (2006). Graduate employability and lifelong learning: A need for realism? Graduate Attributes, Learning and Employability, 91-104. Heijden, B. V. D., Boon, J., Klink, M. V. D., & Meijs, E., (2009). Employability enhancement through learning University of the Netherlands, Heerlen, the Netherlands, Blackwell Publishing Ltd. Gracia, L., (2009). Employability and higher education: contextualizing female students' workplace experiences to enhance understanding of employability development. University of Warwick Coventry, UK. Journal of Education and Work, 22(4), 301318 John, J., (n.d). Study on the Nature of Impact of Soft Skills Training Programme on the Soft Skills Development of Management Students
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Moy, J. W., & Lee, M., (2002). The career choice of business graduates: SMEs or MNCs? Career development international, 7(6), 339-343
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Mason, G., Williams, G., and S. Cranmer, S., (2009). Employability skills initiatives in higher education: What effects do they have on graduate labour market outcomes?: London, UK: Education Economics, 17(1), 130 Rae, D., (2007). Connecting enterprise and graduate employability Challenges to the higher education culture and curriculum? Education + Training, 49(8/9), 605-619 Robinson, J. P., (2000). A fact sheet: What Are Employability Skills? 1(3), Teo, H.A., and Poon, J .T. F., (1994). Career Choice of Undergraduates and SMEs in Singapore. The International Journal of Career Management, 6 (3), 1994, 20-26 Thomas, R. (1998). The Management of Small Tourism and Hospitality Firms, Cassell, London. Wickramasinghe, V., & Perera, L., (2010). Graduates, university lecturers and employers perceptions towards employability skills. Education + Training, 52(3), 226-244 Yorke, M. & Knight, P.T. (2004). Embedding employability into the curriculum, Learning and Employability Series, LTSN Generic Centre web site, [Online] available at: www.heacademy.ac.uk/ resources/publications/learningandemployability (July 27, 2010). Zhang, Y. & Liu, B. (2006), Social occupational classes and higher-education opportunities in contemporary China: a study on the distribution of a scarce social capital, Frontiers of Education in China, 1(1), 89-99. Zhiwen, Beatrice, I. J. M., & Heijden, V. D., (2008). Employability enhancement of business graduates in China Reacting upon challenges of globalization and labour market demands. Education + Training, 50(4), 289-304
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Price, Value and Supply of Money and its Effect on KSE-100 Index
Muhammad Aamir (Corresponding Author) Hailey College of Commerce, University of the Punjab, Lahore, Pakistan Arslan Qayyum University of Central Punjab, Lahore, Pakistan Adeel Nasir University of Central Punjab, Lahore, Pakistan Shabbir Hussain University of Central Punjab, Lahore, Pakistan Kanwal Iqbal Khan University of Central Punjab, Lahore, Pakistan Kiran Farooq University of Central Punjab, Lahore, Pakistan
Abstract This study provides the impact of Money Supply, its value against other currencies and inflation on the KSE 100 index and examines whether an investor before investing in the Karachi Stock Exchange considers some economic factors like Monetary Policy, inflation rate or devaluation of the Rupee against Dollar. Money Supply (M2), Exchange Rate and inflation are used as the independent variables to see the relationship with the KSE 100 index and analyze that whether some macroeconomic indicators can make some difference, and identify the modification of perception of the investor before entering into the stock exchange. Results reflect that investors consider Inflation very important factor before investing into the stock exchange, according to my empirical evidence although inflation is the part of the risk premium set by the investor but according to empirical evidence it has a semi effect in on KSE 100 index. Key words: KSE 100 index, money supply, inflation, exchange rate, microeconomic variables 1. Introduction:
This paper discus the effects of the decisions made by the policy maker on stock market, in order to see the effects of monetary policy on the stock market and see, whether the devaluation of rupee is playing any role in the change of the stock prices for the past couple of years. For this study Karachi stock exchange the biggest and most liquid exchange of Pakistan is consider as the one of the variables. KSE 100 acts as the benchmark to compare prices of Karachi Stock Exchange. The index was launched in late 1991 with a base of 1,000 points. By 2001, it had grown to 1,770 points. By 2005, it had skyrocketed to 9,989 points. It then reached a peak of
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12,285 in February 2007, in April 2008 it reached its record height 15210.17 (State Bank of Pakistam, 2007), which indicates the phenomenal trend for past couple of years in the stock market. Now the question is how we, as an investor perceive these trends in the Karachi Stock Exchange. The first angle to analyze above argument is a bullish sentiment, there is too much trading in the stock market, and even under the crunch times for the whole economy, Karachi Stock Exchange is performing well. The second view would be perhaps Central Bank made the policy according to which they decided to through more money in the economy so money supply increases, investors have more money to invest or increase in money supply attributes to increase in inflation rate, which affect the prices and investor consumption level increases and there investment level decreases. But there is another aspect of in which inflation may help the investor to invest in the stock market. Like if inflation rate in the country is 20% and the investor is getting 15% on deposits or any other less risky investment. Then the investor is sustaining loss of 5% so, what the investor wants is profit, investor always wanted to let go his current savings for better and enhanced future income so that he could earn some premium over his current investment, if the investor is sustaining loss on risk free investment, he would rather set his risk premium go to the stock market, where he may get 25% or more return on investment, invest in it and get his required return over investment. Monetary policy is the use of money and credit controls to influence macroeconomic activity. Monetary policy tools include open-market operations, discount-rate changes, and reserve requirements. Central bank uses these parameters in efforts of maintaining the stabilization in the economy by reducing inflation and curbs the lending rates. Laurens (2005) provided that many countries have moved towards monetary policy frameworks with a more or less specific inflation target. The increase in supply of money leads to reduce the value of money, which indicate that supply of money and value of money are inversely related. The increased money supply and devalued money will increase the inflation rate, which means increase in the assets prices, so ultimately (relate this whole situation with the stock market) it will affect the stock returns because of the two aspects first because of the inflation, prices of the stock will increase, and second price of the stock increases because of the decrease in the currency value. Another reason for the devaluation of money may be associated with the involvement of the government for the purpose of enhancing the exports level in the country so there may be no relationship between exchange rate and stock market. The link between monetary policy and the stock market is of particular interest. Stock prices are among the most closely watched asset prices in the economy and are viewed as being highly sensitive to economic conditions. Stock prices have also been known to swing rather widely, leading to concerns about possible "bubbles" or other deviations of stock prices from fundamental values that may have adverse implications for the economy. It is of great interest, then, to understand more precisely how monetary policy and the stock market are related (LKhagvajav, et al, 2008). Total money supply (M2) in July 2009 surged $13.6 million to $668.0 million following a $1.7 million increase in the previous month. This months significant increase reflected largely a 5 percent expansion in net foreign assets and a 0.1percent rise in net domestic assets (Samoa, 2009). The SBP has kept its tight monetary policy stance in the period July 01, 2008-April 20, 2009. The policy rate was adjusted upward in November 2008 to shave-off some aggregate demand from the economy and kept constant in January 2009. However,
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noticing visible signs of demand compression enabled the SBP to reduce 100 basis points on April 20, 2009. During July 01, 2008 May 16, 2009, money supply (M2) expanded by 4.6 percent against the target of expansion of 9.3 percent for the year and last year expansion of 8.1 percent in the comparable period of last year. The reserve money witnessed growth of 2.4 percent in this period as against expansion of 13.2 percent in the comparable period of last year (Economic Survey, 2009). The second section of this paper will discuss the literature review then section three will presents the theoretical approach section four and five will provide the technical and empirical evidence and section six will mention some conclusions 2. Literature Review: The purpose of writing this paper is to see the whether the monetary conditions for past decades have some effects on the investment decisions made by the investors. In much recent literature there are many documented discussion about the monetary policy effects on the stock market performance and returns. Frank & Young (1972) conducted the first study that examined the ralationship beween stock prices and exhange rates. They used six different exhange rates and found no relationship between these two financial variables. Chairman Alan Greenspan, in his testimony remarked "that monetary policy is best primarily focused on stability of the general level of prices of goods and services as the most credible means to achieve sustainable economic growth." (Hayford, et al, 2002). LKhagvajav, et al (2008) has described that many markets including stock market, government and corporate bond markets, mortgage markets, markets for consumer credit, foreign exchange markets, and many others are affected by the monetary policy. Policymakers by increasing or reducing the money supply in the economy can influence many financial institutions. Economic conditions and investors relations are very closely related, investor require return that would meet his requirement which is pronounced as risk premium, investor set this risk premium according to Certain monetary variables (interest rates, inflation CPI, etc). At least there are three factors that usually effect the stock prices. First investor get the news that the future dividend will be higher that may raise the stock prices, second, news that current or future real short-term interest rates will be higher should lower stock prices. third, news that other investors require higher risk premium on stocks that may decrease the stock prices. These factors made the stock market prices unpredictable and for some extent monetary variables directly or indirectly can stable these prices. Hayford, et al (2002) discuse in his paper that should volatile asset prices cause problems, policy is probably best positioned to address the consequences when the economy is working from a base of stable product prices. Soenen, et al, (1988) employed monthly data on stock prices and effective exchange rates for the period 1980-1986. They discover a strong negative relationship between the value of the U.S. dollar and the change in stock prices. However, when they analyzed the above relationship for a different period, they found a statistical significant negative impact of revaluation on stock prices. Boldbaatar (2003) analyzed the implications of capital markets for monetary policy and concluded that the capital market is not developed yet to attract investor for a profit from capital gain. So, capital market is not ready to operate as monetary policy transmission mechanism today.
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Bernanke, et al, (1995) demonstrates that negative monetary innovations, such as a tightening of the federal funds rate, leads to an immediate decline in residential investment and consumer durables while depressing business investments significantly only in subsequent periods. 3. Theoretical Framework: There are three views of market economy. These three views advocate market solutions to economic problems. Monetarism is the money based macroeconomics Keynesianism discuses the Labor based macroeconomics Austrianianism is the capital based macroeconomics
Friedman (1956) was the monetarist and his views were based on higher level of aggregation. It uses MV=PQ as equation, his theory focused on the government controlled money supply and the price level of the economy, hiding the issues relating to the allocations of resources between consumption and investment for the future investment. He indicated that bad policies of clumsy Central bank put the downward pressure on prices, with the pressure on prices output falls. Policies should be formulated in such ways that focus on avoidance rather on remediation. Monetarists argued that bungling occurred, when economy was experiencing ordinary recession. Keynes (1936) provide his theory on high level of aggregation, Keynes provided that the market economies perform perversely, especially those market mechanisms, which are supposed to bring saving to the equal level of investment. John Maynard Keynes saw unemployment and resource idleness as the basic norm and argued that countercyclical fiscal and monetary policies should be considered for the comprehensive socialization of investment. Keynes argues that with the increase of the money supply three indicators of economy increases, which are output, employment and price level of commodities. When economy reaches its full production capacity, when there are no resources left then increase in money supply in economy would only increase the price level of commodities, which is cause of harmful inflation in the economy. Output and employment stays at the same level. Menger (1931) Austrainism Named for its country of origin, recognized the market process, which adjusts consumption and investment to match actual saving propensities. He showed how process can be imprecise by economically unstable, but politically convenient monetary policies. He argued that adjustment in the rate of interest by the government in the economy would provide inter temporal equilibrium in saving and investment. Push more money in economy through credit markets compel a wedge between saving and investment, which generates the artificial boom, and set the stage for the foreseeable downturn. He indicated that capital based macroeconomics can provide the market solution and solve the problems of inter temporal resource allocations. 4. Technical Evidence For technical analysis we will observe the ups and downs of past 10 years, by looking at the percentage change in money supply, exchange rate and KSE 100 index, and on the
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basis of these trends we will try to draw inferences whether the stock exchange is effected by money supply in the economy devaluation of money and inflation prevailing in the economy.
Fig. 1 (KSE 100 index value for 10 years)
Fig. 2 (Percentage change in KSE 100 index for 10 years) Fig 1 shows the KSE 100 index value from June 2000 to June 2009, and Fig 2 shows the percentage change in the index value for ten years. Above figure show the good trends in the stock market for the past two or three years but the figure below shows the bearish market for the past two year and shows the peak at 2003 with the increase in the percentage value of the stock market, KSE is the most unpredictable and most liquid market of Pakistan and there may be many other factors that may have swear effects on the stock market. Taking all of them constant we will see the effects of inflation, money supply and devaluation on stock market.
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Fig. 3 (Money supply for 10 years)
Fig. 4 (Percentage change in M2 for 10 years) Money supply is quit persistent for past decade, there are no unpredictable activity shown in both figures, it looks like some policy of the government to bring out money into the economy from about 10% to 20 % for every year. Increase or decrease in money supply attributed to inflation which brings the consumption level up and lower the investment.
Fig. 5 (Exchange rate of rupee against dollar for 10 years)
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Fig. 6 (Percentage change in Exchange rate) In the country like Pakistan there are many opportunities for the investors, especially for the foreign investors, Pakistan enter into the floating exchange rate regime and bringing money value down to increase the exports of the country, thats may be good approach to capture the international market by selling the goods and services at cheaper rates, the graphs shows that the money is constantly devaluating against dollar since 2000 except 2003 and 2004. In 2008 to 2009 there is the sharp increase in the exchange rate it may be possible that there is Government policies to increase the imports of the country by attracting more investors, but it also mean selling at cheaper rate and buying at expensive rates. There may be other factors like decrease in demand for Pakistani products in international markets or throwing money into the economy without backing up any reserves would be the reason to decrease the value of the currency.
Fig. 7(Consumer price index rate for past 10 years)
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Fig. 8(percentage change in Consumer price index for 10 years) Inflation always been the factor bringing change to the major economic activities of Pakistan, Fig 1 show the ten years increase and Decrease in the inflation and Fig 2 shows the percentage change. So by look at Fig 2 we can see there is very unpredictable scenario for past couple of years. CPI has never been consistent and that may affect the investor to see this parameter before investing in the market.
Fig. 9 (M2 and KSE 100 index) Figure 9 state the association between the Money Supply and KSE 100 index from 2000 to 2009. From the figure we dont see as such big relationship between to parameter but if we analyze we explore that a little change in Money Supply is bringing humongous change in stock market. From 2002 to 2003 percentage of M2 increase by 8.95% to 15.42% which bring KSE 100 index from 10.15% decrease to 29.54% increase, and from 2007 to 2009 M2 due to tight monetary policy by the Government decrease from 18.93% to 9.55% and it decreased KSE 100 from 37.87% to -40.51% so there is a strong relationship between them.
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Fig. 10 (CPI and KSE 100 index) Figure 10 we can identify the relationship between the Consumer Price Index and the KSE 100 index from 2000 to 2009. By looking at the Picture we have almost identical trend in both inflation and KSE 100 Index. This figure is showing the positive correlation between them. From 2000 to 2003 it seem like there is not much affection exists between them but after 2004 it seems like they are moving together so that would mean that investors are considering inflation as a information that inflation is going to increase and will increase the market return because it increases the risk premium of the investors.
Fig. 11 (Exchange rate RS/US$ and KSE 100 index) Looking at figure 11 we see no association what so ever, that clearly specify that investors never mull over exchange rate before making investment into the stock market. But looking closely there may be possibility that there may be negative correlation between exchange rate and KSE 100 index. Exchange rate may effects other factors that may influence the investment activity i.e. attracting foreign investment, it attribution towards inflation and monetary Policy etc.
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5. Empirical Evidence
This analysis is based on the three independent variables Money Supply, Exchange Rate and inflation and taking KSE 100 index as the dependent variable. Data is collected from Government of Pakistan Statistics Division, Federal Bureau of Statistics, Brecorder.com, and State Bank of Pakistan Monthly indicators. Date has taken for past 10 years from 1999-00 to 2008-09. Each value of the variables is recorded on the June 30th of that year. For empirical analysis I have correlated these four variables using SPSS and then approach I used to provide the information on the basis of the effects of these three independent variables on the KSE 100 index for which I have used OLS Model using eviews 5. Table 1: Correlation Pearson Correlation KSE CPI M2 KSE 1.000 .689 .846 CPI .689 1.000 .509 .821 Exchange M2 .300 .846 .509 1.000 .733 .821 .733 1.000
Exchange .300
The above table describes the correlation between the variables. If we compare KSE with all variables we can see that it is correlated with all the variables and highly correlated with M2, which is money supply in the economy, Investment in KSE 100 is highly sensitive of Money Supply, which means, little change in Money Supply will bring greater variation in the KSE 100 index. According to the above table, Money Supply attribution towards Consumer Price Index and Exchange rate is also quite significant so better control the money of the economy can bring stable growth to economy. Comparing CPI with KSE 100 correlation of .689 which is quit convincing as a matter of fact, but the correlation between Exchange rate and KSE index is not showing that much variations that means investors do not care much about the exchange rate when they were going to invest in the Karachi Stock Exchange. So there is a positive but not that much significance relation between Exchange rate and KSE 100. On the other side if we see the relationship between the Exchange rate and the Money Supply there is the good correlation exists between them so somewhere around Exchange rate attributes the progress of the KSE 100 index. 6. Model Estimation This Study investigates the effects of Money Supply, Inflation and Exchange Rate on the Karachi Stock Exchange. For estimation and implementation of results the proxies of M2, CPI and Pak-Dollar Exchange rate is used in place of money supply, inflation, and exchange rate. So the model, which is used, is as under: As mentioned KSE is the function of money supply, consumer price index and exchange rate. But there may be possibilities that these variables dont affect the
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variations in Karachi stock exchange. To analyze the effect of these variables multiple regression model is used. The study will estimate the relationship between the macroeconomic variables and KSE 100 index. To gain authentic implementation of outcome, I have collected data from the authentic source and to reduce specification error and more significant basis log model is used instead of multiple linear regression model. Estimating the model = (2.80) (0.228) (0.073) (0.368) = (-3.893) (10.616) (-2.423) (-10.621) r2 = 0.993 d = 1.93 T-ratios are significant, which indicate the legitimacy of the slope coefficient of the model. With significant t-ratios, r2 is also high which means that there is no multicolliniearity in the data. AR (1) is used in the model to avoid the non-stationary data and used durbin-Watson test, which is d =1.93, which indicate that the data is stationary and there is no autocorrelation. = -10.89 shows the direct variation in the dependent variable (KSE 100) without the effects of the independent variables. According to above model evidence is provided that 1% increase or decrease in M2 will bring 2.42% increase or decrease in KSE 100 index. CPI and ER are responsible to negate the KSE 100 index. With 1% change in CPI will negatively change KSE with 0.18% and 1% upward move in ER, which is exchange rate, will move KSE downward by 3.91%.
7. Conclusion
SE t
The purpose of this study is to specify that whether the investors consider market return, technical of the market and the fundaments of the listed companies or there are other parameters which may help the investors to see the market in the better way so three variables related to money are taken which are Price, Value and Supply of money. According to the technical and the empirical evidence we have found that supply of money has major effects on the investors going into the stock exchange that clearly shows that increase in money on hand will increase investment that may also be perception that increase in money supply will attribute to inflation rate so market return of the future will be greater. Results show that the investment in KSE-100 is more sensitive to Money Supply. Inflation also plays the vital role in making investment decision. Investors consider Inflation very important factor before investing into the stock exchange, according to my empirical evidence although inflation is the part of the risk premium set by the investor but according to empirical evidence it has a semi effect in on KSE 100 index. The final variable Exchange Rate according to my study has no effect on KSE 100; investors do not consider it before investing in the stock exchange.
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References
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Aggarwal, R. (1981). Exchange Rate and Stock Prices: A Study of the US Capital Market Under Floating Exchange Rate. Akron Business Economic Review , 7-12. Bernanke, Ben, & Gertler, M. (1995). Inside theBlack Box: The Credit Channel of Monetary. Journal ofEconomic Perspectives , 27-48. Boldbaatar, D. (2003). Bank of Mangolia. A Role of Capital Market for Monetary Policy . Economic Survey. (2009). Economic Survey 2008-09. Islamabad: Ministry of Finance. Frank, P., & Young, A. (1972). Stock price Reaction of Multinational Firms to Exchange Realignments. Financial Management , 66-73. Friedman, M. (1956). Quantity Theory of Money: A Restatement. Chicago, University of Chicago. Hayford, M. D., & Malliaris, A. G. (2002). Monetary Policy and the Stock Market. 1. Keynes, J. M. (1936). General Theory of Employment, Interest, and Money (1936) . England. Laurens, B. J. (2005). Monetary Policy Framework and Regims. Tunis: International Monetary Fund. Mauss, M. The Gift: The Form and Reason for Exchange in Archaic Societies. In M. Mauss, The Gift: The Form and Reason for Exchange in Archaic Societies. (pp. 36-37). Menger, C. (1931). Prices and Production. Austria. Monetary Policy and Bond Market Development: A Case Study of Mangolia (2008). Samoa, C. B. (2009). Economic Survey Report. Samoa: Ministry of Finance and the Samoa Bureau of Statistics. Soenen, L., & Hennigar, E. (1988). An Analysis of Exchange Rates and Stock Prices: the U.S. Experience between 1980 and 1986. Akron Business and Economic Review , 7-16. State Bank of Pakistam. (2007). KSE index Mountly Report. Islamabad: Corporate & Publication Division,Staistics and Data Warehouse Department.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Provide a new model for Appraising performance of sport organizations
Seyed Heydar Mirfakhr-al-Dini, Assistant professor, Yazd University, Yazd, Iran Abd-al-Nabi Khatibi Aghda B.A in Industrial Management, Yazd University, Yazd, Iran
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Abstract This work is aimed to achieve a pattern for appraising performance of sport organizations through a balanced scorecard approach (BSC) and TOPSIS. A sport organization performance appraisal model with BSC approach was applied on Yazd Province Gen. Dept. of physical education, followed by with factor prioritizing applying fuzzy TOPSIS technique. To this end, an author-designed questionnaire was employed for data gathering, and having its validity and stability confirmed 119 participants including employees of Yazd Province Gen. Dept. of physical education, coaches, and athletes in the province received the questionnaire as a pilot study ( = 0.90). Data analyzing was carried out applying deductive statistics including Kalogref Smirnovs test, Levins test, single sample t test, single path ANOVA, Chroskal & Eliss ranked variance analysis and fuzzy TOPSIS technique. Findings show that the Yazd Province Gen. Dept. of physical education has acceptable performance in two perspective of internal processors and learning and growth, while failed to show acceptable performance regarding customer and financial perspectives ( BSC perspectives). In addition, it is easy to find that there is a significant difference regarding the quadruple perspectives of balanced scorecards in Yazd Province Gen. Dept. of physical education. This hints that, to have better performance, the organization needs to pay more attention to athletes and coaches as its main customers. Moreover, fuzzy TOPSIS technique was applied to rank 37 indices of highest priority classified into the four landscapes; this implies that, taking into account ranks of the 37 indices, to improve satisfaction of its customers more than ever, the organization under consideration needs to prioritize its performance based on factors of the four BSC landscapes Keywords: Sport organization, performance appraisal, balanced scorecard (BSC) and fuzzy TOPSIS Introduction While strategic management is not just a definition of important issues in an organization, it also encompasses making sure proper implementation as well ( Haapasalo et al, 2006). In one hand, appraising organizational success and effective implementation of the strategies for future prosperities is a major headache for managers, researchers and consultants (Evans, 2005). So that, chief management is always seeking solutions to make sure proper implementation of their strategies and to do this they have adopted performance appraisal methods as tools for controlling implementation of the strategies (Evans, 2005) . On the other hand, all organizations need some sort of performance appraisal system to survive, develop and grow in this
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competitive market. Performance appraisal enables organization to keep a permanent development processes through removing disadvantages and improving advantages. (Medori and Steepl, 2000) As an effective factor for social and economic development, physical education plays an important role in policy and economy of countries. Athletic performance is a phenomenon that has to do with managerial analysis and for better performance and better management it needs to be considered as a system with its key factors as an integral system (W, B, 1997). Performance appraisal is a pivotal issue from managers and experts (W, B, 1997, Chadwick, 2009). This is rooted in the fact that for future planning, these organizations need to identify their current situation (Chadwick, 2009). In spite of several researches conducted in this field, lack of a comprehensive approach to appraise such organizations from different aspects is undeniable. This study therefore is aimed to present patterns to appraise performance of sport organization with balance scorecard (BSC) and TOPSIS approaches. First, a brief introduction to BSC and TOPSIS is provided followed by the results of appraisal regarding performance of Yazd Province Gen. Dept. of physical education using the techniques mentioned earlier. Balance Scorecard (BSC) In industrial age, all known performance appraisals so called traditional appraisal systems- were based on financial ratios (tangible assets). Late 20th century was characterized with emergence of Information age, and many organizations started to appraise their performance in non-financial fields (intangible assets) and to criticize the traditional performance indices. In early 1990s, Nowlan Norten a research affiliate to KPMG, undertake a research titled measuring performance of future organizations. The research resulted in introduction of a performance appraisal technique known as Balanced Scorecard. The system tries to covers disadvantages of the traditional appraisal system in respect of value added from intangible assets ( Kaplan & Norton,1992)( Decoene & Bruggeman, 2006), including customers, services, innovative products, responsible operational processes, information technology, information banks and capabilities, and staffs skills and motivation. In addition to financial evaluation, BCS also appraise performance of organization by adding three additional aspects (Decoene & Bruggeman, 2006). According to the results of researches on 83 companies, BSC is capable of being used for surveying value added process in long run (Sim & Koh, 2001). BSC enjoys a conceptual frame to transform strategic goals of the organization into appraisable indices and achieve a balanced distribution among vital fields of organization. Moreover, it is a comprehensive system, which creates a correlation between performance standards and strategies (Thakkar et al, 2007). Introduced by Caplan and Norton, BSC takes performance from four balanced perspectives : 1- Customer Perspective Nowadays, many organizations have adopted customer-oriented approach as their existence philosophical statement (Kaplan & Norton, 2005). This perspective includes matters such as customers, customers satisfaction, attracting new customers and finally what customers expect from organization. This prospective focuses on the value adding characteristics of product/ service though from customers viewpoint (Decoene & Bruggeman, 2006).
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2- Internal Process Perspective Organizations are supposed to spot the process, which mastering them and achieving competitive advantages on them results in creating value for customers and stockholders (Amaratunga et al, 2001). In this way, managers most find the main process to work on for achieving customers and stockholders goals (Decoene & Bruggeman, 2006). 3- Growth and Learning Perspective Customers perspective and internal processes identify most important competitive parameters. To make this happen, organizations need to optimize their products and processes permanently and develop abilities to introduce quite new processes and products ( Amaratunga et al, 2001). This aspect discuses organizations way of success while focusing on future success of the organization and its structure (Decoene & Bruggeman, 2006). 4- Financial Perspective Measures under this perspective tell us what are probable results and financial achievement by successful implementation of the goals subject to the last three perspectives (Kaplan & Norton, 1992). In other words, it hits how effective are strategy, implementation and operation of the organization regarding profitability of business bodies. TOPSIS Technique Decision making process is to find the best among different options. It is almost always the case where wide range of variables causes troubles for managers to make sure about results of adopting a specific decision. In this way, it seems reasonable to take decision making process as multi criteria decision making (MCDM) (Chia-Chang et al, 2009). MCDM is one of many for solving complicated issues of wide range of fields such as, engineering, social, economic, and managerial (Wiecek et al, 2005). Current models for MCDM may be classified into two general categories of multi objective decision making (MODM) and multi attribute decision making (MADM), so that the former is suitable for decision challenges and the former is suitable for making the best choice. As a supplementary for classic methods in MCDM for solving prioritizing problem, TOPSIS was first introduced by Hong and Yun in 1981 based on similarity with positive ideal solution. To apply the method, a decision making matrix with its rows as alternatives and its column as criteria is required. So that, adopting a systematic approach, TOPSIS decision making techniques is extendable to fuzzy space. Selected alternatives in this method need to be at minimum distance from the positive alternative and at maximum distance from the negative ideal (Chia-Chang et al, 2009). Adopting this approach is highly efficient specially when applied for solving a group decision making problem. Research hypothesis Hypotheses in this work are as follows: 1. Performance of Yazd Province Gen. Dept. of Physical Education is acceptable from customers perspective. 2. Performance of Yazd Province Gen. Dept. of Physical Education is acceptable from internal processes perspective. 3. Performance of Yazd Province Gen. Dept. of Physical Education is acceptable from growth and learning perspective. 4. Performance of Yazd Province Gen. Dept. of Physical Education is acceptable from financial perspective.
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Research questions Questions in this work are as follows: 1. What is priority of the BSC four perspectives in Yazd Province Gen. Dept. of Physical Education? 2. What is the priority of indices in customers perspective? 3. What is priority of indices in internal processes perspective? 4. What is priority of indices in growth and learning perspective? 5. What is priority of indices in financial perspective? Methodology Research Variables Firstly, based on literature surveying and finally by consulting with experts through Delphi method, general indices of strategic performance in sport organization (research variables) and specific indices of performance appraisal were obtained as follows. 1- Human Resource Management An important issues regarding human resource management is its relation with improvement of organizational performance (Tseng et al, 2009). There are several studies confirming the relation between human resources management and organizational performance. Life time employment, motivation, rewarding, training and involvement are considered in this research as the main factors in human resources management, which have direct impact on organization performance (Khatri, 2000, Cho et al 2006,ahmad et al 2003,lai et al 2005,chan et al 2004). Specific indices are employee motivation, improving athletics satisfaction, improving athletic interest, athletic salary and allowances, election and employment, preserving and keeping talents, training and development, involvement, quality of employment services and looking after athletics complaints. 2- Organizational Culture The most important debate raised from organizational culture is its relation with organizational performance (chan et al 2004). Many researches haves been conducted regarding influence of cultural values on organizational performance ( chan et al 2004, Goffee et al, 1998, Denison, 1990). Taking into account previous researches confirming a relation between organizational culture and performance- organizational performance in this work is taken as an index for measuring sport organizations performance. To find more about the relation we need to classify organizational culture. There are four classification of organizational culture: development, general, ranked, logic and expressive (Goodman et al, 2001). 3- Organizational Structure There are many researches conducted regarding the relation between organizational structure and performance (Abraham et al, 2003, Meijaard et al 2005). Several studies have taken size of organization as a factor closely related to organizational structure. A noticeable point regarding organizational performance is the balance between size and form of the organization (Abraham et al, 2003). Functionality and correlation are of issues related to organizational centralism and structure, which need to be taken into account for better perception of organization performance when studying organizational structure ( Haapasalo et al, 2006). There are also specific indices including facilitating internal processes, ranking athletic teams, and focusing international researches and communications.
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4- Management Many researches have certified existence of a relation between management and organizational performance. A manager undertakes variety of tasks such as, strategic planning, information assessment, and taking human resources, leadership, customers, market, etc. into account (Luo et al,2004). In carrying out his tasks, there are many factors affecting the performance including costs, evolution, flexibility and risk (Cua et al 2008), production quality and innovation, market function, and motivation and producing performance (Decoene & Bruggeman, 2006, Lai, 2003). Among specific indices in this regard are management knowledge, risk management, knowledge management, management scientific knowledge, strategic viewpoint, fair compensation, final result assessment, uniform performance appraisal, performance feedback and being in harmony with defined organizational goals. 5- Innovation Many researches have confirmed a positive relation between innovation and organizational performance and considered innovation as an effective factor in improving organizational performance (Danneels et al 2001, Gopalakrishnan, 2008). Innovation affects organizational performance through influencing market performance (Luo et al, 2004), economic performance (Vivero, 2002) and management strategy (Song et al ,2005). Among specific indices are innovations in planning, innovation in controlling system, innovation in management and developing new techniques. 6- Financial Financial aspect is one of the main aspects affecting organizational performance (Atkinson, 2006), so that some study has considered it as the first or second element affecting organizations performance. Nowadays, financial aspect has received high attention from majority of researches (Levine et al, 2007)
Specific indices in this regard are total income, number of athletes, taking into account clubs income, costs management, improving credit and reputation of provinces sport. Having the above indices, they were classified into the four perspective of BSC. The result is illustrated in diagram 1:
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Organization Performance
Diagram 1: Classification of general and specific indices based on four BSC perspectives
Organizational culture
Management
Innovation
Financial
Organizational structure
Human resource management

Improving athletics motivations Developing athletes satisfaction
BSC
Concentratin g on research
Improving credit and reputation of provinces sport
Global communica -tions
Ranking athletic federations
Customer
Fair performance reward
Considering clubs income
Total income Athletes wage and compensation
Financial
Costs control
Planning innovation
Number of athletes
Knowledge management
Risk management
Manager academic background
Managerial innovation
Staffs performance
Manager scientific knowledge
Strategic viewpoint
Innovation in controlling system
Facilitating internal processes
To look after complaints
Internal processes
Cultural rank
A logical and expressive culture
Development culture
Performance feedback
Final results assessment
Public culture
Harmony with organizational goals
Performanc e harmonic assessment
Developing new technique
Preserving and keeping talents
Selection and recruitment
Staff motivation
Learning and development
Growth and learning
Involvement
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7. Research method Concerning goal, application and methodology viewpoints, this work is a comparativesurveying research conducted as a field study. Physical region under study is Yazd Province Gen. Dept. of physical education. Statistical society is comprised of employees of the department, coaches and athletes in different fields who have been somehow related to physical education performance. Statistical sample (n = 74) was determined by sample size for unlimited society formula (confident coefficient: 0.095, sample variance: 4.76, error rate: 0.5), however for accuracy sake and considering this is the minimum sample size, author decided to carry out the research over 119 participants selected randomly as sample group (108 agreed to participate in the study). An author-designed questionnaire was applied for data gathering. A group of researchers, university scholars and experts of the organization received the questionnaire to determine validity of the questionnaire. Consequently 37 elements were confirmed in the questionnaire and having validity of the questionnaire determined, stability of the questionnaire based on a pilot study and according to Chronbach Alpha was confirmed ( = 0.09 ).
Deductive statistics techniques and MADM techniques were applied for data statistical analysis. As first step, a single sample t test was applied to test the four hypotheses. Then, Levene's test carried out to ascertain homogeneity and variances and single path ANOVA technique was applied to test the hypothesis of difference between averages of four perspectives of BSC. Ranked variance analysis test was applied for ranking the perspectives. To rank the 37 elements, the next part characterized by applying fuzzy TOPSIS technique which is one of commonly used technique for MADM. Finally the same technique was applied to rank each BSC perspective. 8.Research Findings Single sample t test was applied to survey the 4 hypotheses of the research (suitable performance 2.5; H0 ), results of the tests are listed in table 1.
Hypothesis H1 H2 H3 H4 Table1: Results of hypotheses test Average Perspective Significance level Customer 2.27 Sig <0.05: rejected Internal processes Growth and learning Financial 2.252 2.62 2.31 Sig > 0.05: confirmed Sig > 0.05 : confirmed Sig < 0.05: rejected Performance Unacceptable performance Acceptable performance Acceptable performance Unacceptable performance
As it is clear from table 1, Yazd Province Gen. Dept. Physical Education has acceptable performance regarding internal processes and growth & learning perspectives and while its performance is not acceptable regarding customers and financial perspectives. Before prioritizing the four BSC perspectives we need to ascertain significance difference regarding the four perspectives. A single path variance analysis was applied to make sure existence of a significant difference between the four perspectives. Results are as listed in tables 2&3:
Table 2: Levene's test results Levene's test 0.476 df1 3 df2 127 Sig. 0.700
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Table 3: ANOVA test results
Total square Intra-group Inter-group Total 40423 76.39 80.81 df 3 127 130 Average square 1.47 0.40 F 2.45 Sig 0.046
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According to table 2, variances equality hypothesis, as a condition for parametric tests, is at significance level of 0.05. Moreover, looking at ANOVA table, difference between organization performance average for different perspectives of BSC is confirmed at significance level of 0.05 (sig = 0.046). Table 3 hints that there is a significance differences between averages of organization performance regarding different perspectives. To find an answer for the first research question and to have perspectives rank determined, a ranked variance analysis method was applied. Table 4 represents the results:
Table 4: Ranked variance analysis test results
Value of 2 and significance probability level (P) were obtained equal to 18.77 and 0.0009 (P<0.05) respectively. This implies that there is a significance difference between the four perspectives and prioritizing is as listed in the above table. Regarding results of ranked variance analysis test results, a fuzzy TOPSIS technique a multiple attribute decision making technique- was applied to survey questions of the research regarding priority of related indices. Results are as follows: Table 5 hints that priorities of the research indices is independent of their perspective, so that resulted information shows that improving satisfaction and motivation of athletics are the main effective indices of organization performance. Table 6 lists priority of indices from customers perspective, it is easy to find out that satisfaction and motivation of athletics are the main effective indices of organization performance. Table 7 represents indices priorities from financial perspective, clearly wage and allowances of athletics are the main effective indices of organization performance. Table 8 lists priorities of indices from internal processes perspective, as shown, looking after complaints are the main effective indices of organization performance. And finally table 9 gives us indices priorities from growth and learning perspective, clear enough, preserving and keeping talents is the main effective indices of organization performance
.
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NO. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 Table 5: Results of fuzzy TOPOSIS and priority of indices Difference with Difference with Factors positive ideal negative ideal Increasing athletes satisfaction 0.209 0.839 Increasing athletes motivation 0.212 0.834 Improving reputation and credit 0.214 0.829 Looking after complaints 0.216 0.823 Quality of staffs performance 0.227 0.818 Athletes wage and allowance 0.239 0.810 Preserving and keeping talents 0.251 0.793 Scientific background and knowledge 0.528 0.784 of manager Concentrating on sport researches 0.260 0.781 Global communication 0.265 0.777 Public Culture 0.269 0.772 Development of new techniques 0.271 0.768 Managerial innovation 0.273 0.761 Staffs motivation 0.277 0.756 Ranked culture 0.280 .0751 Harmonic appraisal of performance 0.285 0.747 Selection and recruitment 0.298 0.741 Fair reward to performance 0.310 0.736 Logical and expressive 0.315 0.731 Manager scientific background 0.319 0.725 Number of athletics 0.348 0.702 Taking clubs income into account 0.352 0.685 Planning Innovation 0.358 0.681 Athletic federation ranking 0.361 0.678 Harmonization with goals 0.367 0.674 Cultural development 0.371 0.670 Training and development 0.373 0.666 Appraising final results 0.378 0.661 Innovation in process system 0.381 0.652 Involvement 0.384 0.651 Performance feedback 0.384 0.651 Facilitate internal process 0.391 0.645 Strategic approach 0.394 0.641 Knowledge management 0.401 0.638 Total income 0.407 0.623 Costs control 0.412 0.628 Risk management 0.416 0.624 CCI 0.800 0.796 0.792 0.791 0.785 0.772 0.763 0.752 0.749 0.746 0.743 0.740 0.738 0.737 0.735 0.733 0.718 0.703 0.698 0.694 0.672 0.662 0.658 0.651 0.648 0.648 0.641 0.633 0.630 0.630 0.628 0.620 0.618 0.611 0.609 0.607 0.601
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Rank 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37
According to the above table, priority of indices for each BSC perspective is as follows: Table 6: Results of priority of customers perspective Items of customers perspective Rank Increasing Athletics satisfaction 1 Increasing athletics motivation 2 Increasing reputation and credit of 3 province sport Concentrating on sport researches 4 Global communication 5 Ranking athletic federations 6
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Table 7: Results of priority of financial perspective Items of financial perspective Rank Athletes wage and allowance 1 Taking clubs income into account 2 Fair payment based on performance 3 Number of athletes 4 Total income 5 Costs control 6 Table 8: Results of priority of internal processes Items of internal processes perspective Looking after complaints Managerial innovation Staffs work quality Managers scientific knowledge Managers scientific background Planning innovation Facilitating internal processes Innovation in process control system Strategic viewpoints Knowledge management Risk management perspective Rank 1 2 3 4 5 6 7 8 9 10 11
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Table 9: Results of priority of growth and learning perspective Items of growth and learning perspective Rank Preserving and keeping talents 1 Public culture 2 Developing new techniques 3 Staffs motivation 4 Performance harmonic assessment 5 Selection and recruitment 6 Ranked culture 7 Logical and expressive culture 8 Appraising final result 9 Harmonization with organizational goals 10 Development culture 11 Development and training 12 Involvement 13 Performance feedback 14
9. Discussion and Conclusion Performance appraisal is one of the main issues which need great deal of attention from managers of organizations and it is of great importance for sport organization as well. Nowadays, taking only financial indices for performance appraisal in business institutes will do no good and performance appraisal requires measuring more indices. BSCTOPSIS approach identifies effective factors for appraising performance of sport organizations based on BSC model and considering theoretical and practical advantages of TOPSIS technique, employs it for ranking the performance. Using this approach, it is possible to determine organizations status from different executive fields, so that the results will provide the managers a framework for better management. This model enables chief managers is sport organization to carry out organizational performance appraisal. So that, with better comprehension of inadequacies and trusting organizational merits, real balance between long-term and short-term objective appraisal and main and subsidiary indices is achievable. Employing BSC-TOPSIS combined model in this research for appraising performance of sport organizations is unprecedented, which in
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addition to determining their performance status in every four BSC perspectives enables manages to identify priority of their performances. Adopting a strategic approach, this work focused on appraising performance of Yazd Province Gen. Dept. of Physical Education applying the above model. Results imply that the organization under consideration has no acceptable performance in two perspective of growth and learning and financial performance. So that it is recommended to carry out permanent analysis on financial ratios and measures satisfaction of its customers athletes and coaches- by establishing and keeping communication lines through providing preferred services and showing trust to customers. A result of variance analysis test implies that the four perspectives are ranked differently so that: customer perspective is in top in the priority ranking and the last place is occupied by financial perspective. A Fuzzy TOPSIS technique was applied to determine the perspectives ranking and priority of related indices of each perspective, so that 37 factors of the four perspective of BSC are ranked separately. Results of the ranking showed that to improve satisfaction and performance, the organization under consideration need prioritize its performance according to ranking of the 37 factors. More study is recommended on using data encompasses analysis (DEA) technique for appraising performance of organization and NET DEA technique for appraising organizations committees systems.
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References Abraham Y,. Nahm, Mark A,. Vonderembse, Xenophon A. Koufteros.( 2003).The impact of organizational structure on time-based manufacturing and plant performance, Journal of Operations Management, 21, pp281306
Ahmad,S.,&Schroeder,R.G.(2003).Theimpact of human resource management practices on operational performance. Recogniing country and industry differences. Journal of Operations Management, 21,pp 1943. Amaratunga, D., Baldry, D. & Sarshar, M. (2001). process improvement through performance measurement: the balanced scorecard methodology, Work study, 50(5), pp179-188. Atkinson, H. (2006). Strategy implementation: a role for the balanced scorecard?. Management Decision, 44(10), pp1441-1460. Chadwick, Simon.(2009). From outside lane to Inside Track: Sport Management Research in the Twenty-first Century, Management Decision, 47( 1), pp 191-203. Chan, L. L. M., Shaffer, M. A., & Snape, E. (2004). In research of sustained competitive advantage: The impact of organizational culture, competitive strategy and human resource management practices on firm performance. International Journal of Human Resource Management, 15(1), pp1735. Chen,C.T.(2000). Extensions of TOPSIS for group decision-making under fuzzy environment, Fuzzy Sets and Systems, 114, pp 19. Chia-Chang Hung and Liang-Hsuan Chen;(2009). A Fuzzy TOPSIS Decision Making Model with Entropy Weight under Intuitionistic Fuzzy Environment . IMECS. Vol I , March 18 20. Cho, S., Woods, R. H., Jang, S., Erdem, M.(2006).Measuring the impact of human resource management practices on hospitality firms, performances. Hospitality Management, 25,pp 262277. Cua, K.O., McKone, K.E., Schroeder, R.G.(2008). Relationships between implementation of TQM, JIT, and TPM and manufacturing performance. Journal of Operations Management 19, pp675694. Danneels, E., & Kleinschmidt, E. J. (2001). Product innovativeness from the firms perspective: Its dimensions and their relation with project selection and performance. The Journal of Product Innovation Management, 18, pp357 373. Decoene, V. & Bruggeman, W. (2006). Strategic alignment and middle-level managers motivation in a Balanced Scorecard setting. International journal of Operations & Production Management, 26(4), 429-448. Denison, D. R. (1990). Corporate culture and organizational effectiveness. New York: Wiley.
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Evans Nigel .(2005). Assessing the balanced scorecard as a management tool for hotels, International journal of contemporary Hospitality management , 17(5), pp376-390. Goffee, R., & Jones, G. (1998). The character of a corporation. How your companys culture can make or break your business. London: Harper Business. Goodman, E. A., Zammuto, R. F., & Gifford, B. D. (2001). The competing values framework: Understanding the impact of organizational culture on the quality of work life. Organization Development Journal, 19(3), pp5867 Gopalakrishnan, S. (2008). Unraveling the links between dimensions of innovation and organizational performance. The Journal of High Technology Management Research, 11(1), pp137153. Haapasalo, Harri., Ingalsuo, Kari.,Lenkkeri,Timo.(2006).Linking strategy into operational management a survey of BSC implementation in finnish energy sector, Benchmarking:an International journal,13(6),pp 701-717. Kaplan, R. S,. Norton, D. P. (1992). The Balanced Scorecard- Measures that drive performance. Harvard business Review. Kaplan, R. S. & Norton, D. P. (2005). The Balanced Scorecard: Measures that drive performance. Harvard business Review, july August. Khatri, N. (2000). Managing human resource for competitive advantage: A study of companies in Singapore. International Journal of Human Resource Management,11, 336 365. Lai, K. H., & Cheng, T. C. E. (2005). Effects of quality management and marketing on organizational performance. Journal of Business research, 58, pp446456. Lai, K.(2003). Market orientation in quality-oriented organizations and its impact on their performance. International Journal of Production Economics 84, pp1734. Levine, R. Loayza, N., Beck, T.,( 2007). Financial intermediation and growth: causality and causes Journal of Monetary Economics, 46,pp 31-77. Luo, X.M., Griffith, D.A., Liu, S.S., Shi, Y.Z.( 2004). The effects of customer relationships and social capital on firm performance: a Chinese business illustration. Journal of International Marketing 12(4), pp2545. Medori , D.,Steepl ,A.(2000). " A Framework For Auditing and Enhancing Performance Measurement System", International Journal of Operation and Production Management , 20( 5). Meijaard Joris, Brand Maryse , Mosselman Marco.(2005). Organizational structure and performance in Dutch small firms,SCALES-paper, EIM,4(20). Sim, K. L,. Koh, H.C.(2001). Balanced Scorecard: A rising trend in strategic performance measurement, Measuring Business excellence, 5(2), pp18-26.
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Song, M., Droge, C., Hanvanich, S., Calantone, R., (2005). Marketing and technology resource complementarity: an analysis of their interaction effect in two environmental contexts. Strategic Management Journal26 (3),pp 259276. Thakkar, J., Deshmukh, S.G., Gupta, A.D., Shankar, R. (2007). Development of a Balanced Scorecard an integrated approach of Interpretive Structural Modeling (ISM) and Analytic Network Process (ANP), International Journal of Productivity and Performance Management, 56(1). Tseng, Y,. Lee, T.(2009). Comparing appropriate decision support of human resource practices on organizational performance with DEA/AHP model,Expert, Systems with Applications 36,pp 65486558. Vivero, R.L.( 2002). The impact of process innovations on firms productivity growth: the case of Spain. Applied Economics 34 (8), pp10071016. W,B, Lyle, John. (1997). Managing Excellence in Sports Performance, Career Development International, 2(7),pp 314323. Wiecek M., Ehrgott M., Fadel G. and J. R. Figueira (2005). Multiple criteria decision making for engineering Omega,36,PP337-339.
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An Investigation of Personnel's Attitude toward Merit Pay In South of Sistan & Baluchistan Hospitals
Mehdi Mohammadi* Assistant Professor, Department of Educational Administration and planning , Shiraz University, Shiraz, Iran
*Corresponding Author: Mehdi Mohammadi. Education and Psychology College, Shiraz University, Eram Square, Shiraz, Iran.
Jafar Tork Zadeh Assistant professor, Department of Educational Administration and planning, Shiraz University, Shiraz, Iran Homayoun Dadgar M.A students of Educational Administration, Department of Educational Administration and planning, Shiraz University, Shiraz, Iran Farideh Barahouei M.A students of Educational Administration, Department of Educational Administration and planning, Shiraz University, Shiraz, Iran Mohammad Ebrahimi B.Sc Nurse. Khatam -ol- Anbia Hospital, Iranshahr, Iran Rehman Safdar PhD Management Sciences, Director ( HR ) Super Solutions Consultancy, Canada.
Abstract
The main purpose of this study is an investigation of personnels attitude toward merit pays in south of Sistan & Baluchistan hospitals. Statistical population of this study comprised of all of 6 hospitals personnel's in south of Sistan and Baluchistan province. Using simple random sampling, 178 individuals were selected. In order to collect data, Kim (2003) questionnaire was used in this study. Data were analyzed by using spss16 software and analytic method i.e. Frequency, Chisquare and ANOVA. Results indicated that hospital personnel's were motivated by merit pay, having a positive opinion of merit pay as a means for their repaying service, and they believed that in case of payment of salary as merit pay, most of its amount should be allocated to main occupational activities and, finally that their dean of ward is the sole authorized person to evaluate their performance. Key words: Merit pay, Attitude, Hospitals.
Introduction
The managers of organizations endeavor to evaluate their employees to a satisfactory level of success, happiness, and contentment by motivating them; so that they exert their full abilities, skills and knowledges to fulfill the institutional goals. One effective way to creating motivation among personnel's is giving donations in different forms and way (Mozaffari G. A, 1996 ). In the way called merit pay, every personnel are benefited in proportion to his efforts. Merit pay or pay for performance, is a system in which personnel's are paid more according the quality, rather than quantity of their work. That is, personnel's are paid more in accordance with the quality of their total work or of a portion of it (Mannat R P & Daniels B. 1990) . Seemingly, rewards systems in different organizations have peculiar problems, one of which being the unassessable nature of the quality services which is resulted either from lack of proper definition and criteria for measuring offered services or from lack of unanimity on measurable goals. Though sometimes some aspects are possible to assess, there is a danger that predicating these aspects may lead personnel's efforts
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into an undesirable way(Mannat R P & Daniels B. 1990) and even when criteria are specified, brown and gray state evaluative method for achievement of goals arent workable (Gray G R & Brown D. 1989). Studies by scholars (Laure and Schoppmeyer for example) indicates that since organizational objectives and pay for performance are often incoherent and unrelated, Merit pay system is not workable (Gray G R & Brown D, 1989 ) Through several studies on merit pay in Iranian institution or organizations, appeared certain results which are both congruent and incongruent. Sadr zadeh found that health care personnel's are mostly unsatisfied with merit pay system (87.2% complained on the way that merit pay is calculated) Sadr zade M. (1999). Esmaili found that out of all nurses only 1.6 % were content with their masters fair assessment of them. Of all samples only 5% were fully satisfied with merit pay. Most of personnel's hold that an increase of work load has ensued merit pay and that they oppose its continuance (Esmaili A A ,1994). Another study by session on feasibility study and design of a merit pay plan for principals has shown that in answer as to if the system needs any professional development plans, 90% responded positively, 36% believed that the merit pay must be public rather than private and assessment must be done by an expert team rather than a person (Session L. E. ,1996) low amount of enough merit pay for proper motivation and use of unreliable criteria for assessment were among the main results from a study by Terpstra et al on faculty perceptions of problems with merit pay plans in institutions of higher education (Schoppmeyer, 1993). Rehman Safdar in 2011 has studied a strong relationship between job design and job performance. Xiangpings survey in a public university shows that merit pay bears some negative effects on time, effort and relationship of faculty members and administrators, and that the majority of faculties didnt trust administrators . Kim's study on the perceptions of administrators and faculty members toward merit pay, has found that administrators held a good opinion of merit pay as a way of repaying faculty members services, but faculty members opinions were not good at all. Also administrators were much more positive opinion on motivating effects of merit pay than faculty members . A review of above exploration indicates the fact that, despite the payment in various forms and methods, and despite numerous studies to achieving unanimity on payment and ways of payment, there is no general agreement between responses and peoples views are different. Considering that hospitals hold the responsibility for maintenance of health, it is crucial to know personnel's understanding about merit pay and its effectiveness in burgeoning motivation and in promotion of individual and organizational performance which is the achievement of the health and treatment goals.
Materials and methodology This descriptive analytic study was undertaken over a group of 178 personnel's at 6 hospitals of south of Sistan & Baluchistan province in 2010. Samples were selected using simple random way and questionnaires were handed to personnel's at workplace. Varients were: demographical variants like gender, marital status, employment agreement (tenure, contractual, and conditional), years of experience and position (nurse, midwife, scrub nurse, laboratory expert, nurse clinician, and administrative and supportive workers). Personnel's attitudes toward merit pay as a means for repaying service, motivational effects of merit pay, its negative effects, qualified person to personnel's assessment ( include boss of hospital, matron and supervisors, dean of ward, teammates and clients), and regarding payment of salary as merit pay and according to quality of service done ( include main occupational activities, research activities, and activities related to ward, hospital and society) was analyzed, using a 19 item questionnaire ( kim, 2003) Along with likert scale. In this scoring system, for each of the five response categories (strongly disagree, disagree, neither agree nor disagree, agree, and completely agree) a score of 1-5 was assigned, with the highest score of 5 being assigned to completely disagree. Data were analyzed with use of spss16 software and analytic method i.e. TWO- WAY ANOVA, Repeated measure ANOVA, Chi-square, and Frequency.
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This study, altogether, included a survey of 178 personnel's in south of sistan & Baluchistan hospitals: khatam ol anbia hospital, iranshahr, 21 persons (11.8%), iran hospital, iranshahr, 26 persons (14.6%), razi hospital, saravan, 47 persons (26.4%), imam ali hospital, chabahar, 26 persons, (14.6%), 22 bahman hospital, nikshahr, 31 persons (17.42%), and imam Khomeini hospital, khash, 27 persone (15.17%). Of all persons 77 persons were nurse, 16 midwife, 16 scrub nurse, 20 laboratory expert, 25 nurse clinician, and 24 administrative and supportive workers. There were 99 women and 79 men out of which 104 were married, 64 single. Of all, 37 personnel's were employed tenure, 101 contractually and 39 conditionally. They were grouped according to years of experience: 0-5 years: 106 persons, 6-10 years: 31 persons, 11 15 years:17 persons, and more than 15 years: 23 persons. Studying samples showed that highest positive attitude of personnels toward merit pay as a means for repaying service goes to administrative and supportive workers (3.27); personnel's with more than 15 years of experience (3.87); married male (3.08), and lowest belongs to midwives (2.53); conditional personnel's with 11 15 years experience (2.63) and single male (2.79) (table:1). highest positive attitude of personnels toward motivational effects of merit pay goes to nurse clinicians (3.80); contract personnel's with 11 15 years and conditional personnel's with more than 15 years of experience (4.16); and single female (3.6). and lowest belongs to midwives (3.17); tenure employed personnel's with 0 5 years (3.29); and married female (3.41), (table: 2). highest positive attitude of personnels toward negative effects of merit pay on behavior goes to scrub nurse (3.5); conditionally employed personnel's with more than 15 years of experience (4.22) and married male (3.46), and lowest is owned by midwives (2.87); tenure employed personnel's with 6 10 years of experience (2.6) and married female (2.81), (table:3). Out of all varying features of merit pay system, highest attitude of personnels is belongs to its motivational effects (3.51) and lowest (2.95) belongs to merit pay as a means for repaying services, (table:4). Regarding payment of salary as merit pay and according to quality of services done, highest percentage is related to main occupational activities (69.89) and lowest percentage (13.55) belongs to research activities, (table:5). Dean of ward has the highest qualification for assessing personnel's for merit pay with 143 votes and clients have the least qualification with only 48 votes, (table:6). 71.9% out of all personnel's who viewed merit pay as a means for repaying services were in the average mean, 15.7% below average mean and 12.4% higher than average mean. 69.1% of all personnel's who viewed merit pay as having motivational effects were occupy average mean, 16.9% were below the average mean and 14% higher than average mean. And finally, 58.4% of all personnel's who viewed merit pay as having negative effects were in average mean, 20.8% below the average mean and remaining 20.8% were higher than the average mean, (table:7).
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Table: 1 Comparison of personnel's attitude toward merit pay as a means for repaying service based on position, employment agreement, and years of experience, gender and marital status Number SD Mean P position Nurse 77 0.61 2.85 Midwife 16 0.53 2.53 Scrub nurse 16 0.56 3.07 0.02 Laboratory expert 20 0.66 3.01 Nurse clinician 25 0.88 3.07 Administrative and supportive workers 24 0.89 3.27 Employment agreement and years of experience Tenure 0-5 years 6-10 years 11-15 years More than 15 years contractual 0-5 years 6-10 years 11-15 years More than 15 years conditional 0-5 years 6-10 years 11-15 years More than 15 years Gender and marital status Female married single Male Married single
7 1 12 17 69 27 3 2 30 3 2 4 45 44 59 20
0.39 0.67 0.50 0.69 0.52 0.05 0.08 0.77 0.75 0.04 1.3 0.53 0.61 0.83 0.94
2.85 3.60 2.90 3.87 2.77 3.04 3.43 3.80 2.81 3.20 2.63 3.80 2.85 2.93 0.11 3.08 2.79
0.79
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Table: 2 Comparison of personnel's attitude toward motivational effects of merit pay based on position, employment agreement, and years of experience, gender and marital status number SD mean p position Nurse 77 0.55 3.43 Midwife 16 0.51 3.17 Scrub nurse 16 0.55 3.67 0.009 Laboratory expert 20 0.61 3.41 Nurse clinician 25 0.69 3.80 Administrative and supportive workers 24 0.73 3.70 Employment agreement and years of experience Tenure 0-5 years 6-10 years 11-15 years More than 15 years contractual 0-5 years 6-10 years 11-15 years More than 15 years conditional 0-5 years 6-10 years 11-15 years More than 15 years Gender and marital status Female married single Male Married single
7 1 12 17 69 27 3 2 30 3 2 4 45 44 59 20
0.32 0.52 0.99 0.63 0.55 0.14 0.68 0.57 1 0.67 0.76 0.56 0.54 0.74 0.62
3.29 3.62 3.56 3.89 3.46 3.51 4.16 3.75 3.49 3.45 3.72 4.16 3.41 3.60 0.28 3.52 3.47 0.93
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Table: 3 Comparison of personnel's attitude toward negative effects on behavior based on position, employment agreement, and years of experience, gender and marital status number SD mean P position Nurse 77 0.66 3.13 Midwife 16 0.69 2.87 Scrub nurse 16 0.96 3.50 0.13 Laboratory expert 20 0.89 3.32 Nurse clinician 25 0.74 3.27 Administrative and supportive workers 24 0.84 3.42 Employment agreement and years of experience Tenure 0-5 years 6-10 years 11-15 years More than 15 years contractual 0-5 years 6-10 years 11-15 years More than 15 years conditional 0-5 years 6-10 years 11-15 years More than 15 years Gender and marital status Female married single Male Married single
7 1 12 17 69 27 3 2 30 3 2 4 45 44 59 20
0.87 0.77 0.97 0.65 0.86 1.07 0.44 0.80 0.88 0.000001 0.83 0.62 0.72 0.73 0.93
2.83 2.33 3.27 3.41 3.16 3.33 3.55 3.66 3.12 2.33 3 4.22 2.81 3.32 0.001 3.46 3.10
0.87
Table:4 Comparison of personnel's attitude toward merit pay as a means for repaying service, motivational effects, and negative effects on behavior Number SD Mean P Personnel's general attitude toward varying features of merit pay 0.71 2.95 as a means for repaying service 0.62 3.51 178 0.0001 motivational effects of merit pay 0.77 3.22 negative effects on behavior
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Table:5 Comparison of personnel's attitude toward payment of salary as merit pay based on performance assessment Number SD Mean P Performance assessment Main occupational 19.09 69.89 activities 178 0.0001 10.46 13.55 Research activities Activities related to ward, 13.82 16.60 hospital and society
Table:6 Comparison of personnel's attitude toward qualified person to assessment them Numbers Percentage P Qualified persons 68 17.70 Boss of hospital 70 18.22 Matron and supervisors 0.0001 143 37.23 Dean of ward 55 14.32 Teammates 48 12.50 Clients
Table:7 Comparison of personnel's attitude toward merit pay as a means for motivational effects repaying service 2.95 3.51 Mean 0.71 0.62 SD Below mean 15.77 16.90 percentage Middle mean 71.90 69.10 percentage Below mean 12.40 14 percentage
negative effects on behavior 3.22 0.77 20.80 58.40 20.80
Discussion and conclusion

Contrary to studies by sadr zadeh and esmaili results of this study showed that administrative and supportive workers viewed merit pay as a means for repaying services. Nurse clinician believed in motivational effects of merit pay more than midwives did. Also evident is that scrub nurse, more than other personnel's viewed merit pay negatively which is harmonious with Xiangping's results. There seemed no considerable difference between employment agreement, experience, gender and marital status on one hand and merit pay as a means for repaying services. However, male personnel's saw more negative points of merit pay in behavior than females ones did. Personnel's believed in motivational effects of merit pay more than its other features, namely, merit pay as repaying service and its negative effects. These results are harmonious with kim's study. Most personnel's believed that, in case of payment of salary as merit pay, 69.89% of it must be calculated upon main occupational activities and 13.55% ( the least portion of merit pay) be paid upon research activities. Majority of personnel viewed the dean of ward as the sole authority in assessing their performance and put clients as the least authorized assessors.
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Considering difficulty of health and medical jobs it appears that either there is no sufficient time for conduction or the personnel themselves one not much eager in educating activities like research or survey. Self directing plans like books, leaflets and brochures, and other training aids are providing a situation in which the burden of class attendance is eased array, hence more free time and a promotion in medical services to patients. Probably managers must prevent negative effects of merit pay and enhance motivational effects of rewards, while they are reforming payment systems. This study recommends that: personnel's awarenesss must be increased, present assessment and rewarding systems must be reconsidered, personnel's view must be taken into consideration and they must be granted more Independence and freedom in their workplaces.
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References
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Engvall R P. (2010) The Corporatization of American Higher Education: Merit Pay Trumps Academic Freedom or, More Discretionary Power for Administrators over Faculty: Youre kidding Me, Right? American Association of University Professors. AAUP Journal of Academic Freedom.; 1: 8
Esmaili A A. (1994) A survey of nurses attitude toward merit pay in instructional hospitals of Beheshti martyrs university: Dissertation. University of Beheshti martyr, Tehran,; 2
Gray G R & Brown D. (1989) Pay for performance in academia. A viable concept? Educational Research Quarterly.; 13 (4): 48-51
Kim Y J. (2003) A Study of the Perceptions of Administrators and Faculty Members toward Merit Pay for Faculty at Junior Colleges in Korea: Dissertation. University of Texas.; 148 -149
Laure A L. (1991) Searching for answers: should universities create merit pay system? Business Officers.; 25(5): 52-54
Mozaffari G. A (1996) Survey of merit pay effects on physicians job satisfaction and performance in social security hospitals: Dissertation. University of tarbiyat modarres, Tehran, 3 4
Mannat R P & Daniels B. (1990 ) Relationship between principals' rating of teacher performance and student achievement. Journal of personnel evaluation in education.; 4: 189-201
Rehman Safdar (2011) Job design and job performance relationship : A study of Pakistan Public Sector employees, 2(12) 562-576 Interdisciplinary Journal of Contemporary Research in Business, UK
Schoppmeyer (1993) M. The Culture of Higher Education. In E. Boe & D M Gilford (Eds.), Understanding the many faces of the culture of higher education. Jossey - Bass: San Francisco.
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Sadr zade M. (1999) A survey of health personnel's satisfaction of merit pay: Dissertation. University of Beheshti martyr, Tehran,; 2 3 Session L. E. (1996) Feasibility study and design of a merit pay plan for principals. Doctoral Dissertation. Lowa state university.
Terpstra D. E, Honoree A L. (2008) Faculty Perceptions of Problems with Merit Pay Plans in Institutions of Higher Education. Journal of business and management.; 3
Xiangping K. (2000) A study of merit pay as a motivator of faculty performance at a public university: Doctoral dissertation. University of Northern Colorado, Colorado.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS An Empirical Study on Customers Satisfaction towards Banking Services in Trichy.
Mahalakshmi. V
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Asst Professor (senior Grade) Department of Management studies, J.J. College of Engineering and Technology, Trichy.
Dr. M. G. Saravanaraj
Professor & Head, Department of Management studies, Muthayammal Engineering college, Rasipuram.
Abstract
The purpose of this research article is to find out the customer satisfaction towards the services rendered by banks in Trichy. The authors conducted a literature search on banking services and interviews with 150 customers of Public and Private sector banks. The study also focused on various factors that influence towards the selection of a bank. General banking services, Infra-structure facility, Value added services and loan oriented services are connected towards customer satisfaction. Analysis was made by using various tools like Percentage Analysis, Ranking, T-test analysis and Correlation. The result showed that there exists a relationship among the variables of customer satisfaction and Banking services. Thus the bank must give importance to these variables in order to be effective.
Key words: Banking services, Customer satisfaction and customer retention. I. Introduction
The banking industry is highly competitive, with banks not only competing among each other; but also with non-banks and other financial institutions .Most bank product developments are easy to duplicate and when banks provide nearly identical services, they can only distinguish themselves on the basis of price and quality. The majority of Indian banks has non-domestic owners, and is not very diversified in terms of the products and services they offer (Hull, 2002). This suggests that the Indian banking industry has reached the maturity phase of the product lifecycle and has become commoditized, since banks offer nearly identical products. This carries the danger of
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creating a downward spiral of perpetual price discounting -- fighting for customer share (Mendzela, 1999). One strategic focus that banks can implement to remain competitive would be to retain as many customers as possible.
i. Customer Satisfaction
In businesses where the underlying products have become commodity-like, quality of service depends heavily on the quality of its personnel. This is well documented in a study by Leeds (1992), who documented that approximately 40 percent of customers switched banks because of what they considered to be poor service. Leeds further argued that nearly three-quarters of the banking customers mentioned teller courtesy as a prime consideration in choosing a bank. The study also showed that increased use of service quality/sales and professional behaviors (such as formal greetings) improved customer satisfaction and reduced customer attrition. Indeed, customer satisfaction has for many years been perceived as key in determining why customers leave or stay with an organization. Organizations need to know how to keep their customers, even if they appear to be satisfied. Reichheld (1996) suggests that unsatisfied customers may choose not to defect, because they do not expect to receive better service elsewhere. Additionally, satisfied customers may look for other providers because they believe they might receive better service elsewhere. However, keeping customers is also dependent on a number of other factors. These include a wider range of product choices, greater convenience, better prices, and enhanced income (Storbacka et al., 1994). Fornell (1992), in his study of Swedish consumers, notes that although customer satisfaction and quality appear to be important for all firms, satisfaction is more important for loyalty in industries such as banks, insurance, mail order, and automobiles. Ioanna (2002) further proposed that product differentiation is impossible in a competitive environment like the banking industry. Banks everywhere are delivering the same products. For example, there is usually only minimal variation in interest rates charged or the range of products available to customers. Bank prices are fixed and driven by the marketplace. Thus, bank management tends to differentiate their firm from competitors through service quality. Service quality is an imperative element impacting customers satisfaction level in the banking industry. In banking, quality is a multi-
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portfolio, and critically, the staff delivering the service.
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variable concept, which includes differing types of convenience, reliability, services
ii. Customer Perceptions of Value
Today, customers are more value oriented in their consumption of services because they have alternative choices (Slater, 1997; Woodruff, 1997). For example, Gale and Wood (1994) explained how customers make purchase decisions between competing providers. The author argued that customers buy on value; they do not simply buy products. Interestingly, it was observed that customers learn to think objectively about value in the form of preferred attributes, attribute performance, and consequences from using a product in a use situation (Woodruff, 1997). Thus, banks must be able to provide up-close personal service for customers who come with high expectations. For customers who value convenience most, banks must offer the latest product such as electronic banking, touch-tone phone account access and internet banking. Clearly, customer value can be a strong driver of customer retention. Reidenbach (1995) argued that customer value is a more viable element than customer satisfaction because it includes not only the usual benefits that most banks focus on but also a consideration of the price that the customer pays. Customer value is a dynamic that must be managed. Customer satisfaction is merely a response to the value proposition offered in specific products/markets (Reidenbach, 1995). By this view, banks must determine how customers define value in order to provide added-value services.
iii.Corporate Image
Todays consumers have more choices for their financial needs than ever before. Technology, globalization, increased competition and increased consumer mobility have dramatically changed the way people bank (Harwood, 2002). Many financial institutions are looking at branding techniques to differentiate themselves. Harwood (2002) argued that branding, as a tool to build image, is critical in the banking industry where all firms offer about the same kinds of products. Hence, it is critical that banks have a comprehensive knowledge of customers values, attitudes, needs and perceptions of various services the bank offers and the image which customers have of the bank itself (Kaynak, 1986a, 1986b). Accordingly, bankers must be able to build and manage their
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competitors.
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banks image in order to clearly define the differences between their bank and its Bharadwaj et al. (1993) argue that services are highly intangible and are, therefore, high in experience and credence qualities. As a consequence, brand reputation is important as a potential competitive advantage. Alvarez (2001) proposed that logic is no longer enough to sell the benefits of an intangible product or service, especially with commodity products and skeptical consumers. This situation calls for emotion or image to change the perception of the audience in any real or profound way (Alvarez, 2001). Furthermore, both Marthur (1988) and Gronroos (1984) proposed image as an alternative to product differentiation.
iv. Customer retention
Customer retention improves profitability principally by reducing costs incurred in acquiring new customers. A prime objective of retention strategies must therefore be zero defections of profitable customers (Reichheld, 1996a). There is, however, a distinction between customers who are simply retained and those who are loyal. The concept of consumer inertia implies that some customers are only being retained, rather than expressing loyalty. Truly loyal customers are usually portrayed as being less pricesensitive and more inclined to increase the number and/or frequency of purchases. They may become advocates of the organization concerned and play a role in the decision making of their peers or family. Satisfaction with a bank's products and services thus also plays a role in generating loyalty that might be absent in the retention situation. Customer loyalty is therefore not the same as customer retention, as loyalty is distinct from simple repurchase behavior. Loyalty is only a valid concept in situations where customers can choose other providers. Companies thus need to understand the nature of their consumers reasons for staying and must not assume that it is a positive, conscious choice (Colgate et al., 1996). Changes in the industrial context of banking could also have an impact on the durability of customer-bank relationships. In New Zealand, these changes have included consolidation through mergers and acquisitions, and the introduction of a new, stateowned bank in 2002. In the former case, banks not only acquire physical assets and human resources, they also acquire the customers of their previous competitors, making assessments of loyalty more complicated. In the case of the new bank, called Kiwibank, its relative youth compromises interpretations of durability. In contrast, the four major
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banks operating in New Zealand all have histories of well over 100 years. These include the Auckland Savings Bank (ASB), the Australia and New Zealand Bank (ANZ/National), the Bank of New Zealand (BNZ), and Westpac Trust. With the exception of Kiwibank, all major banks in New Zealand are now foreign owned.
iv. Switching Barriers
Switching barriers have been used as marketing strategies to make it costly for customers to switch to another organization. Such barriers include search costs, transaction costs, learning costs, loyal customer discounts and emotional costs (Fornell, 1992). These barriers provide disincentives for the customer to leave the current organization. Curasi and Kennedy (2002) have shown that customer satisfaction does not predict the continuation of the relationship. High switching costs are an important factor binding the customer to the service organization. Even with relatively low levels of satisfaction, the customer continues to patronize the service provider because repurchasing is easier and more cost effective than searching for a new provider or sampling the services of an unknown provider (Curasi and Kennedy, 2002). Other than switching costs, cross-selling is another critical variable driving customer retention. Cross-selling is the banks effort to sell as many different products and services as they can to a particular customer (Daniell, 2000). One aspect of loyalty is the impact of cross-selling, which forms a critical element in increasing revenue. Profitability could, as a consequence, be threatened not only by loss of market share but also by diminished opportunities for cross-selling (Jones and Farquhar, 2003). Furthermore, the more products or services you sell to a customer, the less likely it is that they will sever the relationship (Daniell, 2000).
II Review of Literature: Beckett et al. (2000) draw tentative conclusions as to why consumers appear to remain
loyal to the same financial provider, even though in many instances they hold less favorable views toward these service providers. For example, many consumers appear to perceive little differentiation between financial providers, making any change essentially worthless. Secondly, consumers appear to be motivated by convenience or inertia. Finally, consumers associate changing banks with high switching costs in terms of the potential sacrifice and effort involved.
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Athanassopoulus et al (2001) examined the impact of customer satisfaction on customer
behavioral responses. The sample consisted of 793 individual customers of commercial retail banks of Athens, Greece. Statistical tools such as chi-square test, Bentlers comparative fit, Root Mean square of Approximation (RMESA) and confirmatory factor analysis were used for the analysis. The result showed that there is a direct effect of customer satisfaction on the following behavioral responses of customers :(1) decision to stay with existing service provider; (2) positive word of mouth communications; and (3) intentions to stay with the existing service providers.
Aish et al., (2003) compared the bank selection decisions of the small business market
across UK and Egypt and the
results advocated various similarities and provides
evidence to suggest that brand place major role in the bank selection decisions of the small businesses at both UK and Egypt. The study rein forces the opinion that technical quality (quality of services itself) is more important than functional quality (quality of the service provider) in the bank selection customers attitude towards commercial banks were positive. The factors that resulted in customer satisfaction were positive staff attitude. Employee professionalism, timely responses to correspondence, confidentiality of the bank, promptness in correcting errors, and providing accurate billing.
Devlin and Gerrard (2005) studied the relative importance of various choice criteria for
main and secondary banks. Results showed that relatively rudimentary factors such as locations, recommendation and relationships were important choice criteria when choosing a right bank though the same criteria were found to be strongly influential in choosing the secondary bank, offering an incentive was also significantly more important in prompting the choice of secondary bank service exception was found to be significantly more important for main bank as were low fees and over draft charges. Indian financial market is very diverse and the preferences of services change across demographic factors like education, age, sex, salary/earnings level etc.,
Aydin et al., (2005) noted that perceived switching cost had a moderate effect on the
relationship between the customer satisfaction and loyalty, and trust and loyalty. The effect of customer satisfaction on loyalty in customers is less, when the switching cost is perceived to be high rather than low.
Koutouvalas and Siomkos (2006) examined the following issues relating to customer
satisfaction in Greek banks: 1. The factor shaping Greek banks customers perceptions of service quality
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and switching intentions among public and private bank customers
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2. Direct influence of perceptions on customer loyalty customer perceptions
A sample of 200 customers was taken for primary survey. The results of regression analysis showed that, there was a direct and positive correlation between perceive service quality and customer loyalty in the case of both private and the public sectors banks, significant relationship was recorded between demographic characteristic and perceived quality of both types of banks. Customers of both the banks were willing to express their complaints to banks employees. Thus, bank employees were the bank agents and were acting as the connecting link between banks and customers. Customer loyalty was related only to educational level since a higher educational level was related to an increased tendency for information search regarding competitive product\services\providers. Banks promotional efforts, aimed at providing relevant information to the public might increase loyalty level. In such promotional efforts, the service quality and the reputation were the main areas to be emphasized.
Manrai and Manarai (2007) investigated the overall dimensions of customer
satisfaction with bank services in the US. The sample comprised of 578 respondents and for measurement of customers satisfaction factor analysis technique was used. The study identified four overall dimensions of customer satisfaction. These were personnel related considerations financial considerations and convenience related considerations (ATM and hours). The findings suggested that bank marketers should pay much more attention towards promoting factors like personnel, atmospherics, and convenience than what was done in the past. This would help the banks in differentiating their offerings in customers perceptions and thus attracting they form the competitors.
III Research Methodology
Research is the process of a carefully planned scientific way of inquiry for solution of a problem, through an organized method. Research methodology is the description, explanation, and justification of various methods in the research process. The why and how of various aspects encountered in the research process is answered in the research methodology. A good research design provides a clear description about the statement of problem, hypotheses, design, variables, tools used, sample dealings, method of data collection and analysis. Respondents were asked to give opinion on different aspects of customer satisfaction towards the services provided by the banks on a five-point scale ranging from
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through SPSS version 17 Statistical package.
OBJECTIVES OF THE STUDY
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Strongly agree to Strongly disagree and on Ranking. The analysis was conducted
To examine the various services provided by Public and Private sectors banks in Trichy. To identify the factors that influencing towards the selection of a bank. To study the Customer Satisfaction towards the services provided by the banks. To make suggestions for improving the bank customer services.
SCOPE OF THE STUDY
The survey is confined to opinion survey about the various services provided by the Bank at Trichy. The study also involves in identifying and analyzing the Customer satisfaction towards the selection of a Bank.
LIMITATIONS OF THE STUDY
The survey has been conducted only on 150 respondents. Unwillingness of some respondents to provide information is another limitation. Findings of the study may be influenced by personal bias of the respondents.
Problem Statement
The bank has been offering various Banking services like Deposit oriented services, Infra-structure facilities, Value added services, Agency services and identified towards the selection of a Bank.
Sample technique and Size:
Loan oriented
services provided by the banks and in this study the level of customer satisfaction is
Sampling is a technique or a method of selection of samples. Convenient sampling method is used. The researchers have taken 150 samples.
Sampling Area:
This study was undertaken in Trichy city.

Method of Data Collection:
Data collection for this study consists of Primary sources of data collected through structured questionnaire by way of personal interview.
Secondary sources of data collected through magazines, journals and website
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Tools Used
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Percentage Analysis Ranking T-test Inter-correlation Matrix
IV DATA ANALYSIS AND INTERPRETATION
The data has been collected with the help of questionnaire. And it has been analyzed and Interpreted with the help of tables along with relevant descriptions. Appropriate treatment Has been done to the raw data and logical conclusions are drawn based on the findings.
Table 1: Demographic variables Demographic Variables Sex No of Respondents Percentage
Male
Age
93 110 23 12 5
62 73.3 15.3 8.0 3.3
20 to 25 yrs 26-30 yrs 31-35 yrs 36 & above

Marital Status
Married Unmarried
Educational Level
100 50 14 41 90
75 25 9.3 27.3 60.0
School Graduation Professional
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Status & Occupation
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Private Government Business Professional Others

Monthly Income (Rs)
33 4 45 63 5 27 81 42
22.0 2.7 30.0 42.0 3.3 18 54 28
Below 10,000 10001-20000 Above 20000
From the above table it is clear that Total number of respondents were 150 out of which 93(62%) were males and 57(38%) were females. Further Age wise 110(73.3%) were in the age group of 20 to 25 years, 23(15.3%) in the age group of 26 to 30 years, 12(8%) were in the age group of 31 to 35 years, 5(3.3%) were in the age group of above 36 years. Marital status wise 100(75%) were married and 50 (25%) were unmarried. Among educational level 14(9.3%) belongs to school level, 41 (27.3%) belongs to graduation level and 90 (60%) belongs to professionals. Among occupational categories 33(22%) respondents were working in private organizations, 4(2.7%) were working in government organizations, 45 (30%) were working in business, 63(42%) were professionals, and 5(3.3%) belongs to other category. Income wise 27(18%) were in monthly income group below Rs10,000. 81(54%) were in the monthly income group of 10,001 to 20,000 and 42(28%) were in monthly income group of above 20,000.
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Table 2. Ranking of selection of a Bank on the basis of Various Factors
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The factors that influence towards the selection of a bank by the customer were enlisted as (1) Reputation of the bank. (2) Bank promotion attributes (3) Value added services (4) Branch Reputation (5) Schemes and (6) Any other services.
Reputation Rank name) n % of Bank attributes n % Value added services n % the bank (Brach promotion Branch reputation n % Any Scheme n % others. Specify n %
st
54 21 23 22 20 10
36.0 33 14.0 22 15.3 25 14.7 33 13.3 23 6.7 14
22.0 58 38.7 37 14.7 21 14.0 22 16.7 19 12.7 25 22.0 26 17.3 33 15.3 13 8.7 9.3 13 8.7 21 12
24.7 14.7 16.7 22.0 14.0 8.0
36 24.0 28 18.7 24 16.0 24 16.0 22 14.7 24 16.0 25 16.7 22 14.7 29 19.3 26 17.3 14 9.3 26 17.3
2nd 3rd 4th 5th 6th
From the above table 2 it reveals that 54(36%) of the respondents were ranked 1st as reputation of the bank. 33(22%) of the respondents were ranked 1st as Bank promotion attributes. 58(38.7%) ranked 1st as Value added services, 37(24.7%) ranked 1st as Branch reputation, 36(24%) ranked as 1st on Various schemes and 28(18.7%) of the respondents were ranked 1st as other schemes provided by the banks. The reputation of the bank was ranked as 6th by 10(6.7%) respondents, Bank promotion attributes ranked as 6th by 14(9.3%) respondents, value added services were ranked as 6th by 13(8.7%) respondents, Branch reputation was ranked as 6th by 12 (8%) respondents, various schemes were ranked as 6th by 14 (9.3%) respondents and other services provided by banks were ranked as 6th by 26(17.3%) respondents respectively.
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Table 3.Ranking based on Agencies services Provided by the Banks to customer
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The following table shows that the agencies services provided by the banks were enlisted as (1) Foreign exchange (2) Insurance (3) Discounting bill (4) Shares (5) any other
Foreign Rank exchange n %
Insurance n %
Discounting bill n %
Shares n %
Any Specify n %
others.
st
28 32 31 30 29
18.7 21.3 20.7 20.0 19.3
30 23 32 33 32
20.0 15.3 21.3 22.0 21.3
28 28 31 29 34
18.7 18.7 20.7 19.3 22.7
28 18.7 29 26 17.3 34 39 26.0 28 33 22.0 28 24 16.0 31
19.3 22.7 18.7 18.7 20.7
2nd 3rd 4th 5th
From the above table 3 it reveals that 28(18.7%) of the respondents were ranked 1st as Foreign exchange. 30(20%) of the respondents were ranked 1st as insurance. 28(18.7%) ranked 1st as Discounting bill, 28(18.7%) ranked 1st as shares and 29(19.3%) ranked as 1st on any others Foreign exchange was ranked as 5th by 29(19.3%) respondents, Insurance ranked as 6th by 32(21.3%) respondents, Discounting bill were ranked as 6th by 34(22.7%) respondents, Shares was ranked as 6th by 24 (16%) respondents, any other were ranked as 6th by 31 (20.7%) respondents.
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office service provided by the bank. Sl.no Gender Mean S.D Statistical inference
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Table-4. T-test Difference between Gender of the respondents and their front
Time taken to attend
Male (n=93 ) Female (n=57) 2

Approach of the staff
3.38 3.93 3.62 3.49 3.25 3.81 3.55 3.44 3.48 3.56 3.25 3.68 3.32 3.60
1.382 1.083 1.310 1.136 1.404 1.342 1.355 1.310 1.486 1.268 1.479 1.152 1.453 1.294
T = -2.576 P < 0.05 Significant T = .631 P > 0.05 Not Significant T = -2.410 P < 0.05 Significant T = .488 P > 0.05 Not Significant T = -.327 P > 0.05 Not Significant T = -1.903 P < 0.05 Significant T = -1.167 P > 0.05 Not Significant

Response to the complaints

Guidelines by the staff

Answering the queries

Display of token number

Any other specify and rate it
Male (n=93 ) Female (n=57)
Df = 148 Research hypothesis
There is a significant difference between gender of the respondents and their front office services provide by bank.
Null hypothesis There is no significant difference between gender of the respondents and their front office
services provide by bank.
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Statistical test
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Student t test was used in the above hypothesis Time taken to attend = .011<0.05, Approach of the staff= .529>0.05, Response to the complaints=.017<0.05,Guidelines by the staff=.626>0.05, Answering the queries=.744>0.05 ,Display of token number=.059<0.05 , Any other specify and rate it=.245>0.05. Majority of the front office services provided by the banks does not influence the gender of the respondents. Hence, the calculated value is greater than table value. So the research hypothesis is rejected and the null hypothesis is accepted.
Table 5. Inter correlation Matrix between the value added banks. Credit Mobile A.T.M Debit card card banking facilities facilities facilities A.T.M 1 facilities Debit card .106 1 facilities Credit card -.296(**) -.173(*) 1 facilities Mobile -.222(**) -.438(**) .413(**) 1 banking Internet -.199(*) -.341(**) -.036 .342(**) banking Any others. .145 .115 .105 .119 specify n 150 150 150 150 services preferred from
Internet banking
Any others. specify
1 -.494(**)
150
1
150
* Correlation is significant at the 0.05 level (2-tailed). ** Correlation is significant at the 0.01 level (2-tailed). From the above table 5 it is clear that the correlation between the variables like mobile banking and credit card facilities are positively correlated 0.413 and it is 0.01 level of significant. Correlation between internet banking and mobile banking are correlated 0.342 and it is 0.01 level of significant. Thus internet banking, mobile banking and credit card facilities can predict the customer satisfaction towards banking services.
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the banks.
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Table 6. Inter correlation Matrix between the Deposit oriented services provided by
Number of counters Number of counters Procedural formalities Collateral securities Approach of the staff Repayment period Any other
n
Procedural Collateral formalities securities
Approach of staff the
Repayment period
Any other
1 .267(**) .148 .054 .330(**) .197(*)

150
1 .433(**) -.511(**) .305(**) .471(**)

150
1 -.642(**) .339(**) .501(**)

150
1 -.209(*) -.340(**)
150
1 .455(**)
150
1
150
* Correlation is significant at the 0.05 level (2-tailed). ** Correlation is significant at the 0.01 level (2-tailed). From the above table 6 it is clear that the correlation between the variables like Repayment period and other services provided by the banks are positively correlated 0.455 and it is 0.01 level of significant. Correlation between Procedural formalities and Collateral securities are correlated 0.433 and it is 0.01 level of significant. Thus formalities, securities and other services and repayment period can predict the customer satisfaction towards bank.
CONCLUSION
One strategic focus that banks can implement to remain competitive would be to retain as many customers as possible. The argument for customer retention is relatively straightforward. It is more economical to keep customers than to acquire new ones. The costs of acquiring customers to replace those who have been lost are high. This is because the expense of acquiring customers is incurred only in the beginning stages of the commercial relationship. In addition, longer-term customers buy more and, if satisfied, may generate positive word-of-mouth promotion for the company. Additionally, long-
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changes.
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term customers also take less of the companys time and are less sensitive to price The key factors influencing customers selection of a bank include the range of services, rates, fees and prices charged .It is apparent that superior service, alone, is not sufficient to satisfy customers. From this research study it is concluded that excellent front office service, Value added services, Deposit oriented services and providing innovative products will satisfy the client needs. Which are essential to Select, Succeed and Retain in the existing banking industries.
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References
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Aish EMA, Ennew CT, McKechnie SA, et al., (2003), A Cross-cultural perspective on the role of branding in financial services: The Small Business Market.Journal of Marketing Management; Vol.19, pp.1021-1042. Anthanassopoulas Antreas, Gounaris sprios and Stathakopoulas Vlassis (2001),``Behavioral Responses to Customer Satisfaction:An Empirical Study, European Journal of Marketing,Vol.35, Nos.5 and 6, pp.687-707. Aydin Sekran, Ozer Gokhan and Arasin Omer (2005), Customer Loyalty and the Effect of switching Costs as moderator Variable: A Case in the Turkish Mobile Phone Market, Marketing Intelligence and Planning, Vol.23,No.1,pp.89-103. Beckett, A., Hewer, P and Howcroft, B. (2000). An Exposition of Consumer Behaviour in the Financial Services Industry. The International Journal of Bank Marketing, 18(1), p. 15. Devlin J. Gerrard P.(2005), A study of Customer Choice Criteria for multiple bank users. Journal of Retailing and Customer Services; Vol.12, pp.297-306. Kotovalas K and Siomkos G J (2006), An examination of Relationship Between Service quality Perceptions and Customer Loyalty in Public Private Greek Banks, International Journal of Financial Services Management, Vol.14, pp.208-271. Manrai Lalita A and manirai Ajay K (2007), A Filed Study of Customers Switching Behavior for Bank Services, Journal of Retailing and Consumer Services, Vol.14, pp.208-215.
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PAKISTANI MARKET1 Nida Aslam Khan[Principal and Corresponding Author]
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TARGETING SENSITIVE GROUPS AND SOCIAL ISSUES: AN EXPLORATORY STUDY OF
Lecturer, Department of Marketing at Institute of Business Administration (IBA) Karachi, Pakistan Humayun Sultan Ansari Assistant Professor at IBA Karachi Pakistan AUTHORS AFFILIATION Khan, Nida Aslam; [Principal and Corresponding Author] is a Lecturer, Department of Marketing at Institute of Business Administration (IBA) Karachi, Pakistan for last six years. Recently, published article titled as A Study of Brands in the Food and Beverages Industry of Pakistan in International Journal of Business and Social Science Vol. 2 No. 13 [Special Issue - July 2011]. Abstract of research paper titled Are Consumers Dominating the Balance of Power in the Marketplace? An Exploratory Study of Pakistani Market accepted for presentation at Eurasia Economics and Business Society 2011 [EBES 2011] Conference in Istanbul Turkey from June 1-3 2011. Principal author of research paper titled "Targeting Sensitive groups and Social Issues: An exploratory Study of Pakistani Market, the paper was presented in absentia at the 4th IIMA conference on Marketing in Emerging Economies, January 5-7, 2011, Track: Consumer Behaviour at Indian Institute of Management, Ahmedabad, India. Case study on Osman MalikNew Malik Automobiles presented in absentia at 'International Conference on Management of MSMEs 2010' September 17-18th 2010 conducted by Institute of Management Technology, Nagpur, India. Have published and presented paper titled as, Are outrageous prices inhibiting consumer access to lifesustaining drugs at 3rd Asia Pacific Marketing Conference 9th- 11th December 2009 in Kuching, Sarawak, Malaysia; received sponsorship from HEC Pakistan under Travel Grant to Teachers & Students for presenting papers in international conferences, was also awarded with Certificate of Appreciation. She was Assistant Students Counselor from May 2008 till May 2009; and is a member of Library Committee, IBA. She has also worked as a part-time consultant for Xpedient technologies a professional training centre in Karachi on a voluntary basis. She represented Pakistan along with 5 students from IBA and Pakistan at National University of Singapore (NUS) in 2 week Economic and Enterprise Development summer program 2008. Has conducted training sessions on Communication and Presentation Skills Course, part of Central Board of revenue (now FBR) capacity building program at IBA for 10 weeks and assisted technical coordinator in the design of this module, she has also conducted primary research for The City School, Karachi training program at IBA. She participated in TrainTheTrainer(TTT) workshop facilitated by Navitus(Pvt) Limited and received Certificate of Accomplishment. Her experience encapsulates working as an Asst. Product Manager, Clarus (Pvt) Limited, was a wholly owned subsidiary of Ingeniasoft Inc., an Irvine based technology firm in California US. Her research interest lies in Marketing Issues in Pakistan, Consumer Behavior and Brand Management. Ansari, Humayun Sultan is an Assistant Professor at IBA Karachi Pakistan. Mr. Ansari is Ex-Associate Professor and Head of Marketing Department, Hamdard Institute of Manangement Sciences Karachi. He has a more than ten years of teaching experience with IBA, Hamdard Unviersity, Bahria Institute of Manangment Sciences Karachi, PAF-KIET Karachi, University of Karachi and CIBE. He has also worked as a course facilitatior for Chartered Institute of Marketing (CIM) UK and Export Promotion Bureau Karachi. He has more than two decades of corporate experience with Buffinton (Pvt) Ltd., Solar System Division, United Distributors (Pakistan) Ltd., B.P. Solar Pakistan, Forbes Campbell & Co. Ltd. and Pakistan Industrial Gas Limited Abstract: This research article is an attempt is to delineate on whether Should Marketers Target Vulnerable Groups? (Macchiette, Roy, & Gordon, Should Marketers Target Vulnerable Groups?, 2001), it is written with Pakistani content and draws its root from book titled as Taking Sides- Clashing Views on Controversial Issues in Marketing written by Barton Macchiette and Abhijit Roy (Macchiette & Roy, 2001). We have deliberated on the nature of sensitive groups in Pakistani social surroundings and how marketing efforts at segmenting, targeting and positioning products favorably or unfavorably takes into account the sensitivities
1 The first draft of this research paper, titled as Targeting Sensitive Groups and Social Issues: An Exploratory Study of Pakistani Market was presented in absentia by the corresponding author at the 4th IIMA conference on Marketing in Emerging Economies, January 5-7, 2011, Track: Consumer Behaviour at Indian Institute of Management, Ahmedabad, India. Number of changes has been made in the original draft to turn it to Journal paper.
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VOL 3, NO 4 of such groups. Albeit, it neither confirms nor denies that this is a marketing issue because the dynamics of marketing is evolving rapidly, what is an issue right now may not be in a 5 years time. Keywords: Vulnerable groups, Islamic Banking, White Supremacy, Political Marketing, Issue-driven, Marketing-Generated, Shariah-Guided, Halal Introduction: Sensitive groups are defined as being vulnerable groups, this article provides a typology of how we can classify the various vulnerable groups in our society. Broadly speaking, all members of society are part of such groups at some point either by choice of lifestyle, situational circumstance, life cycle or demographics; vulnerable groups are identified as being culturally dictated, situationally influenced, market-generated or issue-driven. This paper can be an important resource addition to refer to in the future research studies and that we hope it serves its purpose of providing substantial findings relevant to the area under study. Discussion: The local examples of Greenstar Social Marketing (Guarantee) Ltd Pakistan Social , Fair and Lovely and Unilever Pakistan have been specifically alluded, along with insight into activities of political parties in student bodies and how they affect their behavior and perceptions about their future. Targeting vulnerable groups and toying with their emotions is now a common phenomenon plaguing almost every level of the society in developed and developing countries. There have been undesirable consequences of these activities which are likely to prevail if this type of marketing goes on unchecked. The case for Greenstar Social Marketing (Guarantee) Ltd Pakistan marketing and Islamic banking is such that they cater to the physical and psychological needs respectively of their target market and improve their lives. Islamic banking identified and gratified the needs of consumers who wanted a more Shariah (Eagle, 2007) based banking system and thus, put their minds and conscience at ease. With Greenstar Social Marketing (Guarantee) Ltd Pakistan marketing, low income groups who were unaware of the dangers of Sexually Transmitted Diseases (STDs) and the implications of a growing household were targeted to improve their health and ultimately their life and standard of living. Thus, targeting a vulnerable group becomes a positive phenomenon when it is done to eliminate something that has been a source of discomfort to them or to satisfy a need that has not been fulfilled. The flip side is that when targeting of vulnerable groups comes with exploitation, it becomes undesirable and abusive. The target market is not benefited as such because the need that is satisfied has been created by the marketers in the first place. Playing with the vulnerable groups emotions to satisfy their profit is just one of the ways these groups are exploited by marketers. In the case of Fair and Lovely (F&L), flagship brand of Unilever Pakistan white-skin supremacy is being promoted leaving dark skinned people feeling vulnerable especially in subcontinent region and to some extent not as attractive. Thus, they have successfully created a need by abusing emotions and are now catering to it. They have not only created a vulnerable group but are perpetuating that vulnerability. The marketing strategies by political parties have also been misusing university students. These parties play with the students emotions who want to be a part of the system to make it better, but more often than not, they are misused by these parties and suffer severe consequences. Targeting vulnerable groups and toying with their emotions is now a common phenomenon plaguing almost every level of the society. There have been undesirable consequences of these activities which are likely to prevail if this type of marketing goes on unchecked. Research Methodology: The approach taken is to identify local businesses that target vulnerable groups, typify them according to the categories mentioned above and use secondary and in a few instances, primary data to support the case. The case for Culturally Defined Vulnerable Groups involves both empirical as well as secondary research. For empirical evidence, an interview with Dr. Pervaiz Said, ex- director Islamic Banking Department, State Bank of Pakistan was conducted. The case for Marketing Generated Sensitive Groups takes on information from primary and secondary sources. Primary research is based on four In-Depth-Interviews(IDIs) conducted on females residing in Karachi belonging to SEC A (State Bank of Pakistan, 2002) in the age bracket of 20-40 years.
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VOL 3, NO 4 Research was based on the findings that were generated with a limited number of brands/products and IDIs in focus which may have lead to unequal distribution may have led to and a narrow focus on the opinion held by the local brand managers. Secondary data draws information from research articles and information related to Pakistani people and information from Unilever Pakistan.
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Summary of Issues: Targeting vulnerable groups does not necessary mean exploitation of these groups. In many cases vulnerable groups have benefited, either physically or emotionally, because of the efforts made by the marketers to fulfill their needs which have made them vulnerable in the first place. Thereby, improving the lives of the targeted market and empowering them. Culturally Defined Vulnerable Group: Are marketing activities of Islamic Banks and their products favorably targeting vulnerable groups in Pakistan? An average consumer of Islamic banks products falls into the category of a vulnerable group because Islamic banking is still in its infancy stages in Pakistan. The concept, though present in Pakistan since its inception, has only recently started gaining popularity. Furthermore, as the concept is a relatively new one and knowledge of an average consumer is quite blurred, there is much room for distortion and misuse. To really understand the difference between the various financial products being offered in the market and the products being offered by Islamic banks, customers need to go back to the Quran (the Holy book of Muslims) and read and understand it carefully. In addition, customers rarely read the fine print that is printed on the forms given by Islamic or other banks. In turn, a customer may end up signing a deed which looks Islamic but has the same terms and conditions as that of any other commercial bank. According to Dr. Pervaiz Said, the State Bank of Pakistan does act as a regulatory body to inspect and monitor the working of these banks, but there is no regulatory or authoritative body to monitor the marketing activities of these banks. Existing Need for the Product: In any economy there is need to transfer funds from savers to investors because people who save are frequently not the same people who have the ability to exploit the profitable investment opportunities. This function is performed either by means of direct finance through securities markets or through the process of financial intermediation in the financial markets. Financial intermediation maintains a pivotal role in Islamic banking and finance. Historically the role of financial intermediary in the Islamic economy is found in the principle of al mudarib udarib; a practice which has existed in Islamic history since early centuries. It can be expressed as the one who mobilizes funds, on profit-sharing basis, extends the funds to the users on the same basis (Iqbal, Ahmed, & Khan, 1998). The banking adoption in Pakistan stands at an amazing 95%. 70-75% of the population of this country is Muslim; however the market share of Islamic banks stands at a mere 4% as compared to 90% of those commercial banks (Said, 2007). The Product: Islamic banks offer a number of financial products. Basically they are all alternates of the financial services provided by the commercial banks. Thus, these products seem very similar to their commercial counterparts. However, there are huge differences between the two. Some of the similarities are the as follows: the products of both types of banks are aimed at making a profit through efficient management of financial resources. In turn, both use similar benchmarks, for example KIBOR (Mansoor Ali, 2009). The procedures of both products are also very similar. However the major differences lie in the fact that Islamic products are equity based, whereas the products of commercial banks are not. The products of Islamic banks are based on money for goods transactions, which means that liquid cash must first be converted to goods or services and then sold at a profit. This is not the case with other banks where they have money for money transactions. Because of this very fact, products of Islamic banks lead to creation of wealth in the economy. Let us take the case of a bank client (C) who actually needs to buy something for which he does not have funds to meet the seller (S)s demand for payment. Currently a bank (B) comes in as follows, (Tahir, 2003). [Refer to Figure 1]. The prohibition of Riba or interest makes the loan option economically infeasible for the bank. It can, however, still play a meaningful role and help the client to tide over his liquidity problems [Refer to Figure 2]: Even after going through this argument, some people may feel that this is still eyewash as the products are too similar for comfort. To resolve this issue, we have to dwell into the historical aspects of the economic systems of trade. For fourteen centuries, Muslims, Christians, Jews, etc. have been trading with one
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VOL 3, NO 4 another. Thus there is similarity embedded in the terms of trade form the very beginning. Furthermore, the capitalist economies have based their financial products on a number of core Islamic economic ideologies; they have simply made a few alterations to suit the product to their needs. But the core remains the same. That is why we see immense similarity between the products and wrongly assume that the only difference between the two products lies in their name. Marketing Strategies and Impact: The current marketing strategies of Islamic banks can be termed as targeting a niche among the various consumers in the market. Presently, the share of the Islamic banks stands at 4% whereas that of commercial banks stands at 90%. The main reason lies in the fact that there are only around 200 Islamic banking branches in Pakistan, whereas the number of commercial banking branches far exceeds 11,000 (Said, 2007). However, as more banks open up Islamic branches, this figure is expected to grow rapidly. Furthermore, though both banking systems hit at the functionality aspect of their products, Islamic banks also add the appeal of being a Muslim and Shariah-guided system. Islamic banks according to SBP source will soon shift their marketing efforts from simply making consumers aware of their products to actually hitting at the concept of halal versus haram (Said, 2007), this is because people have already accepted Islamic banking as a viable solution to interest-based banking. Those consumers who were already feeling guilty have shifted to the Islamic system, but some Muslims still need probing to attract them to the concept. For this the halal versus haram ideology, though a bit rash, seems to be an appropriate strategy, considering the fact that everybody wants to remove dissonance from their mind. Target Response: Ever since its inception, the concept of Islamic banking has been welcomed with great zeal in Pakistan. It must be noted that apart from purely Islamic banks, commercial banks have also capitalized on this opportunity and opened Islamic windows in their regular branches. Some banks such as ABN Amro Pakistan and United Bank Limited (UBL) Pakistan have even opened dedicated Islamic branches; the major reason for doing so is that the response from the consumers is remarkable. Customers are willing to shift from commercial to Islamic banking branches if their needs are met through the products being offered (Said, 2007). Situationally-Influenced Vulnerable Group: Has the targeting of sexually active individuals and married couples by Green Star been a favorable attempt at meeting the needs of the vulnerable consumer? The target group for Green Star is the low income married women of reproductive age and sexually-active groups at risk of sexually-transmitted infection HIV/AIDS transmission. These groups, lacking the proper knowledge and resources are either unaware, unable or simply choose not to use the modern day methods of birth / STD control. Therefore, this target group can be classified as vulnerable not only because they are ignorant of the products that can help to improve and may also save their lives but also because of the mindset that they do not need to use these products. Thus, they put themselves and others in mortal danger. Existing Need for the Product: Over 1/3rd of Pakistanis are living in poverty (State Bank of Pakistan, 20082009). The impact of population growth on poverty is obvious, since poorer families, especially women and marginalized groups bear the burden of a large number of children with much fewer resources further adding to the spiral of poverty and deterioration in the status of women. This large part of the population is constrained to live in poor housing and sanitation conditions and lack of access to safe drinking water. In particular, large families leads to pressures on food consumption and adversely affects caloric intakes and increasing malnutrition in poorer families and contributes to high levels of child and maternal morbidity and mortality. 4.1 The Product: Greenstar Social Marketing (Guarantee) Ltd Pakistan Social Marketing (Guarantee) Ltd provides various products through a network of healthcare providers and their own outlets comprising pharmacies, retail outlets and clinics providing non-surgical services. These products include; Sathi Condoms - the most affordable condoms in Pakistan, Touch Condoms - targeted to high risk groups for disease prevention, Hormonal Contraceptives and Vitalet a multivitamin supplement to improve the quality of life of low-income women by improving their nutritional status especially vis-a-vis iron deficiency anemia thereby improving their health and their babies health.
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Marketing Strategies and Impact (Greenstar Social Marketing (Guarantee) Ltd Pakistan : About Us, 2005): The focus of Greenstars communications is to motivate and create demand among low-income Pakistani women and men for health services and products. The organization has adopted various means which include mass media campaigns on television, radio, newspapers, billboards and public relations. In addition to this, free clinics, neighborhood meetings and seminars are also an integral part of reaching the target population. Also included in the main activities are: the training and refresher for doctors, paramedics and chemists/druggists. It has about 16,000 trained service providers consisting of doctors, paramedics and chemists/druggists to its credit. At the community level, it uses street theater and neighborhood meetings to foster greater awareness of family planning and health issues, which leads to increase client flow to members of the Greenstar Network of providers. For women, neighborhood meetings have been designed to encourage open discussion of sensitive issues in a safe and conducive environment. Trained Greenstar providers, who are highly regarded within their community, lead the meetings to ensure that accurate medical information is provided. Each year, thousands of low-income women are reached by such meetings. Studies have shown that as many as 25 percent of attendees subsequently seek a family planning consultation with Greenstar. Activities like Mobile Health Van, has been launched in order to reach the maximum number of target population. It was launched in 2000 as a fully equipped mobile health van which provides highly subsidized general and reproductive health care in identified underserved communities. The mobile van is in the field every day working in remote areas providing services to the people who are unable to access health care services. Thus, Greenstar not only uses modern day technology like the television and radio to reach out the vulnerable group but also uses methods which allow a one to one contact with the target population like trained health care workers in order to penetrate these groups to the maximum. The marketing activities have been very successful as they have been able to reach a large number of people who were potentially putting themselves and others in life threatening situations. It has trained more than 17,000 private health providers (female and male doctors, female paramedics, and pharmacists) since establishing its continuing medical education and follow-up service programs in 1995. Greenstar Pakistan clinics are nationally recognized for delivering comprehensive, affordable, international-quality health products and services to more than 10 million low-income clients per year throughout Pakistan. Its family planning products or services protect 1 out of every 4 married couples who use modern methods. In addition to this, it has established a network of 30 local NGOs to motivate safer behavior, and implemented a two-year peer-outreach program amongst brothel-based female sex workers in the red light district in Hyderabad. (Greenstar Social Marketing (Guarantee) Ltd Pakistan : What-we-do, 2005) Significant behavioral changes have been observed regarding family planning as recorded by national contraceptive surveys. A report by National Institute of Population Studies, (NIPS) showed rising trend in current contraceptive use among women with low or no education during 1990s. Similarly, existence of persistently high level of unmet need among urban women with no or low education may be attributed to strong awareness campaign by social marketing projects like Greenstar. Massive promotional support has also given users more information about methods and built confidence and trust to ask products by name reflecting the impact of the logo. Greater availability of products in the market and easy accessibility and rising social support/ pressure to adopt contraceptive methods, among other factors, are some major reasons for higher use rate specially among the urban low income groups. Marketing-Generated Vulnerable Group: Have the marketing efforts of Fair & Lovely attempted to aggravate the social stigma associated with dark skin in women and created a vulnerable group as a result? The category of vulnerable group falling under the marketing efforts of Fair & Lovely (F&L) essentially classify as Marketing-generated Sensitive Groups. This refers to groups that become vulnerable as the result of promotional strategies conceived and executed by marketers. Those groups are usually created through marketing innovation (Macchiette & Roy, 2001). The idea of creams that beautify and whiten skin, is a marketing idea and effort that stems from the culture of
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VOL 3, NO 4 white supremacy in Subcontinent and in Pakistan. However given the topography and geographical location of Pakistan, dictates the Pakistani population at large has darker complexions, given the Caucasoid and Mongoloid ancestral background. Previous research identifies special populations as those groups whose members are incompetent and/or may be easily coerced during the research process (Neuman, 2006). Women in Pakistan are the most dominated and suppressed section of the society. Women in this Islamic region suffer from severe financial discrimination and various other obstacles are also there in the way of the growth and development of the Pakistan women. This added with the fact that the white supremacy culture prevails, dark skinned women face immense discrimination in not only personal arena but also in their respective professional fields. The aspiration value associated with the marketing efforts of F&L (globally and locally) and similar products, has meant that they are targeting an already suppressed segment in the society. This segment is attracted to buying the product, based on the promotionally conceived aspiration value. 5.1. Existing Need for the Product: The need to beautify oneself and maintain oneself is increasingly becoming prominent. This coupled with the fact that people around the globe have realized the importance of maintaining looks for both personal and professional success, the expenditure on beauty products worldwide has increased. Consumers worldwide - agree that the pressure to look good is greater today than it was in our parents generation, 62% of Asian consumers say they invest in personal grooming because it makes them feel better about themselves, more or less mirroring the global average (Watershed Publishing publication, 2007). Hence, the global need and awareness to beautify oneself, and the need for such beautifying products is becoming ever prominent. [Refer to Figure 3]. Looking closely at Pakistan, the need for products like F&L is also visible at national level and is largely dictated by the existing culture of the country. Culture can also be a collection of what a group of people think, feel and do based on commonalities (Maan, Arif, Akhtar, Haque, Iqbal, & Raja, 2009). With respect to these definitions, culture is a subjective term that distinguishes the shared experiences of groups of people from those of other groups. Pakistani Culture dictates that white supremacy prevails in the society, and targeting this culture, marketers have selected the vulnerable group of women who aspire to have fairer skins, and using this cultural mind set, is targeting this need. At large the culture of fairer skins being associated with success and luck is predominantly greater in the Indo-Pakistan region, and this can range back to the idea of Colonialism and the effects that is has had on the Pakistani population and society (J. Baugh & Guion, 2006). Females in Pakistan wanted fairer skins since decades ago, and used herbal and natural remedies using turmeric and honey mixtures and other natural ingredients of various sorts. However at large, the need was latent and unrecognized. These remedies were taken as a part of routine lives, and the marketing efforts of F&L essentially generated the need for one specific product. The Product (J. Baugh & Guion, 2006): The color pigment in the skin is hidden in the lower layers of the skin. Direct sunlight on the unprotected skin penetrates to these lower layers causing this pigment to move to the top most layers, resulting in a darkening of the skin tone. All F&L creams have a special fairness system that protects the skin, preventing it from becoming darker and working from within to actually lighten the skin tone. It is a Unilever ISO certified product meeting the highest standards in skin care and safety. The unique selling proposition is Fairness changes your destiny and the distinctive pink pack and the signature two faces in their marketing campaigns are becoming synonymous with giving flight to the dreams of the Pakistani female. Marketing Strategies and Impact: In order to highlight its unique selling point, some of the prominent marketing efforts to target the consumer are; Television Advertising: the 30 second television commercial (TVC) is the most prominent form of marketing/advertising, Print Media: advertisements in local female magazines like Sunday Magazine; Libas, cater to higher income groups, and in MAG, bi-monthly magazine targeting the middle class. In Store Promotion: the marketing consultants promote the product in superstores and Word of Mouth: PR activities conducted on a national level, and through exchange of information regarding the product at consumer level. COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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The primary aim of F&L marketing strategies and its impact on consumers can be highlighted as follows: Persuasive Advertising: The use of popular and pretty models in their advertisements that endorse the products makes the brand more promising. When these prominent people advocate a product or a brand, then its benefits seem more convincing. Women use this product to imitate or become like these stars, which have more artificial beauty than natural beauty. By showing the change in skin color in a matter of two weeks, which clearly is very unrealistic, in order to change the destiny of the female; they are clearly using persuasive technique(s). Informative Advertising: F&L explicitly states the herbal and natural ingredients used in the product that make the skin whiter, and hence make the effectiveness of the use of this product more convincing. This is another tactic to attract consumers to the product. Direct to Consumer: The presence of marketing consultants in stores is being used to generate trial at the spot and informing the consumer about the ingredients of the product, and their effects. Again targeting darker women while shopping, is the primary goal here and this again forms a cycle of continuous discrimination for the darker skinned women. High Market Presence: The marketing tools being used currently are very effective to capture the right kind of market. The presence of the product in all women related magazines, channels etc. has been able to reach the correct consumer. Marketers are clearly using the brand recall strategy of continuous reinforcement, by showing advertisements again and again, and with high market presence. Even if the consumer feels she does not need the product, the constant recurrence in form of TVCs, print ads etc. she will be reminded that maybe this is a way to actually make her dreams come true. 5.2. Target Response: Empirical evidence suggests that the consumers feel that though there already does exist the culture where fair skinned women are thought to excel in personal and professional fields in Pakistan, the marketing efforts of F&L has attempted to aggravate the social stigma associated with dark skin in women and created a vulnerable group as a result. The aggressive marketing of these products is reinforcing the culture that every female should want to be fair to be successful, eventually promoting the idea of white supremacy. The concept of fairness being associated with success and luck remains in Pakistan since a long time and can not be changed. The marketing of such products is even automatically creating awareness amongst people with latent needs for such products, and therefore creating a vulnerable group as a result. Issue-driven Vulnerable Group: Have attempts at political marketing toward vulnerable groups of university students been in the right direction?Political marketing activities directed to student groups can be seen as a perfect case of issuedriven marketing toward a vulnerable group of consumers. Issue-driven vulnerable groups are created as a result of hype around certain issues in society. In 1980, when Zia ul Haque, ex-president of Pakistan, imposed a ban on political parties, it brought an end to all meaningful student activities on campuses. By abolishing student unions he effectively ended their academic and extracurricular activities while putting no check on the political parties hold on the erstwhile unions (F. Paracha, 2008). In many of the 32 government run universities and colleges the students are of a particular age segment between 18-27 years and come from low and middle income backgrounds typically Landhi, Malir, Korangi, Nazimabad and Karimabad, population belonging to socio economic classes of C and D in Karachi. Empirical evidence at the Karachi University and the Urdu University, Karachi; which have very active political setups suggests that most students in these universities have un-chiseled political views and much need for security, these groups classify as particularly sensitive targets. Existing need for the product: The political parties such as the MQM, PPP and Jamaat-e-Islami can be seen as service providing companies that market their products toward students in various universities which then classify as the target market. The target market thus being parties like the Jamaat-e-Ulema-e- Islam (JUI), the Peoples Student Federation (PSF) and the All Pakistan Muttahida Students Organization (APMSO). The returns to the service provider are not in terms of monetary rewards rather in the form of the massive political support and the numbers these student organizations bring in. On the consumer end, the need of any freshman student who enters a university is that of orientation, guidelines on curriculum, and developing a sense of belongingness. This is what the parties capitalize on in targeting their customers.
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VOL 3, NO 4 Current leaders of student organizations feel that the need for the product exists so as to shape the next generation, ensure that party leadership is educated (Ahmed, 2007), to promote a certain ideology in future leaders (Mairaj, 2007); because of this student organizations have been at the forefront in all major political upheavals in the history of Pakistan (Khan, 2007). Tariq Ali, a student leader who was sent off to Oxford in the 1960s and author of several books concedes that for any big revolt the role of a student movement cannot be undermined as there is a need to for the country to be united from below (Zafar, 2007). 6.1. The Product: The question then arises that in the aftermath of the ban on student unions and the critical need to hone university students politically, is the right product being offered to them? Are the benefits and features of the product aptly catering to the needs of its customer? Leaders of the student wings of the PSF and the APMSO at the Karachi University say that they serve the students by providing them with guidance and then by patronizing and promoting them (Ahmed, 2007). The first contact a customer has with the product is when politically active students help the freshman students out of their initial problems at the university (Khan, 2007). An attempt is made by all parties to approach new students in all faculties that are in sizeable number and develop a point of contact with them. In these meetings, parties also provide their application forms. An analysis by Mansoor Kundi (Kundi, 2007), Dean at the University of Baluchistan revealed the service offerings in a different light. He points out that in the case where a party assumes absolute majority which is usually the case when university administration also bears political affiliations, the party then serves in such matters as admission policy, hostel allotments, examination policies and even appointment and promotion of like-minded teaching staff. In case of two or more student political groups, the student force is divided with every group striving for more support from the students. Vice Chancellor at the Liaquat University in Hyderabad seconds this view by saying that student leaders adopt such politics as a vocation and search for opportunities to improve the role of their party even at the cost of academic discipline. This was substantiated by the fact that of the 3 student leaders interviewed for this case, all of them had spent 5-6 years on an average in the university, thereby not restricting their experience to one that is elicited by the program but rather by their political pursuits. (Bureau Report, 2007) 6.2. Marketing Strategies Used: Personal Selling- By conducting a set of orientation sessions, parties like the APMSO and JUI ensure that they personally meet their customer, inform him about the service, how well it has been doing in the past and how it will work for them. They use a mix of fact and emotion to draw the eager youth toward them, the APMSO does this by telling the students about the history of the happenings in Karachi University in particular. Of the brutality suffered by people (Mairaj, 2007). Then comes a series of guidance and support in terms of providing course outlines, these are not the features of the service itself but rather the benefit that it offers to the customer. It is a marketing strategy well used to get in a more personalized contact with the target. Publication Material: At the beginning of the academic year, the parties hand out stationary during their orientation sessions as well as monthly newsletters that speaks of the activities of the party on-campus and the guidelines by the party leader and memos of support and encouragement from party leadership. PR Activities: These include speeches by party leaders who come on campus premises and deliver them. Political clashes further splash such events in the media and spice up the news surrounding them and coupled with other marketing tools attract a lot of attention from potential target students. Word of Mouth: This is perhaps the strongest and most utilized marketing channel employed by student parties. With heir networks of influence, opinion and news are best circulated and entail immediate response. Target Response: At various levels, teachers have condemned the role of political parties as being more political and ideological than academic. The major academic concessions they demand are the provision of university/college transport for carrying its student member to non-academic trips, leniency in examinations on the plea that teaching remained disrupted during the academic year, and less in interference by the administration in their hostel affairs (Kundi, 2007). This view was upheld by a lot of target customers in Capital Talk, a talk show on GEO TV Pakistan that picked up several top academic performers who were just about to enroll in universities. A majority of the students were . parties, these targets did not even see the role of political parties as being a fruitful one and they undermined the activities of such organizations as being unconstructive (Capital Talk, 2007). Students at the Karachi University who are not part of any such political wing say that political activities on campuses have undermined the academic atmosphere of educational institutions. Many of these institutions
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VOL 3, NO 4 have become hostage to these groups despite the fact that absolute majority of innocent students have neither interest nor aptitude for such activities. Conclusions and Recommendations: Targeting vulnerable groups does not necessary mean exploitation of these groups. In many cases vulnerable groups have benefited, either physically or emotionally, because of the efforts made by the Pakistani marketers to fulfill their needs which have made them vulnerable in the first place. Thereby, improving the lives of the targeted market and empowering them. The flip side is that when targeting of vulnerable groups comes with exploitation, it becomes undesirable and abusive. The target market is not benefited as such because the need that is satisfied has been created by the marketers in the first place. Playing with the vulnerable groups emotions to satisfy their profit is just one of the ways these groups are exploited by the marketers. Figure and Tables:
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Figure 1: Interest-Based Solution: Bank as Lender

Source: Tahir, S. (2003, March 2-6). Future of Islamic Banking. Course on Islamic Banking and Finance . Tehran, Iran: Central Bank of the Islamic Repulic of Iran and Islamic Research & Training Institute of the IDB, Jeddah
Figure 2: Interest-Based Solution: Bank as Lender

Source: Tahir, S. (2003, March 2-6). Future of Islamic Banking. Course on Islamic Banking and Finance . Tehran, Iran: Central Bank of the Islamic Repulic of Iran and Islamic Research & Training Institute of the IDB, Jeddah
Figure 3: The Global Need and Awareness to Beautify Oneself Source: Watershed Publishing publication. (2007, September 14). Consumers Feel Pressure to Look Good, but Dont Spend on Beauty Products. (D. Berthiaume, Editor) Retrieved October 22, 2007, from MarketingCharts
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References
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Ahmed, N. (2007, November 15). Leader APMSO, Karachi University Unit. (N. A. Khan, Interviewer) Bureau Report. (2007, June 24). VC vows to weed out student politics. Retrieved October 13, 2007, from Dawn.Com: http://www.dawn.com/2007/06/24/nat22.htm Capital Talk. (2007, September 21). Karachi, Sindh, Pakistan. Eagle, D. (2007, January 10). Banking on Sharia Principles: Islamic Banking and the Financial Industry. Retrieved December 22, 2007, from BankersOnline.com: http://www.bankersonline.com/vendor_guru/edcomm/edcomm_mkt_100107.html F. Paracha, N. (2008, February 10). Students Politics: A Brief History. (The Dawn Media Group Company) Retrieved May 25, 2008, from Dawn.Com: http://www.dawn.com/wps/wcm/connect/dawn-contentlibrary/dawn/in-paper-magazine/magazine/student+politics+a+brief+history Greenstar: About Us. (2005, December). Retrieved October 15, 2007, from Greenstar Social Marketing: http://www.greenstar.org.pk/what-we-do.htm Greenstar: What-we-do. (2005, December). Retrieved October 15, 2007, from Greenstar Social Marketing: http://www.greenstar.org.pk/what-we-do.htm Hussain, A. (2003, May 2). Lack of Commitment to Education Keeps Muslim Countries Weak. The News . Iqbal, M., Ahmed, A., & Khan, T. (1998). Challenges Facing Islamic Banking (1st Edition ed.). King Fahd National Library-in-Publication Data. J. Baugh, E., & Guion, L. (2006). Using Culturally Sensitive Methodologies when Researching Diverse Cultures. Journal of MultiDisciplinary Evaluation (4). Khan, S. (2007, December 6). Leader PSF, Karachi University Unit. (N. A. Khan, Interviewer) Kundi, M. A. (2007, September 11). Politics on Campus. Retrieved December 5, 2007, from Views on Pakistan: http://www.views.pk/politics-on-campus Maan, M. A., Arif, S., Akhtar, S. J., Haque, H., Iqbal, J., & Raja, M. I. (2009). Socio-Economic and Psychological Impact of Skin Complexion on Female. Egyptian Dermatology Online Journal , Vol. V (2), 1-11. Macchiette, B., & Roy, A. (2001). Taking Sides Clashing Views on Controversial Issues in Marketing. USA: McGraw- Hill/Dushkin. Macchiette, B., Roy, A., & Gordon, M. (2001). Should Marketers Target Vulnerable Groups? In B. Macchiette, & A. Roy, Taking Sides: Clashing Views on Controversial Issues in Marketing (pp. 250263). Connecticut: Mc Graw Hill/ Dushkin. Mairaj, A. (2007, November 5). Leader APMSO, Karachi University Unit. (N. A. Khan, Interviewer) Mansoor Ali, S. (2009, January 26). DAWN the INTERNET EDITION. Retrieved December 9, 2009, from DAWN: The Dawn Media Group: http://www.dawn.com/2009/01/26/ebr13.htm Said, P. (2007, November). Director Islamic Banking Department, State Bank of Pakistan. (N. A. Khan, Interviewer) State Bank of Pakistan. (2008-2009). Social Sector Developments. In State Bank of Pakistan, Annual Report (Vol. I, pp. 223-236). Karachi: State Bank of Pakistan SBP BSC, Printing Press. Tahir, S. (2003, March 2-6). Future of Islamic Banking. Course on Islamic Banking and Finance . Tehran, Iran: Central Bank of the Islamic Repulic of Iran and Islamic Research & Training Institute of the IDB, Jeddah. Unilever Pakistan. (2006, December 4). About Us: Unilever Pakistan. Retrieved January 18, 2007, from Unilever Web site : http://www.unileverpakistan.com.pk/brands/personalcarebrands/fair-lovely.aspx
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VOL 3, NO 4 Watershed Publishing publication. (2007, September 14). Consumers Feel Pressure to Look Good, but Dont Spend on Beauty Products. (D. Berthiaume, Editor) Retrieved October 22, 2007, from MarketingCharts: http://www.marketingcharts.com/television/consumers-feel-pressure-to-look-good-butdont-spend-on-beauty-products-1644/ Zafar, A. (2007, April 27). The Review: A Firebrand Revolutionary. Retrieved July 25, 2008, from Dawn.Com: http://www.dawn.com/weekly/review/archive/060427/review4.htm
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Privatization and Performance of Banking System in Pakistan
Ahmed Arif (Corresponding Author) Research Scholar, Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology Shoaib Akhtar Assistant Professor, Fatimah Jinnah Women University, The Mall, Rawalpindi. Nauman Waheed Assistant Professor, Fatimah Jinnah Women University, The Mall, Rawalpindi. Sadaf Bashir Fatimah Jinnah Women University, The Mall, Rawalpindi. Abstract
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This study analyses the impact of privatization on the performance of banking system in Pakistan. The private banks started their operations after 1990 in Pakistan. Most of the banks were state-owned before 1990. This study is aimed to investigate the impact of the privatization on performance of banking system. The study has employed three measures of performance of banking system i.e. ROA, ROE and NIM. The data for the period starting from 1990-1999 has been employed in this study. The technique of ratio analysis has been used to assess the impact of privatization on performance of banking system in Pakistan. Ration analysis revealed that private banks are performing better than the state-owned banks. This also shows that customers have more confidence in private banks as compared to the state-owned banks. Keywords: Privatization, Return on Assets, Return on Equity, Net Interest Margin 1. Introduction The financial sector plays an important role in the development and growth of economy in any country. It performs key functions like mobilizing savings, allocating capital, and providing a mechanism for monitoring. It supports the investment in the country and help to diversify the risk involved in the business (Usman, 2010). There are ample evidences supporting the claim that development of financial sector leads to poverty reduction by increasing the income of the poor. Empirically it has been proven that economic growth can be geared up by the increase the size of private credit less-developed country. This increases the national income of the country (King & Levin, 2001). However, inefficient financial markets damage the economic prospects of a country. They cause an increase in the cost of mobilizing savings, thus making it hard to support the investment and growth in the economy. Privatization is the process of transferring ownership of a business, agency or public service from the public sector to the private sector. In a broader sense, privatization leads to transfer of any government property to the private sector - including governmental functions like revenue collection and law enforcement (Usman, 2010). 1.1. Pakistani Financial Sector Pakistan only inherited Habib Bank at the time of independence. It was established in 1941 and was shifted from Bombay to Karachi after independence. The Central Bank of Pakistan (SBP) was established in 1948 with the help of private sector and in subsequent years after independence a fully owed National Bank of Pakistan was established (Burki & Niazi, 2003). The Pakistani financial sector has shown tremendous growth especially in the last two decades or so. It is mainly because of the privatization process that government followed. Nationalized banks were privatized in the 1990s decade which resulted in the opening up of the financial sector to foreign competition as well. The banking system in Pakistan was nationalized during 1970s, and public sector financial institutions were extended. The main aim was to create harmony between financial sector and the state socio-economic policies (Shearer, 2000). In practice, however, the policy framework was included administered interest rates, high reserve requirements, domestic credit controls, and the use of the banking system to finance large budgetary necessities of the government. The nationalization of all domestic banks, however, did
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VOL 3, NO 4 yielded certain social goals such as nationwide branch expansion, compulsory credit allotment to the public and agricultural sector, and deposit recruitment through the National Saving Scheme (NSS). But it also led to a financial system marked with overstaffing, over-branching and weakened portfolios. In the recent past many governments have retreated from their stake in the banking sector, yet the control needs to be fully relinquished if the banking sector has to grow. Research shows that state ownership tends to exploit financial sector development mainly because of interference in the banking operations and with huge borrowing to meet governmental expenditure. The result is the slow growth of the banking sector with low depositors confidence. La Porta, Lopez-de-Silanes, & Shleifer (2000) research on 92 countries from 1970 1995 showed that the greater governmental involvement in the financial sectors during the decade of 1970s, slowed overall growth of the financial sector. The data used by the researchers belonged to the largest commercial and development banks operating in these countries. Similar kind of research but with different data set carried out by King & Levine (2001) showed that state ownership of banks resulted in higher interest rate spreads and lesser activity in the stock exchange markets. In Pakistan, share of the state in the banking system was reduced to less than 54 percent by 1999 from over 92 percent in 1990. Simultaneously, the share of private banks increased more than 30 percent during the same period from a position of nil in 1990. The 1990s decade saw government initiatives of privatization along with the favourable environment provided by the government for foreign banks to invest in the country. Presently, the share of government in the banking sector stands at percent. The banking sector reforms of 1990s also led to improved performance of the banking system. With the entry of foreign banks in the domestic market and with increased competition among domestic and foreign banks have led to increased profitability and diversified portfolios. This in-turn has led to containment of systemic risks across banking system. The competition has also improved the outreach services of the banking sector especially to consumers of lower and middle income groups. Currently banks are engaged in offering new services like SME credit, micro-financing, personal loans, mortgage financing, balance transfer facilities, agri-loans etc. This has opened up new venues for conservative commercial banks, which were hesitant in venturing into unchartered waters to jump in and share the spoils. Commercial banks are now the single most source of agriculture financing. This has improved purchasing power of many of families stimulated aggregate demand in the economy, and expanded production of manufactured goods leading to higher growth of the economy. Privatization process was initiated in the early 1990s in Pakistan. The Privatization Commission was set up in 1991. The purpose of this commission was to provide an institutional framework that would facilitate the privatization process in the country. The basic purpose behind setting up of this commission was to get rid of the fiscal insufficiency of the banking sector by transferring ownership to private hands. It was envisaged that with the transfer of ownership banking sector would show high growth and would become more efficient to the needs of the community. Another aim was to release the much needed financial resources for physical and social infrastructure development. The aims were realized by the government and much needed financial resources were acquired by the government for social and infrastructure development. The 1990s decade saw growth in every sector of economy. 2. Prior Literature Research is replete with studies conducted on the role of financial institutions (inclusive of public banks) in the economic development of a state. During the decades of 1960s and 70s, development economics favored state ownership of the financial institutions to stimulate economic growth. With the increased realization of importance of financial sector in the economic development, governments of developing countries took steps to increase the share of state in the banking system and to route much needed financial resources to more priority areas. Barth (2001) conducted study on banking regulations and ownership using cross-country data of over 60 countries. The results of this study revealed that the performance of banking system is negatively associated with the state ownership. The overall development of the financial sector is also negative affected due to the state ownership. The study also pointed out that the state ownership of the banks does not necessary cut the likelihood of financial crises. Another study by Lopez-de-Silanes, Shleifer, & Vishny (2002) found that the state ownership was high in developing countries. The data was based on study of state owned banks across 92 countries. There is an important question that how privatization improves the performance of a previously state owned company. The case for privatization of state owned enterprise can be followed around three major themes, that is, competition, political intervention and corporate governance.
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VOL 3, NO 4 Clarke, Crivelli & Cull (2005) in their study conclude that privatization of prior state owned banks not only improve performance but also improve efficiency. However, their study points out that continued state ownership even at minority level would have negative effect on the performance. It is also highlighted that strategic investors would bring more gains rather than initial public offerings of state owned enterprises because of weak institutional framework of developing countries. Many of the past researchers presented a comprehensive analysis of the pre and post privatization performance of the banking sector across low and middle income countries. Boehmer (2003) studied the impact of political and economic factors on bank privatization across 101 countries. The data contained banks that were privatized in these countries from 1982-2000. The results of the study showed that the banks were privatized because of low quality of the banking sector and the government being a right winged tended to be more accountable towards its people. 3. Research Methodology This study aims to evaluate the performance of the banking sector during privatization process in Pakistan. For this purpose, sample of state-owned, foreign and domestic private banks were selected. Financial reports of the State Bank of Pakistan have been used to gather the data. Data has been analysed using ration analysis technique. There are two variables in the hypothesis one is privatization and the other is performance of banks. The ratios used in the study are ROA, ROE and NIM. 3.1. Return on assets (ROA) ROA ratio utilizes earning and assets to calculate return. It shows the efficiency of the management in utilizing its resources to generate earnings. ROA has been calculated as follows: ROA = 3.2. Net Income Total Assets (1)
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Return on equity (ROE)
Return on equity measures a ratio of primary interest for the shareholders of the company. This ratio is measure of assessing the organizations ability to earn profit on the given equity. ROE is calculated as follows: ROE = 3.2. Net Income Shareholders Equity (2)
Net interest margin (NIM)
Net interest margin is basically difference between the total interest income earned and interest expense paid. If the interest expenses exceed the interest income this difference will be negative, revealing a situation of loss and vice versa. NIM is like gross margin of non-financial companies. Net interest Margin ratio is calculated as: Net interest income = Interest Earned Interest Paid to Customers (3) 4. Data Analysis There are number of indicators used to measure the performance of the banking system. The most widely used and accepted measure are Return on Assets, Return on Equity and Net Interest Margin. The profitability of the banking system is the prime measure to assess the performance of any given bank. The profitability plays a vital role in continuity of the business operations of the banking system. Moreover, a highly profitable bank can bear the emerging losses due to unexpected events, and it also helps to build a strong capital base. The expansion of the financial instituted is also funded by this profitability and shareholders are also given dividend from it. Tables given below provide some indicators about the performance of different banks in Pakistan. It is showed that state owned banks experienced a significant decline in their earnings, especially after mid 1990s. This situation evolved due the declining share of earning assets, increase in non-performing loans (NPLs) and provisioning requirements and, to some extent, decrease in rates on government securities.
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Table 1: Ratios of State-Owned Banks 1990 ROA ROE NIM 0.4 10.5 3.2 1991 0.5 13.4 3.2 1992 0.5 15.3 3.3 1993 0.7 19.2 3.7 1994 0.2 7.5 3.4 1995 0.2 5.9 3.9 1996 -0.3 -14.8 1.9 1997 -2.3 -2.44 3.2 1998 0.5 11.5 3.5
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In state owned banking sector of Pakistan, the ROA which is a comprehensive measure of profitability, increased up till 1993. By that time only one bank MCB was privatized but after 1994, as more banks were privatized, the ROA continued to decrease. The ROA was 0.7% in year 1993 which decreased drastically up to -0.7% in year 1999. The results show that privatization put negative effect on profitability which is measured by Return on Assets. Return on Equity which is the second measure of profitability was 19.2% in year 1993 which decreased up to -19.8% in years 1999. Both measures of profitability show that profitability decreased during the period of privatization. Net interest margin is difference between interest rate which is earned and paid by bank if this ratio is higher its mean that bank is generating income. In table of state-owned bank shows ups and downs of net interest margin. There is regular annual increase in the Net Interest Margins till 1995 when it reached to its highest range 3.9 after that there was a sudden decline in its value because new banks emerged. With the passage of time it recovered to 3.8 at the end of 1999. Table 2: Ratios of Private Banks 1990 ROA ROE NIM 1991 1992 0.7 6.3 2.3 1993 1.9 20 5.2 1994 1.5 17.2 4.7 1995 1.4 14.4 4 1996 1.5 16.6 3.4 1997 1 13.3 3.9 1998 0.6 8 3.5 1999 0.6 8.4 2.6
The profitability of privatized banks increased initially as, they started their business but they were unable to sustain it in subsequent years. The initial period of good performance can be attributed to clients attraction to these banks in an expectation of high quality banking services. But later as they suffer inconvenience they may have refrained from the new banks. It is worth noting that most of new banks were set up in few major cities of the country. They didnt have a branch network across the country which may have rendered them unattractive. ROA in the initial year of privatization was .7 which increased up to 1.5 in year 1996 but later on it started decreasing and reached up to 0.6 in year 1999. Interpreting the second measure of profitability, the ROE was 6.3 in year 1992 which increased drastically within four years up till 16.6 but later on again decreased up to 8.4 in year 1999. This analysis shows that in initial years of privatization, the customers were attracted towards privatization. Net Interest Margin in Private Banks shows different ratios. Initially in 1993 there was a monopoly of MCB because it was only privatized. Due to the relaxed market conditions other banks were privatized that reduced the share of Net Interest Margins to the limit of 2.6 in year 1999. Table 3: Ratios of Foreign Banks Year ROA ROE NIM 1990 0.8 10 3.5 1991 1.9 27.1 4.8 1992 2.6 30.8 5.2 1993 1.2 13.5 5.1 1994 0.8 8.7 4.2 1995 0.4 4.9 2.5 1996 1 12.8 3.2 1997 1.3 15.9 4.4 1998 0.4 4.8 3.5 1999 0.7 7 4
The foreign banks in Pakistan failed to sustain their profitability during 1990, despite having a better asset quality, sufficient capital base and strong management. They outperformed in the beginning as compared to
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VOL 3, NO 4 their existing competitors in the market. But it became difficult for them to stability their earnings at the same pace. The first three indicators showed declining earning capacity and thereby constraining profitability for this group, especially after 1997. These foreign banks were mainly dealing in foreign currency accounts. The freezing of these accounts in May 1998, adversely affected the earning capability of the foreign banks in Pakistan. ROA of foreign banks was 2.6 in year 1992 which was initial period of privatization. Later on, it started decreasing drastically and reached up to 0.7 in year 1999. On the other side the ROE was 30.8 in year 1992 which also decreased drastically and reached up to 7 in year 1999. Both of the measures of profitability show that there is decrease in profitability after privatization. 5. Conclusion The purpose of this study was to examine the impact of privatization on the performance of banking system in Pakistan. This study employed the ratio analysis of the financial measures of performance during the period 1990-1999. The analysis highlighted that although the performance of banking system substantially improved after the privatization, but the performance of the privatized banks is not up to the desired level. The profitability of the state-owned bank experienced a significant decrease after 1990s where privatized banks started their operations in the market. However, it is pertinent to note that the profitability of the privatized banks enjoyed good profitability in the beginning of their operations but with the passage of time they failed to sustain their profitability. The earning stability could not be achieved. Hence, privatization could not yield the required results. The good performance in the early period of their operations can be ascribed to the attraction of a large pool of clientele. The customers were of the view that these banks may provide better services to them as compared to state-owned banks. So in the early times they enjoyed a good customer portfolio. Lately, might be due the inconvenience faced by the customer, the new banks failed to attract new customers. Moreover, it also became difficult for these banks to retain their existing customers. Although, privatization helps to improve the performance of financial institutions, but it is required that this transition is not only confined to the change of management. The new management should identify the potential needs and demands of their customers and address them in a timely fashion. This will improve the customer base of the bank, thereby helping it to stabilize its earnings.
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References
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Burki, A.A., and Niazi, G.S.K. (2003). The Effects of Privatization, Competition and Regulation on Banking Efficiency in Pakistan 1991 2000. In the proceeding of CRC Conference on Regulatory Impact Assessment: Strengthening regulation Policy and Practice Chancellors Conference Center, held on 26-27 November. University of Manchester, UK. Clarke, G., Crivelli, J., & Cull, R. (2005). The Direct and Indirect Impact of Bank Privatization and Foreign Entry on Access to Credit on Argentina's Provinces. Journal of Banking and Finance, 295-309. King, H., & Levin, D. (2001). Efficiency and Productivity Growth in US. The Measurement of Techniques and Applications. La Porta, R., Lpez-de-Silanes, F., and Shleifer, A. (2000). Investor Protection and Corporate Governance. Journal of Financial Economics, 58, 3-27. Lpez-de-Silanes, A., Shleifer, A., & Vishny, R. (2002). Law of Finance. Journal of Economic Literature, 688-822. Spahis, C., Kosmidou, K., & Doumpos, M. (2002). Assessing Profitability Factors in Greek Banking System. International Transactions in Operational Research , 517-530. Shearer, A. N. (2000). Efficiency of Financial Institutions: International Survey and Directions for Future Research. European Journal of Operational Research, 175 212. State Bank of Pakistan. (2002). Pakistan Financial Assessment, 1990 2000. Karachi: Research Department, State Bank of Pakistan. Usman, M. (2010). Scale Efficiency in Banking Sector of Pakistan. International Journal of Business and Management, 5.
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Motives behind Channel Choice in Multichannel Air Travel Retail Context among Pakistani Consumers
Shamaila Gull
Lecturer (Business Studies), Institute of Business and Information Technology, Quaid-e-Azam Campus, University of the Punjab, Lahore, Pakistan.
Amina Ashraf
Graduated Student of Institute of Business and Information Technology, Session 2009-11, Specialization in Marketing.
Syeda Nazish Zehra Rizvi
Lecturer (Business Studies), Institute of Business and Information Technology, Quaid-e-Azam Campus, University of the Punjab, Lahore, Pakistan.
Abstract
This research was conducted in order to investigate the determinants influencing Air Travelers in Pakistan in their selection of distribution channel in order to make purchases of airline tickets. The study was based upon 220 air travelers in Pakistan where; the sample exhibited differences in various demographics and travel characteristics such as age (24 and above), gender (both males and females) and a blend of domestic and international travelers. The sample included travelers who purchased air travel tickets via one of the three channels namely Internet, Travel Agents and Airline line Booking Offices and who travelled either for leisure, business concerns, educational concerns and medical concerns. A closed ended survey questionnaire was designed by keeping in view, the standard and prevalent pretested measures available in literature on channel choice by (Williem Pieterson 2009; Williem Pieterson and Jan van Dijk ) with necessary modifications pertaining to the area under investigation. motives included in the study were : Previous Experience, Routine, Awareness, Contact Speed, Feedback Speed, Ease of use, Tangible cues, personal contact, trust, transaction security, risk aversion, shopping comparison, payment alternatives, accessibility, Time saving, Task Ambiguity Price, Geographical location Situation and Social Influence. The analysis in the study was executed using two very commonly used statistical analysis applications: SPSS and Microsoft Excel. The statistical tables were used to represent the collected data in order to provide a meaningful understanding of data which was collected from sample respondents. Frequency distributions presented the actual number of observations falling in each range or the percentage of observations in each category whereas the Cross
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Tabulation tables were formulated for all demographics and travel groups. Shopping Comparison, Payment Alternative, Geographical location and Task ambiguity were found to be the most disagreed motives whereas Transaction security, Personal contacts, Risk avoidance, Trust, Awareness and Accessibility were found to be the most significant motives. Significance of a motive is vital for its use in understanding the consumer behavior in the selected segment or segments. Understanding the factors behind the decision making process of a consumer can definitely help new comers or existing players survive in the air travel industry, regardless of the market that they are targeting. Motivational factors can help improve on their services and provide solutions for their target markets needs.
Keywords: Channel Choice Motives, air travel distribution channel determinants, multichannel retailing, air travelers profiles
Introduction
The technological advances and changing consumer preferences in Pakistan have expanded the range of channels that tourism suppliers might use to distribute their services. Each channel or path to the market may appeal to different segments, suit some products more than others, and have a simple or complex structure. Since the distribution channels are now acknowledged as a key part of revenue management and as a source of gaining competitive advantage and in order to survive the insurgency; where consumers are no more restricted to a solo means or channel to shop for a desired product rather they are open to choose the means which best suits their comfort and ease and simply abandon the options that do not come up to their expectations; calls for making an astounding move towards deeply undertaking the channel choice motives because motives are known to strongly influence consumers choice criteria and hence their channel selection behavior. Travelers make a choice out of several options available to them but following every selection of channel choice is either a latent or evident motive. In order to accomplish a specific motive lets say risk evasion; a specific channel is selected by the customer from a whole bundle of retail options available in the current air travel multichannel context. The distribution channels in air travel multichannel retail arena embrace unique advantages. Each and every distinct channel exhibits various notable and varying characteristics from other channels in terms of accessibility, price, reliability, interaction and like. Along with the advantages these channels also bear certain complexities and limitations. Similarly distinct segments of consumers have varying preferences and motives when selecting different distribution channels. Air Travel Retailers actually have an opportunity to exploit this dormant drive by highlighting the benefits and overcoming the deficiencies of each channel. Though there have been various studies on channel preference motives but very few have applied it to the field of air travel industry. The study aimed at uncovering major motivating factors influencing consumers choice of distribution channel in a multichannel environment while purchasing airline ticket .A second step is to figure out the set of motivational factors which work most effectively for each demographic and travel bases of analysis. Finally it reveals the motive sets of
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major consumer profiles/groups identified in the sample.The various channels covered by the study include: Traditional Travel Agents who work as commission based mediators in support of travel products and services Reservation Offices are physical locations of airlines which eliminate the need of an intermediary and works by directly providing reservation services. Online Reservation e-commerce websites for selling air ticket directly to customers on 24/7 availability basis.
Literature Review
This literature review offers a deeper insight and analysis of the choices of consumers regarding selection of distribution channel for their air ticket purchases and also explores the consumers motives which guide them to choose among traditional and contemporary distribution channels while purchasing air ticket. It also analyses motives used in the previous researches and studies. In air ticket distribution Travel Agents are regarded as the indirect channel of distribution since they work as a facilitator between the producers i.e. Airlines and final consumers. They also facilitate wholesalers. The tour operators in travel industry can be seen as wholesalers as they provide package holidays by collectively putting offers, services and products bought from various producers. (Andersen Consulting, 1998). Today the most critical challenge and treat faced by indirect channels comes from the outburst of direct channels for distribution. Internet is one such direct channel which allows direct interaction between producers and final consumers. (Vassos, 1996). Other than internet the direct channels for air ticket distribution include airlines own ticket offices and reservation centers.(Dembrower and Daneil 2003) confer in his study that traditional travel agents also enjoy the perk of being a well established and most widely recognized channel. Travel Agents continue to carry the most significant role on the market because of their long term relationships and trust that they have managed to build up in years. (Diana M. Dorinson) undertaking the Evolution of Airline distribution channels explains that air ticket distribution has undergone a notable change in the past few years with the advancement in communication technology. The new technology has made it possible to distribute tickets electronically using internet much more efficiently ( Bouvard & Somosi, 1997).Since electronic ticketing involves use of internet; therefore the more the customers at ease to use Internet, the greater would be the chances of the success of this channel Other than indirect channels such as travel agents; the distribution of airline tickets is also carried out through dedicated ticket sales offices. (Grenblad & Rosn, 1999) Vihalem explains that consumer motives are valuable for gaining deeper insights about customers and to shape their actions by sending out messages that cater their specific motives. In a study carried out by (Black) vast material of literature covering motives that might shape consumer cannel selection has been observed. The most significant factors uncovered in this study include: perceived risk, convenience, transaction costs, ease of use, preference for dealing face to face, concerns about safety and risk, complexity, trust
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and flexibility. Nicholson, Clarke, and Blakemore (2002) in one study investigated how and why consumers opt for a particular retail channel to make a purchase and so they assimilated situational variables. The study proposed that when individuals are faced with various distinguished situations; they pick different retail channel which best suits their current situation. The decision for channel choice in such a context is dependent upon the prevailing circumstances being experienced by the consumer. Sheth (1983) states that the choice of retail channel is made by consumers after the comparison of distinctive characteristics of retail channel with the motives behind this choice and the retail option which best fulfills the all the needs and drives of consumers becomes the final choice.Contemporary retail channels in travel retailing context offer consumers with several benefits such as convenience of purchasing irrespective of geographical, physical and time constraints. Consumers are free to make purchases whenever and wherever the fancy by spending lesser effort and time, saving their travel costs while still benefiting from capacious and extensive choice selections yet a physically secure and sound shopping experience right in their desired geographical setting. Allen in his study determined that effort was the most critical motivation of channel choice; the most convenient, adaptable and easy reachable channel becomes consumers choice since it reduces effort in terms of both time and energy. Swanson in his findings extracted identical results, further adding that this effort is a situational determinant which explains that based on different situations consumers opt for different channels available to them in the multiple retail arena. Consumers choice of distribution channel is based on different determinants including availability of time and resources, their inference and estimation of costs versus the benefits of choosing a particular channel as well as the restraint of capital. Reardon & McCorkle (2002).A few motives of channel selection identified from the study of Reardon & McCorkle which shall be considered helpful in this study are avoidance of perceived risk which includes mainly the financial risk. Schoenbachler & Gordon (2002) carried out a qualitative study undertaking certain retail alternative: brick-and-mortar, internet, catalogue or a amalgamation of these multiple channels options. The study proposed five crucial motives influencing the choice of consumer while making a selection among available retail channel formats. (i) the supposed risk related with the preference of a particular channel including financial, social or physical or a blend ; (ii) the earlier marketing know-how and experience which refers to past cannel choice preference(iii) the drive to adopt a certain channel which is subjected to customers demographic characteristics which include age, education, income, occupation, household size. Also the lifestyle (need for convenience,) consumers were taken in consideration; (iv) the nature of product/service type. Certain product categories are more appropriate for selling through web while others that might be perishable or need to be felt or observed with physical senses are suitable to be sold using traditional retail formats. (v) The design of the retail channel which refers to various benefits such as its eye appeal, user friendliness, accessibility, agility and simplicity of purchase process. The decision of the travels for choice of channel lies on their motives. Based on their specific personal needs ; they seek for channels through assistance provided by their peers family and friends, guidebooks for travel ,television as well as internet. (Peter & Olson, 1999).
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Research Methodology
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The research carried out basic, descriptive, cross-sectional, and deductive and a mishmash of qualitative and quantitative approach. It was accomplished in order to uncover the motivations of consumers for channel selection while purchasing air tickets. In order to achieve the results, the study followed a systematic method. Secondary data was used to study the reasons behind shaping channel choice and to identifying common patterns and themes in previous studies on channel choice. Contact Speed, Feedback Speed, Ease of use, Tangible cues, personal contact, trust, transaction security, risk aversion, shopping comparison, payment alternatives, price, accessibility, geographical location, time saving, and ambiguity of task, situational factors, social influence, previous experience and awareness were found to be the most significant dimensions in William Pietrson and Jan Van Dijks study. A final set of categories was formulated by short listing and merging repetitive motives. A sample of 220 air travelers from the city of Lahore was drawn to carry out the research. The sample exhibited differences in various demographics characteristics such as age(24 and above), income (more than Rs 50,000) and gender (male and female)as well as various travel characteristics such as type of traveler (domestic or international),channel preferred (traditional travel agents, airline booking offices or internet) and traveling purpose (leisure, business, education and health). The questions were designed by keeping in view, these shortlisted pretested measures available in literature on channel choice. The primary data was gathered from 220 air travelers through closed ended, multiple choice questionnaire administration using 5 point Likert Scale (1 depicting Strongly Agree) which served as the chief data collection tool. The respondents were accessed through different sources including travel agents, internet as well as visiting airport. The collected data was further tabulated and analyzed using statistical analysis applications: SPSS and Microsoft Excel. The meaningful interpretation of data was carried out to draw results and inferences. The statistical tests used for carrying out the analysis of Univariate data include cross-tabulations, frequency distributions and graphical representation.
Results Significant and Insignificant Motives

Significance of a motive is vital for its use in understanding the consumer behavior in the selected segment or segments. During the analysis it was found that certain motives seems to be determining the channel selection while some motives are not. Table A1 in appendix A is prepared using the union of data analysis done in the previous chapter. Significant and non significant motives were identified from it. It is evident from the table that, some of the motives are being treated as agreed by many of the categories. For example the motive transaction security is agreed by majority of the responds in 11 categories out of total 14 categories. Only the majority of the group travelers who
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travels for education and for medical reasons and those who buy ticket using internet are the groups that does not agree (with majority) with the reason Transaction security. On the other hand, the motive Situational Factors and the Routine Habit are the least agreed by majority by number of categories. Only the group of travelers who travels for the purpose Medical Concerns are agreed by majority with the motive Situational Factors when selecting a channel to purchase air line ticket. Similarly Routine Habit is also only agreed by one category of travelers. Those are the domestic travelers. It is quite comprehensive observation since when a person get medical reason to travel, then the selection of channel to buy air line ticket would definitely depend on the situation which the person is in. On the other hand Routine Habit popular only with one group of travelers and that s also very rear situation. Domestic travelers agree only to Routing Habit when selecting a channel to buy air line tickets.
Channel wise significant motives

Customer responses have revealed that for each channels there are motives that play the role as the deciding factor (deciding motive). The three channels that were considered for this study were selected by customers because of some motives that customers perceive as vital in selecting them. Internet The motive that derived most users to select internet as the preferred channel was that its Accessibility .Internet in most of the cases available full time where as other two channels are most probably available within normal working hours unless there is a special kind of service offered by certain travel agents and Airline booking offices . It is therefore vital for Internet Channels to keep that special strength of them available to customers in order for them to be selected over that motive (Accessibility). Ease of use which suggests that the content being provided by internet channels to buy air line tickets and the purchasing flow via internet has to be made simple for average and below average (internet literal) customers was found to be the second most agreeable motive.
Travel agents . Transaction Security is the main motive that makes Pakistani air travel customers to purchase airline tickets via Travel Agents while Personal Contact also got the approval of almost same percentage of customers. Personal contact and security of transaction ( in any business) go hand in hand since both these features offer more reliability. The other agreed motives in this section including trust and then risk avoidance. So, it becomes evident that the strength of the Travel agents revolve around trust and security which they provide to their selectors. It can be assumed therefore that the customers who reach this
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option are risk averse segment. So, travel agent therefore should preserve their key strength to attract customers by promoting and advertising and highlighting that strength.
Airline booking offices Vast majority of customers selected Time Saving as the most significant factor in choosing to buy air line tickets from Airline Booking Offices. Buying ticket from the air line directly will save time because it avoids extra communication link. (Internet or travel agent) . The other two motives that made customers select this option are Transaction security and risk averseness. Therefore the segments of customers select Airline Booking Officers have the quality of risk averseness ( than travel agent preferred user and internet preferred users)
Category Wise Significant Motives

Age One important conclusion that can be drawn out from the result(age group analysis) is the sense of Risk Averse increases with the age. This is obvious since the motives like Trust, Transaction Security, Personal Contact and Risk Avoidance becomes increasingly acceptable with age group. On the contrary, Shopping Comparison Payment Alternatives and Task Ambiguity are of very less important motive for any age.One very important conclusion that could be drawn here is older the customer more risk averse s/he would be. So when catering to such customers the channels should pay attention to enlighten them with the security of payments, building trust by having
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personal touch to the business process will ensure that they are comfortable doing business with the channel selected.
Gender Transaction Security is accepted by both genders as a motive to agree first. Therefore it is needed to ensure the customers with the security of the transaction that the channel offers irrespective of their gender as both female and male perceive same degree of acceptance towards the transaction security. But in contrast, male customers concerned on trust while female customers appeared to be disagreeing it to be motivating factor.
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Reason for traveling Those who travel for medical reasons show that they are keen on Time Saving and Contact Speed. This is much understandable. As in case of medical reason there is nothing more important than getting the treatment as soon as possible . On the other hand those who travel for education seems to have being paying attention to Social influence as the majority agreeable motive. Therefore it is necessary for channels to show themselves (the channel) as having quick response time if they are to cater consumers who travel for medical reasons. On the other hand it is necessary to address the society around which the person who is to travel for education. Most of the time air line ticket buying decisions is taken by the parents for those who travel aboard. Therefore as the results suggested its required to address the society around the student traveler. Strategies that could be employed are television advertisements promoting student travelers getting discounts. ( the target group should be the parents).
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Traveler type The most significant and common motives for the customers when choosing a channel to buy air line tickets for international or domestic travelers are Transaction Security. International travelers consider Trust and Awareness in addition. This shows that winning the International customers requires trust and awareness along with transaction security .Payment Alternative and Task Ambiguity are the two motives that customers do not agree as motives in high majority. It is therefore clear in this case that promoting alternative payment options play no or a little role in motivating customers to select a ticketing channel. When it comes to the domestic travelers, accessibility is the most preferred motive to select a channel. Time Saving and Transaction Security also more than having agreement level by majority .This shows that there are number of motives behind when selecting a channel when purchasing air tickets for international travel . Its not as simple and straight forward as domestic travelers.
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Significant Complete User Profiles
User profile shows a significant market segment. For each user profile there are motives that drive a user to buy air line tickets via a particular channel. According to the survey there are 144 different customer groups depending on their Gender, Age group, Travel type, Purpose of travel and the channel selection. According to the responding statistic, those user profiles were ranked according to the number of responses to each motive and summed them up to find the rank and identified what are the most significant customer profiles. These ranked user profiles are shown in table A3 in Appendix A . In the sections coming below ,most significant top 6 profiles and their significance is discussed. Rank 1 :Males of above 45 years old, take international travels for business purposes and choose travel agents as the channel to purchase airline tickets Above customer profile is the most significant in terms respondent number. Most (31) respondents belong to this profile. Preferred motives: Personal contact Trust Transaction Security Time Saving Awareness Routine Habit
Transaction Security is of highest concern in this profile while Awareness and Trust has same degree of significance. So overall it could be concluded that motives personal contact, trust, transaction security, time saving, awareness and routine habit are the important and decisive factors for the customers in this profile motivated to chose travel agent assisted travelers. Furthermore, it could be seen that this includes business purpose international travelers and also they are above 45 males. It could be therefore safely assume that this category of travelers are high profile personalities could be vital for the business of the purchasing channel. The strategies that need to attract this group of customers should include awareness, building trust and security and personal care for each individual.
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Rank 2 Males of above 45 years old, take international travels for holiday making and choose travel agents as the channel to purchase airline tickets
Preferred motives: Personal contact Trust Transaction security Risk avoidance Awareness Price Social influence
Similar to the above profile, this profile also consist of similar sort of categories but the purpose of travel holiday making makes this group very significant .Price is a motive for this profile of customers. Understandably international holiday making is an expensive task for any customers. Therefore price could be a very sensitive factor specially because this profile of users mentioned that price is a motive. There are verity of motives that are shown by this profile of customers. In order to facilitate or attract this category of customers to the travel agents to buy air line tickets, all these set of motives has to be considered and should facilitate them in order to attract them. Rank 3 Males between 24-34 years old, take international travels for education concerns and choose travel agents as the channel to purchase airline tickets Preferred motives: Personal contact Trust Transaction Security Risk avoidance Awareness Price Social Influence
The customers belongs to this profile consider the same motives as the 2nd profile. However, the major motive of preference for this group is transaction Security. They pay interest on Awareness, Price, Social Influence secondly. In addition, they also consider Personal contact, Trust and Risk avoidance as important next to that. When observing this profile it is visible that the profile of customers consist of young males who travels abroad for the purpose of education concerns and purchase tickets from travel agents. Again, trust, risk avoidance and awareness are motives to this profile of customers. Since this young travelers are socially influenced , strategically the channels can influence this profile of users to buy air line tickets Rank 4 Females between the age of 35-44 years, take domestic travels for business purposes and choose Internet as the channel to purchase airline tickets Preferred motives: Ease of use Trust Transaction Security
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Time Saving Accessibility Routine /Habit
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Business purpose, domestic, female travelers who select internet to purchase ticket is a segment of customers that would be beneficial to stimulate by some marketing campaigns. The majority in this user profile considered Access as the major motive when selecting Internet to purchase airline tickets. They have also agreed that they would look in to trustworthiness, ease of use, time saving, transaction security it would provide, in addition to the routine habit.
Rank 5 Males of 35-44 old, take international travels for business purposes and choose travel agents as the channel to purchase airline tickets
Preferred motives: Trust Transaction Security Risk avoidance Time Saving
Although this user group positions in the 4th place, the customers only considered four motives as important to them when choosing a channel to purchase airline tickets. They have chosen Time Saving as the most important motive followed by the transaction security, trust and risk avoidance respectively.The other significance of this profile is that, the difference of this profile and the profile ranked 1, is only the age group. Again motives are not much differ but latter seems to be risk averse than the former. So, overall, This group of customers are risk conscious and additionally conscious about the time spent. Rank 6 Males between 24-34 years old, take international travels for education concerns and choose Internet as the channel to purchase airline tickets Preferred motives: Ease of use Access Awareness
The customers belong to this profile considered ease of use as the major motive for choosing Internet to purchase airline tickets. They paid similar concern on the access to this channel and awareness on this channel. Since the group represent young males travelling for education purposes, it is understandable why above mentioned motives are behind their channel selection. It is the youngest generation who prefer internet most. So, strategies to attract this profile of people to the said channel would the awareness and easy to use web or application access interfaces to the channeling company. In the light of this study it can be recommended that the motives identified; whether significant or insignificant; hold a considerable value in terms of suggesting a number of practical implications.Understanding the factors behind the decision making process of a consumer can definitely help new comers or existing players survive in the air travel industry, regardless of the market that they are targeting. They can use these motivational factors to improve on their services and provide solutions for this target markets
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needs.The study also recommends some insightful and perceptive motivations which drive the travelers to opt for one channel or another. These motives hold significance for channel managers of airline and various related industries in order to create a fit between their services and the channels they offer for distribution of their services.
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References
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Black, N.J., Lockett, A., Ennew, C., Winklhofer, H. and McKechnie, S. Modelling consumer choice of distribution channels: an illustration from financial services. International Journal of Bank Marketing, 20 (4). 161-173. Gilbert, D.C. (1991) An Examination of the Consumer Behavior Process Related to Tourism. In Progress in Tourism, Recreation and Hospitality Management, edited by C.P. Cooper .London: Belhaven, pp.78-105 Hackman, David, Siegfried Gundergan, Paul Wang and Kerry Daniel (2006), Service Perspective on Modeling Intentions of On-Line Purchasing, Journal of Marketing,20(7), 459-470. Heinonen, Kristina (2004), "Reconceptualizing Customer Perceived Value: The Value of Time and Place," Managing Service Quality, 14(2/3), 205-215. Hirschmann, Elisabeth C. and Holbrook, Morris B. (1982), Hedonic Consumption, emerging concepts, methods and propositions, Journal of Marketing, 46 (Summer), 92-101. Jrvelinen, J. (2004). Online or Offline : Motives Behind the Purchasing Channel Choice of Online Information Seekers, Turku School of Economics and Business Administration, 17(1), 5374. Jones, M n,,././..A. (1999), Entertaining Shopping Experiences, An Exploratory Investigation, Journal of Retailing and Consumer Services, 6 (3), 129-139. Kaufman-Scarborough, Carol and Lindquist, Jay D. (2002), E-shopping in a multiple channel environment, Journal of Consumer Marketing, 19 (4), 333-350. Khalifa, M. and Limayem, M., 2003. Drivers of Internet Shopping. Communications of the ACM 46 (12ve), 233-239. Lee, J. A Key to Marketing Financial Services: The Right Mix of Products, Services, Channels and Customers. Journalof Services Marketing, 16 (3). 238-258. Leek, S., Naud, P. and Turnbull, P. W (2003): Interactions, relationships and networks in a changing world. Industrial Marketing Management 32, pp. 87-90. McGoldrick, P. J., & Collins, N. (2007). Multichannel retailing: profiling the multichannel shopper. International Review of Retail, Distribution & Consumer Research, 17(2),139-158. Mathwick, Charla, Malhotra, Naresh K. and Rigdon, Edward (2002), The effect of dynamic retail experiences on experiential perceptions of value, an Internet an catalog comparison, Journal of Retailing, 78 (Spring), 51-60. Middleton, V., and J. Clarke (2000). Marketing in Travel and Tourism. 3rd ed. Oxford: Butterworth-Heinemann. Nicholson, M., I. Clarke, and M. Blakemore, 2002. One Brand, Three Ways to Shop:Situational Variables and Multichannel Consumer Behaviour, International Review of Retail, Distribution, and Consumer Research 12(2): 131-148
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Noble, S. M., Griffith, D. A., & Weinberger, M. G. (2005). Consumer derived utilitarian value and channel utilization in a multi-channel retail context. Journal of Business Research,58(12), 1643-1651. Pieterson W. and van Dijk J., 2007, "Channel Choice Determinants; An exploration of the factors that determine the choice of a service channel in citizen initiated contacts", The Proceedings of the 8th Annual International Digital Government Research Conference, 173-182. Rangaswamy, A., & Van Bruggen, G. H. (2005). Opportunities and challenges in multichannel marketing: An introduction to the special issue. Journal of Interactive Marketing,19(2), 5-11. Reardon, J., & McCorkle, D. E. (2002). A consumer model for channel switching behaviour. International Journal of Retail & Distribution Management, 30(4), 179 185. Schoenbachler, D. D., & Gordon, G. L. (2002). Multi-channel shopping: understanding what drives channel choice. Journal of Consumer Marketing, 19(1), 4253. Stern, L.W., El-Ansary, A.I, and Coughlan, A.T. (1996). Marketing channels, 5th ed., Saddle River NJ:Prentice Hall. Swanson, E.B. Information Channel Disposition and Use. Decision Sciences, 18 (1). 131-145. Van Dijk, Maria G. (2007), Pick and Mix.Consumers Moving between Online and Offline Channels in the Context of Leisure Travel Preparations, Milton Keynes, UK:The Open University. Westwood, S. Pritchard, A. and Morgan, N. J (2000): Gender-blind marketing: businesswomens perceptions of airline services. Tourism Management 21, pp. 353362.
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Addiction in Internet chatting: An empirical study using modified Technology Acceptance Model
Dr. Sam Thomas
Assistant Professor, School of Management Studies, Cochin University of Science and Technology, Cochin, Kerala, India 682022 Abstract Many researchers have argued that the attractiveness of the Internet could lead to excessive use which can be described as Internet addiction .Internet chatting is one of those applications which is reported to be addictive in nature. This research tries to explain addiction in Internet chatting through a modified version of the technology acceptance model (TAM). TAM has been considered the most useful for predicting the usage of technology driven applications. Based on the data is collected by administering validated instruments to students undergoing graduate and post graduate programmes in various colleges in the state of Kerala, India, the research proposed and validated a structural model linking internet chatting addiction to perceived usefulness, perceived ease of use, perceived enjoyment and perceived risk. Attitude was seen to the mediating variable between addiction and the antecedent variables. Key words: Internet chatting, addiction, technology acceptance model (TAM), Structural equation modeling, India. 1. Introduction Internet applications have revolutionized the way we live. The impact has been most felt the way we communicate with each other. The revolution started off when email became mainstream for businesses and personal communication. Soon after email became mainstream, instant messaging and chatting started to become the new standard in socializing for teens and businesses alike. Teens started using online chat to talk to multiple people at one time while simultaneously being able to listen to music or surf the net. Business used it for providing support to numerous customers. Internet Relay Chat (IRC) allows people across the world to chat in real-time with each other in virtual rooms over the Internet. As things evolved, social networks like Facebook and Myspace started offering a venue for people to chat, with billions of people flocking to these services. Many researchers have argued that the attractiveness of the Internet could lead to excessive use. Past research has described this phenomenon as Internet addiction (Griffiths, 2000; Soule et al., 2003; Widyanto and Griffiths, 2006). This is viewed as a kind of psychological dependence. Young (1998) argued that the Internet itself is not addictive but highly interactive applications like online chatting can be addictive. Past studies have studied Internet addiction from a psychological context, focusing on the negative effects of Internet addiction on vulnerable groups as adolescents or young students (Kandell, 1998; Nalwa and Anand, 2003; Chou et al., 2005; Wan and Chiou, 2006). There is little empirical research exploring the relationship between Internet addiction and other attitudinal or behavioral variables (Hsi-Peng Lu and Shuming Wang, 2008). This research tries to explain addiction through the technology acceptance model (TAM). TAM has been considered the most useful for predicting the usage of technology driven applications. This model, proposed by Davis (1989), is based on constructs and relationships in the theory of reasoned action (TRA). The model has been shown to have a good predictive validity for the use of several information technologies, including e-mail (Adams et al., 1992; Karahanna and Straub, 1999; Gefen et al., 2000); Word (Chau, 1996), the world wide web (WWW) (Lederer et al., 2000; Moon and Kim, 2001), online shopping (Shih, 2004; OCass and Fenech, 2003; Vijayasarathy, 2004), and online business management applications (Ortega et al., 2006. Additional variables have been incorporated into the original TAM to improve its predictive power in specific contexts (Moon and Kim, 2001), (Agarwal and Karahanna, 2000),(Koufaris, 2002).
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2. Research Model and Hypotheses
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The original TAM consisted of perceived ease of use (PEOU), perceived usefulness (PU), attitude toward using (ATU), behavioral intention to use (BI), and actual system use (AU). PU and PEOU are the two most important determinants for system use. The ATU directly predicts users BI which determines AU. Many researchers suggested that TAM needed to be given additional variables to provide an even stronger model. Venkatesh and Davis proposed an extension, TAM2, incorporating social influence processes and cognitive instrumental processes. Jen-Her Wu and Shu-Ching Wang (2004) studied the drivers of mobile commerce with a new TAM version incorporating perceived risk and cost as added variables. Chun-Hsiung Liao et.al (2007) had perceived enjoyment as one of the predictors of attitude in the modified TAM. The proposed research model is shown in figure 2. This model draws on the work of previous researchers. Since the study is proposed among actual users, intention to use was dropped. Addiction being a case of excessive usage, is used as the dependent variable. Conceptualization of variables and hypotheses are stated fig.1 in the annexure 2.1 Perceived Ease of Use (PEOU) Perceived Ease of Use is defined as the degree to which a person believes that using a particular technology will be effortless (Davis 1989; Davis et al. 1989). In this context it means the degree to which a person believes that online chatting is easy to use. Previous research has consistently argued that there is a positive relationship between perceived ease of use and acceptance of information technology (Dishaw, M.T, and Strong, D.M. ,1999; Gefen, D., and Straub, D.W., 2000; Venkatesh, V., and Davis, 2000). This finding has also been validated in Internet technology use (ederer, A.L.et.al, 1999; Moon, J-M., and Kim, 2001). The TAM premise is that perceived ease of use has direct as well as indirect (through perceived usefulness) influence on attitude. Linkages between PEOU, PU and attitude in TAM theory have been empirically verified in the IT literature. Many studies have also tested the effects of external variables on PEOU (Hong et al., 2002; Igbaria et al., 1997). Hence the following hypotheses are stated. H1: There is a positive relationship between Perceived Ease of Use and Attitude H2: There is a positive relationship between Perceived Ease of Use and Perceived usefulness 2.2 Perceived Usefulness (PU) The degree to which a person believes that using a particular system will enhance hiss/her job performance (Davis 1989; Davis et al. 1989). In this context it measures the extent to which a person believes that online chatting will enhance his performance with respect to communication requirements. In the TAM, it is posited that PU affects behavioral attitude. Adams et al. (1992) and Davis et al. (1989) found PU a major determinant of usage behaviour and intention. Individuals evaluate the consequences of their behavior in terms of perceived usefulness and base their choice of behavior on the desirability of the usefulness. Based on this theory, Robey (1979) argues that a system that does not help people perform their jobs is not likely to be received. Chaus (1996) study suggests that PU can be separated into two distinct types: near-term usefulness (i.e. improving job performance or enhancing job satisfaction) and long-term usefulness (i.e. improving ones career prospects or social status). He showed that perceived near-term usefulness had more significant influence on the intention to use a technology than long-term usefulness. This research tests the following hypotheses. H3: There is a positive relationship between Perceived usefulness and Attitude 2.3 Perceived Enjoyment (PE) Perceived enjoyment is viewed as a reason for performing an activity for no apparent reason other than the process of performing by itself (Igbaria et al., 1994) and is positively related to attitude towards using a specified source (Moon and Kim, 2001). Prior studies of the WWW and mobile commerce have empirically added PE to the TAM to predict user acceptance and adoption of a specific source, and found this construct has a positive effect on attitude towards using a specified system (Dabholkar, 1996; Moon and Kim, 2001; Bruner and Kumar, 2005). Hence the hypothesis H4: There is a positive relationship between Perceived enjoyment and Attitude
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2.4 Perceived Risk (PR)
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Perceived risk may be defined as users subjective expectation of suffering a loss in pursuit of the desired outcome (Jen-Her Wu and Shu-Ching Wang, 2005). The distant and impersonal nature of the on-line environment and the implicit uncertainty of using an open infrastructure for transactions have made risk an inevitable element of the internet services. PR arises from the uncertainty that customers face when they cannot foresee the consequences of their decision to chat online. The major component of PR is the privacy risk. Perceived fears of divulging personal information and feelings of insecurity have a negative influence on internet services use (Howcroft et al., 2002). Users worry that the web sites may share their profiles with others and, thus, use the information to try and sell additional products (Gerrard and Cunningham, 2003). Another component of risk is performance risk which is concerned with how well the product will perform relative to expectations (Littler and Melanthiou, 2006). Time loss risk arising from searching for web sites, response time of the web site and speed is also studied in literature (Jayawardhena and Foley, 2000). Social risk is concerned with the possibility of attracting unfavourable attention and response from their transaction. The social status of the consumer who uses Internet services may be affected because of the positive or negative perceptions of internet services by family, acquaintances or peers (Littler and Melanthiou, 2006). So the researcher proposes that H5: There is a negative relationship between Perceived Risk and Attitude 2.5 Attitude (ATT) Attitude is viewed as the degree to which an individuals is favorably or unfavorably disposed towards using the system. Several empirical studies have shown that an individuals attitude is influenced by various constructs or external variables, which may be system features, training, documentation, and user support, (Davis et al. 1989, Lucas and Spitler, 1999). The TAM posits that actual usage of a specified system will be determined by an individuals attitude towards using a system (Davis et al., 1989). Prior empirical studies have shown the existence of such generalized attitude and its influence on the evaluation of new technologies in similar situations (OCass and Fenech, 2003; Moon and Kim, 2001; Vijayasarathy, 2004). Attitude is hypothesized to mediate the influences of perceptions on usage. H6: There is a positive relationship between Attitude and Internet Addiction 2.6 Internet chatting and addiction Internet Chat allows people across the world to chat in real-time with each other in virtual rooms over the Internet. This is an online communication system through which files and text can be transferred. Internet Chat permits anybody with a server to create their chat rooms as well as invite other people to participate providing users with a clean, ad-free interface-based means of chatting. It offers the most cost effective way of communicating with people across the globe. It is possible for users to engage in chatting for many hours a day over the courses of years. Excessive time spent in this manner could lead to the problematic behavior known as Internet addiction. Internet addiction is viewed as a psychological dependence on or a behavioral addiction to the Internet resulting in excessive usage (Kandell, 1998; Griffiths, 2000). Addiction to internet chatting can lead to concerns like (i) a need for increased lengths of time online (ii) unpleasant feelings when off-line (iii) social or occupational problem and relationship difficulties (iv) lying about the level of use once the problematic behaviors have been formed (Armstrong et al., 2000; Chou et al., 2005). This study tries explain internet addiction in chatting using a modified version of TAM. Attitude is hypothesized to be the intervening variable between the perception variables and addiction. 3. Research Methodology This research was accomplished by conducting a questionnaire survey. The study is designed as a explanatory study using survey method. The unit of analysis is a person who uses chatting services in internet. Data is collected by administering validated instruments to the qualified respondents. 3.1 Measures of concepts Measures were adapted from previously validated questionnaires. Minor modifications were made to fit the context of the present study. Table 1 shows the details of the scales used for measuring the constructs in the study. The respondents were asked to indicate their response on a five-point Likert-scale where 1 indicates the least favorable response alternative and 5 the most favorable response alternative.
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3.2 Data Collection
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Data is collected from students undergoing graduate and post graduate programmes in various colleges in the state of Kerala, India. A total of 345 valid responses were received from students of 15 colleges in the state. The sample consists of 205 males and 140 females with a mean age of 22 years. 4. Data Analysis The data analysis is split into two parts: Validating the measurement models of the constructs and validating the structural model (figure 1) linking these constructs. Structural equation modeling (SEM) is often used for testing theory associated with latent variable models because it enables the inference of complex relationships among variables which cannot be directly observed. SEM is a multivariate statistical methodology, which takes a confirmatory approach to the analysis of a structural theory. SEM provides researchers with the ability to accommodate multiple interrelated dependence relationships in a single model. (Hair et al., 1998). AMOS 4.0, a leading SEM package, was used in this study. The overall fit of a model in SEM can be assessed using a number of fit indices. There is broad consensus that no single measure of overall fit should be relied on exclusively and a variety of different indices should be consulted (Tanaka, 1993). The indices used include Chi-square (2), Goodness of Fit Index (GFI) (Joreskog and Sorbom, 1989), Non-normed Fit Index (NNFI) (Bentler and Bonet`t, 1980), Comparative Fit Index (CFI) (Bentler, 1990) and Root Mean Squared Residual (RMSR). Table 2 shows major fit measures and guidelines for their acceptable values. The models can also be evaluated based on the magnitude and the significance of the loading coefficients. These loadings, or parameter estimates, are similar to the reliability measures between a set of indicators and the construct that they measure. The high magnitude and significance of the loadings would further validate the models. 4.1 The measurement model Confirmatory Factor Analysis (CFA), which is part of the structural equation modeling (SEM) techniques, can be used to validate a measurement model that specifies the relationship between observed indicators and their underlying latent constructs. The measurement model specifies how latent constructs are measured by the observed variables and it assesses the construct validity and reliability of the observed variables (Joreskog and Sorbom, 1989). CFA is often used to confirm a factor structure known beforehand as is the case with constructs in the study. The Current research has 35 observed variable measuring 6 latent variables (perceived ease of use, perceived usefulness, perceived enjoyment, perceived risk, attitude, addiction). The measurement model is shown in figure 2. The values of the fit indices are also indicated. All the fit indices values show very good fit validating the measurement model. The loading coefficients of all the observed indicators onto the hypothesized dimensions were also seen to be significant at 1% level further supporting the validity of the measurement model. The reliability of each construct was separately analysed. The reliability of the scale items for each of the variables was analyzed using Cronbach alpha coefficients. The values are reported in table 3. All the constructs had Cronbach alpha values higher than the suggested cut off of 0.707 (Nunnally and Bernstein,1994; Gefen et al., 2000) indicating the adequate level of reliability for the scales. 4.2 Structural model The proposed research mode shown in figure 1 is now tested with SEM using AMOS4.0. Figure 3 shows the final model with path loading coefficients significant at 0.05 level. This model demonstrates the linkages among addiction, attitude, perceived usefulness, perceived ease of use, perceived enjoyment and perceived risk based on the data collected from students in India. Internet addiction has strong positive correlation with attitude supporting hypothesis 6. Perceived risk has a negative correlation with attitude supporting H5. Perceived enjoyment and perceived usefulness have positive influence on attitude supporting H4 and H3. Perceived ease of use was seen to have a positive association with perceived usefulness but not with attitude. Thus H2 is supported and H1 is rejected. The model shows that the effect of the perception variables on addiction is through the mediating variable attitude. The squared multiple correlation coefficient, which is equivalent to R2 in regression, was a strong 0.592. This means that the model is explaining 59.2% of the variation in the dependent variable addiction.
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5. Discussion and Conclusion
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The research proposed and validated a structural model linking internet chatting addiction to a modified TAM model. The study has limitations with respect to sampling and hence the model can not be generalized across the globe. But findings from the study add to numerous TAM based research. The researcher has followed the accepted procedures in model validation. Scales were proposed and validated for each of the constructs under study. Researchers can use these measures for future studies. The study added two variables to the TAM list: perceived enjoyment and perceived risk. Perceived enjoyment was seen to be the most significant factor contributing to a favorable attitude towards online chatting. Perceived usefulness comes next. This means that for youngsters, chatting is driven more by enjoyment they derive from it than the need for communication. The impact of perceived ease of use on attitude is indirect through perceived usefulness. Given the level of comfort youngsters have with computer applications, ease of use is no more a major factor driving usage. Risk perception is a significant but not a major influencer on attitude in the model. Attitude is seen to be the intervening variable between the antecedents and addiction construct. This means all the antecedents result in the formation of a strong favorable attitude which leads to addiction behavior. The ever increasing levels of competition among various chat service providers are conferring greater importance to loyalty as a way to obtain competitive advantage. Social networking sites compete with each other to keep the members addicted to their site. This study will be of use to them in drawing conclusions on varying levels of importance of different variables in maintaining addiction.
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VOL 3, NO 4 Venkaetesh, V. and Davis, F.D. (2000).A theoretical extension of the technology acceptance model: four longitudinal field studies. Management Science, 46(2), 186-204. Vijayasarathy, L.R. (2004).Predicting consumer intentions to use on-line shopping: the case for an augmented technology acceptance model. Information & Management, 41(6), 747-62. Wan, C-S. and Chiou, W-B. (2006).Why are adolescents addicted to online gaming? An interview study in Taiwan. Cyber Psychology & Behavior, 9(6), 762-6. Widyanto, L. and Griffiths, M. (2006).Internet addiction: a critical review. International Journal of Mental Health and Addiction, 4(1), 31-51. Wu,J, and Wang,S.(2005). What drives mobile commerce? An empirical evaluation of the revised technology acceptance model. Information & Management, 42, 719729. Young, K.S. (1998b), Internet addiction: the emergence of a new clinical disorder, Cyber Psychology & Behavior, Vol. 1 No. 3, pp. 237-44.
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Annexure 1. Figures
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Figure 1: The proposed research model
Figure 2: The Measurement model
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Figure 3: Structural model with fit indices and path coefficients
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Annexure 2. Tables Construct Perceived ease of use Item no PEU1 PEU2 PEU3 PEU4 PU1 Perceived usefulness PU2 PU3 PU4 PU5 PE1 PE2 Perceived enjoyment PE3 PE4 PE5 PE6 PR1 PR2 PR3 Perceived risk PR4 PR5 PR6 Scale items It is simple to use Internet chatting I learned to use Internet chatting quickly Internet chatting is understandable and clear It is easy to use Internet chatting Less/more efficient Less /more convenient Less/more relaxing Lower/higher the quality of communicating Useless/useful Boring/interesting Unpleasant/enjoyable Painful/delightful Incurious/curious Internet chatting helps me to explore novelty Internet chatting excites me with more imaginative space I worry about giving my personal details to chatting websites I am worried that my messages will be intercepted and modified by hackers Chat sites could provide my personal information to other companies without my consent It increases the likelihood of receiving spam Chatting worsens the image your friends and relations have of you My friends and relations think I am being imprudent when I use chatting instead of traditional communication means When I chat, I feel I waste a lot of time PR7 PR8 I rate internet chatting as ATT1 Attitude ATT2 ATT3 ATT4 ADD1 Addiction in chatting ADD2 Fruitless/beneficial Unworthy/worthy Bad/good idea Negative/positive attitude Young (1998b) It is very likely that the online chatting will not meet my expectations Source
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Davis (1989), BurtonJones and Hubona (2005)
Davis (1989), Fenech (2003), Vijayasarathy (2004)
Bruner and Kumar (2005), Moon and Kim(2001), Dabholkar (1996)
Cheung and Lee (2001); Flavian and Guinaliu (2006); Janda et al. (2002); Littler and Melanthiou (2006) Joaqun AldasManzano et.al (2008)
Moon and Kim (2001), Vijayasarathy(2004), Lucas and Spitler (1999)
Felt the need to chat with increasing amounts of time in order to achieve satisfaction Felt preoccupied with the Internet chatting (think about it when off line ) Lied to friends or family members to conceal the
Hsi-Peng Lu and Shuming Wang (2008)
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ADD3 ADD4 ADD5 ADD6 extent of online chatting Felt restless, moody, depressed, or irritable when attempting to cut down or stop online chatting Made unsuccessful efforts to control, cut back, or stop online chatting Used online chatting as a way of escaping from problems or relieving feelings of helplessness, guilt, anxiety, or depression Spent time on playing online game than originally intended ADD7 ADD8 Table 1: Scale items Jeopardized or risked the loss of significant relationship, job, educational, or career opportunity because of online chatting behavior
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Indicators of fit Normed Chi-square (2 ) GFI AGFI RMSR RMSEA CFI
Target Values for very good fit <3 >0.90 >0.80 <0.05 <0.05 >0.90
Target Values for moderate fit <5 >0.80 >0.70 <0.10 <0.08 >0.80
Table 2: Fit indices and their acceptable values Construct Perceived ease of use Perceived usefulness Perceived enjoyment Perceived risk Attitude Addiction Cronbach alpha 0.929 0.854 0.852 0.746 0.776 0.755 Table 3: Crobach alphas for the constructs
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Quality Assessment for Academic Services in University of Isfahan According to the Students opinions Using SERVQUAL Model
Dr. Mohammad Hossein Mosharaf Javadi Batool Samangooe
Mohammad Hassan Tanhaei
Abstract Its not only important but necessary to measure the general quality of service-providing organizations, especially the educational institutions. For the same reason, university of Isfahan has to evaluate and assess the quality level of its services, based on the surveys carried out with its customers who are students. This is a descriptive and survey-based cross-sectional study which was carried out in the year of 2011. In this study, 250 students were sampled based on a stratified random sampling from statistical population of 12815 students. To analyze the data, t-test, t2-test and analysis of Variance (ANOVA) were used in which were evaluated in a Likert Scale. Based on the findings of this study, there was a significant difference of 5% between the groups and there was a difference between the service quality scale indicators. So, considering the assumed mean of 3, the factor of the tangibles, with a mean of 3.09, plays the most significant role and the factor of empathy plays the less significant role with a mean of 2.78. The students evaluated quality of educational services with regard to the dimensions of responsiveness, assurance, reliability and empathy to be at an average level or less and the tangibles to be higher than average. The educational experts and managers should take the required measures to improve quality of educational services. Keywords: Services, Service Quality (SERVQUAL), Reliability, Responsiveness, Assurance, Empathy Introduction: Service quality plays a significant role in education. Higher quality is not selective or optional strategy but disfingushes between efficient and inefficient universities. What is refered to as virtual university is formed to obtain a higher service quality. E-learning activities are therefore performed with the purpose of service quality improvement. Periodical measurement of service quality is highly effective in identifying the level of and promoting the quality of service-providing organizations continuously, especially in the universities. On the other hand, Higher Education in Iran has been mostly focusing on the quantitative improvement and drastic increase of students in number . for the last two or three decades qualitative aspects of higher education has not been in a desirable degree. The educational services quality assessment has been evaluated in a study, based on the opinions of the students, using universally agreed SERVQUAL2 model. This scale was designed by Parasuraman et al in 1988 and so far it has been used in many serviceproviding organizations all over the world.
Faculty Member of Management University of Isfahan M.S. in the field of Business Administration and Educational Services Expert in University of Isfahan Holder of Bachelors Degree & Educational Services expert in University of Isfahan 2 Service Quality
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Theoretical Framework Services Services include intangible duties that satisfy the needs of consumers or commercial users. In other words, services and products can be assumed on two ends of a continuum, as most cases are a combination of these two features (Nasehifar & Haghbayan, 2009). Most authors have pointed out 5 fundamental principles that distinguish good service activities from non-service ones. These 5 principles include: intangibility, instability, heterogeneity, inseparability and non-posessiveness of the services (Mousavi & Rezaeian, 2007). Here, it needs to be pointed out that a complaining customer is not an enemy to the organization. Those customers who complain of the specifications of a product or the services provided by the company are more likely to come back, as compared to those customers who never express complain about the organization. That is to say an appropriate response to complaining customers will make them 50% faithful to the organization; otherwise, they will go to the rivals (Behin Moshaveran Atiyehsaz Conference, 2006). Complaints should be addressed as opportunities to improve relationships with the customers. They should be used as the instruments for satisfying the changeable demands of the customers (ranjbaran et al, 2002). The studies show that only 10% of the personnel in the industrial sector are directly in contact with the customers. However, this ratio increases to 90% or even 100% for the service-providers (Nasehifar & Haghbayan, 2009). Service Quality Quality is a dynamic feature that is linked with production, service providing, personnel, processes and environment and it can reach the level expected by the customers or even beyond (Venoos & Madadiyekta, 2005). Researchers and scientists in service marketing have presented several metaphors for service quality. For example, Berry has defined it as the most powerful competitive weapon, Clave has considered it as the reviving blood for the organization and Peters as the magic bullet that provides the customer with less expensive services at lower prices (Haghighi et al, 2003). The customers expect two desirable and sufficient levels of services that are separated by the tolerance zone of the customer (Baglou & Zomorodpoush, 2009). Tangibles include the products or protections and supports received from the products and services. However, Tangibles dimensions are less observable in governmental and service-providing organizations such as universities and higher education institutes and the customers of organizations such as universities evaluate the tangibles based on the availability of instructional credits. Interactive quality refers to the relation between the customer and the service-provider and organizational quality refers to the general conceptions from the organization (Shahriari, 2006). Generally, most definitions of quality are customer-oriented when they are being used about quality. In other words, quality assessment in the service-providing sector is carried out based on the customers conception (Samavi et al, 2008). The knowledge of the concept of service quality and the attempt to improve it has resulted in providing high-quality services, and improving the satisfaction of students can be expected as a result of improving the service quality. Then, the service quality is defined as a scale for evaluating the students satisfaction.
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SERVQUAL Scale SERVQUAL scale has been used in many experimental studies in different organizations and its result and findings have been published in well-known journals3. Besides, many researchers (Buttle, 1996; Cliff, 1994, Babakus et al, 1992; Newman, 1996) have used this model in their studies. The criticisms made about this model include important issues of being merely qualitative and objective and inconclusive in its dimensions (Buttle, 1996). In this study, to improve the reliability and validity of the study, the ideas of experienced experts of this university and educational managers with abundant experiences in educational system of University of Isfahan were used. In this way, the questions of SERVQUAL model were localized, observing the main framework of this model based of Likert Scale as a suitable instrument for measuring the attitudes. This scale includes 5 dimensions and 22 indicators mentioned in table 1. Table(1)
Dimensions Reliability
Dimensions and Indicators of Service Quality Scale

Description The ability to perform the promised services exactly and accurately. So that a balance should yield the same result at every trial, the higher education institutes, such as universities, should always offer the services exactly and accurately as promised The tendency to help and protect students immediately Indicators Positive Effect of financial fines in education on motivating the students to select the credits and to do other similar academic affairs on time, being careful in correspondences related to the students, fast performance of official correspondences, coordination of academic services and other educational parts, fulfilling one's commitments toward the students Fast physical performance of affairs (Educational Commission forms, medical withdrawal, defense permit, withdrawal, etc), providing information on academic rules through notifications on boards, personnel's care for solving educational problems, fast correspondence through official automation Creating a sense of assurance and confidence in the students when providing services, offering required guidelines when a student has faced an educational problem, being fair and observing equity among the students, awareness of the educational personnel about the educational rules being empathetic and patient when dealing with the students, offering the required guidelines when a student has faced an educational problem, being aware of the special needs of a student Suitable scheduling at the time of credit selection, omitting or adding credits and withdrawal, having access to the educational authorities (vicechancellors and directors), students' satisfaction with internet-based enrollment at the time of admission and submission of the documents by the educational services department, neat appearance of the personnel
Responsiveness
Assurance
The knowledge of the personnel, respecting the students and their abilities in creating a sense of assurance and confidence The compassion and attention of the personnel for the students what the students think about the level of personnel's empathy for them, their needs and problems Physical facilities, equipment and the appearance of the personnel
Empathy
Tangibles
. Journal of Marketing, Journal of Retaining, Journal of HRM
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Research Method This study is a descriptive and survey-based study carried out in the year of 2011, the statistical population included 12815 including bachelor's , master's and PhD degree students, who were selected based on a stratified random sampling among the students of different faculties of this university. The data were collected using a researcher-made questionnaire. The validity of which was approved by the authorities and experts and its reliability had been proved by Chronbach's with a reliability coefficient of 0.92. For descriptive statistics, the statistical indicators of frequency, percentage, mean, and standard deviation were used and for inferential statistics, the statistical tests of singlevariable t-test, multi-variable analysis of variance, Hoteling t were used. To estimate the size of sample, first 30 questionnaires were distributed among the students of the University of Isfahan and then, when the Chronbach's coefficient was estimated, the size of the required sample was estimated to be 250 students.
n= n= Demographic Data Analysis

Table 1. Students Distribution Based on Their Sex Sex Frequency 134 Female 105 Male 11 Not Mentioned 250 Total
=250
Percentage 53.6 42.0 4.4 100
Table 2. Students Distribution Based on Educational Degree Degree Frequency Percentage 197 78.8 Bachelor's 45 18.0 Master's 5 2.0 PhD 2 0.8 Not Mentioned 250 100 Total
Table 3. Students Distribution Based on Their Faculty Field Frequency Percentage 50 20.0 Sciences 28 11.2 Language 11 4.4 Physical Education 42 16.8 Engineering 43 17.2 Economics 45 18.0 Literature 31 12.4 Education 250 100 Total
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Research Questions Analysis
First Hypothesis: Reliability Table 4. A Comparison between the Reliability Mean and Assumed Mean of 3
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Reliability
Mean 2.94
SD 0.73
Standard Error 0.05
T -1.36
Df 249
Sig 0.173
According to the results of table 4, the resulted t is less than the critical value of the table at the error level of 5% and the reliability mean is also less than average.
Second Hypothesis: Responsiveness Table 5. A Comparison between the Responsiveness Mean and Assumed Mean of 3
Standard T Df Sig Error 2.93 0.86 0.05 -1.28 249 0.202 According to the results of table 5, the resulted t is less than the critical value of the table at the error level of 5% and the responsiveness mean is also less than average.
Third Hypothesis: Assurance Table 6. A Comparison between the Assurance Mean and Assumed Mean of 3
Responsiveness
Mean
SD
Standard T Df Sig Error 2.86 0.76 0.05 -2.81 249 0.015 According to the results of table 6, the resulted t is less than the critical value of the table at the error level of 5% and the assurance mean is also less than average.
Fourth Hypothesis: Empathy Table 7. A Comparison between the Empathy Mean and Assumed Mean of 3
Assurance
Mean
SD
Standard T Df Sig Error 2.78 0.87 0.05 -3.97 249 0.021 According to the results of table 7, the resulted t is less than the critical value of the table at the error level of 5% and the empathy mean is also less than average.
Fourth Hypothesis: Tangibles Table 8. A Comparison between the Tangibles Mean and Assumed Mean of 3
Empathy
Mean
SD
Standard T Df Sig Error 3.09 0.72 0.04 2.08 249 0.038 According to the results of table 8, the resulted t is less than the critical value of the table at the error level of 5% and the Tangibles mean has no significant difference with the mean level.
Tangibles
Mean
SD
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Table 9. A Comparison of the Mean of Dimensions and service Quality Indicators
Statistics of Service Quality Scale Indicators Tangibles Reliability Responsiveness Assurance Empathy Sig 0.000 Mean 3.09 2.94 2.93 2.86 2.78 F 13.79 Standard Deviation 0.73 0.73 0.86 0.76 0.87 T2 55.86
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According to the findings of table 9, the resulted f is significant at level of 5%. Therefore, there is difference between the service quality scale indicators. So, among all these factors, the factor of tangibles with a mean of 3.09 plays the most significant role and empathy with the mean of 2.78 plays the less significant role.
Discussion and suggestions: Based on the findings of this study, the difference between the groups is significant at the level of 5% and there is difference between the service quality scale indicators. Moreover, among all these factors, the factor of tangibles with a mean of 3.09 plays the most significant role and empathy with the mean of 2.78 plays the less significant role. So, the students evaluated the educational service quality to be at an average level or less with regard to the dimensions of responsiveness, assurance, reliability and empathy, and to be at an average level or more with regard to the tangibles. So, it can be concluded that the educational experts and directors have to take the required measures in order to improve educational services. To be reliable, the university should design and utilize motivational and involvementbased strategies, such as paying commission on suggestions system expertise and quality improvement teams. To improve the responsiveness aspect of quality of educational services, the measures that can be taken to facilitate appropriate responding to the students include improvement of educational processes and avoiding the repetition and parallel activities, utilizing information system, and designing and performing the motivational strategies. To improve the assurance, the and regulations need to be clarified for the customers and the educational regulations and rules should be submitted to them in a booklet. To improve the empathy in providing services, appropriate strategies have to be designed and revised to evaluate the performance of the personnel, either administrative personnel or faculty members, and to motivate them to take the required measures in order to have a more desirable relationship with the students. Considering the significance of continuous and comprehensive improvement and reconsideration of planning and educational services processes, the process improvement executive system must to design and establish structural principles including the description of duties (steering committee, secretariat and improvement teams) and it should be protected and supported by the senior directors of the university.
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References Baglou, R.; Zomorrodpoush, F. (2009) Specifying the Position of Customers Relationship Management in Libraries and Information Centers, Librarianship & Information Quarterly, No. 47 Buttle, F.(1996) servqual :review, critique, research agenda, European journal of marketing,vol. 30; Cliff, A,(1994) Measuring quality in New Zealand polytechnics, jounal of tertiary education administration, vol. 16, no.1;
Haghighi, M.; Moghimi, M; Keimasi, M. (2003) Service Loyalty: The Effects of Service Quality and the Mediating Role of Customer Satisfaction, Management Science, No. 6061: 53-72 Ranjbarian B.; Rashidkaboli, M.; Haghshenas, A.; Yavari, Z. (2002) The Study of Customer Satisfaction with After-Sale Services Quality; Case Study: Xerox Co. in Isfahan Province, Commercial Research Quarterly, No. 25: pp. 127-145 Samavi, H.; rezaeimoghaddam, K.; Baradarn, M. (2008) Customer-Oriented Activities and Their Application in Higher Education System; Case Study: Higher Education on Agriculture in Khuzestan Province, Research & Planning in Higher Education Quarterly, No. 143: pp. 121-49 Behin Moshaveran Atiyehsaz Modiriyat Co. (2006) Measuring Customers Satisfaction: Viva the Complaining Customer, Behin Moshaveran Atiyehsaz Modiriyat Co. One-Day Conference Report, Tehran, Hotel Venoos Shahriyari, S. (2006) The Effects of Customer Orientation Policies of Agri Bank based on Respect for Customer Plan on customer Satisfaction in Shiraz, MA Thesis, Faculty of Graduate Studies Khorasgan University Mousavi, F.; Rezaeian, S. (2007) The Role of Electronic Customer Relationship (eCRM)in Tourism in Iran, Modiriyat Farda, No. 13-14 Nasehifar, V.; Haghbayan, A. (2009) Payment System Quality in Mellat Insurance Company According to the Customers and Presenting Some Strategies for Improving it for Auto Insurance, Insurance Industry Quarterly, No. 89-90: pp. 23-45 Newman cowling (1996) service quality in retail banking: the experience of two british clearing banks, international journal of bank marketing, vol. 14. no.6; Parasuraman, A.; Zeithaml, V.A. and Berry. L.L(1985), a conceptual model of service quality and its implications for future research, journal of marketing, vol.49, autumn, pp.41-50; Venoos, D.; Madadiyekta, Sh. (2005) The Study of Factors Affecting Customer Satisfaction with Internal Flights of IRI Airline (Homa), Administrative Sciences & Economics: University of Isfahan
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 4 Measuring Customer Satisfaction in Fast Food Industry A Case From Pakistan Fast Food Industry
Usman Asif, Kashif Javed & Wajid Saleem MS-Scholar, Riphah Internationl University, Islamabad Abstract Customer retention is an important element of Fast Food Industry in todays increasingly competitive environment. FFRs management must identify and improve upon factors that can limit customer defection. These include employee performance and professionalism, willingness to solve problems, friendliness, level of knowledge, communication skills, and selling skills, among others. In Pakistan due to the increasing competition among the FFRs (Fast Food Restaurants) customer satisfaction has become a major ingredient to fast food companies for their success and growth. The present study provides the level of customer satisfaction of FFRs operating in Pakistan. To measure the level of customer satisfaction SERVQUAL Model was being adopted and descriptive statistics was used to analyze the data. The results of the study indicate that the customers of FFRs in Pakistan are not much more satisfied with the services provided by these restaurants. Key Words: Fast Food Restaurants Pakistan, Customer Satisfaction, Service Quality, SEVQUAL Model, Introduction One of the rich and exciting and rich experience in Pakistan is eating. There can be found a number of Foods in Pakistan with different styles and tastes with a great number of restaurants in all the major cities of Pakistan. All of them seem to possess about one chef or another, which is superior, but for the majority of us want to get down to eating. More of it, food found in Rawalpindi and other Pakistani restaurants are not restricted to traditional tasted of Pakistani foods. Foods with different tastes from all over the world including Indian, Asian and middle east can be found in Pakistan, Due to the convenient and family oriented styles, fast food chains are rising in popularity in Pakistan of which multinational companies are enhancing their network in Pakistan. In this way competition is rising among the Fast Food Restaurants (FFR). To compete with the competition and to stay in the industry companies are focusing on the customer satisfaction. Today the Fast Food companies have come to know that the organizational success is based on the customer satisfaction and customer satisfaction comes from the service offered by the company. Currently, almost all the FFRs focus on several ways to enhance their service quality in such a way to increase the level of satisfaction in between their customers and therefore to increase their purchase intentions (Qin & Prybutok, 2008; Gillbert, Veloutsou, Goode, & Moutinho, 2004). When FFRs perform equal to their expectations or more than their customer expectations, the customer will be satisfied with the service provided by the firm. For instance, Mostly world wide companies dealing in fast food are working too hard to offer superior and distinctive service to their customers. Therefore, the service quality has to be look into depth, frequently and in a timely manner to obtain an precise current level of service quality in order to in order to enhance the customer satisfaction as well as to persuade the customer purchase
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intentions towards the restaurants (Gilbert et al., 2004). Basically, Customer satisfaction is the individuals perception of the performance of the product or service in relation to his or her expectations. The concept of customer satisfaction is a function of customer expectations. A customer whose experience falls below expectations (e.g. a limited beverage list at an expensive restaurant or cold chicken served by the company) will be dissatisfied. Diners whose experiences match expectations will be satisfied; customers whose expectations are exceeded (e.g. by small samples of delicious food from the Chef served between courses at an expensive restaurant, or a well-designed play area for children at a multinational restaurant) will be very satisfied or delighted. Besides, the degree of satisfaction provided by the goods or services of a firm as measured by the number of repeated customers (Leon & Leslie, 2006). As for many mature industries, high quality service is a cornerstone to every successful company to gain competitive advantage. Intense competition and high quality expectation from consumer have forced fast food industry to transform from a product-centric approach to a customer-centric approach. Fast Food restaurants including McDonalds, KFC and Pizza Hut are undergoing remarkable transformations and are experiencing sharp competition in Malaysia (Yap & Kew, 2007). Kuang, and Chung (2000) explained in their study that FFRs are shifting from conventional methods and standards to a more or less sophisticated operations and styles of services. Flexibility and comfort at FFRs are to be provided to customers at more reasonable prices. Different customers satisfaction in terms of tastes, drives, and upbringing are met; customer satisfaction is the fundamental to all service-oriented establishments. Therefore, customers support and satisfaction are attributed for the existences and growing of FFRs. As a result, understanding each customers distinct needs and recent service quality level are essential for FFRs to maintain and expand their market in this aggressive competitive environment. The rationale of the study is that a little work has been done in FFRs especially in Pakistan Fast Food Restaurants. The objectives of the study are given as below: To find the relationship between Service attributes to customer satisfaction. To find the impact of Tangibility on Customer Satisfaction To find the impact of Reliability on customer satisfaction To find the impact of Responsiveness, Assurance and Empathy on customer satisfaction
Literature Review:
The purpose of this study is to identify the key determinants of customer satisfaction in those fast food outlets as well as the current perceived service quality level amongst existing customers of FFR in the major cities of Pakistan.
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Service Quality Concept:
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Gronroos (2000, p.46) defined service as, A service is a process consisting of a series of more or less intangible activities that normally, but not necessarily always, take place in interactions between the customer and service employees and/or physical resources or goods and/or systems of the service provider, which are provided as solutions to customer problems. Fogli (2006, p.4) define service quality as a global judgment or attitude relating to a particular service; the customers overall impression of the relative inferiority or superiority of the organization and its services. Service quality is a cognitive judgment. Service quality is not that easy to define. In this study, it is the evaluation of customer satisfaction in the service industry. Most experts agree that customer satisfaction is a short-term, transaction-specific measure, whereas service quality is an attitude formed by long-term, overall evaluation of performance (Hoffman & Bateson, 2006:333). Gronroos (2000:63) states that it is better to talk about quality without defining it. In service quality literature the quality of a particular product or service is whatever the customer perceives it to be Parasuraman, Zeithaml and Berry (1988: 12-40) define service quality as the result of an evaluation process in which customers compare their perceptions of the service with their expectations. Zeithaml, Bitner and Gremler (2006:116) state that consumers judge the quality of services based on their perceptions of the technical outcome provided, the process by which that outcome was delivered, and the quality of the physical surroundings where the service is delivered. Service Quality across the Globe 1 1982 Gronroos Suggest three dimensions of service quality: technical quality; functional quality; corporate image 2 1982 Lehthinen and Lehthinen Identified three dimensions of service quality: physical quality; corporate quality and interactive quality 3 4 5 1984 Gronroos 1985 Parsuraman et al 1988 Parsuraman et al Refined their previous work into three dimensions of service quality Identified ten dimensions of service quality Refined their previous work and explored five dimensions of quality: reliability; responsiveness; empathy;
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assurance; empathy
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6 7
1990 Gronroos 1991 Parsuraman et al
Gronroos Explored six dimensions of service quality Refined five dimensions of service quality and devised the final version of SERVQUAL (replicate in three service industries . FFRing telephone repairing and insurance)
8 9
1992 Cronin and Taylor 1994 Avkiran
Developed SERVPERF to compare with SERVQUAL Developed four factor scale that consists of seventeen items to measure Service quality
10 11 12 13
1995 Johnston 2000 Oppewal and Vriens 2000 Bahia and Nantel 2002 Sureshchander et al.
Identified eighteen dimensions of service quality Explored twenty eight attributes to measure service quality Developed six dimensions of service quality contained thirty one items Developed five dimensions of service quality that consists of forty one item scale
14
2005 Malhotra et al.
Used 10 dimensions to measure service quality
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Customer satisfaction
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A variety of alternative definitions exist. The most popular one of customer satisfaction is that it is a comparison of customer expectations with perceptions regarding the actual service encounter (Hoffman & Bateson, 2006:304). After consumers have ordered and eaten their meal, they can evaluate the outcomes of their choice. If their evaluations are positive (their needs or goals have been met) they feel satisfied.. When consumers have a negative evaluation of an outcome, they feel dissatisfied (Hoyer & Maclnnis, 2004:280) Customer Satisfaction across the Globe 1 1980 Oliver when the customers compare their perceptions of actual products/services performance with the expectations, then the feelings of satisfaction have arisen 2 1982 Surprenant and Churchill, It serves to link processes culminating purchase and consumption with post purchase phenomena such as attitude change, repeat purchase 3 1983 LaBarbera and Mazursky 4 5 6 7 8 1988 1990 1991 1992 1992 Parasuraman et al. Bitner Bolton and Drew Leeds Fornell Post purchase evaluation. Cited Olivers (1981) definition: An evaluation of the surprise inherent in a product acquisition and/or consumption experience Customer satisfaction is related to a specific transaction and it depends on the service offered. customer satisfaction is the antecedent of service quality customer satisfaction is the antecedent of service quality Quality of service depends heavily on the quality of its personnel that leads to customer satisfaction. customer satisfaction and quality appear to be important for all firms, satisfaction is more important for loyalty especially for service firms 9 1996 Reichheld Customer satisfaction is not the reciprocal of Customer
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dissatisfaction. 10 1994 Storbacka et al.
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Customer Satisfaction depends on various factors such as , greater convenience, better prices, and enhanced income.
11 12
2001 2005
Lai Arasli et al.
Found that assurance, empathy and tangibles are the important factor for customer satisfaction Pointed out that reliability dimension of SERVQUAL has the highest impact on customer satisfaction. whereas reliability is not related to customer satisfaction
13 14 15 16 17
2007 2007 2010 2010 2010
Baumann et al. Mengi Kumar et al. Zaim et al. Yee et al.
Found that tangibles are not related to customer satisfaction Assurance, empathy and tangibles are the important factor for customer satisfaction. Found that assurance, empathy and tangibles are the important factor service quality has a positive influence on customer satisfaction Found that service quality has a positive influence on customer satisfaction
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2010
Ahmed et al.
Find out that empathy is negatively related to customer satisfaction
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The SERVQUAL dimensions
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Dimensions Reliability
Description Restaurant services are willing to perform the service dependably and accurately as promised.
Responsiveness Restaurant services are willing to help customers and solve their problems effectively. Assurance Empathy Tangibility Restaurant service should be knowledgeable, to help customers and offer friendliness and courteous service. Restaurant service should understand customers needs and have customers best interests at heart. Restaurant service must provide an attractive, comfortable environment, physical facilities and neat appearance of employees. Source Adapted from Parasuraman et al (1988:12-40)
Methodology The Subjects of the study are the customers of Fast Food Restaurants and the Fast Food Restaurants Service Quality unit. The Population was the customers of FFRs in Pakistan where as the customers of FFRs in Rawalpindi, Faisalabad and Sargodha are the sampling frame. A nonprobability sampling design, convenience sampling method was being opted and it was considered to be more appropriate to gather the data in the area. The convenience sampling was being used because respondent was easily accessible, their availability, and required less time and inexpensive method to gather the data. Bickle, R., & Papaginnis, G. (2001) stated that the major advantage of non-probability samples is that they are less complicated and more Economical than probability samples. Furthermore, A quantitative methodology was used to assess the perception of the customer and the service they are getting. The instruments used to gather the data was questionnaires. The structure of the questionnaires was both closed ended ranking scale of 1-5 i.e. from strongly Disagree to Strongly Agree. The researchers involvement up to some extent was useful to meet the objectives of the desired study. The Questionnaire was divided into two sections. 1. Demographic of the Respondent
2. The last section dealt with the respondents satisfaction levels. Statistical software will be used to analyze the data set. A frequency distribution was used to describe the sample. The mean and standard deviations of the attributes will also be computed.
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A total of 22 attributes were categorized under five dimensions in this section are as follows: Tangibility (4 attributes) Reliability (5 attributes) Responsiveness (4 attributes) Assurance (4 attributes) Empathy (5 attributes)
FINDINGS: Findings of Descriptive Statistics 100 questionnaires were distributed among the selected sample to collect data of which only 81 were collected back. The Response rate is 81%, which is quite reasonable for data analysis. The gender-composition was 62 male (76%) and only 19 females (24%) respectively of total 81 respondents. The reason behind less numbers of female respondents was that in Pakistani cultural females are either was not willing to give response or not visiting the FFR more frequently than Males. As Obbe, 1980 explained that Men fulfill the necessities or responsible for outside the home and females prefers to perform domestic-duties inside the house. As per Qualification of the customers, majority of the respondent 60 (51 males and 9 females) were Below Bachelor, 10 of them (5 males and 5 females) has Bachelor Degree and other remaining respondents (Males 6 and Females 4) were holding Master or higher education as shown in Table-B. As per division of respondents according to the age 30 respondents persons (males 25 and 5 females) lies in age group of 18-22, 38 including 28 males and 3 females lies in the age group of 23-28 and 16 respondents (Males 6 and females 10) lies in age group of 29-34and only 4 respondents (3 males and 1 females) belongs to the age group of 35 & above. The marital status of the respondents was as 60 respondents (Males 52, Females 6) were unmarried. Remaining of the respondents (Males 10 & females 13) was married and most of them were females. The results shows that the trends of unmarried customers towards the FFR are higher than Married customers and married females are more likely to go to FFR than unmarried females The geographical trend of respondents living in Rawalpindi is higher than other Cities under study. 36 respondents were from Rawalpindi and 26, 19 from Faisalabad and Sargodha respectively. Results of Reliability and Validity of Data Cronbachs alpha for instrument used for the study (22 items) was 0.819. The Cronbachs alpha for individual variables of Tangibility (0.836); Reliability (0.759); Responsiveness (0.753); Assurance (0.860); and Empathy (0.693) were found to be within limits for further analysis as greater then Rule of Thumb (0.7).
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Table A
Reliability Statistics
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Cronbach's Alpha .819
N of Items 22
Results of variability (Deviation)
Table-B is showing the descriptive-statistics for the service quality of Fast Food Restaurants in Pakistan and its further dimensions. The results shows Fast Food Restaurants Service quality score are not more deviate, so we can conclude that Fast Food Restaurants Consumers are satisfied from the services provided by the Fast Food Restaurants. TABLE B
Descriptive Statistics
N Tangibility Reliability Responsivene ss Assurance Empathy Valid N (listwise) 81 81 81 81 81 81
Minimu Maximu m m Mean 1.75 1.60 1.75 2.50 2.00 5.00 5.00 5.00 5.00 5.00
Std. Deviation
3.7901 .85005 4.4444 .73007 3.4259 .96294 4.4815 .79822 3.7407 .74796
Analyses of Customers Satisfactions
The intention of this study is analyzing customers satisfaction was to find/confirm the results of low or high service quality level & the degree of satisfaction or dissatisfaction. The respondents (Fast Food Restaurants customers) were asked to rate their level of satisfaction according from 1 to 5 where 1 = Strongly Disagree, 2 = disagree, 3 = neutral, 4 = agree and 5 = Strongly Agree based on their level of satisfaction. The table
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illustrated below shows that the mean for overall customers satisfaction was 3.9765. This indicates that customers were agree/satisfied with the service provided by Fast Food Restaurants (Pakistan).
Descriptive Statistics
N All3 Valid N (listwise) 81 81
Minimum 2.50
Maximum Mean 4.96 3.9765
Std. Deviation .49858
LIMITATIONS AND FUTURE RESEARCH:
The major limitation to this is that the present study was being carried out only three cities of Pakistan and results were generalized to all the other cities of Pakistan. So in future it is proposed that the present study is to be done in other cities and results are to be compared with the present study. Other limitation to the study is that the present study only shows the overall satisfaction level of the customers and in future by applying other statistical tools customer satisfaction is to be measured. The data is to be gathered by using some of probability sampling techniques.
CONCLUSION AND IMPLICATION:
This study builds and find / examines the level of service-quality of Pakistan Fast Food Restaurants (FFR) from customer's perspective. Customers perception is always very important weather it relates to any industry, but in Fast Food Restaurants Customers involvement is very high in the delivery of quality services. As FFR to gain maximum share in competitive market so they have need of to pay attention towards the services they are offering that leads to customer satisfaction. In Pakistan, Customers are looking satisfied from the quality of services, but restaurants shouldnt be happy as this study attributes had negatives aspects & scores as well from some consumers. Fast Food Restaurants should care of this and need to improve their services that ultimately work to make their customers happier than as before
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In the era of competition FFRs Management should work for quality push & should measure the performance of their employees, so customer response can be find to become a globally competent as response leads to perception then satisfaction, These measures / actions and changes may be expensive in terms of employee time, resources and effort, but FFRs needs to find-ways to overcome these types of hurdles, otherwise they can lost their existing market share due to increasing competition from National / international FFRs.
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References:
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Adele Berndt., Investigating Service Quality Dimensions in South African Motor Vehicle Servicing, African Journal of Marketing Management, Vol. 1(1) pp. 001-009 April, 2009. Ahmad, A., Afzal-Humayoun, A., Ul-Hassan, (2010), An Analysis of Functions Performed by Islamic Bank: A Case of Pakistan. European Journal of Social Sciences Volume 17,Number 1 (2010). Ahmad, A., Rehman, K., Saif, M. I. & Safwan, M.N.(2010). An Empirical Investigation of Islamic Banking in Pakistan based on Perception of Service Quality, African Journal of Business Management, 4 (6), 1185-1193.American Marketing Association, Committee of Definitions 1960, p. 21 Arasli H., Mehtap-Smadi S., and Katircioglu S. T.,, 2005, Customer Service Quality in the Greek Cypriot Banking Industry. Managing Service Quality. Vol. 15 No. 1. pp 41-576 Asia Market Information & Development Company. Chinese Markets for Fast Food,2007, available at http://www.marketresearch.com/map/prod/1545057.html, retrieved on 08/22/08. Baumann, C.; Burton, S.; Elliott, G.; and Kehr, H. (2007) Prediction of attitude and behavioural intentions in retail banking. The International Journal of Bank Marketing. 25(2), 102-116 Buttle, F. 1996. SERVQUAL: Review, critique, research agenda. European Journal of Marketing. 30(1): 832. Caruana A (2002). Service loyalty: the effect of service quality and mediating role of customer satisfaction, European. J. Mark, 36(7/8): 811-28. Cronin, J. J., & Taylor, S. A. (1992). Measuring Service Quality: A Reexamination and Extension. Journal of Marketing, 56(3), 55-68. Food and Nutrition Technical Assistance Project (FANTA). Sampling Guide. Washington, DC: Robert Magnani. Furer, O., Ching-Liu, BS., Sudharshan, D. (2002). The relationship between culture and service quality perceptions, Journal of Service Res, 2(4): 355-70. Galloway L, Ho S (1996). The model of service quality for training, Training for Quality, 4(1): 20-26. Gronroos C (1982). Strategic Management and Marketing in the Service Sector, Swedish School of Economics and Business Administration, Helsingfors Gronroos, C. (2000) Service Management and Marketing: A Customer Relationship Management Approach. 2nd ed. West Sussex: John Wiley & Sons, Ltd. Fogli, L. (2006) Customer Service Delivery. San Francisco: Jossey-Bass Hanson W (2000). Principles of Internet Marketing, Cincinnati, Ohio: South-Western. Hoffman KD, Bateson JE (2002). Essentials of Services Marketing: Concepts, Strategies, and Cases, 2nd ed. Harcourt College Publishers. Hull, L. (2002). Foreign-Owned Banks: Implications for New Zealands Financial Stability, Discussion Paper Series, DP 2002/05. Johnston R (1997). Identifying the critical determinants of service quality in retail banking: importance and effect. Inter. J. Bank Mark, 15(4): 111116. Leeds B (1992). Mystery Shopping Offers Clues to Quality Service, Bank Mark, 24(11): 2427.
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Lehtinen U, Lehtinen JR (1982). Service Quality: A Study of Quality Dimensions, Service Management Institute, Helsinki Morre CD (1987). Outclass the Competition with Service Distinction, Mortgage Bank,pp. 1147. Oliver, Richard L. A cognitive model of the antecedents and consequences of satisfaction decisions. Journal of Marketing Research, Vol.17, pp.460-469 -1980 Oliver, Richard L. Whence consumer loyalty?. Journal of Marketing, Vol.63, Special Issue 1999, pp.33-44 (1999) Parasuraman A, Berry LL, Zeithaml VA (1991b). Understanding customer expectations of service, Sloan Manage Rev., 39: 39-48. Parasuraman A, Zeithaml VA, Berry L (1988). SERVQUAL: a multipleitem scale for measuring customer perceptions of service quality. J. Retailing, 64: 12-40. Parasuraman A, Zeithaml VA, Berry L (1991a). Refinement and reassessment of the SERVQUAL scale, J. Retailing, 67(4): 42-50. Parasuraman, A., Berry, Leonard L. and Zeithaml, Valarie A. A conceptual model of service quality and its implications for future research. Journal of Marketing, Vol.49, pp.41-50 (1985) Quinn, J.B., Baruch, J.J. and Paquette, P.C. (1987). Technology in services, Scientific American, 257 (6):50-58. Spreng RA, Mackoy RD (1996), An empirical examination of a model of perceived service quality and satisfaction. J. Retailing, 72: 201214. State Bank of Pakistan (2010), Islamic Banking Bulletin, April - June 2010. Sureshchander, G.S., Rajendran, C. and Anatharaman, R.N. (2002), The relationship between service quality and customer satisfaction: a factor specific approach, Journal of Services Marketing, Vol. 16 No. 4, pp. 363-79 Zeithmal VA, Parasuraman A, Malhotra A (2000). Service quality delivery through websites: a critical review of extant knowledge. J. Acad Mark Sci, 30(4): 362-37
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BRAND TRUST: A TRUE GESTALT OF UNETHICAL ADVERTISEMENT AND BRAND POSITIONING IN CONSERVATIVE ECONOMIES Amer Rajput 1,*, Abdul Hamid Abu Bakar2, Muhammad Amir Rashid3
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Assistant Professor, COMSATS Institute of Information Technology, Wah Campus (Pakistan) PhD Student, Department of Management, Faculty of Management and Human Resource Development, Universiti Teknologi Malaysia, 81310 UTM Skudai, Johor, (Malaysia) *Corresponding Author
2
Associate Professor, Department of Management, Faculty of Management and Human Resource Development, Universiti Teknologi Malaysia, 81310 UTM Skudai, Johor, (Malaysia)
3
Assistant Professor, COMSATS Institute of Information Technology, Sahiwal, (Pakistan) PhD Scholar, Department of Management and Human Resource Development, Universiti Teknologi Malaysia, 81310 UTM Skudai, Johor, (Malaysia)
ABSTRACT
Advertising campaigns assist to devise brand awareness as well as to frame a well-liked brand image. This study investigated the relationship between unethical advertising and brand positioning as well as with the moderating role of brand trust in an Islamic country. The measurement instrument of the study required consumer survey. It was concluded that the unethical advertisement was the strongest predictor of brand positioning. Moreover, brand trust diminished the effect of unethical ad on brand positioning.
Keywords: Advertising; unethical advertising; brand trust; brand positioning; Pakistan 1. INTRODUCTION
Enormous quantity of advertising is capitalized to initiate brand inclination, loyalty, and awareness. Brand trust is the promise that a brand makes with its customers. It is a key element for consumer purchase intention and long term relationship with the organization. It generates customer loyalty during in high competitive market. However, a single unethical advertisement causes a possibility of disastrous effect for brand image as well as brand positioning. An unethical ad can cause a disastrous effect on the brand image and possibly ruins the brand positioning. Repetitive exposure of the ad to consumers sabotages repute of company, brand, and advertiser. It means ethics and social responsibility are sensitive issues of todays marketing in context of advertising in any country and particularly in conservative economy of an Islamic country. Recently, there are some precedents of
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unethical advertisements in Pakistan for which customers showed incensement. Pakistan possesses a high context culture with high legal bounds; religion is exercised as a base of reference for every avocation. Positioning of a brand is the distinctive place of the brand in consumers mind. Ries & Trout (2000) revived the concept of positioning. They justified brand as a perception in mind of customer; moreover, each brand is positioned to a specific segment. Brand is composed of five factors: brand attributes; consumer expectations; competitor attributes; price; and consumer perception (Keller, 2008). Three categories of positioning are documented in literature: functional; symbolic; and experiential (Solomon, 2009). Brand trust is a promise that a brand makes with customers. It is a feature like reliability, durability, quality that firm offers to customer. Brand trust is a key element for consumer purchase intention and long term relationship with the firm. It accommodates customers to be brand loyal. Furthermore, firms emphasize on building brand trust not only to maintain its existing customers but to capture new customers and markets (Keller, 2008).
2. LITERATURE REVIEW
A considerable amount of literature has been published on advertising. These studies alight ethical issues such as: ethicality of political attack advertisement; sexual appeals utilization; fear appeals; and lottery advertising (Dean, 2005). A growing body of literature is available about unethical advertising (Colford, 1991; Krugman, 1994; LaTour & Henthorne, 1994). In response to competitive pressure, advertisers often use sexual appeals as a creative way to capture the consumers attention (Ford & LaTour, 1993). The anticipation of uncertain outcomes would lead to better understanding for avoiding unethical advertisements (Arrington, 1982). Ethics and moralizing are vividly differentiated; ethics deal with creating frameworks that people might find appealing as tools to grasp and be in control of moral questions that make them uncertain (Millar & Choi, 2003). Many annotators argue that unethical advertising is bruising society. For example Marriott (1992) argued that advertising of lotteries furnished two negative impacts on society such as gambling and mental disorders. Carson et al. (1985) pointed out deceptive advertising as morally objectionable and unethical. However, the habit of thinking within ethical limits would assure more freedom of action and a greater social responsibility (Arruda & Arruda, 1999). Clear and simple message should be communicated (Trout, 1996) and positioning decision for entering a new market is very critical for a firm (Dolan, 1993; Kotler, 1999; Tyagi, 2000; Urban & Hauser, 1993; Wind, 1982). Contemporary cultural differences challenge academicians and practitioners for understandings of consumers interpretations of brands and advertising (Kates & Goh, 2003). Marketing communications are processed culturally by consumers (Hirschman & Thompson, 1997; Kates & Shaw-Garlock, 1999; McCracken, 1986; Mick & Buhl, 1992; Ritson & Elliot, 1999). Consumers interpret differently about marketing communications from what sponsors intend to communicate. Moreover, consumers make up several meanings due to their background, social variables, contexts of consumption, and frames of references (Kates & Goh, 2003). Relationship marketing emphasized role of trust in fostering relationships (Sirdeshmukh, Singh, & Sabol, 2002). There is a dearth of research in context of unethical advertising in conservative economies. There are few investigations which have focused the consequences of perceived trusts outcomes as loyalty and cooperation (Garbarino &
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Johnson, 1999). To compensate the research gap this study addresses the research question; what are the factors of unethical advertising that spoil the brand positioning in a conservative economy?
3. THEORETICAL RESEARCH FRAMEWORK
The framework of this study encompasses three constructs: unethical advertising, brand positioning, and brand trust. Brand trust as a moderator variable is integrated to model the relationship of unethical advertising and brand positioning.
3.1 UNETHICAL ADVERTISING
The generalisability of much published research on the issue of ethicality in advertising is problematic; moreover, there is no general agreement about what is ethical and what is not ethical. Advertising is not characterized as demonstrating undue honesty and truthfulness (Frenkel & Lurie, 2001). Moreover, unethical advertising is measured with four sub-constructs: belief system, moral values, religious issues, and cultural impact.
3.1.1 BELIEF SYSTEM
Consumers judge ads using belief systems, pragmatism, and relativism. The belief system corresponds that actions are judged upon intrinsic right or wrong; however, actions are not justified by consequences of proceedings. Therefore, advertising should be truthful, fair, not targeted at children and poor (Thompson, 2002).
3.1.2 MORAL VALUES
Moral values concerned to perform special conception of obligation. Ethical conceptions are embedded in particular cultural form. Moral values are essential to the promises offered in communication by marketer to consumer (Vitell et al., 2003).
3.1.3 RELIGIOUS ISSUES
Religion is of supreme importance to marketers in conservative economies. These issues must be felt with special care and should not be dealt in ways that can disturb brand positioning. Religion has the basic importance in Islamic country like Pakistan. The ethical issues are of primary importance particularly related to religious beliefs (Vitell, et al., 2003).
3.1.4 CULTURAL IMPACT
Perception and thinking of individuals in some societies is more concerned with personal goals; however, some are more interested in collective interests according to a concept entitled a perceived ethical problem (Solomon, 2009).
3.2 BRAND POSITIONING
Huge amount is spent on advertising. It is used to create brand awareness, preference, and loyalty. This is done to communicate brands positioning. Advertising campaigns are launched to create brand awareness and brand image (Kotler & Armstrong, 2006).
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3.3 BRAND TRUST
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Brand trust is a promise of brand to customers. It is possibly: reliability; durability; and quality. Because brand trust is a key element for consumer purchase intention and it generates long term relationship with an organization. It helps the customer to be loyal with the brand of the company during rigorous competition; therefore, a firm should . (Keller, 2008)emphasize brand trust to incarcerate new customer and new market However, sex appeal and political advertising constructs are not incorporated in this study because both of these factors are not being utilized by advertisers in Pakistani culture. To compensate the research gap a theoretical research framework (see Fig. 1) is proposed as well as two hypotheses are postulated to test the relationships among variables empirically.
Brand Trust
Unethical Advertising
Brand Positioning
Figure 1: Theoretical research framework 3.4 HYPOTHESES H1: There is no relationship between unethical advertising and brand positioning. H2: Brand trust does not affect the relationship of unethical advertising and brand positioning. 4. METHODOLOGY
Research design of this was quantitative and mainly correlation. Survey research method was used to collect the data. A self-completion questionnaire was designed from previous studies. All the constructs were formed as reflective measures. Likert scale was used to measure the positive and negative responses of the customers for each item. All items were measured on 5-point scale; 1= strongly disagree, 3= neutral, and 5= strongly agree. Unethical advertising was measured with four sub-constructs: belief system with two items; moral values with two item; religious issues with two items; and cultural impact with two items. Brand positioning was measured with three items; furthermore, brand trust was measured with four items. The measurement instrument of the study required a consumer survey. The consumer survey relied on a self-administered questionnaire to consumers of telecom, shoes and, beverages brands in Pakistan. Convenience sample was used for this study with sample size of 300 respondents at a response rate of 88%.
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5. RESULTS AND DISCUSSION
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There were 263 respondents who agreed to the statement that blend of advertising with religious values of a region would create a strong brand positioning (Mean=2.50). The mean values tend towards agreeableness of the variables (see Table 1). Moral issues vary across borders and ignorance of moral issues create a negative impact on brand positioning; therefore, it indicated a mean of agreeableness of the respondents (Mean=2.41).
Table 1. Descriptive statistics for variables Mean 2.42 2.19 2.22 2.41 2.50 Std. Deviation .67 .70 .88 .88 1.11 N 263 263 263 263 263
Brand Positioning Belief System Culture Impact Moral Issues Religious Issues
The respondents agreed with the statement that cultural impact had a powerful indication of brand positioning (Mean=2.22). Belief system helped in creating brand positioning and had a positive impact; moreover, respondents agreed with the statement (Mean=2.19). There was a positive correlation of brand positioning with belief system, cultural impact, moral issues, and religious issues. It illustrated that all independent variables had a positive impact on brand positioning (see Table 2).
Table 2. Correlations among variables
Variables Belief System Cultural Impact Moral Issues Religious Issues *p<.000 Brand Positioning (r) .262* .394* .258* .292*
Cultural impact had a positive strong correlation with brand positioning(r = 0.39) as compared to other variables. The model summary showed that there was 22.2 % relationship of brand positioning with belief system, cultural impact, religious issues and moral issues at a significance level of 0.00 (see Table 3). F-statistics (18.38) also showed that the model was best fit to measure the relationship of brand positioning with unethical advertising. Therefore, H1 cannot be accepted. It is concluded that there exists a relationship between brand positioning and unethical advertising.
Table 3. Model summary
R 0.47 R2 0.22 Adjusted R2 0.21
Cultural impact had a very strong impact on brand positioning as indicated by tvalues (4.49) at a significance level of 0.000 (see Table 4). Therefore, cultural impact
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was a powerful indicator of brand positioning. An unethical advertisement would damage the brand positioning. Religious issues had effect on brand positioning; the tvalue 2.73 showed that ignorance of moral issues created negative impact on brand positioning. It was exact because unethical according to moral issues of a culture was harmful for brand positioning.
Table 4. Coefficients of variables
Beta 0.10 0.27 0.15 0.16 t 1.85 4.49 2.63 2.73 Sig. 0.06 0.00 0.00 0.00
Belief System Cultural Impact Moral Issues Religious Issues
Descriptive statistics of variables are presented in Table 5. Survey showed the mean of unethical ad was 2.30; indicated that consumers accepted unethical ad that created a negative word of mouth about the brand. Brand trust (Mean 2.31) exhibits that consumers trusted the brands upon quality, reliability, and positive word of mouth. Brand positioning (Mean 2.42) proved the existence of positioning.
Table 5. Descriptive statistics

Unethical Ad Brand Trust Brand Positioning N 263 263 263 Mean 2.30 2.31 2.42 Std. Deviation .569 .716 .674
Correlations among the variables are presented in Table 6. There was a positive correlation (0.52) between brand positioning and unethical ad. When an unethical ad was presented to the customers it captured the attention of customers and brand positioning was disturbed. The value 0.52 supported that unethical ad had a positive relationship with brand positioning. Brand trust also affected the brand positioning (0.27) showing the relationship between the variables.
Table 6. Correlation of variables
Unethical Ad Brand Trust Brand Positioning (r) 0.520**
0.276** ** Correlation is significant at the 0.01 level
5.1 RESULTS OF MODERATOR REGRESSION ANALYSIS
Firstly, the results are presented for moderation regression analysis of unethical ad with brand positioning in step 1 (see Table 7). Secondly, brand trust as a moderator on relationship of unethical ad and brand positioning was presented. The result showed that
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unethical ad and brand positioning yielded the beta value of 0.52 at 0.00 significant level; the beta value is 0.456 when brand trust taken as a moderator upon unethical ad and brand positioning at a significance level of 0.00.
Table 7. Moderator regression analysis
Predictor Beta Moderator Analysis Step 1 Unethical Ad Brand Positioning Step 2 Unethical Ad X Brand Trust *P< 0.00 0.52* 0.456* Brand Positioning Adjusted R2 0.27 0.21
From the above results it was concluded that unethical ad significantly related to brand positioning. It had a significant positive effect in determining brand positioning which did not support H1.The results did not support H2; therefore, brand trust affected the relationship of unethical ad and brand positioning. The results also partially supported the moderation effect of brand trust on relationship of unethical ad with brand positioning. Finally the results did not support hypotheses H1 and H2.
6. CONCLUSION
Strong evidence of relationship between unethical advertising and brand positioning were found. This study showed that there was a positive relationship of brand positioning with belief system, cultural impact, moral issues and religious issues. The strongest predictor among the variables was cultural impact on brand positioning. Irrefutably, unethical ad is the strongest predictor of brand positioning in telecom, shoes and beverage industry in an Islamic country. Moreover, brand trust decreased the effect of unethical ad on brand positioning. Unethical ad occupied a place in consumers minds which led to disturbance of brand positioning. Brand trust also played its role in minimizing the effect of unethical ad upon brand positioning. The future research can be conducted to investigate the effects of unethical ad upon brand loyalty and its relationship with brand equity.
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COMPARING THE IMPACT OF FINANCIAL AND NON-FINANCIAL REWARDS TOWARDS ORGANIZATIONAL MOTIVATION
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Rosliza Md Zani1, Nazahah Abd Rahim1, Sutina Junos1, Shuhaimi Samanol2, Sarah Sabir Ahmad1, Farah Merican Isahak Merican1, Shakirah Mohd Saad1, Intan Nazrenee Ahmad1
1
Faculty of Business Management, Universiti Teknologi MARA Kedah, P.O. Box 187, Sg. Petani, Kedah, Malaysia
Faculty of Mechanical Engineering, Politeknik Seberang Perai, Penang, Malaysia
ABSTRACT The main aim of this paper is to investigate the relationship of the two types of rewards namely financial rewards and non-financial rewards towards employees motivation. Based on past literature, it is found that financial rewards or money has become the main motivator for employees performance in organizations. Traditionally, little thought has been given to the impact of non-financial rewards as it does not hold any immediate monetary value to the employees. However, in the context of heightened awareness among employers and employees, there has been greater emphasis on non-financial rewards such as praise and recognition as it holds a deep and greater impact to the employees especially in the long run. This paper defines the nature of financial and non-financial rewards and discusses the impact on employees motivation. By undertaking a comparison between the financial and non-financial rewards, this paper identifies the differential nature of the rewards and discusses some of their consequences. The outcome of this paper provides vital information for organizations to structure a better rewards plan for their employees. Keywords: Rewards, Motivation, Organization, Employee 1. Introduction Motivation is a central element in a learning process of a human. In the organizational context, motivation plays an important role in ensuring organizational success as humans are the heart of an organization. Humans or employees without motivation are not able to carry out the job perfectly. If the organization is not able to motivate its employees, the knowledge within the organization is not efficiently used. Therefore, it becomes the aim of every organization to search for the clues to motivate employees; otherwise the organization will face difficulty to maintain its workforce thus achieving the goal. How to motivate employees? This is the question most organizations are asking themselves. Is money the best way to motivate these people? If employees are asked to choose between money and enjoyment of work, what would be their choice? Currently, many organizations are implementing reward programmes. Large amount of money are being spent in these programmes. Reason being, these types of incentives or rewards will increase employees motivation, will also make them stay longer in the organizations. However, will money really make things work? Motivating employees using pay-for-performance is a long-established management practice. It is expected to boost employees effort as well as performance. Expectancy theory by Victor Vroom in 1964 clearly stated that employees effort is increased when rewards are offered. On the other hand, there were also literatures that did not support what Vroom had found. The first evidence that employees are not motivated by money was found by Elton Mayo in his research known as the Hawthorne studies. The result found that human relations and understanding attitudes were more
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VOL 3, NO 4 motivating than money. Employees seek attention from managers and this will make them becoming loyal employees. This paper seeks to understand the nature of financial and non-financial rewards and comparison is made on the effect of these rewards in relation to employees motivation in an organization. By understanding the nature of these two types of reward and their consequences on motivation, managers can make good decisions in motivating employees in their organization. 2. Definitions 2.1 Financial Incentives Money is the most powerful and influential incentive in the society and always used to motivate employees in organizations. According to Llewellyn, Eden and Lay (1999), financial incentives may take in the form of direct monetary gain such as personal income and income to spend. Mathauer and Imhoff (2006) also agreed that financial incentive is a transfer of monetary values or equivalents such as allowances, salary increases and bonuses. They also included the basic salary, allowance scheme, health insurance premiums and housing allowance as the financial incentives. 2.2 Non-Financial Incentives Non-financial incentives are the ones that involve no direct transfers of monetary values or equivalents such as holidays, token awards or recreational activities and recognition from superior (Mathauer and Imhoff, 2006). Llewellyn, Eden and Lay (1999), in their study on incentives in health care industries defined non-financial incentives or they call it as professional incentives are status , congeniality of work, career progression and health care benefits offered to employees. Manolopoulos (2008) stated that there are two types of motivators (incentives) that will influence employees motivation at work: extrinsic and intrinsic. Non-financial incentives or intrinsic motivation are the factors such as opportunities for creativity, opportunity to use initiatives and the perception of work importance in the outside world. In other words, intrinsic or non-financial incentives are the ones that are not involving money and it is about the job itself that motivates people to work. The example of non-financial motivations or incentives, as mentioned by Woodruffe (2006) are: Advancement Autonomy Civilised treatment Employer commitment Environment Exposure to senior people Praise is awarded when praise is due Support is available The feeling of being trusted The feeling of working for good and reliable organization
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The feeling of working on useful assignments 2.3 Motivation
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Motivation is what moves us from boredom to interest (Islam and Ismail, 2008). According to them, the word motivation comes from the word movere which means to move. Bartol and Martin (1998) defined motivation as a force that energize behavior, direct someones behavior and underlines the tendency to persist. Motivation is as important aspect of leading function of a manager. In order to lead employees to work, managers must be able to motivate them. Robbins and Judge (2009) in the book Organizational Behavior defined motivation as the processes that account for an individuals intensity, direction, and persistence of effort toward any goal (in this context it refers to an organizational goal). 3. The Impact of Financial Incentives on Motivation Does money motivate? Definitely the answer would be yes to most of us. Money is the best motivator as said by Frederick Taylor in his theory. Money, or also called as the financial incentive is the strongest influence in motivating employees at work. Money helps employees to survive and thus making it as the main aim for people to work. Pay is not a motivator. Surprisingly that was the declaration made by Edward Deming. Definitely money buys the things people want, but is not the one that make people motivated to work. There is no support that says paying people more will encourage them to do better work, especially in the long run. Often studies have found that money and performance or motivation only have slight correlations. In other words, higher pay does not produce better performance (Kohn, 1993). This is supported by Turner (2006) that the use of financial incentives did not produce any improvement in employees performance. Turner (2006) in his study on factory workers found that the relationship between financial incentives and performance was not significant, however when the same study was conducted on service businesses, the finding turned out to be significant and positive. Darmon (1974) in his study on salesmen has provided evidence that financial incentives do have some effect on human behavior. Kontodimopoulos, Paleologou and Niakas (2009) focused on health care professionals to examine their motivating factors; financial or non-financial incentives. They found that remuneration, which is the financial incentive, was the strongest motivating factor, but only to professionals in managerial positions. However, extreme focus on financial incentives in public sector could make employees think that money is more important than others, and only work to get money. Manolopoulos (2008) in his study focusing on public sector in Greek, comparing extrinsic reward (money) and intrinsic reward (praise) found that extrinsic ones were more motivating than intrinsic rewards. Employees dont think what is important in their work, but what is important to make them work, and money answers all. A research conducted in 1992 where employees were asked to rank the factors that motivate them the most revealed that money was the best motivating factor (Islam and Ismail, 2008), contradict with the survey results in 1946, 1980, 1986 and 1992, where money became the fifth important factor to motivate employees. 4. The Impact of Non-Financial Incentives on Motivation It is very clear that money or financial incentives have a significant impact on employees motivation. It is a wonder whether non-financial incentives would have the same impact on employees motivation as the financial incentives. Lord (2002) in his study on motivation of workers found that the main motivators are accomplishment, job responsibility, recognition, etc. and these motivators improve job satisfaction and increase productivity.
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VOL 3, NO 4 This is supported by Mani (2002) who said that good pay and recognition are the strongest motivators compared to benefits, working environment and co-workers, while Lee (1997) who has done a research on motivating factors influencing female entrepreneurs found that achievement, affiliation, autonomy and dominance have a great influence on their motivation. Darling, Arm and Gatlin (1997) said At one time, money was considered the best employee motivation technique. But today, the use of money as motivation has several strikes against it. The impact of a monetary reward is often short-lived. Non-cash rewards of high intrinsic recognition value such as merchandise credits or time off often work better. When given a cash incentive, an employee may spend the money on groceries or the electric bill. If merchandise is offered, however, employees will constantly be reminded of the incentive each time they look at the gift. Even though many researchers have found that money of financial incentive is the most influential motivator in motivating employees, the influence of non-financial incentives cannot be denied. Supporting the above literatures, Mathauer and Imhoff (2006) stated that non-financial incentives such as a more conducive working environment, recognition, appreciation and feedback contributed to workers motivation. Other than that, good working relationship with superiors and colleagues are also the determinants of motivation. Cameron and Pierce (1997) investigated on the effect of types of rewards namely verbal rewards such as praise and feedback and tangible rewards such as money on motivation and concluded that verbal rewards whereby superiors praising employees for their good work can enhance motivation. Not only verbal rewards, tangible rewards also enhance motivation. Lanchance (2000) said that people stay at work for many other reasons, not just for money. Acknowledgment from managers or recognition works better than money as it is a means to show managers are paying attention to employees and giving direction to what they do. By recognising accomplishments, it will boost up employees spirit and enthusiasm. Fagbenle, Adeyemi, and Adesanya (2004) in their study on the impact of non-financial incentive on bricklayers productivity in Nigeria have come out with conclusions that non-financial incentives are more preferred in motivating these employees than financial incentives as it increases the productivity. 5. The Effectiveness of Financial and Non-Financial Incentives In most situations, organizations use financial incentives as the way to motivate their employees. Just give them money and they are willing to do anything. Most managers believe that money is the most efficient way to make people work, but the question is, how long will the motivation last? Kohn (1993) pointed out that money only produce temporary compliance and is not effective in shaping employees behaviour to last for a longer time. In other words, employees, when given money, will only show positive attitude for a short time. According to him, money or reward, will make people seek for more reward in future. In his article Why incentive plan cannot work, Kohn (1993) stated that rewards (money) succeed at securing one thing only: temporary compliance. When it comes to producing lasting change in attitudes and behaviour, however, rewards, like punishment, are strikingly ineffective. Once the rewards run out, people revert to their old behaviour. He further expressed that incentives (money) or extrinsic motivator does not change our attitudes, it only changes what we do. Darling, Arm and Gatlin (1997) write At one time, money was considered the best employee motivation technique. But today, the use of money as motivation has several strikes against it. The impact of a monetary reward is often short-lived. Non-cash rewards of high intrinsic recognition value such as merchandise credits or time off often work better. When given a cash incentive, an employee may spend the money on groceries or the electric bill. If merchandise is offered, however, employees will constantly be reminded of the incentive each time they look at the gift. It is true that when money runs out, employees forget that they have received it and will look for some more. Sullivan (2000) agreed when he said if money is given, it will only last for 12 to 15 minutes. The money will be kept in the wallet and then disappeared.
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VOL 3, NO 4 However, this finding contradicts with Vroom (1964) in his famous theory called as the expectancy theory which suggested that money will motivate to the extent where is it able to satisfy employees personal goals. This means that money is effective in longer term until the goal is satisfied. What about non-financial incentives? Is it the best way to motivate employees since money is not the best way? Darling, Arm and Gatlin (1997) have highlighted that non-cash rewards such as praise, recognition from superiors are much better where it has psychological value that makes employees being remembered of it. Recognition and praise give intrinsic meaning to employees where they feel appreciated and valued and will definitely last for a longer time. 6. Conclusion Employees motivation is a serious issue managers must focus on. Employees with low levels of motivation will make it hard for the organization to achieve its long term goal. To motivate employees is not an easy task for managers. They need to identify what factors motivate employees the most. Employees are individuals who are different in their characters. Due to this, they perceive differently. Money was believed to have a significant impact on employees motivation at work. Vroom (1974) expressed that money will make people work in order to satisfy their personal goals. Darling, Arm and Gatlin (1997) agreed that money has its own influence; however this impact is only temporary. People who are given money will work hard to get the money. When they run out of money, old behaviour will be back into their working life. This paper tries to examine the impact of two types of incentives, namely financial and non-financial incentives, in motivating employees. Most of the researches agreed that financial incentives or money motivate, but only in short period of time. The best way to motivate employees is to use non-financial incentives such as praise and recognition where it is believed to have a significant intrinsic value to the employees. Managers out there may have to look at this as the important issue in motivating their employees as money is not the most important thing in employees life anymore. They need to be concern on employees feeling as this is the best way to make employees feel appreciated and motivated.
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References Bartol, K.M. and Martin, D.C. (1998). Management, 3rd ed., McGraw-Hill, New York, NY.
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Cameron, J. and Pierce, D.W. (1997). Rewards, interest and performance: an evaluation of experimental findings. American Compensation Association Journal, Vol. 6. Darling, K., Arm, J. and Gatlin, R. (1997). How to effectively reward employees. Industrial Management, July/August, pp. 1-4. Darmon, R.Y. (1974). Salesmens response to financial incentives: An empirical study. Journal of Marketing Research, XI (November), pp. 418-426. Fagbenle, O.I., Adeyemi, A.Y. and Adesanya, D.A. (2004). The impact of non-financial incentives on bricklayers productivity in Nigeria. Construction Management and Economics, Vol. 22, pp. 899911. Islam, R. and Ismail, A.Z. (2008). Employee motivation: a Malaysian perspective. International Journal of Commerce and Management, Vol. 18, pp. 344-362. Kohn, A. (1993). Why incentive plans cannot work. Harvard Business Review, September-October, pp. 5463. Kontodimopoulos, N., Paleologou, V. and Niakas, D. (2009). Identifying important motivational factors for professionals in Greek hospitals. BMC Health Services Research, Vol. 9. Lanchance, J.R. (2000). International Symposium of the International Personnel Management Association. Public Personnel Management, Vol. 29, pp. 305-13. Lee, J. (1997). The motivation of women entrepreneurs in Singapore. International Journal of Entrepreneurial Behavior and Research, p. 3. Llewellyn, S., Eden, R. and Lay, C. (1999). Financial and professional incentives in health care. Comparing the UK and Canadian experiences. The International Journal of Public Sector Management, Vol. 12, pp. 6-16. Lord, R.L. (2002). Traditional motivation theories and older engineers. Engineering Management Journal, Vol. 14, pp. 3-7. Mani, B.G. (2002). Performance appraisal systems, productivity, and motivation: a case study. Public Personnel Management, Vol. 31, pp. 141-59. Manolopoulos, D. (2008). An evaluation of employee motivation in the extended public sector in Greece. Employee Relations, Vol. 30, pp. 63-85. Mathauer, I. and Imhoff, I. (2006). Health worker motivation in Africa: the role of non-financial incentives and human resource management tools. Human Resources for Health, pp. 1-17. Robbins, S.P. and Judge, T.A. (2009). Organizational Behavior, 13th edition, Prentice Hall, Eaglewood Cliffs, NJ. Sullivan, J. (2000). Recognizing the importance of incentives and rewarding employees. Nations Restaurants News, Vol. 26, p. 36. Turner, J.H. (2006). Pay for performance: contrary evidence and a predictive model. Academy of Marketing Studies Journal, Vol. 10, pp. 23-38.
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Vroom, V.H. (1964). Work and Motivation, John Wiley, New York, NY.
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Woodruffe, C. (2006). Employee engagement the real secret of winning a crucial edge over your rivals. Motivation, pp. 28-29.
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Pro-activity in NPD as a competitive advantage in complex competitive environment A study on Hotel industry of Pakistan
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Ahmed Nadeem MS- Management Sciences (Scholar), Riphah School of Leadership, Islamabad, Pakistan Haroon Rashid MS- Management Sciences (Scholar), Riphah School of Leadership, Islamabad, Pakistan Sheraz Ahmed Khan MS- Management Sciences (Scholar), Riphah School of Leadership, Islamabad, Pakistan Abstract
This research paper is about pro-activity in new product development (NPD) and its impact on competitive advantage in complex competitive environment. This concept is applied on hotel industry of Pakistan with medium level businesses that pro-activity in NPD can give an edge to hotels over their competitors or not? After using statistical tool, we explore that there is a positive relationship between pro-activity in PND and competitive advantage. We conclude that customers always want something new, and in hotel industry, hotels pro-active moves to increase customer choice by extending their product mix, line extension and exiting food items modification (change and improvement) with taste, quality, quantity and appearance, attract the new customer, exiting customers retention and resonance. This customers attraction provides the chance to hotels to enhance their profitability. So we found that pro-activity in NPD as competitive advantage is a true story. Future researchers were recommended that they should apply this concept in different industries and countries. Keywords: Pro-activity ; NPD ; Competitive advantage ; Complex competitive environment; Study ; Hotel industry ; Pakistan
1. Introduction
This research paper is about a front line issue that how firms can have a competitive advantage in complex competitive environment, there are many conducts that firms employ for competitive advantage but in this paper, it is examined that how pro activity
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in new product development (NPD) can turn into competitive advantage for the firm in complex competitive environment. The basic theme of this research paper is, the firms which are pro-active, pioneer or first mover in NPD (product mix extension, product line length and product modification) enjoy competitive advantage in complex marketing environment. Competitive advantage is being measured through number of new customer, existing customer retention and resonance, market shares that company posses and profitability. This research was applied on Hotel industry of Pakistan, the reason to choose hotel industry for this research is that in hotel business new product development and product modification is not big issue, NPD is not more costly and time consumer, only a reasonable efforts and information about customer behavior is enough to develop a new product or existing product modification, after a simple information about the market and customers a new food item can be developed. In hotel industry specially of Pakistan, there are many food items generally called dishes are same and offers by all hotels for their customers, so the hotels those show pro-activity in modification (change & improvement) of these food items with taste, increase quality and appearance and develop new product to increase their product mix, length for customers can enjoy competitive advantage. Competitive advantage is big topic of management studies and researched by famous researchers but in this research, we highlight pro-activity in NPD as a competitive advantage and this competitive advantage was measured through number of new customers, existing customers retention & resonance and increase market shares & profitability.
1.1 Problem statement:
The problem statement of the paper what is the impact of pro-activity in NPD and product modification on competitive advantage and how pro-activity is valuable for the competitor to face their competitors well in complex competitive environment.
1.2. Objectives:
The basic purposes of this study are: To know how pro-activity in NPD gives competitive advantages to the perfect competitive firms in complex competitive environment.
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their products?
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To know what are the ways that are used by the firms to develop new or modify To know what the key variables that can be considered as competitive advantage in complex competitive environment? To highlight the importance of pro-activity in NPD and its impact as competitive advantages under perfect competition. To know what is the impact of pro-activity in NPD on competitive advantage in hotel industry
1.3. Significance of the study:
In present age, world of business is facing many challenge everyday, companies are doing business in a stress competitive environment, in these circumstances there is a needs to practice effective pro-active strategy in NPD to attract the new customers, existing customers retention and loyalty, and enhancement in market share & profitability in stress competitive environment. It is an important study that can provide valuable dimensions to the firms (and according to this simple research to hotel industry) to compete their competitors in the complex completive environment.
2. Literature Review
The literature on Pro-activity in NPD and competitive advantage exclusively is enormous to exhaust, but unfortunately literature on direct relationship between pro-activity in NPD and competitive advantage is unusual. So here, some selected literature is being reviewed which is close to our variables and furthermore in next parts of the paper, a link between these variables will be focused.
A new product is defined as, A new product is a good, service, or idea that is perceived by some potential customers as new (Kotler & Armstrong, 2005). According to literature product mix extension, product line length and modification are all considered as NPD. The importance of the new product development (NPD) has grown dramatically over the last few decades and is now the dominate driver of the competition in many industries (schilling & hill, 1998) and (Kessler & Bierly, 2002) says the new product innovation is critical to the competitive advantage of many firms.
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New product development is a critical component of competitive strategy because it can be a used to leapfrog competition, create entry barriers, establish a leadership position, open up new distribution channels, and garner new customers to improve market position(Wheelwright & Clark,1992; Clark & fujimoto,1991). In the current highly competitive marketplace, firms are under increasing pressure to develop new products and services that are both timely and receptive to customer needs. (Olson, Walker & Ruekert, 1995) and (Ibrahim, Ahmed and Taha,2009 ) found that in highly competitive era which forces companies to launch a new product faster, the decision on setting up virtual teams and using a modified NPD process is not a choice but a requirement. Product line length is aggressive competitive tool to attract the new customer, to retain the existing customer and for market shares, according to the (Draganska & Jain 2005) the increasing number of consumer goods and services offered in recent years suggests that product proliferation and in particular line extensions have become a favored strategy of product managers. Firms may compete through their product lines in two ways. First, firms have an incentive to extend their product lines in order to extract more consumer surplus, and according to the (Kekre & Srinivasan, 1990) by offering broader product lines, firms can increase their market share and profitability. A pleasant and valuable change in product play an important role in market shares enhancement, Product improvements and new products provide firms the momentum for market leadership and sales growth (Iabsiti, 1995). An important product strategy for firms in mature markets is value-adding modifications to existing products, and (lyer & soberman, 2000).Customers will remain loyal to a service organization if the value of what they receive is determined to be relatively greater than that expected from competitors (Zeithaml & Bitner, 1996). No doubt, product mix extension, product line length and product modification are the aggressive actions to have competitive advantage over competitors but in complex completive environment, the firms that will be proactive in NPD actions will restrain competitive advantage such as (Hauser & Wernerfelt, 1990) say, "If two brands enter the market with the same distribution of perceived utility, the brand that enters earlier will be considered more often. If it is considered more often, it should have a higher market share. Repeat purchase should also be higher for pioneering brands. One reason is that
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market. (William T. Robinson)
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consumers learn more about pioneering brands because of their longer time on the
(Schmalensee, 1982) argues that even for identical products, the risk of an unfavorable experience motivates rational consumers to continue buying the pioneering brand and he also argue when consumer successfully use the first brand in a new product category, they will favor it over later entrants because they know with certainty that it works. Next to similar lines, (Kardes & Kalyanaram, 1992) conclude, "The learning advantage conferred to the pioneering brand translates into more extreme and confidently held judgments of the pioneer. Judgments held with conviction are persistent over time and resistant to competitors' activities. Together, these judgmental processes lead to long-run pioneering advantage". The market shares of pioneer is consistence across all types goods and firms (Golder & Tellis, 1993). (Murthi, Srinivasan & Kalyanaram, 1996) found that after accounting for such unobserved, firm-specific factors there remained a robust positive effect of pioneering on market share. After rewiring the literature related to NPD, proactive strategy and their relationship with those dimensions that give competitive advantage to the firms, a theatrical frame work is develop below:
Theoretical Framework Model: Independent variable Pro-activity in NPD Variables:
Dependent variable Competitive advantage
Pro-activity in NPD
According to the different literature on NPD, there are many ways that are considered dimensions of NPD but in this particular research paper only following dimensions are being considered as NPD and Pro-activity in NPD was considered in this research as: Proactive product mix extension, Proactive product line length
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products appearance, taste & quality etc.
Competitive advantage
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Proactive product modification (changes & improvements) in exiting
Competitive advantage was evaluated and measured in this research paper through: Number of new customer Existing customer retention & resonance and Increase market shares & profitability.
Hypothesis:
Pro-activity in NPD positively impact competitive advantage
3. Methodology, Findings and Discussion

3.1 Questionnaire
A questionnaire was developed for this current study which contains important questions about independent variable (pro-activity in NPD) i.e. (pro-activity in product mix extension, product line extension and modification with taste, appearance, quality & packages) and independent variable (competitive advantage) i.e. (number of new customers, existing customers retention & resonance, market shares and profitability). A five-point Likert scale was used (where 5= strongly agree and 1= strongly disagree). Reliability Statistics for variables
Competitive Advantage
N of Items 6
Pro-activity in NPD

3.2 Respondents
N of Items 6
We randomly selected 70 hotels with medium level business, in four cities of Pakistan. So, respondent of this research paper are 70 hotel managers of these hotels. Hotels are situated at different (famous food markets) of these cities.
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3.3 Statistical Tool
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To verify existence of relationship between the independent variables i.e. pro-activity in product modification and the dependent variable competitive advantage, Correlation
matrix was used which is a most authentic statistic tool to find the relationship between
two variables and a lot of researchers use it.

Fig 1: Correlation Matrix Descriptive Statistics
Mean Competitive Advantage Pro-activity in NPD

Correlations
Std. Deviation 2.70097 2.19547
N 70 70
23.4571 25.1857
Competitive Pro-activity in Advantage NPD Competitive Advantage Pearson Correlation Sig. (2-tailed) N Pro-activity in NPD Pearson Correlation Sig. (2-tailed) N **. Correlation is significant at the 0.01 level (2-tailed). The results of correlation as shown in table 1(correlation) indicate that there is a statistically significant relationship Pro-activity in NPD and competitive advantage in hotel industry of Pakistan. We found (r=0.41, p<0.01) which indicate that our hypothesis pro-activity in NPD positively impact competitive is accepted. 70 .413** .000 70 70 1 .413** .000 70 1
4. Conclusion
This research study has a number of suggestions for hotel industry of Pakistan. The positive relationship between pro-activity in NPD and competitive advantage find that customers want choices and different packages in hotel food, a change and pleasant improvement in taste, quantity, appearance and quality in exiting food items (dishes ) attract them to make purchase and repurchase decisions as well create WOM for other customers, these favorable conditions makes the hotels financially strong and profitable
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because pro-activity brings specialty and hotels can set their prices high up to re-active actions by their rivals in the market. It is also found that first move to increase choices in products, change and improvement in existing products quality and taste provides an edge to hotels over their competitors in complex competitive environment.
5.
Recommendations
5.1 Recommendations for industry
Hotel industry should focus on enhance their product portfolio and modify to their existing food items with new taste, appearance quality and quality on regular basis because new customers can be attracted and resonance of the existing customers can be enhance by these actions.
5.2 Recommendations for future researchers Future researchers were recommended that they should apply this concept in different
industries and countries.
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References
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Armstrong, G. and Kolter, P. (2005). Marketing: an Introduction. (7th edition). United States of America: Pearson Education, Inc. Hauser, J. R. and Wernerfelt, B. (1990). An Evaluation Cost Model of Consideration Sets. Journal of Consumer Research, 16, 393-408. Kekre, S. and Srinivasan, K. (1990). Broader product line: A necessity to achieve success? Management Science 36, 12161231. Kardes, F. R. and Kalyanaram G. (1992). Order-of-Entry Effects on Consumer Memory and Judgment: An Information Integration Perspective. Journal of Marketing Research, 29, 343-357. Murthi, B. P., K. Srinivasan and G. Kalyanaram (1996). Controlling for observed and unobserved managerial skills in determining first-mover market share advantages. Journal of Marketing Research, 33 (3), 329336. Michaela, D. and Dipak, C.J. (2005). Product-Line Length as a Competitive Tool. Journal of economics and management strategy, 14 (1), 1 28. Schilling, M. A. and Hill, C. W.L. (1998). Managing the new product development process: strategic imperatives. Academy of Management Executive, 12(3), 67-81. Paul, M. H., Frank, R. K. and John K. (1994). First-Mover Advantages from pioneering new Markets: A Survey of Empirical Evidence. Review of Industrial Organization, 9, 1-23. Schmalensee, R. (1982). Product Differentiation Advantages of Pioneering Brands. American Economic Review, 72, 349-365. Golder, P.N. and Tellis, G.J. (1993). Pioneer advantage: Marketing logic or marketing legend? Journal of Marketing Research, 30(2), 158-170 Clark, K. and Fujimoto, T. (1991). Product Development Performance. Boston, MA: Harvard Business School Press Wheelwright, S. C. and Clark, K. B. (1992). Revolutionizing Product Development. New York: Free Press. Olson, E.M., Walker, O.C. and Ruekert, R.W. (1995). Organizing for effective new product development: the moderating role product innovativeness. Journal of Marketing, 59, 48-62 Iyer, G. and Soberman D. (2000). Markets for Product Modification Information. Marketing Science,19(3),203-225 Ebrahim, N. A., Ahmed, S. and Taha, Z. (2009). Modified stage-gate: A conceptual model of virtual product development process. Journal of Marketing Management ,1(9), 211-219
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TEACHERS PERCEPTIONS OF PRINCIPALS EFFECTIVENESS IN HIGHER SECONDARY SCHOOLS OF PUNJAB
Khuda Bakhsh Malik1, Dr.Umar Ali Khan3 ,Liaquat Hussain2 , Allah Noor2, Dr Abdur Rehman4
1. 2. 3. 4.
Ph.D Scholar IER Gomal Unbiversity, DIKhan, KPK, PAKISTAN. Assistant Professor IER, Gomal University, Dera Ismail Khan, KPK, PAKISTAN. Professor IER, Gomal University, Dera Ismail Khan, KPK, PAKISTAN. Professor Hazara University, Mansehra.
Abstract
An effective principal can operate a school system to achieve the pre-determined objectives of the system. There are certain factors which significantly contribute to principals leadership effectiveness. The teachers working on daily basis with their principals have a unique insight about the determinants of leadership effectiveness. A sample of five hundreds senior teachers of boys higher secondary schools of Punjab was taken who rated their respective principals. The study explored factors that make principals effective in their leadership and how teachers perceive principals effectiveness. The researcher developed a questionnaire for the teachers to evaluate their principals job satisfaction, powers, leadership behavior, conflict management skills and personal traits. It required respondents to rate the extent to which each of the listed items contributed to the effective leadership in the schools. Descriptive statistics was used for data analysis to summarize the information. Key words: Principals Leadership Effectiveness, Job Satisfaction, Powers, Leadership Behavior, Conflict Management Skills, Personal Traits
INTRODUCTION
The focus of many of the leadership studies in the school system was to identify and describe the characteristics of effective school leadership (De Bevoise, 1998, Sweany, 1992,Yukl ,1982, Boyer,1983,Lightfoot,1995). It is believed that school leadership has an effect on students academic performance (Glasman, 1995). A principals interaction and participation can increase the learning climate, productivity, achievement and school reputation(Sparks,2007 ,Sergiovanni,2007).The accomplishments of a school and even whether or not it achieves its goals and missions can be determined by the principals effectiveness as a leader(Halawah,2005). An effective principal envisions a mission for the school that accomplishes the needs of the community (Hoerr,2006,Barth,2006). What determines the effective educational leadership is a question of vital significance to effective teaching-learning process. Effectiveness is the function of the congruence of behavior and expectations. A principal effectiveness is the quality of his skills/traits and leadership behavior perceived by school population in general and faculty members in particular. Several factors have been attributed to the perceived effectiveness of the principals among which principals job satisfaction; powers, leadership behavior, management skills and personal traits are key determinants. A proper understanding of effective administrator envisages that these factors and forces be understood and their
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specific contribution be determined. Carter V. Good defines administrative effectiveness as the extent to which satisfactory results have been produced through the control, directions, and management exercised by the executive authority. Martine, Charlier and Witten found personality traits of principals as determinants of their administrative effectiveness. A higher secondary school principal is so effective if he is satisfied with his job and has administrative and financial powers in school affairs. He would work better when he feels that his salary as principal is compatible with his needs and esteem. He should enjoy the powers to transfer or suspend any of his subordinates for poor performance ( EPM report,2010). Effective principals concentrate on various conflict management skills (Dessler, 2008).An effective principal is an effective mediator. He diagnoses the causes of conflict, builds consensus, maintains equity and defends his positions strongly to resolve the conflicts. His behavior as principal is friendly and he makes staff feel at ease when talking with them. He develops an open and supportive school climate. He does not include his likes and dislikes in decision making. Taking personal traits, an effective principal is cooperative, honest, straight forward, committed to excellence and possesses attractive looks. Moreover, he has good sense of humor, stress tolerance and emotional maturity (Rachel L.J. 2005).
STATEMENT OF THE PROBLEM
The purpose of this study was to explore potential of leadership effectiveness as perceived by teachers. REVIEW OF RELATED LITERATURE Effective leadership is an individuals ability to stimulate and direct subordinates to perform specific tasks deemed important by the leader (Njuku,2001;Lisa.A.Weinberger,2003). The fact that an administrator/manager can work effectively if he is enriched with personal traits, management skills and good leadership behavior. Besides this, he must be satisfied with working conditions and organizational climate. His subordinates will try to work hard if they know the powers of their boss to get them suspended/transferred on poor performance. Hoy and Miskel (1987) noted that the trait theory (great man theory of leadership) dominated the study of leadership. According to these scholars, this approach attempts to identify any distinctive physical or psychological characteristics of the individual that relate or explain the behavior of leaders. Psychological researchers using this approach attempt to isolate specific traits that endow leaders with unique qualities that make them different from their followers. They believe that leaders are born not made.
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Using sophisticated techniques, researchers have confirmed that effective leaders do tend to possess certain traits and skills listed below:
Traits and Skills of Effective Leaders ------------------------------------------------------------------------------------------------------------------------------Traits Skills
------------------------------------------------------------------------------------------------------------------------------Alert to social environment Cooperative Honest Ambitious and achievement oriented Courageous and energetic Straight forward Risk taker Self-confident Tolerant of stress Clever Effective mediator Able to build consensus Creative Fluent in speaking defends his position strongly Socially skilled Able to diagnose the causes of conflict Persuasive
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Fiedler(1967) has described a relationship between personal traits and leadership effectiveness. His research attempted to predict leadership effectiveness from conflict management skills and leadership behavior. Scrutiny of the available literature in the area of administrative effectiveness of principals reveals that a number of studies have been conducted abroad pertaining to the competencies required by principals for effective administration as well as pertaining to the factors contributing to the administrative/leadership effectiveness. These studies have contributed a lot in the field of educational administration by identifying a number of competencies for effective administration and by analyzing the factors that influence and predict the effectiveness. Exploring the leadership behavior, most of the research work on correlates of leadership effectiveness, it was found that an effective leader is easy to understand, available when needed, dependable, friendly and approachable.
METHODOLOGY
The sample for this study consisted of five hundred senior teachers randomly selected from one hundred boys higher schools of Punjab. The researcher developed a questionnaire for teachers to mark five determinants of principal effectiveness on 5-point likert scale. For data analysis, descriptive analysis was used to summarize the information.
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RESULTS AND DISCUSSIONS
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The study found that the leadership effectiveness is satisfactory. The leader effectiveness was ranked with the highest 5(strongly agree) and lowest 1(strongly disagree). The data showed that the means of leadership effectiveness ranged from 2.5 to 3.8 on 5-point Likert scale.
Level of leadership effectiveness N=500 ITEMS M SD ------------------------------------------------------------------------------------------------------------------------------Job satisfaction Powers Leadership behavior Conflict management skills Personal traits 3.5 2.5 3.8 3.0 2.9 .85 .98 .66 .72 .92
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The above table displays the mean scores of each of the determinants of leadership effectiveness. CONCLUSIONS AND RECOMMENDATIONS Based on the findings of this study, it was concluded that leadership behavior of the principals in higher secondary schools of Punjab is very encouraging. They have job satisfaction but dont enjoy administrative powers in school affairs. About 45% of the principals possess the desired personal traits and management skills. Given the significance of the finding of this study, the following recommendations are made: 1. Punjab Education department should take potential steps for empowering principals 2. The principal should be authorized to suspend or transfer any of his subordinates who remains absent from duty or shows poor performance 3. The principal must have such powers to face political pressure 4. The principal must be empowered to resolve the conflicts of school population using his administrative potential and conflict management skills 5. The teachers with desired personal traits should be appointed to the post of principal
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References
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Barth.R.S. (2006). Improving relationships within the shool. Boyer.E. (1983). Higher school: A report on secondary education in America. Carter.V.Good(1977). Dictionary of Education Charlier.P.J(1987). A study of the relationship between selected personal and interpersonal dimensions of principals and their leadership behavior De Bevoise.W(1998).Synthesis on the principal as instructional leader Dessler.G(2008). Human resource management EPM report (2010).Educational Planning and Management report for Punjab province Glasman,M.S.( 1995). Student achievement and the principal Halawah.I.(2005). The relationship between effective communication of high school principal and school climate Hoerr.T.R(2008). What is instructional leadership? Lightfoot.S.L(1995). The good high school Martine.C.A(1988). Selected personality traits as predictors of effective administrative performance Rachel.L.J(2005).The effects of principals humor orientation on principals leadership effectiveness as perceived by teachers Sergiovanni.T.J(2007).Leadership and excellence in schooling Sparks.D(2007).Leading for results Sweany.J(1992).Research synthesis on effective school educational leadership Witten.R.G(1987).Selected administrative functions and principal effectiveness as perceived by teachers Yukl.G(1982).Managerial leadership and effective principal
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Designing 8-Dimensional Capital structure and Dividends
Mohammad Reza Hamidizadeh, Ph.D. Faculty Member of Shahid Beheshti University, Tehran, Iran Abdulmajid Abdulbaghi Ph.D. student of finance, Shahid Beheshti University,
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Abstract This paper is to design an eight dimensional model of capital structure and dividend policy. The methodology of this research is based on econometrics models such as CLRM , 2SLS and panel data models(Time-Fixed). The results indicate that variables such as ROA; size; COL( assets that can be used as collateral); FundDef; DOL; Tax rate have significant effect to leverage. But there arent evidence imply that dividend policy has significant effect to leverage. Although the results imply that COL has positive relation with leverage and the sign of ROA is based on pecking order hypothesis and signs of COL and FundDef are based on agency cost theory, the signs of other variables do not haven explicit relationship to other capital structure theories. Also significant relation with dividend policy based on financial theory did not show, while previous studies, confirmed there was a random walk process in Iranian firms dividend policy. Key words: Capital structure; Dividend policy; Simultaneous Structural Equations; Panel data. I. Introduction Recent theories about capital structure refer to studies provided by Modigliani and Miller(1958).According to their findings there is no significant relationship among capital structure and the value of a firm under efficient market and zero cost for bankruptcy. This theory developed incrementally. Active factors like tax and bankruptcy costs, actual costs of agency theory, asymmetric information, ethical issues, and so on will be influenced if there is an optimal capital structure. Based on this study, three various theories about capital structure arise: Static trade-off theory, Pecking order, and agency cost. Static trade-off theory states in assumption of stability of company investment decisions, optimal capital structure will formed when tax advantages of financing through debt is according to bankruptcy costs. Referring to agency cost theory, the optimal structure of capital structure will be determine in a manner that the cost of stockholders' conflicts will be minimized. Jensen and Meckling(1976) declare that because of existence of conflicts between stockholders and creditors, the costs of agency play an important role in financial decisions. If companies approach financial crisis, stockholders can encourage managers to finance through stockholders instead of creditors. Therefore, they quest higher rate of return for investment. According to pecking order theory (asymmetric information theory), firms finance through internal sources (earnings), debt, and finally sell stocks, in order. Myers states that because of placing the financing through capital in start and the end of the financing process, it is hard to state. Because of different factors that are affecting to determine of optimal capital structure. Many of them are taxes and bankruptcy costs, the agency costs, asymmetric information and so on are studied in many of classical studies. But according to the conditions, there are many variables that affect to optimal capital structure. Because, the higher operating leverages institutions
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more likely to face bankruptcy, therefore, need to create a lower financial leverage. However, higher operating leverage level is associated with more fixed assets; in fact, a partly of these assets as a criterion for the operating leverage are known. However, the level of fixed asset of firms has a positive relationship with leverage levels because such assets can be used as loan collateral [9; 20]). According to studies, Jensen, and Solberg, and Zorn (1992) collateral has a positive effect to leverage. Also non-debt tax shields is an important factor in this regard, therefore expected the firms to non-debt tax shields have lower levels of debt [15]. Based on the trade-off, the capital structure decisions depends to benefits and costs of more leverage.When the debt is used less than other financial resource that the costs of bankruptcy is more than benefits of non-debt tax shields and other benefits of debt [15; 10]. Therefore, based on trade-off theory of capital structure is always a negative relationship between leverage and bankruptcy costs and positive relationship between leverage and the marginal tax rate [17; 8]. From the agency theory side, free cash flow is caused the more severe problem in agency problems because the managers can release some of the cash flows for their own interests that causing the devaluation of firms [13]. To protect the firms of such undesirable behavior of managers, companies with high level of free cash flows should have high level of leverage used. Based on asymmetric information model [ 24]. There is a positive relationship between debt and profitability of firms. According to the agency theory the firms with more growth opportunities, will use less of the debt. Stolze (1990) proved that firms with the more growth opportunity most should use less debt. Based on the pecking order theory of capital structure, Myers and Majluf (1984) proposed due to transaction costs and asymmetric information, firms finance new investments first with retained earnings, then successively with safe debt, risky debt and finally with equity. Referring to this model, more profitable companies must leverage the lower level and less debt to reduce the control to short-term investments. Kordestani and Najafiomran (2009), studies the determinants factors of capital structure and empirically test the trade-off and pecking order theories of capital structure for 93 active companies in Tehran Stock Exchange (TSE) began the year 2009 to 2006. Their results indicate a significant and positive relationship among the size, leverage, growth opportunities, volatility of profit payout ratio and negative communication among non-debt tax shield, fixed assets and leverage. The results of Bagherzadeh (2005) revealed a significant positive relationship between profitability, sales volume, fixed assets with debt ratio and negatively related to M2B ratio. Namazi and Shirzadeh (2006) to evaluate the relationship between profitability and capital structure began. Their results indicate there is no significant relationship of these variables.
II. Dividend Policy Factors Lintner proposed the first dividend policy research (1956), which according to the company has a long-term objective for dividend. Therefore, mature companies with stable profitability, usually are distributed a significant portion of their profits. Also managers more attention to volatility rather amount of profit. However, changes in dividends follows the changes of long-term and stable of profitability. Rozef (1992) studies that how firms determine their dividend ratio? The results proposed that the determinant factors of dividend are such as: transaction costs of capital market financing, financing constraints due to increased operational and financial leverage and agency costs of external ownership. Bercley (1995) another study entitled " The Determinants of Corporate Leverage and Dividend Policies," proposed three dividend policy factors such as investment opportunities, the informational and signaling effects of dividend changes and company size. Jahankhani and Ghorbani (2006) analysis of 63 active companies in
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the T.S.E. during the period 1999 to 2005 and founded that the dividend policy of these companies have a random walk behavior. Samadzadeh (1996) also found the fact that the dividend policy on Tehran stock exchange unknown for managers and shareholders do not attention to dividend changes. III. Capital structure and dividend policy Those factor that affecting to capital structure, affected to dividend policy. Easterbrook (1984) showed that cause of dividend, has issued a new stock. But dividend policy has direct relation with financing decisions. In fact, the dividend ratio in a firm is a determinant factor of its survival and capital structure. The pecking order theory states debt levels of firms should related to their cash flows and dividend policies. However, there are unavoidable evidences that indicate lack of dependence between dividend policy and capital structure. Adedeji (1998) suggests that if firms respond to earnings shortages by borrowing to pay dividends because of reluctance to cut dividends, financial leverage may have a positive relationship with dividend payout ratio, and a positive or negative relationship with investments depending on whether firms borrow to finance investments or postpone/reduce the investments. Therefore, based on the pecking order theory, capital structure has a positive relationship to dividend. In other view, the dividend policy and debt are replacement mechanisms for controlling agency costs of free cash flow [12]. Jensen et al. (1992) indicates that firms with high dividend payouts might find debt financing less attractive than equity financing leading to a negative relation between debt and dividends. Several variables such as commercial risks [13], the beta coefficient [25], degree of operating leverage as a measure of operational risk and tax rates as a measure of the tax benefits of interest payments influenced on the capital structure. The agency problem and investment indicates that firms with higher growth opportunities (that evaluated by MTOB) have less liabilities .In addition, Chang (1992) emphasized in their studies that more profitable firms (high level of ROA), have high level of debt in their capital structure. Funding deficit (FundDef) is a measure of agency costs. According to Shyam-Sunder and Myers (1999), the funding deficit is: FundDeft = DIVt + Xt + Wt + RtCt : Where, Ct : operating cash flow, after interest and taxes ; DIVt : dividend payments ; Xt: capital expenditures; Wt : net increase in working capital; Rt: current portion of long-term debt The agency issue in dividend payout decisions is similar to capital structure decisions in the presence of agency costs. Agency costs predict a positive relation between firm's free cash flow (FreeCFLS) and payment of dividends. As signaling hypothesis of Ross (1977), firms with high profitability (ROA) will pay out more dividends as costly credible signals. Firms with higher growth opportunities (SalesGR) will pay out lower dividends especially when there is an alternative for using dividend payout as monitoring technique as suggested by Easterbrook (1984). Firm's past five year's sales growth is used for the dividend payout regression [as 26]. Also the size of firms has a negative impact on debt ratio [15; 14; 23]. Other researches about capital structure is the studies of Aggarwal & Kyaw(2010). These studies used simultaneously equations model between leverage ratio and dividend ratio that shows simultaneously relationship between leverage and dividends ratio. Based on both OLS and 2SLS method variables such as ROA, B2M, size, collateral, cash deficit, dividend ratio and tax rates had significant effect on capital structure. Also, variables such as ROA, size, sales growth and leverage had significant effect on the dividend. IV. Research design In this study we investigate to design the eight-dimensional structure of capital structure and dividend policies. Secondary research objectives are: Search and explore the most important determinants of capital structure; explain the relationship between determinants
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of capital structure and dividends; description of determinant factors of dividend and dividend policy and explain the simultaneous relationship between capital structure and dividend policy. According to these objectives the following hypothesis in order to evaluate their realization was developed. Hypothesis1: there are significance relationship among determinant factors of capital structures (dividend policy, B2M, ROA, collateral, deficit funding, size, DOL, tax rate) and leverage Hypothesis 2: there are significant relationship among determinant factors of dividend policy (ROA, sales growth rate, size and leverage ratio) and dividend. In this paper we used financial data of companies that listed in T.S.E. except financial and investment companies since 2001 to 2010.In this period, observed data including the year 2740 firm-year, but few companies due to lack of necessary data, were excluded. Finally 2302 firm-year data presented. Other data gathered from financial statements of the informational database of Stock Exchange (RDIS), the comprehensive software of Stock Exchange (RAHAVARD) and Rayaneh Tadbir Pardaz database. Research model. The main model is based on capital structure variables. Following variables used in two simultaneous equations. (a) Dependent variables: Leverage [Leverage=LTD/(LTD+MVE)] (LTD: long term liability) DivPO [dividend payout ratio] (b) Independent variables: DOL: degree of operating leverage; ROA, Return on assets as a measure of profitability; MTB, market-to-book ratio, as a measure of growth opportunities; SalesGR, growth rate of the firm; COL, assets that can be used as collateral, measured as PP&E/Total Assets; Lsize, natural log of total sales as a measure of size ; FundDef, funding deficit. The model is
V. Data Analysis Table 1 shows some research variables about model. The average leverage ratio for companies in during the desired sample 13%, ROA 38% , M2B ratio 4.5%, ratio of collateral to total assets 23% , DOL3.11%, tax rate 9% , sales growth rate 65% , dividends ratio 80% (the high ratio in many cases is due to stock dividend) and the deficit of funds is 357363 (Million Rial). The data indicate a very high Leptokurtic distribution of financial data. The leverage correlations with other factors presented in table 2. The highest significant correlation is between size and leverage ratio. Also there are significant correlation between variables Col, sales growth rate, tax rates and deficit funds with leverage ratio. The results in table 3 indicate significant effects of variables such as ROA, size, Collateral, deficit funding, DOL, and tax rates on capital structure. Unlike the theories of capital structure, did not found significant relationship between leverage ratio and dividend ratio. Also the result indicated that collateral positively has significant effect to leverage ratio. Table 4 also shows that sales growth has significant effect to capital structure, also funds deficit as a proportion of average assets is adjusted. However sales grow is insignificant. Also due to the coefficients presented to two decimal places, amount of some variables is presented with zero. In table, tests results on the determinant variables of dividend ratio are presented. The results indicate the insignificant effect of variables on dividend ratio. But dividend is not affected from leverage, size, sales growth and ROA. In Table 6 & 7 the coefficients of factors based on OLS methods for panel data, 2SLS, balanced and unbalanced panel based on random effects models are
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presented. In table 8, the significant effect of determinant variables and the dividend ratio is not observed. Table 9, based on adjusted variables such as: deficit of funds based on average of total assets and added sales growth rate, coefficients of each factor based on TSLS method is presented. Figure 1 shows factors that affecting to capital structure based on the research findings. VI. Conclusion The aims study to identifying the factors of capital structure and dividend based on previous study. Hence, variables such as ROA, size, COL, DefFund, tax rates, M2B, dividend ratio that affecting factors on capital structure and ROA, size , leverage ratio and growth rates as factors dominating the dividend policy was selected. Research results based on models of OLS, 2SLS, a balanced panel and fixed effects models shows that ROA, size, COL, FundDef, DOL AND tax rate have significant effect on the leverage ratio and unlike capital structure theories there is not a significant relationship between leverage and dividend ratio. These results indicate that COL positively has a significant effect to leverage. The sign of ROA is based on pecking order theory and signs of COL, FundDef are based on agency costs theory. However, there is no a significant relationship among the variables such as ROA, growth rate, size, leverage ratio with dividend policy. This result matches to the other Iranian studies, indicating the existence of random walk on Iranian firms dividend policy.
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Annexure
Table 1. Elementary reseals about research model
Mean Medain SD Skewness Kurtosis SalesGR 0.65 0.16 12.29 30.50 100.7 Divpo 0.80 0.67 0.14 35.26 1336 TaxRate 0.09 0.07 0.11 -7.68 185.9 Funddef 357363 91442 1637850 13.62 247 Dol -3.11 0.96 149.5 -26.65 944.88 Lsize 5.23 5.17 0.7 0.31 3.45 Col 0.23 0.19 0.16 0.96 3.50 M2B 4.50 2.29 84.59 14.01 88.12 ROA 0.38 0.10 10.39 40.38 163.2
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Lev 0.13 0.1 0.14 2.06 8.40
Table 2. Variables correlations

SalesGR 0.056** (0.016) -0.001 (0.97) 0.00 (0.99) -0.029 (0.21) 0.005 (0.83) 0.001 (0.97) -0.001 (0.96) -0.02 (0.38) -0.002 (0.91) 1.00 Divpo -0.007 (0.728) -0.007 (0.72) -0.002 (0.93) 0.002 (0.93) -0.014 (0.54) 0.008 (0.74) -0.005 (0.81) -0.011 (0.58) 1.00 TaxRate -0.131*** (0.00) -0.131*** (0.00) 0.004 (0.86) 0.047** (0.024) 0.015 (0.49) -0.006 (0.79) 000 (0.38) 1.00 Funddef -0.049** (0.02) -0.049** (0.02) -0.003 (0.89) -0.013 (0.54) 0.34*** (0.00) 0.003 (0.89) 1.00 Dol -0.025 (0.27) 0.001 (0.96) 0.005 (0.83) 0.01 (0.55) 0.047* (0.056) 1.00 Lsize -0.38*** (0.00) -0.057** (0.011) 0.027 (0.23) -0.023 (0.31) 1.00 Col 0.131*** (0.00) 0.014 (0.50 -0.014 (0.52) 1.00 M2B -0.017 (0.44) -0.001 (0.97) 1.00 ROA -0.024 (0.241) 1.00 Lev 1.00 Lev ROA M2B Col Lsize Dol Funddef TaxRate Divpo SalesGR
Note: *** 1% significance level, ** 5% significance level and * 10% significance level
Table 3. Determinants of Capital Structure

panel A. Corporate leverage determinants TaxR 0.23 0.23 0.23 0.20 0.17 0.15 0.001 0.49 0.48 0.48 0.45 0.41 0.38 0.03 panel B. Corporate leverage determinants (Adjusted DefFund scaled by total asset and sales grows) salesGR TaxR Dvipo Dol ADFunddef Col Lsize 0.20 0.21 0.00 (0.54) -0.12*** (0.00) 0.00 (0.53) 0.00** (0.03) -0.07*** (0.00) 0.122*** (0.00) -0.07*** (0.00) M2B 0.00 (0.73) ROA -0.036*** (0.00) 0.59*** (0.00) -0.13*** (0.00) Dvipo 0.00 (0.27) 0.00 (0.22) Dol 0.00** (0.00) 0.00** (0.02) 0.00** (0.02) Funddef 0.000*** (0.00) 0.00*** (0.00) 0.00*** (0.00) 0.00*** (0.00) Col 0.123*** (0.00) 0.12*** (0.00) 0.124*** (0.00) 0.129*** (0.00) 0.128*** (0.00) Lsize 0.01*** (0.00) -0.102*** (0.00) -0.102*** (0.00) -0.089*** (0.00) -0.076*** (0.00) -0.077*** (0.00) M2B 0.00 (0.99) 0.00 (0.98) 0.00 (0.98) 0.00 (0.88) 0.00 (0.80) 0.00 (0.73) ROA -0.001*** (0.004) -0.001*** (0.005) -0.001*** (0.005) -0.001*** (0.008) -0.001** (0.014) -0.001** (0.02) 0.64*** (0.00) 0.63*** (0.00) 0.63*** (0.00) 0.56*** (0.00) 0.50*** (0.00) 0.53*** (0.00) 1 2 3 4 5 6 7
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Table 4. Significance results of determinants of dividend
Lev 0.01 0.002 0.001 0.002) 0.032 0.003 0.002 0.007 5.146 (0.26) -0.055 (0.97) -0.051 (0.97) -0.43 (0.72) Lsize -0.124 (0.89) SalesGR -0.008 (0.87) -0.001 (0.91) -0.001 (0.91) ROA -0.004 (0.94) -0.005 (0.92) 1.85 (0.72) 1.77*** (0.01) 1.77*** (0.01) 1.62 1 2 3 4
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Table 5. Test significance results of leverage variables Time-Fixed model

0.61*** (0.00) -0.0006** (0.04) 0.00 (0.68) -0.095*** (0.00) 0.120*** (0.00) 0.000*** (0.00) 0.00** (0.00) 0.0001 (0.73) -0.14*** (0.00) 0.37 0.27 Balanced panel 0.64*** (0.00) -0.0008*** (0.003) 0.00 (0.98) -0.101*** (0.00) 0.122*** (0.00) 0.000*** (0.00) 0.00** (0.00) 0.0001 (0.28) -0.13*** (0.00) 0.24 0.23 2SLS 0.68** (0.03) -0.0009 (0.26) 0.00 (0.96) -0.105*** (0.00) 0.13** (0.03) 0.00*** (0.00) 0.00 (0.70) -0.009 (0.88) -0.18 (0.60) 0.35 0.13 OLS 0.64*** (0.00) -0.001*** (0.004) 0.00 (0.99) 0.01*** (0.00) 0.123*** (0.00) 0.000*** (0.00) 0.00** (0.00) 0.00 (0.27) -0.13*** (0.00) 0.49 0.23 Dependent: Lev
ROA M2B Lsize Col Funddef Dol Divpo TaxR
Table 6. Test results of deteminants of dividend ratio
2SLS 2.44 (0.80) -0.004 (0.93) -0.007 (0.87) -0.20 (0.89) 4.12 (0.78) 0.001 0.0003
OLS 1.85 (0.072) -0.004 (0.94) -0.008 (0.87) -0.124 (0.89) 5.146 (0.26) 0.032 0.01
Dependent: DivPO ROA SalesGR Lsize Lev
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Table 7. Test results of significant variables on leverage ratio based on TSLS method
Significant test factors affecting capital structure with adjusted DefFund based on average total assets and sales growth rates
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salesGR 0.20 0.21 0.00 (0.54)
TaxR -0.12*** (0.00)
Dvipo 0.00 (0.54)
Dol 0.00** (0.03)
ADFunddef -0.07*** (0.00)
Col 0.122*** (0.00)
Lsize -0.07*** (0.00)
M2B 0.00 (0.73)
ROA -0.036*** (0.00) 0.56*** (0.00)
Figure 1. Eight-dimensional structure of capital structure
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References
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Adedeji, A. .(1998). Does the pecking order hypothesis explain the dividend payout ratios of firms in the UK? Journal of Business, Finance and Accounting. 25 (9 & 10), 1127 - 1155. Aggarwal, Raj & Kyaw, NyoNyo Aung. (2010). Capital structure, dividend policy, and multinationality: Theory versus empirical evidence. International Review of Financial Analysis 19 (2010) 140150. Arellano,M.(2003) Panel data econometrics, Oxford University Press, Oxford. Bagherzadeh, S. (2005). Explanation pattern of capital structure in the Tehran Stock Exchage. Financial research. No 5. Vol. 16. PP. 11-23. Barclay, M. J. et al. (1995). The Determinants of Corporate Leverage and Dividend Policies, Journal of Applied Corporate Finance. Brooks, Chris (2008). Introductory Econometrics for Finance. Second edition. Cambridge University Press. Chang, C. (1992). Capital structure as optimal contracts between employees and investors . Journal of Finance, 11581141 ,(3)47 . Cloyd, C. B., Limberg, S. T., & Robinson, J. R. (1997). The impact of federal taxes on the use of debt by closely held corporations .National Tax Journal. 261-277 (2) 50.. Friend, I., & Lang, L. (1988). An empirical test of the impact of managerial self-interest on corporate capital structure .Journal of Financ. 281-271. 43. Graham, J. R. (2000). How big are the tax benefits of debt? .Journal of Finance, ,(5)55 .19411901. Jahankhani. Ali & Ghorbani S. (2006). Identification of Determinant Factor of Dividend in the Tehran Stock Exchage. Financial research. No 7. Vol. 20. PP. 27-48. Jensen, M. C. (1986). Agency costs of free cash flow, corporate finance, and takeovers. American Economic Review.323-329. (2) 76. Jensen, G. R., Solberg, D. P., & Zorn, T. S. (1992). Simultaneous determination of insider ownership, debt, and dividend policies .Journal of Financial and Quantitative Analysis. 247263. (2)27. .263247. Jensen, M., and Meckling, W., (1976). Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure. Journal of Financial Economics 3, 305-360. Kim, W. S., & Sorensen, E. H. (1986). Evidence on the impact of the agency costs of debt in corporate debt policy .Journal of Financial and Quantitative Analysis. 131-144. 21. Kordestani, G. & Njfiomran, M. (2009). Determinant Factor of Capital structure: Testing of pecking order and trade-off theory . Financial research. No 10. Vol. 25. PP. 73-90. Lasfer, M. A. (1995). Agency costs, taxes and debt: The UK evidence .European Financial Management.285265 ,(3) . Lee, K. C., & Kwok, C. C. Y. (1988). Multinational corporations vs. domestic corporations: International environmental factors and determinants of capital structure .Journal of International Business Studies.217195 ,(2)19 . Lintner J., (1956). Distribution of Incomes of Corporations among Dividends, Retained Earnings and Taxes, American Economic Review. Long, M. S., & Malitz, I. B. (1985). Investment patterns and financial leverage. In B. M. Friedman. United States .Chicago: The Univ of Chicago Press. Myers, S. C., & Majluf, N. S. (1984). Corporate financing and investment decisions when firms have information that investors do not have .Journal of Financial Economics ,(2)13 , .221187. Namazi, M. & Shirzadeh, J (2006). The study of relationship of capital structure and profitability in the Tehran Stock Exchage, accounting and auditing studies. no 12 . vol 42. Pp. 75-95. Noronha, G. M., Shome, D. K., & Morgan, G. E. (1996). The monitoring rationale for dividends and the interaction of capital structure and dividend decisions .Journal of Banking and Finance .454439 ,(3)20. Ross, S. A. (1977). The determination of financial structure the incentive signaling approaches .Rand Journal of Economics.4123 ,(1)8 .
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Rozeff, M., (1992). How companies set their Dividend-Payout Ratios, The Revolution in Corporate Finance, Blackwell Publishers, Oxford. Rozeff, M. S. (1982). Growth, beta, and agency costs as determinants of dividend payout ratios .Journal of Financial Research, 259249 . Samadzadeh, M. (1996). Dividend policy and firms value in the Tehran Stock Exchage. MBA Dissertation in the Isfahan University. Shaffer, S .and DiSalvo,J.(1994) Conduct in a banking duopoly, Journal of Banking and Finance 18,106382 . Stulz, R. (1990). Managerial discretion and optimal financial policies .Journal of Financial Economics273 ,26 .
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Impact of innovation and creativity on productivity enhancement of employees in Isfahan Telecommunications Company
Amin Sedaghat Rostami (Islamic Azad University, Najafabad Branch, Isfahan, Iran) Dr. Mohammad Hossein Moshref Javadi
Abstract Economic attempts of human beings have always been focused on achieving maximum output from minimum efforts and facilities (production inputs). This endeavor could be called eagerness of receiving ever-increasing productivity. Collection of scientific achievements reveals that product of creativity and innovation of the intelligential is in a range from the simplest devices to the most advanced and complicated technology that have been created based on human's knowledge and intellectual enhancement during several years. Subject of this survey is to study the impact of innovation and creativity on productivity enhancement of employees in Isfahan Telecommunications Company. This survey is a case study and correlation type of research. Statistical population included all working employees in five-field regions of Isfahan province during the month March-June of 2011. From 1983 population, 114 persons were selected as simple size. Data was collected by three different questionnaires: creativity, innovation and productivity. Data analysis was performed by SPSS software. The results indicated that amount of correlation coefficient in the main hypothesis which examines the significant relation between creativity and innovation with productivity enhancement of employees in Isfahan Telecommunications Company is equal to 0.489 which states that enhancement of productivity, creativity and innovation have moderate significant relation with each other. Amount of statistic F is equal to 70.167 and amount of significance level is equal to 0.000. We can confirm hypothesis that examines existence of linear significant relation among independent variables (creativity and innovation) and dependent variable (productivity enhancement) with 99% confidence because amount of significance is lower than amount of type one error at level 0.01. Key words: Innovation, Creativity, Productivity, Effectiveness, Efficiency.
Introduction
Productivity has been one of the main purpose of All discoveries and inventions of human beings from the most elementary tools in ancient ages to the most complicated mechanical and electronic equipments of the present time. But this question is proposed that why has a country developed while similar countries with better natural is primary resources the still underdeveloped? Which important factor is leaded to development and success of a countrys and underdevelopment and improper performance of some other?
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The answers to this question might be investigated in direct relation and positive correlation between creativity and innovation of human force and productivity level of organizations statement of the problem.
Stating the problem
Today, productivity has been converted into a national priority in economy of all countries whether developed or underdeveloped. Productivity provides the grounds for economic growth and inflation control and makes it possible to have access to a high level of living standards. In most international conferences of productivity it has been stated that human resources productivity is low in economic sectors of developing countries. All well-known experts and managers of global industries consider human resources as the most basic factors of increased productivity and believe that capital and technology could be supplied and bought or loaned but human beings couldn't be loaned or bought. Humans must be trained as the major capitals of third world countries and motivation and effort should be created for them. On the other hand, problems related to human force productivity in governmental offices of the country generally and in Isfahan Telecommunications Company specifically illustrates necessity implementation of researches in this field as a key and important affair.
Main objective of research
Studying impact of innovation and creativity on productivity enhancement of employees in Isfahan Telecommunications Company is the main objective of this survey.
Secondary objectives of research
1- Informing managers of Isfahan Telecommunications Company with hidden talents of creativity and guiding them towards innovation 2- Developing and establishing creative and entrepreneur environment and help to extend creative and innovative management techniques in Isfahan Telecommunications Company 3- Encouraging and attracting employees of Isfahan Telecommunications Company to participate in educational courses 4- Helping more and more development of productivity by relying on effective creativity and innovation in this regard
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Research literature
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Productivity is a wide and comprehensive concept so that perhaps it could be claimed that management means an attempt to improve productivity. According to this definition and in the field of personal management, we may state that the individual who has an outstanding future than better today than a better tomorrow is a successful and productive person and if a manager can achieve more and better outputs by keeping the amount of inputs at the organizational or constant level, he will be considered as a successful and productive manager. Purpose of management science is to investigate and explain methods of achieving more productivity (Imaee, 2006). Peter Druker states that innovation is the certain tool of entrepreneurship and is an action in which divinely gifted resources offer a new ability to create wealth (Draker, 2002). Also Palssman states that innovation is using a new purpose or an appropriate modern thinking. There are three kinds of innovations which create capital for the organization: 1- Business innovation model: creating a significant and important change in the financial structure or model in business 2- Innovation of performances: improving efficiency and effectiveness of processes and central business performances 3- Innovation of products-services-markets: creating significant new and different products or services and sending them to the active market Franken state: creativity means attitude towards production and identification of secondary periodic and possible ideas. Creativity may be useful in problem solving, making relation with others and amusing them. Creativity is motivated for humans because of three reasons(Francalanci and Golal,1998): 1- The need for variety innovation and perfect stimulations 2- The need for valuable ideas 3- The need for solving problems
Difference between creativity and innovation
Although the terms creativity and innovation are used synonymously, most of the researchers believe that these two expressions should be considered separately because they have separate meanings and definitions. Creativity refers to bringing a new thing to
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phase(Bertschek & Kaiser,2009).
Research methodology
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the existence phase while innovation indicates bringing a new thing to the application
This survey was conducted using descriptive-analytical, field method, As the researcher intended to investigate and represent a view from situation of performance assessment in the organization and its relation with human resources productivity. It is considered among field study researches because the intended data has been obtained through sampling that were used statistically analyzed.
Statistical population and sample
All men and women employees of Isfahan Telecommunications Company participated in this survey that their total number was 1983 persons. After using the sampling formula one-hundred fourteen (114) persons were selected as statistical sample.
Reliability and validity of research
In order to enhance validity of the questionnaire it has been tried to design the questions simply and clearly so that not being ambiguous and vague in the case study. First, preliminary questionnaires were distributed among the employees and after collecting they were studied by the guiding professor and experts of Telecommunications Company to make some modifications for improvement. Cronbach alpha coefficient was used to test reliability of the questionnaire which was equal to 0.96.
Data analysis
Data analysis was performed at two descriptive and inferential levels. Average central tendency index, frequency distribution table, standard deviation and diagram plotting were used at descriptive level. At inferential level parametric T-test and statistic F were used in order to test hypotheses. Also statistical correlation coefficient (R) was applied to prove existence of relation among the variables.
The results indicated that amount of correlation coefficient in the main hypothesis which examines the significant relation between creativity and innovation with productivity enhancement of employees in Isfahan Telecommunications Company is equal to 0.489 which states that enhancement of productivity, creativity and innovation have moderate significant relation with each other. Amount of statistic F is equal to 70.167 and amount of significance level
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is equal to 0.000. We can confirm hypothesis that examines existence of linear significant relation among independent variables (creativity and innovation) and dependent variable (productivity enhancement) with 99% confidence because amount of significance is lower than amount of type one error at level 0.01.
Conclusion
Statistics as well as average score of the questionnaire have been used in this research with regard to the impact of creativity and innovation on human force productivity and amount of statistic F. F parametric has been equal to 70.167 at significance level of 0/000, as a result F of the test is equal to 70.167>F= 70. Also amount of test average is 3.84 and the standard average is number 3, so it is obvious that test average of 0.84 is larger than standard average. Therefore impact of creativity and innovation on human force productivity is positive. Also amount of p-value of the test is equal to 0.007 which is lower than standard p-value that is 0.005. Hence we can claim that creativity and innovation have a positive and effective impact on human force productivity in view of employees of Isfahan Telecommunications Company. Given obtained results of this survey it is recommended that: 1- To create a legal and flexible structure for institutionalization of productivity through creativity and innovation that could be an incentive for managers and employees to improve the process of performing services. 2- To inform employees about obtained improvements of modern technology and the created changes and give them the opportunity to represent their suggestions and ideas and using their creativity and innovation power by authorities. Also it is recommended to hold courses for culturalization and create suitable beds to establish spaces of organizational creativity and innovation. 3- As Elena Hugo et al found out that impact of participation in educational courses in invention process is effective on productivity growth and showed that education of creativity and innovation is leaded to productivity enhancement, employees must be encouraged to represent modern and creative thinking. Moreover, suitable incentives should be considered for institutionalization of creativity and innovation culture in organizations and industries.
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References
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Ahmadi, A (1994), Researches of productivity and productivity researches, Tadbir Magazin, No.39. Bertschek, I, Fryges, H & Kaiser, U (2009), B2B or Not to Be: Does B2B Ecommerce Increase Labor Productivity? Discussion Paper No. 04-45 Retrieved September 7. Batacharbagodi, R (1991), Statistical concepts and methods, translated by Morteza Shahr Ashub and Fatah Mikaeeli, University Center Publications Biglari, A (1996), the manner of designing a model or models to measure productivity, lecture collections of productivity seminar, Productivity National Organization of Iran. Francalanci, C and Golal, H. (1998), Information Technology and Worker Composition: Determinants of Productivity in the Life Insurance Industry, MIS Quarterly. Islam, Rafikul and Ismail, Ahmad. Z,(2008) Employee Motivation: A Malaysian Perspective, International Journal of Commerce and Management, pp. 344 362,vol 2,NO115. Pohjola, M, (2010). Information Technology, Productivity, and Economic Growth: International Evidence and Implications for Economic Development, Oxford: Oxford University Press UTL publishes, Vol 2. Yang, Seung-Bum and Choi, Sang,(2009),Employee Empowerment and Team Performance, Team Performance Management, No15/5, pp.289 301.
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The Effect of Working Capital Management on Firms Profitability: A Review Paper

Mohammad Tahir
Phd Scholar, Faculty of Management and HRD (FPPSM), Universiti Teknologi Malaysia (UTM) 81310, Skudai, Johor Bharu , Malaysia Assistant Professor, Department of Management Sciences, COMSATS Institute of Information Technology, Islamabad, Pakistan
Dr. Melati Binti Ahmad Anuar

Senior Lecturer, Faculty of Management and HRD (FPPSM), Universiti Teknologi Malaysia (UTM) 81310, Skudai, Johor Bharu , Malaysia
Abstract This paper aims to accumulate the studies that have emerged to explore the relationship
between Working Capital Management and Corporate Profitability and also the Methodologies used along with the relevant Financial Ratios that have been employed in order to unearth the outcome of these studies for the period of 3 years from 2008 to 2010. This study focuses on the literature review and the adopted Methodology of the review paper. The Current Study demonstrates literature on Working Capital Management on Firms Profitability for the period of 3 years .This study takes into account the relevant Financial Ratios used and findings proposed accordingly. The firms Growth (in Sales) has significant and positive influences on the firms profitability. In this case the firm may add a number of benefits like monopoly or negotiate authority due to escalation as a reflection of economies of scale, a positive relationship between growth and profitability is anticipated. It is also worth mentioning that the ratio of fixed financial Assets to total Assets has a negative relation with the Dependent Variable in some of the studies in literature.
Keywords: Working Capital Management, Corporate Profitability.
Introduction
Working Capital Management plays a vital role in the day-to day function of the business and is therefore an important element of corporate finance as it directly influences the liquidity and profitability of any firm (Raheman & Nasr, 2007). Padachi (2006) accentuated that the management of working capital is imperative to the financial health of the business of all sizes. This significance is pivot for many reasons. First the amount invested in the working capital is in excess to the total assets utilized; therefore this amount may be used in an efficient manner. Efficiency in Working Capital
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Management is particularly significant in the Manufacturing Firms as most of their assets comprises of current assets (Home and Wachowitz, 1998). In other words, well ordered management of Working capital is a vital constituent of the general approach aspiring at escalating its market worth. (Howorth & Westhead, 2003: Deloof, 2003; Afza & Nazir, 2007), and efficient management of Working Capital would perhaps capitulate Kamalavalli, 2009). Secondly, the management of working capital directly influences the liquidity and profitability of the business and accordingly its net value (Smith, 1980). The effect of working capital management on corporate performance have been a hub of extensive amount of empirical research which was conceded worldwide (Shin and Soenen, 1998; Deloof, 2003; Narware, 2004; Filbeck and Krueger, 2005; Lazaridis and Tryfonidis, 2006; Padachi, 2006; Sayaduzzaman, 2006; Afza and Nazir, 2007; Chowdhury and Amin , 2007; Ganesan, 2007; Raheman and Nasr, 2007; Christopher and Kamalavalli, 2009 and Uyar, 2009). This paper aims to accumulate the studies that have emerged to explore the relationship between Working Capital Management and Corporate Profitability and also the Methodologies used along with the relevant Financial Ratios [See Appendix 1] that have been employed in order to unearth the outcome of these studies for the period of 3 years from 2008 to 2010. to substantial outcome , and to ignore it may be perilous to any firm (Christopher and
Literature Review
F.Samiloglu and K.DemirgOnes (2008) studied the effect of Working Capital Management on Firms Profitability in the Turkish Manufacturing firms by taking a sample of 5843 firm / quarter which were listed in Istanbul Stock Exchange (ISE) for the period 1998 -2007. They used Return on Assets (ROA) as Dependent variable and Account Receivables period (ACRP), Inventory period (INVP) and Cash Conversion Cycle (CCC) as Independent Variables. Their study considered the Firm size, Firm Growth (in sales), Leverage (Lev) and Fixed Financial Assets (FFA) as Control variables. Similarly, the study of M.A.Zariyawati, M. N. Anwar, H. Taufiq , AS. Abdul Rahim (2009) examined the relationship between working Capital Management and firms profitability. Cash Conversion Cycle is used as measure of Working Capital Management using the panel data of 1628 firm-year with observations of 148 firms for the period of 1996-2006 that consist of six different economic sectors of Malaysia which are listed in Bursa Malaysia.
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They used Operating Income (OI) as Dependent variable and Current ratio and Cash Conversion Cycle (CCC) as Independent variables. Their study considered the Debt Ratio (DR) Sale Growth (SG) as Control variables. Olufemi I. Falope OI, and Olubanjo T. Ajilore OT (2009) studied the effects of Working Capital Management on Profitability performance for a panel made up of 50 Non Financial firms listed in the Nigerian Stock Exchange for the period 1996-2005. They used Return on Assets (ROA) as Dependent variable and Number of Days Accounts Receivables (AR), Number of Days of Inventory (INV), Number of Days Accounts Payable (AP) and Cash Conversion Cycle (CCC) as Independent variables, while they considered Firm Size, Firm Growth (In Sales), Debt and GDPR (Annual GDP Growth) as Control variables. Similarly, the study of David M Mathuva (2010) observed the influence of Working Capital Management components on Corporate Profitability by taking a sample of 30 firms which were listed on the Nairobi Stock Exchange (NSE) for the period 1993 to 2008. They used Net Operating Profitability (NOP) as Dependent variable and Accounts Collection Period (ACP), Inventory Conversion Cycle (ICP), Average Payment Period (APP) and Cash Conversion Cycle (CCC) as Independent variables, while the study considered Firm Size, Leverage (Lev), Fixed Financial Assets Ratio (FFAR), GDPGR and Age as Control variables. Huynh Phuong Dong and Jyh-tay Su (2010) made an attempt to study the relationship between Working Capital Management and Profitability by gazing into the financial statements of 130 listed firms which are listed in the Vietnam Stock Market. They adopted Gross Operating Profitability (GOP) as Dependent variable and Number of Days Accounts Receivables (AR), Number of Days Inventories (INV), Number of Days Accounts Payable (AP) and Cash Conversion Cycle (CCC) as Independent variables. They also considered few Control variables in their study i.e. logarithm of Sales (i.e. Size of the firm), Debt Ratio (DR), Fixed Financial Assets to Total Assets (FATA) as Control Variables . Similarly, the study of Amarjit Gill , Nahum Biger , Niel Mathur (2010) explored the rapport between Working Capital Management and the firms profitability by taking a sample of 88 American Manufacturing Companies which are listed on the New York Stock Exchange for the period of 3 years from 2005 -2007. They considered Gross Operating Profit (GOP) as Dependent variable in their study and their Independent variables comprises of Number of Days Accounts Receivables (AR), Number of Days
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Accounts Payable (AP), Number of Days Inventory (INV) and Cash Conversion Cycle (CCC). Their study used Firm Size, Financial Debt Ratio(FDR) and Fixed Financial Asset Ratio (FFAR) as Control variables.
Research Methodology
This study focuses on the literature review and the adopted Methodology of the review paper. The Current Study demonstrates literature on Working Capital Management on Firms Profitability for the period of 3 years from 2008 to 2010.This study takes into account the relevant Financial Ratios used and findings proposed accordingly.
Findings of Research
Amarjit Gill , Nahum Biger , Niel Mathur (2010) explored the rapport between Working Capital Management and the firms profitability by taking a sample of 88 American Manufacturing Companies which are listed on the New York Stock Exchange for the period of 3 years from 2005 -2007. Pragmatic results showed that Accounts Receivables are directly related with the Working Capital Management and have shown notably negative effects on firms profitability. This means that while accounts receivables elongate, profitability declines or vice versa .The negative relationship between Accounts Receivables period and Profitability may be due to the reason that customers want more time to assess attribute of goods they purchase from firms with declining profitability (Deloof, 2003).On the other hand , less time taken by customers to forfeit their bills, the more cash is available to stock up the inventory, hence leading to more sales which result to an increase in profitability. The above findings are in line with the previous studies.( Deloof M , 2003;Lazaridis I, Tryfonidis D 2006; Raheman A , Nasr M, 2007; F.Samiloglu and K.Demirg Ones 2008; Olufemi.I.Falopeand Olubanjo.T. Ajilore, 2009; David M. Mathuva , 2010;Huynh Phuong Dong and Jyh-tay Su 2010) Amarjit Gill , Nahum Biger , Niel Mathur (2010) explored the rapport between Working Capital Management and the firms profitability by taking a sample of 88 American Manufacturing Companies which are listed on the New York Stock Exchange for the period of 3 years from 2005 -2007. The outcome of the study demonstrates that there is no significant relationship between Average number of Days the inventory is held and the corporate profitability. Exploratory, the relationship between the number of Days the inventory is held and the profitability made in the previous studies , the results reveal
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that the relationship is negative (Shin & Soenen, 1998; Deloof, M., 2003;
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Lazaridis I,
Tryfonidis D 2006; Raheman and Nasr 2007; F.Samiloglu and K.DemirgOnes 2008;Olufemi.I.Falopeand Olubanjo.T. Ajilore , 2009;Huynh Phuong Dong and Jyh-tay Su 2010; David M. Mathuva , 2010) The findings of negative relationship between inventory period and profitability divulge that the outcome of decreasing sales leading to lesser profits and more inventory, as stated in Deloof (2003)s findings. It can be argued that Firms holding too much inventory may experience reduction in the possible disruption in the production process. Results further recommends that Firms profitability can be augmented by curbing Accounts Receivables and Inventory periods. Moreover, longer storage times symbolize a greater investment in inventory for a specific level of operation. This assists to avert loss of business due to the paucity of products and reducing the cost of supplying the goods. In doing so, the firms are cosseted against price oscillation. (Blinder and Maccini, 1991) Amarjit Gill , Nahum Biger , Niel Mathur (2010) explored the rapport between Working Capital Management and the firms profitability by taking a sample of 88 American Manufacturing Companies which are listed on the New York Stock Exchange for the period of 3 years from 2005 -2007. In our study, the result confirms a positive relationship exists between Cash Conversion Cycle (CCC) and Corporate Profitability. However, In the study of F.Samiloglu and K.DemirgOnes (2008) , it was found that Cash Conversion Cycle have no notably effects on firms profitability of Turkish Manufacturing Firms listed in Istanbul Stock Exchange for the period 1998-2007. Moreover, a number of preceding research depicts that there is a negative relationship which between Cash Conversion Cycle (CCC) and Corporate Profitability. (Shin and Soenen , 1998: Deloof, M., 2003; Eljelly A , 2004; Raheman and Nasr 2007; Garcia Teruel PJ, Martinez-Solano PM , 2007; Falope OI, Ajilore OT , 2009). This result supports the expectation that a Cash Conversion Cycle (CCC) is associated with higher profitability and recommends that firm manager should fret on lessening of cash conversion period in order to erect shareholders wealth. The result is also consistent with the view that the time lag between the expenditure for the purchases of raw materials and the collection of sales of finished goods can be too long and that decreasing this time lag increases profitability (Deloof, 2003).
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M.A.Zariyawati, M. N. Anwar, H . Taufiq , AS. Abdul Rahim (2009)examined the relationship between working Capital Management and firms profitability. Cash Conversion Cycle is used as measure of Working Capital Management using the panel data of 1628 firm-year with observations of 148 firms for the period of 1996-2006 that consist of six different economic factors which are listed in Bursa Malaysia. In our study, Current Ratio (CR) is positively related to profitability. This shows that Cash Conversion Cycle (CCC) is measuring liquidity differently from the conventional Current Ratio. Generally, traditional liquidity ratios such as current ratio have been understood that is deficient of gauging the efficiency of the firms working capital management. For example is that they include assets that are not gamely convertible into cash and disregard the timing of Cash Conversion Cycle (Shin & Soenen, 1998). Amarjit Gill , Nahum Biger , Niel Mathur (2010) explored the rapport between Working Capital Management and the firms profitability by taking a sample of 88 American Manufacturing Companies which are listed on the New York Stock Exchange for the period of 3 years from 2005 -2007. In the above study, there exists no statistically significance between Average Days of Accounts Payable and Corporate Profitability. However, in the preceding studies, reported negative correlation of this variable and the profitability of the firm (Lazaridis I, Tryfonidis D 2006; Raheman and Nasr 2007; Garcia Teruel PJ, Martinez-Solano PM, 2007 ; Olufemi.I.Falopeand Olubanjo.T. Ajilore, 2009). The negative Correlation of this variable with Firms profitability signifies that the fewer profitable firms linger to disburse their bills. In that Profitability influence the Account Payable policies and vice versa. Moreover in some of the previous studies, Positive correlation exists between this variable and the firms profitability. This can be explicated with the fact that lagging payments to suppliers ensures that the firm has some cash to buy more inventory for sale thus escalating its sales level hence also enhancing its profits. (Huynh Phuong Dong and Jyh-tay Su 2010; David M. Mathuva , 2010). This result is in stripe with the Working Capital Management rule that firms should endeavor to insulate their payments to creditors as much as possible, taking care not to impair their business relationships with them. In some of the studies, Leverage has a significantly negatively affect on firms profitability. (F.Samiloglu and K.DemirgOnes, 2008; Amarjit Gill , Nahum Biger , Niel
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Mathur; 2010; David M. Mathuva , 2010). The negative of this variable on firms profitability shows that high leveraged firms are softer contestant that will curb investment (Myers, 2003), so their inadequate authority of contest may lead to diminish in profitability. Also increase in leverage will have an adverse affect on its profitability. However, the result of some studies indicates that there is a positive relationship with the Firms Profitability (Huynh Phuong Dong and Jyh-tay Su 2010). The positive of this variable on the Firms profitability that if there is an increase in debt ratio it will lead to increase in profitability of the firm In some of the studies Size and Financial Assets has no statistically noteworthy result on firms profitability. (F.Samiloglu and K.DemirgOnes, 2008; Amarjit Gill , Nahum Biger , Niel Mathur, 2010). It is also worth mentioning that the ratio of fixed financial Assets to total Assets has a negative relation with the Dependent Variable.(Amarjit Gill , Nahum Biger , Niel Mathur, 2010). However the result of few studies reveals that Firm Size is positively related to the Dependent Variable (Huynh Phuong Dong and Jyh-tay Su 2010). The positive correlation with the Dependent Variable means that larger firm report higher profits compared to smaller firms. This may be due to larger firms aptitude to use their economies of scale. This also connotes that size of the firm has effect on profitability of the firm. The larger size leads to more profit. In some of the studies, the firms Growth (in Sales) has significant and positive influences on the firms profitability. In this case the firm may add a number of benefits like monopoly or negotiate authority due to escalation as a reflection of economies of scale (Kulter and Demirgunes, 2007), a positive relationship between growth and profitability is anticipated. An enhancement in sales leads profits to grow.(Evanoff and Fortier, 1988: Michael, 1985; Civelek and Al-Alami 1991; and Ali Abdula , 1994).
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References:
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Abdul Raheman & Mohamed Nasr (2007), Working Capital Management and Profitability Case of Pakistani Firms, International Review of Business Research Papers, Vol. 3 (2), pp.275-296 Afza, T., Nazir , M.S. (2007). Is it better to be Aggressive or Conservative in Managing Working Capital?, Printed at Singapore Economic Review Conference (SERC), 2007, P.1-15 Ali Abdula, J.Y., (1994), An Empirical analysis of commercial banks performance in Bahrains, Saving Dev., 18:307-321 Arnold, G., (1998), Corporate Financial Management, 1st Edn . Pitman Publishing, London, ISBN: 0 273 63078 4, pp: 543. Blinder, A.S.and L.J. Maccini, (1991), The resurgence of inventory research: What have we learned? J.Econ.Survey, 5: 291-328. Chowdhury Anup & Amin , Md. Muntasir. (2007). Working Capital Management practiced in Pharmaceutical companies listed in Dhaka Stock Exchange. BRAC University Journal, Vol. IV, No.2, 2007, pp.75-86 Christopher, S. B., and Kamalavalli , A. L.(2009) .Sensitivity of profitability to Working Capital Management in Indian Corporate Hospitals . [Online] Available: http://ssrn.com/abstract=1331500 Civilek,M.A and M.W. Al-Alami, (1991). An empirical investigation of the concentration profitability relationship in the Jordanian banking Industry, Savings Dev _ Vol. 15 Deloof, M., (2003). Does working capital management affect profitability of Belgian firms. J. Bus. Finance Acc., 30: 573-587 Emery, GW, 1984b. A pure financial explanation for trade credit. J. Finan Quant. Aral., 9: 271285. Eljelly A , (2004) Liquidity profitability tradeoff : An empirical investigation in an emerging market. International Journal of Commerce and Management, 14: 48-61. Evanoff, D.D. and D.L. Fortier, (1988). Re-evaluation of the structure conduct performance paradigm in banking, J. Fin. Services Res., 1: 277-294 Filbeck, G.and T. Krueger, (2005). Industry related differences in Working Capital Management .Mid.Am.J.Business, 20: 11-18. F.Samiloglu and K.DemirgOnes (2008), The effect of Working Capital Management on Firms Profitability; Evidence from Turkey. The International Journal of Applied Economics and Finance 2 (1): 44-50 Ganesan, Vedavinayagam. (2007). An Analysis of Working Capital Management efficiency in telecommunication equipment. Industryrivier Academic Journal, 3, No.2, Fall. Garcia Teruel PJ, Martinez-Solano PM, (2007), Effects of Working Capital Management on SME Profitability, International Journal of Managerial Finance, 3: 164-177.
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Gitman, L.J., (1974). Estimating corporate liquidity requirements: A simplified approach . Finan . Rev., 9: 79-88. Home, J.and J.M.Wachowitz, Jr., (1998), Fundamentals of Financial Management.10th Edn.Prentice-Hall International, Inc., New Jersey, ISBN: 0-13-8898820. Howorth, C., Westhead,P. (2003), The focus of Working Capital Management in UK small firms .Management Accounting Research, 2003, vol. 14, p.94-111 Kutler, B. and k. Demirgunes, (2007), Determinants of profitability in retailing firms: An empirical study on ise listed retailing firms, .J. Cukurova Univ.Inst.Soc. Sci., 16: 445-460. Lazaridis, J. and D.Tryfonidis, (2006), Relationship between Working Capital Management and Profitability of listed companies in the Athens Stock Exchange ,J.Finan.Manage.Anal., 19: 26-35. Michael, S., (1985). Evidence on the (Non) relationship between concentration and profits ability in banking. J. Credit Banking, 17: 69-83. Myers, S.C., (2003) Financing of Corporations. In: Handbook of the Economics and Finance Vol 1, Constantinides , GM, M Harris and R. Stulz (Eds.). Elsevier Publications London, pp: 215-253. NarwareP.C.(2004), Working Capital and Profitability An empirical analysis. The Management Accountant, Vol. 39(6), pp 120-127. Nazir, M.S.(2009), Impact of Working Capital Aggressiveness on firms profitability. IABR & TLC Conference Proceedings, San Antonio, Texas, USA Padachi, K., (2006).Trends in Working Capital Management and its impact on firm,s performance; An analysis of Mauritan small manufacturing firms. Int.Rev.Business Res.Papers, 2:45-56. Raheman, A. & Nasr, M. (2007), Working Capital Management and Profitability _ Case of Pakistani Firms, International Review of Business Research Papers, 3(1), 279-300 Sayaduzzaman, Md. (2006), Working Capital Management, A study on British American Tobacco Bangladesh Company Ltd. The Journal of Nepalese Business Studies, III, No.1 Shin, H. H., & Soenen, L. (1998) .Efficiency of Working Capital Management and Corporate Profitability. Financial Practice and Education, 8(2), 37-45. Smith,K., (1980), Profitability versus Liquidity Tradeoffs in Working Capital Management, Readings on the Management of Working Capital. West Publishing Company, New York, St, Paul. Uyar, Ali (2009). The Relationship of Cash Conversion Cycle with Firm Size and Profitability: An Empirical investigation in Turkey., International Research Journal of Finance and Economics, ISSN 1450-2887 Issue 24, EuroJournals Publishing Inc.
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Annexure 1 a. Operating Income (OI) Definition: Operating Income (OI) is defined as the profitability of a companys basic business Activities. b. Return on Assets (ROA) Definition: Return on Assets (ROA) is a measure of the productivity of Assets regardless of how the Assets are financed. c. Accounts Receivables Definition:
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Accounts Receivables is defined as the amount which credit customer owes to the business or the amount which the business has to recover from the customer for the goods or services they have purchased on credit. Accounts Receivables in days represent the number of days that a firm takes to collect payments from its customers. d. Inventories Definition: Inventories are the list of stock of raw materials, work in process or finished goods waiting to be devoured in production or to be sold. Inventory in days signifies the number of days of inventory measures the average number of days of stock apprehended by the firm. e. Accounts Payable (AP ) Definition: Accounts Payable are those suppliers whose invoices for goods or services have been purchased by the business, but they have not been paid so far. Average Payment Period (APP) is the average period the firm takes to pay to its suppliers. The higher the value, the more time the firm takes to settle its outstanding payments to suppliers. f. Cash Conversion Cycle Definition: Cash Conversion Cycle as a fraction of operating cycle is a continuing liquidity measure as urbanized by Gitman (1974). Intimately associated with operating cycle is in short, the part of operating cycle, funded by the firm itself (McLaney , 1997) and is merely calculated by adding Inventory period to Accounts Receivables period and then subtracting Accounts payables period from it. It hubs on the duration of time between attainment of raw materials and other inputs and inflow of cash from the sale of goods (Arnold , 1998) . The shorter this cycle, the less resources the firm wants to fasten up, and the lower the value, the better it will be for the firm as it will have higher liquidity which easily
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VOL 3, NO 4 transform its short term investment in current asset to cash. The longer value of Cash Conversion Cycle (CCC) shows larger investment in current assets, and consequently the greater call for funding of current assets.
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g. Current Ratio (CR) Definition: Current Ratio (CR) is a measure of liquidity and is calculated by current Asset over Current Liabilities. The current ratio has always been used as a measure of corporate liquidity conventionally. h. Size Economies of Scale is implicated to have a positive relationship with the firms size. Size confines economies of Scale, and it is thought that as a company becomes big, it is better place to harvest economies of scale .However the impact of firm size on profitability can also be negative. Any positive influence on profits from economies of scale may be incompletely counteracted by greater aptitude to diversify assets ensuing in a lower peril and a lower required return in line with the Portfolio Theory (Evanoff and Fortier, 1988: Michael, 1985), Civelek and Al-Alami (1991) and Ali Abdula (1994) have ascertained this divergent idea. Another explanation is that smaller firms are easy to administer in terms of control and harmonization. We gauged the size (SIZE) as the logarithm of Assets. i. Leverage: Definition: Leverage means using borrowed money to earn a return greater than the cost of borrowing, increasing net income and return on common stockholders equity. j. Sales Growth (SG) Definition: Sales Growth is the increase or decrease of the annual Sales measured as a percentage. A positive effect from Sales growth on the recital gauge is assumed. k. Economic Cycle: As good fiscal conditions does have a propensity to be reflected in a firms profitability , we controlled for the escalation of the economic cycle using the variable GDPGR, which measures the Annual GDP growth.
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Important Formulas
S. No. a. b. c. d. e. f. g. g. h. i. j NAME OF VARIABLES Operating Income (OI) Return on Assets (ROA) Gross Operating Profitability (GOP) Number of Days Accounts Receivables (AR) Number of Days Inventory (INV) Number of Days Accounts Payables (AP) Cash Conversion Cycle (CCC) Current Ratio (CR) Logarithm of Sales (LoS) Financial Debt Ratio (FD) Fixed Financial Assets (FFA) FORMULA OF VARIABLES Operating Income + Depreciation / Total Assets Operating Income / Average Total Asset Sales Cost of Goods Sold / Total Assets Financial Assets 365 Days x Accounts Receivables / Sales
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365 days x Inventory / Purchases Average Payment Period / Purchases x 365 days No. of days A/R plus No. of Days inventory minus No. of Days Accounts Payable (AP) Current Assets / Current Liabilities Natural logarithm of Firms Sales , lagged one year period Short term loans plus long term loans divided by total Assets Fixed Financial Assets divided by Total Assets
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS The Influence of Intellectual Capital and Internal Auditing on Corporate Performance
Dr. Saudah Sofian Department of Management Faculty of Management and Human Resource Development Universiti Teknologi Malaysia, 81310 UTM Skudai, Johor, Malaysia Dewi Fariha Earnest (Corresponding Author) Department of Management Faculty of Management and Human Resource Development Universiti Teknologi Malaysia, 81310 UTM Skudai, Johor, Malaysia
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Abstract The purpose of this paper is twofold: to discuss the implication of intellectual capital (IC) and the internal audit function (IAF) on corporate performance; and to propose a future research that captures the influence of IC and IAF on corporate performance. Principally a review of literature, this paper aims to underline the ultimate latent contribution of IC and IAF to enhance corporate performance. Previous research advocates that IC and IAF will be futile if not recognized and managed as good as the tangible assets to achieve corporate success. While, IAF is an important function that assist the organization to meet its objectives and goals. A business might risk profitability for failing to capture IC contributions. The value of this paper rests on the attention drawn in the proposed conceptual research framework. Additionally, the inclusion of spiritual capital as one of the core IC components is new in studies of IC. Keywords Intellectual capital, internal auditing, human capital, spiritual capital, corporate performance Introduction Intellectual capital (IC) is viewed as the most valuable intangible assets in a company that stimulate value creation and boost overall corporate competitiveness (Bounfour, 2003; Roos et al., 2005). According to Roos et al. (2005), a companys IC is the difference between its market value and book value. A companys value is made up of both tangible and intangible assets (Harrison and Sullivan, 2006). IC includes information, knowledge, skills, experience, innovation, customer loyalty, patents, trademarks, relationships and intellectual property that will force innovation and value creation of an organization (Bontis et al., 2000; Usoff et al., 2002; Tayles et al., 2007). Indisputably, the existence of IC in the global business would allow companies to gain a competitive edge and promote sustainable growth to the business. As evidenced in Bontis et al. (2000), Bontis and Fitzenz (2002), Usoff et al. (2002), Pek (2005), Roos et al. (2005), Tayles et al. (2007) and Irene and Hooi (2009), IC is a positive attribute that influences corporate performance. Though IC typically remains hidden, nevertheless, it exists in every organization be it little or immense and it ultimately contributes to a companys success.
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In Malaysia, the importance of IC is already in the limelight of the government administration. However, there is a lack of empirical evidence in the country that shows IC is treated with a holistic approach via a systematic IC management. This is unexpected when Malaysia is assumed to have thoroughly shifting towards a knowledge economy country. The significance of IC, mainly human capital was highlighted and documented in the Ninth Malaysian Plan 2006-2010. The emphasis on human capital is further mentioned in the Tenth Malaysian Plan. Human capital is stressed as one element that is crucial to achieve the nations mission. Chapter Five of The Tenth Malaysian Plan (2011) states: Human capital lies at the core of innovation and a productive high income economy. It is the most important investment a country makes. No economy can succeed without a highly skilled talent base that is able to rapidly respond creatively to economic changes, and is centred on developing and utilising knowledge. (The Tenth Malaysian Plan, 2011) The Securities Commission revised Malaysian Code on Corporate Governance, effective 1 October 2007, requires all Malaysian public listed companies (PLCs) to establish an independent internal audit department to facilitate adequate internal control, risk management and enhance effective corporate governance. Cases of company collapses of the Enron-Andersen and World.Com could have been avoided if an independent audit function (particularly in Enron case) were able to perform their duties objectively, ethically and independently. Indeed, all the IC values such as knowledge, skills, expertise and ethics which are embedded in the internal audit function (IAF) of Malaysian PLCs are strongly viewed as the intangible assets that can drive the companies value creation and competitive edge. A company risks the loss of profitability, creativity, customer loyalty, competitiveness, and so on if IC is not managed and measured in a systematic manner (Brooking, 1997; Usoff et al., 2002). This paper provides two aims. First, a review of the existing literature is mainly to highlight the emerging issues relating to IC and IAF. Then, we seek to conceptualize the link between IC and IA by showing the importance of managing and measuring IC. We also demonstrate how IC and IAF could enhance corporate performance. Our second aim is to extend our literature analysis in initiating a basis for future research by presenting a proposal on how we foresee a study on IC and IAF in Malaysia can take place. Indeed, IC research is in its developing phase that there are vast opportunities to explore the area (Petty and Guthrie, 2000; Mouritsen, 2006). Being principally a conceptual paper, IC literature is critically reviewed to draw attention on important issues that require action. Finally, this paper suggests future research that aims to fill the gap in IC research and provide fruitful contribution to existing literature.
Definition and Classification of IC IC is generally referred as the difference between the market value and physical asset of an organization that is also termed as intangible asset of which among others includes knowledge, experience, professional skills, values and norms, technologies, innovation, processes, goodwill, patent and trademarks (Brooking, 1997; Andriessen, 2001; Usoff et al., 2002; Tayles et al., 2007). Nerdrum and Erikson (2001) defined IC as individuals complementary capacity to generate value and thus create wealth. Roos et al. (2005)
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defined IC as all nonmonetary and nonphysical resources that are fully or partly controlled by the organization and that contribute to the organizations value creation. While there are various definitions given on IC, in general, IC is commonly categorized into three components: (i) Human capital which is the attribute uniquely entrenched in an individual which not transferable into a physical substance (Roos et al., 2005). Human capital is one important aspect of IC because firms rely heavily on human knowledge and skills to generate profitability, foster value and growth, and improve overall organizational performance (Petty and Guthrie, 2000; Mayo, 2000). Human capital includes competence, knowledge, professional skills, experience, networks, creativity, leadership, education, innovativeness, motivation, changeability (Brooking, 1997; Roos et al., 2005; Tayles et al., 2007); (ii) Structural capital which are stored knowledge that remains in an organization even if an employee leaves the organization such as brands, innovation capital, patents, processes, organizational structures, databases, organizational charts, strategies and any other resources that bring higher value than its material value (Bontis et al., 2000; Roos et al. 2005; Tayles et al., 2007; Marr, 2008) and (iii)Relational capital which is usually customer and market related (Leliaert et al., 2003) and more of networking oriented. It is the intangibles that develops over time in an organization, like marketing channels, customer loyalty, customer and supplier relationships, governmental and industrial networking, intermediaries, partners, lenders, and the like (Bontis et al., 2000; Roos et al., 2005; Tayles et al., 2007; Marr, 2008). Apart from the common definitions and classification of IC mentioned above, Mazlan et al. (2005) proposed a new IC definition where IC is defined as all intangible assets, which include human capital, structural capital, relational capital and spiritual capital that can be leveraged or converted into value or profit. This is literally consistent with Zohar and Marshall (2004) view which emphasized that companies with high spiritual capital are better at placing and achieving wealth, goals, sustainability and vision. Spiritual capital is a new emerging concept which came after religious capital, however, it has no precise clear definition or measurement related to it (Finke, 2003). Nevertheless, Zohar and Marshall (2004) phrased spiritual capital as the amount of spiritual knowledge and expertise embedded in an individual or a culture. They defined spiritual capital as the wealth that helps sustain future humanity and wealth that nourishes and sustain human spirit. These spiritual wealth embedded in individuals are capable of generating decent profit and guarantee sustainability to a business. Indeed, Mazlan et al. (2005) offered a new definition that can be illustrate as the most comprehensive at this point for including spiritual capital as one important component of IC. This proposed new definition is seen to be very inclusive, relevant and practical. Spiritual capital is further defined as the intangible knowledge, faith and emotion of individual, whilst the organization carries vision, direction, guidance, principles, values and culture. Hence, after the inclusion of spiritual capital, the summary of four IC components is illustrated in Figure 1.
Managing IC When more organizations understand the importance of IC in creating competitive advantage and value, and the cost for ignoring it (Brooking, 1997; Usoff et al., 2002),
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they show mounting interest in managing and measuring IC more seriously. Undeniably, even up till today IC is often poorly documented or managed (Roos et al., 2005). Though the trend has shifted towards more IC oriented, however, more attention and efforts must be in place. Despite the fact that managing IC requires much effort, the risk of ignoring the existence of IC can be paramount to a business or organization. With more companies that make profit by only having intangibles assets, Brooking (1997) pledged that a system of monitoring, managing and valuing IC must take place. Lelieart et al. (2003) argue that a manager should understand how and what actions that might influence a companys IC, seek for ways to modify and improve its IC and search for tools to calculate or measure IC. Distinctively, Lelieart et al. (2003) show the flow on how IC is managed as shown in Figure 2.
Intellectual Capital and Internal Auditing The Internal audit function (IAF) is a unique function within an organization that provides continuous assurance and consulting services (Dittenhofer, 2001; Abdolmohammadi et al., 2006). The IAF is taken responsible by certified internal auditors, accountants or other professionals called internal auditors. Evaluating, analyzing and monitoring organizations procedures, controls, and risk management are IAFs prime concern. Dittenhofer (2001) notes that among internal auditing responsibilities is taking an important role in organization and also becoming part of management, to help ensure continuous success of a business. IAF is a profession that possesses high IC fundamentals such as experiences, knowledge, professionalism and skills with wide array of knowledge on the operations, policies, regulations, financial position and potential risks in a company. Hass et al. (2006) stress that the existence of the IAF would increase the organizational and stakeholders value through understanding corporate goals. This is consistent with the Institute of Internal Auditors (IIA) stance on the establishment of the IAF to evaluate and promote improvement of risk management, control and governance. However, Elliot et al. (2007) report that the IAF has not shown their role as adding value and offer benefit or savings to an organization.
As it is, under Securities Commission revised Malaysian Code on Corporate Governance, effective 1 October 2007 (Adequate Internal Audit in Most PLCs, 2007, October 3) all Malaysian PLCs are required to establish an independent IAF to facilitate adequate internal control, risk management and enhance effective corporate governance. IC values embedded within internal auditors can be said to appear as among core drivers to a businesss success. Knowledge, skills and experiences that internal auditors possess will be futile if not utilized for the benefit of the organization (Usoff et al. 2002). While, Rittenberg et al. (2008) states that internal auditors are required to have broad knowledge of organizational operations, understanding management strategies and risks associated with the strategies. Hass et al. (2006) then suggests that the existence of the IAF would increase the organization and stakeholders value through understanding organizational goals. At post-Enron crashes, serious attentions were placed on the issue of independence and outsourcing of internal audit function. Chatzkel (2003) strongly argues that corporate failure case such as Enron demonstrates that intangibles do exist, carrying values that can be powerful to drive business success, however can be manipulated and destroyed for wrong reasons. As such, internal auditors should avoid any conflicting relationship either
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with the management or audit committee. It was mainly the individuals behavior and intentional dishonesty that led to Enrons failure. This distinctively implies to the values of human capital and spiritual capital embedded within the internal auditors. Undeniably, both IC and IAF could not be ignored intentionally or unintentionally. How IC and IAF Influence Corporate Performance IC empower innovations, competitive strategies and value creations of an organization (Bontis et al., 2000; Usoff et al., 2002; Bounfour, 2003; Tayles et al., 2007) and allow companies to gain a competitive edge and sustainable business growth even during an economic distress. IC qualities also pose an impact on how internal auditors perform their duties (OLeary and Stewart, 2007) which eventually influences managers decision makings. Hence, this strongly indicates that the IC substance of internal auditors appears as a core driver to a businesss success. On the other hand, it is a requirement under the Securities Commission revised Malaysian Code on Corporate Governance (effective 1 October 2007), for all Malaysian public listed companies (PLC) to establish an independent internal audit function to execute adequate internal control, risk management and enhance corporate governance. Hence, the IAF in Malaysian PLCs should demonstrate that their existence is vital otherwise it will be ineffectual to maintain such function in a company. Andriessen (2001) argues there are synergies existing among intangibles that create uniqueness and wealth. The combination of human capital, structural capital and relational capital are interrelated hence makes the pact. Indeed, the importance of IC is apparent in uplifting a companys value, thus improve performance, providing competitive edge, profitability, efficiency, and the like (Brooking, 1997; Usoff et al., 2002; Roos et al., 2005; Tayles et al., 2007). Additionally, according to Zohar and Marshall (2004) companies with high spiritual capital are able to set goals and strategies, more alert with their achievement, vision and value led, have higher sense of holism, more compassionate, courageous and have good sense of humility. Bontis et al. (2000) study revealed that while IC components have significant influence over business performance, human capital were found to have a greater influence over other IC components in non-service industries compared to service industries. It is mainly the human capital capabilities (Bontis and Fitz-enz, 2002) such as knowledge, skills, know how, and so on that establish certain economic and corporate business outcomes. An investigation by Tan et al. (2007, p.76) using Pulics framework on 150 publicly listed companies on the Singapore Exchange found IC and company performance as positively related and the rate of growth of a companys IC is positively related to the companys performance. Tayles et al. (2007) study explored the perception of managers on IC and management accounting practices (MAP), and corporate performance. It was discovered that the term knowledge is commonly used rather than IC, and IC is reported internally. Human capital was the mostly recognized IC component, while structural capital is the least. Importantly, their findings indicate that the level of IC is associated with the level of business performance. This is consistent with Usoff et al. (2002) argument on the need for companies to measure and manage IC; otherwise there will be loss of value and profitability. The implications for ignoring IC could be severe.
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In the context of IAF, Hyland and Verreault (2003) agree that internal auditors possess the expertise in risk management and financial measurement, they believe that these qualities could create values thus yield competitive edge to their clients. As evidenced in their study, a cost benefit analysis performed by internal auditors on human resource management practices would eventually improve financial performance. Consequently, IC in IAF is reflected through the output and performance of the department via mission statement, its charter, integrity, behavior, reliability of financial information to name a few. Dittenhofer (2001) emphasized that productivity is very much associated with output, while the measures of performance is linked to effectiveness and efficiency. Brooking (1997) vie with the notion that losing an employee means a company loses a mass of corporate memory. The impact can be disastrous. Previous researches for instance Bontis et al.(2000), Mazlan et al. (2005), Pek (2005), Saudah (2005) and Tayles et al. (2007) reveal that IC is a significant contributor to corporate performance of Malaysian companies. While, Huang (2008) finds that fund managers and financial analysts in Malaysia do consider IC when evaluating financial statements. However, it is not yet to the extent of relying on particular information on IC because they view Malaysia as not valuing and practicing IC in an aggressive manner. Additionally, Usoff et al. (2002) argue that when a company fails to measure and evaluate IC, the company might face the risk of inefficiency, ineffectiveness and profits loss. This is in consistence with the resource-based view (RBV) theory of the firm which suggests that companies which are able of managing their resources, knowledge and dynamic capabilities effectively will result in an improved performance (Kristandl and Bontis, 2007; Raja Adzrin et al., 2009). According to Harrison and Sullivan (2006), on a consensus previous researches agree that IC (intangibles) bring dramatic importance and impact on organizations. Undeniably, IC and IAF are inseparable within the aim to execute its effective role as professionals to enhance the viability of improved corporate performance (financial or non financial). Therefore, these questions rise: Does having an IAF with expected high IC criteria in Malaysian PLCs lead the company to a greater dimensions of success and improved performance? If the companys management does have a method of managing and measuring IC in IAF, will there be any difference or improvements to the companys corporate performance? Consequently, since there is extremely little evidence linking IC and internal auditing, this study is strongly important in filling these absences.
Proposed Research Considering the heightened importance of IC in todays business, Kauffman and Schneider (2004) suggested that future research should consider IC to be more useful in its practical application, for example focusing on certain types of intangibles (other than knowledge) and investigate the functionality of intangibles. They suggested a focus on specific industry types such as comparing traditional manufacturing industry with a service or multimedia based company will be very interesting.
Previous researches such as Bontis et al. (2000), Pek (2005) and Tayles et al. (2007) revealed that IC does contribute to corporate performance of Malaysian companies. However, there is no indication so far that the corporate performance is a result of IC in IAF. Measuring and reporting IC in a formal manner for Malaysian PLCs seems to be less feasible at current time because IC concept is relatively new to these companies and
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even to the wide society. However, efforts should be made to educate and encourage these companies to take an early first step. While, Usoff et al. (2002) study on the importance of IC and performance measurement systems used internal auditors as respondents revealed that the size of the internal audit department is positively related to a companys stance on IC. They also argue that failing to measure and evaluate IC, company risks inefficiency, effectiveness and profits loss. Apparently, Usoff et al. (2002) proposed that future research should explore what are the characteristics of organizations that more highly appreciate the prospective contributions of IC. A Malaysian study by Tayles et al. (2007) assessed the relationship between IC and management accounting practices, and its effect on corporate performance. They discovered that IC within management accounting practices does bring positive impact on corporate performance. Human capital was found to be the most recognized IC components. This shows consistency with what has been specifically mentioned in The Ninth and Tenth Malaysian Plan on human capital. Further, Pek (2005) study on Malaysian commercial banks revealed that IC, particularly human capital, creates value to both domestic and foreign banks. Bontis et al. (2000) concludes that IC has a significant and substantive relationship with corporate performance in Malaysian industries regardless of its sector. However, their studies did not cover the interaction of various IC components with IAF. To date, there is yet such evidence. Interestingly, other than the three main IC components, spiritual capital was found in Mazlan et al. (2005) case study on Telekom Malaysia Berhad (TMB) to be another one important IC component that drives corporate performance. Their study found that managers of TMB perceived that spiritual capital pose greater affirmative influence on TMBs overall performance, better than the rest of IC components. In Huang (2008) study on the importance of IC information, it was evidenced that Malaysian financial analysts and fund managers do consider IC information in their evaluations. However, this is not to the extent of relying on them simply because they view Malaysian companies has yet achieved the level of aggressively valuing IC. In accounting context, IC is an area which is still young. The concept of IC is still new to the society. Therefore, massive opportunities of exploration are widely open within the field. Indeed, it is interesting to explore IC in IAF and its relative implications on business performance, particularly within the Malaysian setting. So far, there are generally few studies related to IC in Malaysia, however none has explored the influence of IC and IAF on corporate performance. Whilst, most IC literature is found emphasizing on IC disclosures issues (Kauffman and Schneider, 2004; Pek and Kwee, 2004), nevertheless, very little is discovered linking IC and internal auditing. Furthermore, Ali et al. (2006) discovered that auditing in Malaysia is a profession that is intertwined by political and socio-economic to reflect Malaysia as modern economy and attract foreign investments. Realizing there is extremely little evidence linking IC and internal auditing, this study is held important in filling these absences. Indeed, after depositing above arguments on IC and IAF, it is interesting to further explore the contributions of IC on corporate performance of Malaysian PLCs. The aim of this proposed research is twofold. First, the aim is to explore whether IC and IAF is acknowledged and managed in Malaysian PLCs. The second aim is to examine whether IC and IAF affects corporate performance of Malaysian PLCs. It is an ultimate aim of this
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research to see if the IAF brings positive synergy to improve corporate performance in Malaysian PLCs. If IC and IAF is proven to play an effective role in a companys success, then Malaysian PLCs should start seriously consider adopting a method to identify, manage, measure and utilizing IC and IAF in their company. It is also worth considering embarking the study on IC intensive companies such as technology, consumer products, trading and services and finance (Tayles et al., 2007; Huang, 2008). Consequently, the framework of the proposed research as shown in Figure 3 which reflects the theoretical view of this study that is developed based on the research frameworks of Tayles et al. (2007), Mazlan et al. (2005) and Saudah (2005). This proposed research is consistent with the reported concern by earlier writers indicating that IC should be made intensive and properly managed in organization (Brooking, 1997; Bontis et al., 2000; Roos et al., 2005; Tayles et al., 2007) and in the course of improving performance, promotes wealth creation and offer a competitive edge. This proposed research probes IAF as the moderator because its interaction controls the strength of a causal relationship between the independent variable (IC) and dependent variable (corporate performance) (Wu and Zumbo, 2008). The main idea is that IC and IAF influences corporate performance. In other words, the aim of this proposed research is to examine if the affixed IC components which are embodied in the IAF (when properly managed and measured) would influence corporate performance of Malaysian PLCs.
Discussion and Conclusion Indeed, it is not easy to develop an employees know-how, skills, knowledge or talent that might take years to establish. IC is very important that Brooking (1997, p.11) argues Lose the employee knowledgelose the trademark and the business has no value. Further, the latter suggests that the real value of a company lays in the intangibles not the tangibles. Continuously improving professional development, knowledge, maintain professionalism, being ethical in their duties are among main responsibilities of internal auditors as professionals. In that respect, extending optimal utilization of their knowledge and skills are mostly important for the betterment of a company. Malaysian studies covering IC includes Bontis et al. (2000), Pek and Kwee (2004), Mazlan et al. (2005), Pek (2005), Saudah (2005), Tayles et al. (2007), Huang (2008) and Irene and Hooi (2009). Due to the absence of empirical research evidence pertaining to IC in IAF, therefore, it is critically important to conduct an empirical study on this topic area. This paper at which attempts to draw attention on some important IC issues, concurrently exhibit our desire to suggest that future research should explore to see whether Malaysian PLCs do seriously acknowledge and manage IC.
Essentially, this paper points out the importance of managing and measuring IC in all organizations, particularly public listed companies which usually have large number of staff. We also suggest that there are large stockpiles of IC in Malaysian PLCs, however, little empirical evidence is found on the overall impact of IC and IAF on corporate performance leading us to highlight that future research should cover these issues. The issue of IC and corporate performance is frequently highlighted in literature, however little is found with relation to IC and IAF, particularly within Malaysian context. Nevertheless, this lack of evidence consequently inspires the researcher to embark on this study.
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Inevitably, the intended new knowledge gained from future research is believed to benefit the academicians, standards setters, regulators and also add to the existing stock of literature. It is expected the proposed research could present a better and thorough understanding on the scenario of IC in IAF in Malaysia. More important insights of the effect of acknowledging IC within IAF to further enhance business performance are illustrated. This paper also anticipates that the information gained from the proposed study will be forward to the standard setting bodies and governing agencies in the course of enhancing existing guidelines with related to IC. Concurrently, this will provide an impetus to Malaysian companies that shall encourage them to seriously acknowledge and utilize IC, as good as how they utilize their tangible assets in the organization to help sustain growth in their business. This proposed research is expected to add valuable contribution and provide fruitful contributions either academically or practically. Importantly, this proposed research will contribute to the existing anthology of literature. Hence, this study is expected to pose distinct new knowledge to the profession, educators, regulators and practitioners. Consequently, the emulation of improvements and contributions to the knowledge can be expanded over time. Finally, it also will offer a potential ground for more future research within the accounting profession and other fields relating to IC and IAF.
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References Abdolmohammadi, M. J., Burnaby, P. & Hass, S. (2006). A Review of Prior Common Body of Knowledge (CBOK) Studies in Internal Auditing and an Overview of the Global CBOK 2006. Managerial Auditing Journal, 218, 811-821. Adequate Internal Audit in Most PLCs. (2007, October 3). [Online] Available: http://biz.thestar.com.my/news/story.asp?file=/2007/10/3/business/19063631&sec=busin ess. Ali, A., Haniffa, R. & Hudaib, M. (2006). Episodes in the Malaysian Auditing Saga. Managerial Auditing Journal, 217, 684-701. Andriessen, D. (2001). Weightless Wealth: Four Modifications to Standard IC Theory. Journal of Intellectual Capital, 23, 204-214. Bontis, N., Chua, W. C. K. & Richardson, S. (2000). Intellectual Capital and Business Performance in Malaysian Industries. Journal of Intellectual Capital, 11, 85-100. Bontis, N. & Fitz-Enz, J. (2002). Intellectual Capital ROI: A Causal Map of Human Capital Antecedents and Consequents. Journal of Intellectual Capital, 33, 223-247. Bounfour, A. (2003). The Management of Intangibles: The Organizations Most Valuable Assets. London: Routledge. Brooking, A. (1997). Intellectual Capital. London: International Thomson Business Press. Chatzkel, J. (2003). The Collapse of Enron and the Role of Intellectual Capital. Journal of Intellectual Capital, 42, 127-143. Dittenhofer, M. (2001). Reengineering the Internal Auditing Organization. Managerial Auditing Journal, 168, 443-450. Dewi,F. A. & Saudah, S. (2005). Intellectual Capital and Internal Auditing: A Review. Conference Proceedings of The Asia Pacific Conference on Management of Technology and Technology Entrepreneurship 2008. 29-30 October. Melaka, Malaysia, 197-215. Edvinsson, L. (2000). Some Perspectives on Intangibles and Intellectual Capital 2000. Journal of Intellectual Capital, 11, 12-16. Elliott, M., Dawson, R. & Edwards, J. (2007). An Improved Process Model for Internal Auditing. Managerial Auditing Journal, 226, 552-565. Finke, R. (2003). Spiritual Capital: Definitions, Applications and New Frontier. The Spiritual Capital Planning Meeting, October 10-11, 2003. Harrison, S. S. & Sullivan, P. H. (2006). Einstein in the Boardroom: Moving Beyond Intellectual Capital to I-Stuff. Hoboken, New Jersey, John Wiley & Sons, Inc. Hass, S., Abdolmohammadi, M. J. & Burnaby, P. (2006). The Americas Literature Review on Internal Auditing. Managerial Auditing Journal, 218, 85-844. Huang, C. C. (2008). The Importance of intellectual Capital Information to Financial Analysts and Fund Managers. Accountants Today, 21, 16-18. Hyland, M. M. & Verreault, D. A. (2003). Developing a Strategic Internal Audit-Human Resource Management Relationship: A Model and Survey. Managerial Auditing Journal, 186, 465-477. IIA web The Institute of Internal Auditors (IIA). [Online] Available: www.theiia.org Irene, W. K. T. & Hooi, H. L. (2009). Intellectual Capital Performance of Financial Institutions in Malaysia. Journal of Intellectual Capital, 104, 588-599.
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Kauffmann, L. & Schneider, Y. (2004). Intangibles: A Synthesis of Current Research. Journal of Intellectual Capital, 81, 76-95. Kristandl, G. & Bontis, N. (2007). Constructing a Definition for Intangibles using the Resource Based View of the Firm. Management Decision, 459, 1510-1524. Leliaert, P. J. C., Candries, W. & Tilmans, R. (2003). Identifying and Managing IC: A New Classification. Journal of Intellectual Capital, 42,202-214. Marr, B. (2008). Intangible Asset Measurement. Accountants Today. November, 1618.Kuala Lumpur, Malaysia. Mayo, A. (2000). The Role of Employee Development in the Growth of Intellectual Capital. Personnel Review, 294, 521-533. Mazlan, I., Abdul, H. R., Raduwan, S., Nooh, A. B. & Ahmad, R. S. (2005). The Influence of Intellectual Capital on the Performance of Telekom Malaysia. Conference Proceedings of the Management of Technology and Technology Entrepreneurship 2005 Conference. 31 May-2 June. Johor Bahru, Johor: 197-215. Mouritsen, J. (2006). Problematising Intellectual Capital Research: Ostensive versus Performative IC. Accounting, Auditing & Accountability Journal, 196, 820-841. Nerdrum, L. & Erikson, T. (2001). Intellectual Capital: A Human Capital Perspective. Journal of Intellectual Capital, 22, 127-135. OLeary, C. & Stewart, J. (2007). Governance Factors Affecting Internal Auditors Ethical Decision-Making: An Exploratory Study. Managerial Auditing Journal, 228, 787808. Pek, C. G. (2005). Intellectual Capital Performance of Commercial Banks in Malaysia. Journal of Intellectual Capital, 63, 385-396. Pek, C. G. & Kwee, P. L. (2004). Disclosing Intellectual Capital in Company Annual Reports. Journal of Intellectual Capital, 53, 500-510. Petty, R. & Guthrie, J. (2000). Intellectual Capital Literature Review: Measurement, Reporting and Management. Journal of Intellectual Capital, 12, 1469-1930. Raja Adzrin, R. A., Abu Thahir, A. N. & Maisarah, M. S. (2009). Value Creation Strategy for Sustainability. Accountants Today, January, 12-13. Rittenberg, L. E., Schwieger, B. J. & Johnstone, K. M. (2008). Auditing: A Business Risk Approach. Thomson: South-Western. Roos, G., Pike, S. and Fernstrm, L. (2005). Managing Intellectual Capital in Practice. Oxford: Butterworth-Heinemann. Saudah, S. (2005) Intellectual Capital and Management Accounting Practices. School of Management. Ph.D Thesis. Bradford, University of Bradford. Tan, H. P., Plowman, D. & Hancock, P. (2007). Intellectual Capital and Financial Returns of Companies. Journal of Intellectual Capital, 81,76-95. Tayles, M., Pike, R. H. & Sofian, S. (2007). Intellectual Capital, Management Accounting Practices and Corporate Performance: Perceptions of Managers. Accounting, Auditing & Accountability Journal, 204, 522-548. The Ninth Malaysian Plan (2006). [Online] Available: http://www.epu.jpm.my/rm10/html/english.htm The Tenth Malaysian Plan (2011). [Online] Available: http://www.epu.gov.my/html/themes/epu/html/RMKE10/rmke10_english.html
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Usoff, C. A., Thibodeau, J. C. & Burnaby, P. (2002). The Importance of Intellectual Capital and its Effect on Performance Measurement System. Managerial Auditing Journal, 1712, 9-15. Wu, A. D. & Zumbo, B. D. (2008). Understanding and Using Mediators and Moderators. Social Indic Research, 87, 367-392. Zohar, D. & Marshall, I. (2004). Spiritual Capital: Wealth We Can Live By. San Francisco: Berret-Koehler Publishers, Inc.
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Figures
Intellectual Capital
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Human Capital Knowledge Skills Work experiences Competences Expertise Innovativeness Education Adaptability Intellectual agility
Structural Capital Brands Innovation capital Patents Process/ routines Databases Organizational structures Strategies
Relational Capital Marketing channels Brand image Customer loyalty Supplier relationships Partnerships Franchising agreements Market intelligence Industrial networking
Spiritual Capital Faith Emotion Determination Honesty Guidance Values Cultures Integrity
Figure 1: Classification of IC Adapted and Reproduced: Bontis et al. (2000), Zohar and Marshall (2004), Ismail et al. (2005), Roos et al. (2005), Tayles et al.(2007) and Marr (2008).
Management starts with understanding IC
Monetary value: IC
Managers need calculations
Figure 2: Measuring is Knowing Source: Lelieart et al. (2003, p.207).
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Independent variable
Moderator
Dependent variable
Internal Audit Function IC Components Human Capital Structural Capital Relational Capital Spiritual Capital Corporate Performance Financial performance Nonfinancial performance Overall performance
Figure 3: The Conceptual Framework in Exploring the Influence of IC and IAF on Corporate Performance
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Organizational Agility Development in Electronic Environment Using Fuzzy Logic
Daryosh Mohammadi Janaki
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Department Of Industrial Engineering, Najaf Abad Branch, Islamic Azad University, Najaf Abad, Iran
Mahdi Mohammadi Janaki
Department Of Industrial Engineering, Najaf Abad Branch, Islamic Azad University, Najaf Abad, Iran
Abstract The internet has spawned a rich set of tools that allow firms to engage in rich, interactive dialogues with a broad and diverse customer base, thereby enhancing firms ability to sense and respond to shifting customer needs and preferences. Although academics and practitioners suggest that IT is a key enabler of customer agility, we know little concerning how and why IT facilitates customer agility. Building on the dynamic capability literature, we propose that the knowledge creating synergy derived from the interaction between a firms web-based infrastructure and its analytical ability will enhance the firms ability to sense customer-based opportunities, and the process enhancing synergy obtained from the interaction between a firms coordination efforts and its level of IT integration will facilitate the firms ability to respond to those opportunities. This paper have a new approach to supply chain agility using Fuzzy logic and MADM to prioritize the main key success factor in Iranian auto industries, and hopes to take a step forward to gain better market position in international market by prioritizing the indexes using fuzzy logic. Keywords: Agility, Supply Chain Performance, Electronic Environment, Fuzzy MADM Introduction The digitization of supply chains has led to numerous business innovations and development of new models for managing physical information and financial flows (Bowersox et al. 2006; Rai et al. 2006; Sambamurthy et al. 2003). The introduction of information technologies often leads to superior performance of supply chains (Vickery et al. 2003). These technologies enhance the efficiency of work processes by facilitating superior execution of management processes through digitallyenabled work systems. For example, in the absence of the technological support, firms had to either rely on mass production of high volumes with high standardization or follow job production that led to high degree of customization but low volumes. However, enabled with its digital infrastructure, Dell Inc. simultaneously achieves the conflicting objectives of mass production and customization. Dell could simultaneously achieve these conflicting objectives as the customers could personalize their own electronic products that were assembled only after customer orders had been placed. The use of internet and advanced information technologies (IT) helped coordinate personalization of these mass customer orders before assembly. However, while the impacts of IT systems on fulfillment of customer demand are well documented in the popular press, little is known of the complex managerial dynamics that help some firms realize these superior impacts. The impact of IT is
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also associated with superior business and service performance. For example, Dell not only leveraged its technologies for customization and superior order fulfillment but also realized superior operational performance. Dell reduced its inventory to only six days and has a negative cash conversion cycle for its financial flows. It is thus no surprise that the firm's fulfillment of customer demand has gained increasing research attention. The increased interest to study demand fulfillment in supply chains is also due to the relatively little organizational attention to supply chains in last decade. For example, successful implementation of such initiatives, as supply chain partnering that are considered vital for business success, has been very restrictively adopted by only 50% of the respondents (Boddy et al. 1990). In general, there is a huge gap and hence opportunity to enhance the performance of supply chains. In a recent survey of North American manufacturers, Deloitte Consulting found that only 2% of the respondents regard their supply chains as world class (Li et al. 2005). Supply chains have also become critical to performance due to the increase in competitiveness of business environments and enhanced importance given to satisfying customer demand (hypercompetition) (D'Aveni 1994; Sambamurthy 2000). New ways of serving customers, managing production, and communicating with partners have changed the way various supply chains manage customer demand (Boyer and Olson 2002; Brynjolfsson and Smith 2000; Kaplan and Sawhney 2000; Lee and Whang 2001). Efficiency in day-to-day operations is no more a sufficient metric for evaluating performance of a firm's supply chain (Lee, 2004). It is realized that the firms now need to apply modern management principles to develop more advanced capabilities for rapidly managing customer demand. Thus, recent research has studied various supply chain capabilities such as absorptive capacity (Malhotra et al. 2005), supplier and customer side information capabilities (Barua et al. 2004), JIT (Banker et al. 2006), process integration (Rai et al. 2006), and customer and supplier participation (Banker et al. 2006). However, beyond these capabilities for superior operational performance, competitive performance of organizations is crucially dependent on their capability to rapidly respond to the changes in customer demand (Teece et al. 1997). Therefore, in this research, our focus is on demand management agility which is the capability of the organization to rapidly respond to changes in customer demand. We study the impact of information technologies used in demand management processes on the creation of agility in a firms demand management process. Literature review Technology plays an important role in coordination of activities within a firm (Gurbaxani and Whang 1991). Hence, we now examine the information technologies that are related to the four categories of initiatives discussed above. For each of the demand management initiatives, we evaluate matching demand management information technologies (IT) (see Figure 3). These technologies, related to each of these initiatives, are: 1. Internal supply side IT (for coordination): Technologies can play an important part in the coordination of information across departments. Given the amount of information that needs to be coordinated, digital means are the best measures to accommodate the granularity and details of this information. The use of such information technologies for coordinating the information across the logistics, supply chain, sourcing, and finance functions is considered critical. In this research we assess the frequency with which the firm uses these information technologies to manage the customer demand through internal supply-side initiatives.
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2. External supply side IT (related to sharing information with suppliers): These IT systems help firm to manage its demand management activities across its external suppliers, and technologies in this group include extensible markup language (XML), and electronic data interchange (EDI) for complete and real time visibility into the suppliers systems, partner related information systems, and group collaboration systems (Asgekar 2003). 3. Internal demand side IT (used for planning and forecasting demand). These technologies help integrate and bring in information from the firm's internal marketing department. These technologies, are critical for the development of responsive demand plans and include IT systems used for creating and changing products for new and short life cycle products, data mining, and scenario management,. 4. External demand side technologies (customer related). The technologies are used for bringing in the data from the customer outlets and include POS data collection technologies such as RFID, and Bar coding. (Fish and Forrest, 2007). Demand Management (DM) Agility Agility has become an important organizational characteristic due to the rapidly changing organizational environment which calls for greater responsiveness of the firm. It is defined as "the ability to detect opportunities for innovation and seize those competitive market opportunities by assembling requisite assets, knowledge, and relationships with speed and surprise." (Sambamurthy et al. 2003; D'Aveni 1994). Other related definitions of agility have been proposed since the construct is still in its initial stages of application to organizational phenomenon. For example, Sharrifi and Zhang (1999) define agility as "the ability to cope with unexpected challenges, to survive unexpected threats of the business environment, and to take advantages of changes as opportunities." Researchers studying agility have emphasized that firm's ability to respond is a key measure of agility (Dove 2001; Overby et al. 2006; Zaheer and Zaheer 1997). In this research we study the firm's response capabilities to meet customer demand as a measure of their demand management (DM) agility. The agility of the organization is intricately linked with the agility of its order management cycle (Swafford et al. 2006; Shapiro et al. 1992). It is thus not surprising that agility in the firm's order management cycle or its supply chain is often studied as a critical part of the organizational agility (see Sambamurthy et al. 2003; Swafford et al. 2006). For example, Narsimhan et al. (2006) surveyed 354 manufacturing plants in two phases and did a cluster analysis to distinguish low, lean, and agile performers. They compared the adoption of various supply chain best practices across the groups and found that agile performers are at par with lean performer group on statistical quality control and benchmarking. However, these agile performers rated higher in the adoption of practices such as supplier-base rationalization, customer orientation, integrated product design, supplier development, manufacturing strategy integration, cellular manufacturing, supplier information sharing, supplier partnerships, strategic supplier selection, JIT flow, TQM, and workforce development. However, in supply chain literature, there has been more than proportional emphasis on the supply side agility. Particularly, wide research attention has been given to the manufacturing agility that is defined by the researchers at Iaccoca Institute of Lehigh University as "...A manufacturing system with extraordinary capabilities (Internal capabilities: hard and soft technologies, human resources, educated management, information) to meet the rapidly changing needs of the marketplace (speed, flexibility, customers, competitors, suppliers, infrastructure,
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responsiveness). A system that shifts quickly (speed and responsiveness) among product models or between product lines (flexibility), ideally in real-time response to customer demands (customer needs and wants)" Youssef (1992). Data gathering Data gathering tools and their validity and reliability Data required for ascertaining research hypothesis is gathered via questionnaire. The questionnaire is comprised of 8 sections totally including 7 dimension about effectiveness of factors effecting on IT utilization on auto industries supply chain. Since the main objective of the work is to rank and classify the effective factors through multi-standard decision making in fuzzy environment, following fuzzy number and terms listed in table 1, therefore, are used: Table 1: Fuzzy numbers and terms (Ching et al. 2005) Terms Fuzzy numbers Very low (0, 5.0, 5.1) Low (1, 2, 3) Fairly low (2, 3.5, 5) Fair (3, 5, 7) Fairly high low (5, 6.5, 8) High (7,8,9) Very High (8.5, 9.5 , 10) The study uses questionnaire based on AHP principle for determining weight of seven groups of factors. Table (2), lists fuzzy numbers corresponding to priorities in pair comparisons: Table 2: Fuzzy numbers Terms Fuzzy numbers Priority or equal importance (1, 1, 1) Priority or low importance (2, 3, 4) Priority or high importance (4, 5, 6) Priority or very high importance (6, 7, 8) Priority or complete and absolute importance (8, 9, 10)
Validity and reliability of data gathering tools The term validity implies for the goal that a test tries to realize (Ching et al, 2005). In other words, a validity test is proper test for measuring what is intended to measure. Since the questionnaires in this study are designed based on diagnosed factors on background of the research and experts viewpoint, validity of the questionnaire is acceptable. Another technical specification of a questionnaire is its reliability, which has to do with uniformity of produced results in similar situation by a data gathering tool. There are different methods for calculating reliability coefficients including Chronbach Alfa calculated through computer aid method. So that, the nearer is to 100%, the higher reliability coefficient. This study uses Chronbach Alfa, which shows higher reliability of the questionnaire ( = 0.834,) Study group and statistical sample The study is conducted in different occasion on Iran auto industries. Study group is comprised of top managers in the auto industries (53 persons). 60 questionnaires therefore, distributed between the participants. Study framework has shown in figure 1:
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Figure 1: Study Framework
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Study results
Table 3 show study indicators that used in main questionnaire:
Dual comparisons of seven effecting factors on IT utilization in Iran auto industries supply chain were calculated with fuzzy AHP approach and calculating geometric average of fuzzy numbers for all samples, resulted weights are as follows:
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Table 4: Fuzzy Mean
Employee performance Customer relation Supply procurement Inventory management Production scheduling Transportation Orders process Service to customers Customer relations (1, 1, 1) (3.46, 4.58, 5.65) (0.20, 0.25, 0.35) (0.11, 0.12, 0.14) (0.20, 0.25, 0.35) (0.5, 0.57, 0.70) (6.92, 7.93, 8.94) Supply procurement (0.17, 0.21, 0.28) (1, 1, 1) (0.20, 0.25, 0.35) (020, 0.25, 0.35) (0.5, 0.57, 0.70) (2, 2.23, 2.44) (2.82, 3, 3.16) inventory management (2.82, 3.87, 4.89) (2.82, 3.87, 4.89) (1, 1, 1) (2, 3, 4) (0.17, 0.21, 0.28) (4.89, 5.91, 6.92) (4.89, 5.91, 6.92) Inventory management
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Transportation (2.82, 3.87, 4.89) (1.41, 1.73, 2) (3.46, 4.58, 5.65) (4, 5, 6) (1, 1, 1) (2, 3, 4) (4, 5, 6)
Orders process (1.41, 1.73, 2) (0.40, 0.44, 0.5) (0.14, 0.16, 0.20) (3.46, 4.58, 5.65) (0.25, 0.33, 0.5) (1, 1, 1) (5.65, 6.70, 7.74)
Customer services (0.11, 0.12, 0.14) (0.31, 0.33, 0.35) (0.14, 0.16, 0.20) (0.12, 0.14, 0.17) (0.16, 0.2, 0.25) (0.12, 0.14, 0.17) (1, 1, 1)
(6.92, 7.93, 8.94) (2.82, 3.87, 4.89) (0.25, 0.33, 0.5) (1, 1, 1) (0.16, 0.2, 0.25) (0.17, 0.21, 0.28) (5.65, 6.70, 7.74)
Looking at results in table 3, and fuzzy AHP process, what follows discusses about calculation weight of each effective factors on IT utilization in tail industries supply chain based on fuzzy AHP
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First step: calculating fuzzy combination expansion for each one of the factors:
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j =1
M gj1 = (1, 1, 1) + (0.28, 0.21, 0.17) + (4.89, 3.87, 2.82) + (8.94, 7.93, 6.92) + (4.89, 3.87, 2.82) + M gj2 = (5.65, 4.58, 3.46) + (1, 1, 1) + (4.89, 3.87, 2.82) + (4.89, 3.87, 2.82) + (2, 1.73, 1.41) + M gj3 = (0.35, 0.25, 0.20) + (0.35, 0.25, 0.20) + (1, 1, 1) + (0.5, 0.33, 0.25) + (5.65, 4.58, 3.46) + M gj4 = (0.14, 0.12, 0.11) + (0.35, 0.25, 0.20) + (4, 3, 2) + (1, 1, 1) + (6, 5, 4) + (5.65, 4.58, 3.46) + M gj5 = (0.35, 0.25, 0.20) + (0.70, 0.57, 0.5) + (0.28, 0.21, 0.17) + (0.25, 0.2, 0.16) + (1, 1, 1) + M gj5 = (0.70, 0.57, 0.5) + (2.44, 2.23, 2) + (6.92, 5.91, 4.89) + (0.28, 0.21, 0.17) + M gj5 = (0.35, 0.25, 0.20) + (0.70, 0.57, 0.5) + (0.28, 0.21, 0.17) + (0.25, 0.2, 0.16) + (1, 1, 1) +
7
(2, 1.73, 1.41) + (0.14, 0.12, 0.11) = (15.28,18.75, 22.17)

7
j =1
(0.5, 0.44, 0.40) + (0.35, 0.33, 0.31) = (12.25,15.84,19.3)

7
j =1
(0.20, 0.16, 0.14) + (0.20, 0.16, 0.14) = (5,41, 6.77, 8.27)
j =1
(0.17, 0.14, 0.12) = (10.9,14.11,17.33)

7
j =1
(0.5, 0.33, 0.25) + (0.25, 0.2, 0.16) = (2.46, 2.78, 3.34)

7
j =1
(4, 3, 2) + (1, 1, 1) + (0.17, 0.14, 0.12) = (10.70, 13.09,15.55)
j =1
(0.5, 0.33, 0.25) + (0.25, 0.2, 0.16) = (30.96, 36.26, 41.52)
i =1
j =1
M gji = (15.28,18.75, 22.17) (12.25,15.84,19.3) (5,41, 6.77, 8.27)
(10.9,14.11,17.33) (2.46, 2.78, 3.34) (10.70, 13.09,15.55) (30.96, 36.26, 41.52) = (88,107.64,127.51) (i =1 j =1 M gji ) 1 = (0.007, 0.009, 0.011)
7 7
Where S1: Customer relation S2: procurement/ supply S3: inventory management S4: production schedule S5: transportation S6: Orders process S7: customers services
S1 = (15.2, 18.7, 22.1) (0.007, 0.009, 0.011) = (0.11, 0.17, 0.25) S 2 = (12.2, 15.8, 19.3) (0.007, 0.009, 0.011) = (0.096, 0.14, 0.21) S 3= (5.41, 6.77, 8.27) (0.007, 0.009, 0.011) = (0.42, 0.62, 0.93) S 4 = (10.9, 14.1, 17.3) (0.007, 0.009, 0.011) = (0.085, 0.13, 0.19) S 5 = (2.46, 2.78, 3.34) (0.007, 0.009, 0.011) = (0.019, 0.025, 0.038) S 6 = (10.7, 13.0, 15.5) (0.007, 0.009, 0.011) = (0.083, 0.12, 0.17) S 7 = (30.9, 36.2, 41.5) (0.007, 0.009, 0.011) = (0.24, 0.33, 0.47)
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Conclusion
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The research tests the impacts of four different types of information technologies and business initiatives used in demand management process on organization's ability to respond to changes in customer demand. To summarize, while external supply side IT and internal demand side IT have predominantly direct impacts, the impact of the other two types are contingent in nature. While external demand side IT have synergistic influence with corresponding initiatives, the alignment that Assuming relationship pathways with alternate internal supply side IT have matching or the corresponding initiatives. Thus, the results indicate similar patterns of impacts may be a broad and (the demand planning manager)
characterize the way IT impacts accrue in a given process.
all technologies to have only
unrealistic assumption. The study has two key limitations. Firstly, the data for the study was collected by surveying a single respondent within each organization. There might thus be respondent bias that cannot be ruled out. The dual respondents within organizations help reduce the variability due to personal preferences. However, given that demand management is a niche field within a firm, we had to forego this option. While the research results would have been more robust in light of a dual response design, we believe that the results make significant contributions by exploring an area of research that has hitherto been very hard to study primarily due to the limited availability of people in this field of work.
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References:
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Bowersox, D.J., Closs, D.J., and Cooper, M.B. Supply Chain Logistics Management, (2nd ed.) McGraw-Hill, New York, 2006. Rai, A., Patnayakuni, R., and Patnayakuni, N. "Firm Performance Impacts of Digitally Enabled Supply Chain Integration Capabilities," MIS Quarterly (forthcoming)) 2006. Sambamurthy, V., Bharadwaj, A., and Grover., V. "Shaping Agility through Digital Options: Reconceptualizing the role of IT in Contemporary Firms," MIS Quarterly (27: 2), June 2003, pp 237-263. Vickery, S.K., Jayaram, J., Droge, C, and Calantone, R.J. "The Effects of an Integrated Supply Chain Strategy on Customer Service and Financial Performance: An Analysis of Direct Versus Indirect Effects," Journal of Operations Management (2:5 December) 2003, pp 523-539. Li, S., Rao, S.S., Ragu-Nathan, T.S., and Ragu-Nathan, B. "Development and Validation of a Measurement Instrument for Studying Supply Chain Management Practices," Journal of Operations Management (23:6) 2005, pp 618-641. Boddy, D., Cahill, D., Charles, M., Fraser-Kraus, H., and Macbeth, D. "Success and failure in implementing partnering," European Journal of Purchasing and Supply Management (2:3) 1998, pp 143-151. D'Aveni, R.A. Hyper competition: Managing the Dynamics of Strategic Maneuvering. The Free Press, NY, 1994. Sambamurthy, V. Business strategy in hypercompetitive environments: Re-thinking the role of IT differentiation Pinnaflex Educational Resources, Inc., Cincinnati, OH, 2000. Kaplan, S., and Sawhney, M. "E-Hubs: The New Marketplaces," Harvard Business Review) 2000, pp 97-103. Brynjolfsson, E., and Hitt, L. "Paradox lost? Firm-Level Evidence on the Returns to Information Systems," Management Science (42:4) 1996, pp 541-558. Boyer, K.K., and Olson, J.R. "Drivers of Internet Purchasing Success," Production and Operations Management (11:4) 2002, pp 180-198. Lee, H.L., and Whang, S. "Winning the Last Mile of E-commerce," MIT Sloan Management Review (42:4) 2001, pp 54-62. Lee, H., Padmanabhan, V., and Whang, S. "Information Distortion in a Supply Chain: The Bullwhip Effect," Management Science (43:4) 1997, p 546. Lee, H.L. "The Triple-A Supply Chain," Harvard Business Review (82:10) 2004, pp 102114. Barua, A., Konana, P., Whinston, A.B., and Yin, F. "An Empirical Investigation of NetEnabled Business Value," MIS Quarterly (28:4) 2004, pp 585 - 620. Malhotra, A., S. Gosain, et al. "Absorptive Capacity Configurations In Supply Chains: Gearing For Partner- Enabled Market Knowledge Creation," MIS Quarterly (29:1)2005. Teece, D.J. "Economics of scope and the scope of the enterprise," Journal of Economic Behavior and Organization (1) 1980, pp 223-247. Gurbaxani, V., and Whang, S. "The impact of information systems on organizations and markets.," Communications of the ACM (54:1) 1991, pp 59-73. Asgekar, V. "Event Management Graduates with Distinction," Supply Chain Management Review) 2003. Fish, L.A., and Forrest, W.C. "A Worldwide Look at RFID," Supply Chain Management Review), April 2007.
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Dove, R. Response ability: the language, structure and culture of the agile enterprise John Wiley & Sons, New York, 2001. Sharifi, H., and Zhang, Z. "A methodology for achieving agility in manufacturing organizations: An introduction.," International Journal of Production Economics (62) 1999, pp 7-22. Youssef, M.A. "Agile manufacturing: A necessary condition for competing on global markets," Industrial Engineering-.December) 1992, pp 177-180. Zaheer, A., and Zaheer, S. "Catching the Wave: Alertness, Responsiveness and Market Influence in Global Electronic Networks," Management Science (43:11) 1997, pp 14931509. Narasimhan, R., Swink, M., and Kim, S.W. "Disentangling leanness and agility: An empirical investigation," Journal of Operations Management (24:5-1 September ) 2006, pp 440-457. Ching-Torng, L. Hero, Ch. Po-Young, Ch. (2005). Agility index in the supply chain, Int. J. Production Economics.
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MACROECONOMIC EFFECTS OF EXTERNAL DEBT AND DEBT SERVICE ON ECONOMIC GROWTH IN PAKISTAN (A Case Study of Pakistan 1970-2010)
Waheed Murad (Corresponding Author) M.Phil Research Scholar Hamdard Institute of Education and Social Sciences (HIES) Hamdard University, Karachi, Pakistan Dr. Farooq Aziz Assistant Professor Department of Business Administration Federal Urdu University of Arts, Science and Technology Karachi, Pakistan Abstract
This study focuses the effects of external debt and debt service on Economic Growth of Pakistan considering the other explanatory variables such as gross capital formation, rate of inflation and terms of trade by using time series data for the period 1970 to 2010 is used. This study investigates the relationship between external debt, Debt Service and economic growth by using OLS regression model. Unit root test (ADF test) was used to check the stationarity of time series and after running OLS regression, test of normality, serial and auto correlation test, hetroscedasticity test, model specification tests were used. It was revealed through tests that regression line was best fitted; most of the independent variables were individually significant and were jointly significant to explain dependent variable that model was best specified and no error in the model was found. Results of estimation equation showed that external debt and debt service to GDP ratio have negative impact on economic growth of Pakistan as it was hypothesized and gross capital formation and inflation have positive impact on economic growth of Pakistan. The findings of the study is that practice of reliance on external borrowing is unsustainable unless serious efforts are made to overcome the basic weaknesses in the economy and to improve its overall productivity and to manage its debt in a better way. Key Words: Macroeconomic effects, External Debt, Debt Service, Economic Growth
1.
Introduction
In early seventies underdeveloped countries were encouraged by developed countries to borrow from abroad to finance their current account deficit to boost up their economic growth. From 1980s the international financial institutions have been providing help to debtor countries in an attempt to reduce their external debt burdens, foster growth, reduce poverty and attain viability. These measures have resulted in considerable success in alleviating the external debt burdens of many middle-incomecountries. However, many poor countries continue to suffer from poverty, civil conflicts, high external debt burdens and low economic growth. (Clements, Benedict, 2002) In the second half of the 1990s, policy makers and public opinion around the world have been increasingly concerned that high external indebtedness of developing countries is limiting growth and development. (Clements, Benedict, 2002).These debates made this issue very important and a lot of studies were conducted to
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understand the impact of external debts on growth and economic performance of developing countries. Like many other countries of the world, Pakistan has accumulated large external debt. Pakistan began to receive foreign economic assistance from July 1951 but substantial increase took place in outstanding debt during the second half of 1960s when debts were taken for building dams and industrialization. At that time the rate of accumulation averaged about 24 per cent per annum. At the end of December 1969, the external debt of Pakistan amounted to $2.7 billion while by December 1971, the figure rose to $ 3.6 billion and in June 1977 it was $ 7 billion which gives an average annual growth rate of about 11 per cent per annum. Later Pakistan continued to rely heavily on external resources to fill the increasingly high fiscal and external sector deficit and a sustainable pattern of external account was not maintained. One obvious consequence of continuous borrowing was the continuous debt-servicing burden. Thus a high level of debt stock and debt servicing emerged in the decade of 1980s and continued to be so in the decade of 1990s and afterwards in the second half of 2000s. Although the debt reduction strategy pursued in the beginning of the decade of 2000s brought some temporary relief in the form of restructuring and rescheduling of debt, yet in the financial year of 2007 alone, total debt and liabilities stock rose by 10 percent, the share of short-term debt increased and the share of foreign debt at floating interest rates also increased. This attempt has been made to study and analyze the causes of indebt-ness of Pakistan and to understand the relation of its external debt and debt service with economic growth in the presence of some other relevant variables. How and how far external borrowing has affected Pakistans growth performance is the fundamental question for this study.
2.
Data and Research Methodology

The level of this study is explanatory, seeking to identify the relation between the Economic
Growth and External Debt and Debt service. We used the Deductive Method and comprehensive analysis with literature review and econometric analysis. Econometric analysis served primarily to operations and regression analysis results, which were essential for hypothesis testing. The results of data analysis and estimation are obtained using statistical and econometrics computer packages (E Views version 3) The study is conducted based on secondary data collected from internal and external data resources. For this study the sample is the data set consists of 40 observations over the period 1970 till 2010 and in order to investigate the impact of external debt on economic growth of Pakistan econometric model and estimators are used. The data is analyzed using regression analysis. To avoid the spurious results that are associated with non stationary time series models Unit Root Test (ADF test) is used. To check the robustness and misspecification of the model, Normality Test, Serial and Autocorrelation Test (LM test), Hetroscedasticity Test (White Test), Wald-coefficient Restrictions
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Test and Redundant Variable likelihood Ratio Test are also used. Besides these tests descriptive statistics is also used. The data is obtained from domestic and foreign sources. For the domestic sources from Economic Surveys of Pakistan, Pakistan Economic Indicators, Federal Bureau of Statistics, State Bank of Pakistan while for external sources from World Debt Tables, Global Development Finance, World development Indicators, Different World Bank reports and IMF publications.
3.
Hypothesis
This study is preceded on the base of following hypothesis: that H0 HA High external debt and debt service has a negative correlation with Real GDP of Pakistan from 1970-2010 High external debt and debt service has a positive correlation with Real GDP of Pakistan from 1970-2010
4.
Empirical Literature Review

In economic literature of recent times, there are different studies about the relation between
External Debt and Economic growth. A few of these studies discussed that reasonable debt levels have a positive effect on growth; other models suggested that high accumulated debt stocks are likely to be associated with lower growth or negative growth. There have been several attempts to empirically assess the external debt-economic growth link i.e. debt overhang and crowding out effect theories. We discussed all these studies respectively: Amoateng and Amoako-Adu (1996) have investigated the relationship between external debt servicing, economic growth and exports for the total sample of 35 African countries during 19831990. The empirical results declared that there is a unidirectional and positive causal relationship between foreign debt service and GDP growth. Chowdhury (1994) investigated the direct, indirect and full effects of external debt on GNP and vice versa, by using a system of simultaneous equations. The results of the model show that the effect of public and private external debts on the GNP level is small. The author found that the external debt of developing countries is not a primary cause of economic slow down (Chowdhury, Khorshed, 1994). Fosu (1999) has employed an augmented production function to investigate the impact of external debt on economic growth in sub-Saharan Africa for the 1980 -1990 period. The author has used tests to measure the direct effect of debt overhang hypothesis namely that external debt negatively affect economic growth even if it has little or no effect on the level of investment. The findings show that as debt variable is included in the equation, debt exhibits a negative coefficient. And this might be due to a poor performer receiving large external debt ( Fosu, Agustin K, 1999). Krugman, Paul, stated that if there is some likelihood
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that in the future debt will be large than the country's repayment ability, expected debt-service costs will discourage further domestic and foreign investment (Krugman, Paul, 1988). Cunningham (1993) examined the association between debt burden and economic growth for 16 heavily indebted nations. This study concludes that the growth of a nations debt burden had negative effect on economic growth during the period of 1971-1979 (Cunningham, Rosemary, T., 1993). In economics, crowding out theoretically occurs when the government expands its borrowing to finance increased expenditure or tax reduction, crowding out private sector investment by way of higher interest rates. If increased borrowing leads to higher interest rates by creating a greater demand for funds and hence a higher "price", the private sector, which is sensitive to interest rates will likely reduce investment due to a lower rate of return. This is the investment that is crowded out and a fall in can hurt long-term economic growth (Gul, Adnan, 2008). Kruger(1987) states that after the rise in oil prices, the oil importing developing countries faced large current account deficits. On the other hand, oil exporters had large current account surpluses, which they lent to the commercial banks, which in turn financed the deficits of oil importing countries, thus the surpluses of the oil exporting countries were used by oil importing developing countries (Krueger, Anne O., 1987).
5.
External Debt and Economic Growth of Pakistan

Pakistans economy was agricultural based economy when it gained independence in 1947
from Britain. In sixties Pakistan was able to reduce the difference in growth of agriculture and manufacturing. Agriculture growth increased 6 percent while industry grew by 10 percent during the period 1960-65. (Zaidi, S, A., 2005) In1965 after war industrial growth was slow down, defense expenditure were increased while the GDP growth rate remained 6.8% on average per annum. The large deficit in the balance of trade throughout was financed by the increasing flow of foreign loans. In fact big foreign loans inflow helped accelerating the economic growth. At the end of December 1969, the external debt of Pakistan amounted to $2.7 billion while by December 1971, the figure rose to $ 3.6 billion. In 1972 government brought fundamental structural reforms and key industries, banks and companies were nationalized to break the link between the industrial and financial capital, improve the efficiency of the manufacturing sector and ensure a fair and equitable distribution of income, but the percentage share of both the manufacturing and agriculture in GDP declined. Growth rate in large scale manufacturing reached the lowest percent of 4.7 per annum. Thus decline in the two major sectors of the economy led to decline in GDP growth to 2.3 percent per annum even lower than the growth rate achieved in the period 1955-60. In 1977 external debt was $ 7 billion which gives an average annual growth rate of about 11 per cent per annum .Although the average growth rate has slackened since 1977-78, about 6.5 per cent per annum, the indebtedness continued to rise. In this era decisions to acquire debts and to increased budget deficit were influenced by political needs rather than economic priorities. Such uncontrolled expenditure mainly started during Zia era when foreign
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aid started to flow in due to Afghan war. (Zafar, Rehan, Muhammad., 2009) The large accumulated amount of foreign debt has increased the liability of debt service payments manifold. The total debt service payments (principal plus interest) which were only $182 million in 1970-71 rose to $603 million in 1980-81. Debt service went up to $ 788 million in 1984-85, $1.11 billion in 1987-88, $ 1.232 billion in 1989-90. Debt servicing liabilities grew at annual average rate of 8.3 per cent during 1980-81 to 1990-91. The debt servicing liability exhibits a rising trend in 1990s, rising from $ 1.316 billion in 1990-91, thus registering an average increase of 8.8 per cent per annum and showing an increase of 148 percent during the decade which means more than one billion dollar was accumulated each year. The period of 1980s was more focused towards denationalization and the role of public sector was to be reduced. The Growth rate of GDP in 1980s remained at 7.1% on average. The Pakistani economy in this era was benefited from rising worker remittances, which rose to a peak of US $3 billion in 1982-83 (10% of the GDP). The governments of 90s also brought in more debt and economic crisis for the country. These governments failed in reducing the fiscal gap, control, reduce borrowing or induce sustained growth in the economy. If we compare the decade of 80s with decade of 90s the later is more adverse. The external debt increased from $15.2 billion in 1989-90 to $28.6 billion in 1995-96 showing a growth rate of 11%. Debt servicing as percentage of GDP increased from an average of about 5% in 80s to nearly10% in the 90s. In 1986-87 debt servicing was 34.4% on total revenues of the government which increased to 51.7 percent in 1995-96 and the share of debt servicing in total expenditure was 23.5% in 1986-87 but then rose to nearly 40% in 1995-96, while its share in current expenditure rose from 31% to 46 %. External debt servicing as percentage of exports earnings increased from 32.6% in 1989-90 to 52.2% in 1995-96 and External debt servicing as percentage of total foreign exchange earnings increased from 18.8% in 1989-90 to 34% in 1995-96 (Appendix Table 6). For the year 1990-94, average GDP growth per year was recorded at 4.9 percent, which dropped further in the year1995-99 period to 4.3 percent. The slowdown in economic growth in this period occurred in the backdrop of a macroeconomic context that had been burdened by significant imbalances induced by fiscal imprudence of successive governments since the 1980s, and high fiscal and current account deficits, leading to unsustainable levels of public debt(domestic and external), an external financing constraint imposed by the Pressler Amendment, associated policy inconsistencies that were a result of an uneasy transition to democracy in the 1990s. As a result of these weaknesses Pakistan's investment climate deteriorated, leading to capital flight and a fairly systemic erosion of investor confidence over a period of time.(Asian Development Bank, 2002)
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Fig 1
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Fig 2
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40000 30000 20000

1000 2000
10000 0 70 75 80 85 90 95 00 05 10 External Debt (million US $)

0 70 75 80 85 90 95 00 05 10 Total D ebt Serv ice (m illion U S $)
(Data Source: Economic Surveys of Pakistan, various issues, Bar Graph is plotted by using EView 3)
(Data Source: Economic Surveys of Pakistan, various issues, Line Graph is plotted by using EView 3)
In 2000, the government made significant inroads in macroeconomic reform, but more work was needed to be done. The event of September 11, 2001 and Pakistans alliance with coalition forces in the fight against terrorism helped its economy in many ways. The rescheduling of $12.5billion bilateral and multilateral external debts resulted in about $1.5 billion annual relief in shape of decreased debt servicing charges. Lifting of sanctions brought handsome foreign grants about $1 billion to $1.5 billion per annum during last four five years. Some external debts were written off. U.S. assistance has played a key role in moving Pakistan's economy from the brink of collapse to setting record high levels of foreign reserves and exports, historic low inflation, solid 5% GDP growth, and dramatically lowers levels of debt in 2002. The GDP growth rate remained around annual average of 4.9% during 2000s. The Fiscal deficit remained around annual average of 4.5% of GDP while the primary balances remained surplus. The current account balance remained surplus around an annual average of 1.9% of the GDP. The external debt increased to $37 billion in 2005 that is 36.6% of the GDP as compared to 50.2% of GDP in 2000. In fact public Debt to GDP ratio declined from 102.8% of the GDP in 2000 to 74.6.3% of the GDP in 2005 mainly because of healthy GDP growth rate and premature retirement of expensive debts to ADB. (Appendix , Table6).
Pakistan positioned itself as one of the four fastest growing economies in the Asian region during 2000-07 .Its real GDP increased from $60 billion to $170 billion, with per capita income rising from under $500 to over $1000 during 2000-07. Large capital inflows financed the current account deficit and contributed to an increase in gross official reserves to $14.3 billion at end-June 2007. On October
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11, 2008 State Bank of Pakistan reported that country's foreign exchange reserves had gone down by $571.9 Million to $7749.7 Million. The foreign exchange reserves had declined more by $10 billion to an alarming rate of $6.59 billion. In November 2008, The International Monetary Fund (IMF) has approved a loan of 7.6 Billion to Pakistan, to help Stabilize and rebuild the country's economy. More recently the government of Pakistan received an economic aid of US $5bn dollars out of which the US pledge of $1bn was described as a down-payment on the previously announced $1.5bn already promised to Pakistan for each of the next five years. The European Union promised $640m over four years, while reports said Saudi Arabia had pledged $700m over two years. Overall Friends of Pakistan had pledged $1.6 billion in aid, which would help Pakistan, move forward on its way to self-reliance. Despite, the severe challenges, the economy has shown resilience in the year 2009. GDP growth for 2009-10 has been recorded at 4.1 percent while it was 1.2 percent in 2008-9. The incipient recovery in the economy has come about in the face of strong headwinds. The severe challenges the economy had to navigate through in the outgoing year were energy and water shortage and the sharp rise in the number of incidents of terrorism across the country and the scale and nature of attacks, which affected growth and investment. The global "war on terror" has been imposing a heavy cost on the economy since 2001. It is estimated that the cost to the economy of terrorism amounted to around 6 percent of GDP in 2009-10 and Pakistan has impacted to the extent of over US$ 43 billion between 2001 and 2010 (Economic Survey of Pakistan 2009-10). The economic history of Pakistan reflects the Fig 3 Governments current inability to forced establish cuts a
10 8 6 4 2
sustainable pattern of public finance. High expenditures in development expenditures thus retarding the infrastructural development. An inelastic, nonprogressive tax structure with narrow tax base and a big size ever developing black economy are the main structural weaknesses in the fiscal policy. The easiest recourse of monetizing the budget deficit and financing the expenditures by borrowing from abroad was adopted. The result was an ever-rising public debt and expenses on debt servicing. The policy makers always been attracted
0 70 75 80 85 90 95 00 05 10 GDP Growth (annual percent)
(Data Source: Economic Surveys of Pakistan, various issues, Line Graph is plotted by using EView 3)
by the idea of maximizing foreign assistance for financing budget deficit and big investment lay out to achieve high growth. The domestic savings were too low to finance it. Instead of relying upon stable
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and sustainable sources of external financing like exports, FDI, portfolio investments and foreign assets of Pakistan for stimulating growth of economy, the policy makers remained dependent on unstable and less sustainable sources of external financing like loans, foreign aid, and remittances. Thus the economy of Pakistan has always remained under stress due to high fiscal and external sector imbalances, high aggregate demand, unsustainable GDP growth, high unemployment and levels (Mehmood, Tahir., 2008). poverty
6.
Model Specification
Recent literature has provided a significant body of evidence about the most relevant
indicators and predictors of external debt crises. The key macroeconomic indicators are output growth, external debt ratio to GDP, external debt service ratio to GDP, external debt service ratio to exports(reflects the crowding out effect), gross capital formation , rate of inflation(reflects macroeconomic stability) and terms of trade (captures external shocks). To capture all relevant debt burden indicators, the model adopted is based on Elbadawi et al's (1996) model specification. Like in similar studies, the debt burden indicators enter the production function directly, therefore, the regression equation is specified as: RGDPt = f (ED, TDS, DSR, GCF, INFL, TOT)----------------------------------(1) Where RGDPt = Real GDP at time t, ED = Stock of External Debt to GDP ratio (-), TDS = Total
Debt Service to GDP ratio (-), INFL = Rate of Inflation (- or +), DSR = The Debt Service as a ratio of export earnings (-), TOT = Terms of Trade (- or +), GCF = Gross Capital Formation as a ratio of GDP (+) Using equation (1) and expressing the variables in natural logarithmic form, an attempt has made to look at the relative contributions (elasticitys) of each variable to the growth process. Therefore, the model to be estimated is specified as: LRGDPt = 0 + 1LED+ 2LTDS+ 3LDSR+ 4LGCF+ 5LINFL + 5LTOT +t---------- (2) In equation (2) above, all variables are in log form and 1, 2, 3, 4 elasticitys, and t is the random disturbance term.
and
5 are coefficients of
7.
Econometrics Results
We used Augmented Dickey Fuller (ADF) tests to test the stationarity of the series. We
applied this test on four stages; at first without trend and intercept, then with trend but without
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intercept, then with trend and intercept and we found that all variables were non stationary therefore at last stage we test all series with 1st difference and ADF statistic(t statistic) was less than ADF critical values (1%,5%,10%) and in all cases p value was less than 0.05 so null hypothesis that unit root exists was rejected which means the 1st difference of variables become stationarity. Then we transformed all series with 1st difference (See Results in Appendix Table 1). After transforming all variables in 1st difference we run the Ordinary Least Square (OLS) Regression equation. In the results R-squared is 0.79. It means that 79 percent variation in RGDP can be explained jointly by six independent variables such as LTDS, LDSR, LED, LGCF, LINFL and LTOT. The rest 21 percent variation in RGDP can be explained by residuals or other variables other than mentioned below. Most of the independent variables are individually significant to explain dependent variable. This matter was checked by t statistics and its p values. In our case as shown in the OLS output results p value for LTDS is 0.00, p value for LDSR is 0.01 and p value for LED, LGCF, LINFL is 0.00 and p value for LTOT is 0.68. Since the p value for first five variables is less than 0.05 we can reject the null hypothesis that coefficients are equal to zero, and can accept alternative hypothesis but for LTOT p value is more than 0.05 so we cannot reject null for this variable. Hence we can conclude that independent variables LDSR, LED, LGCF and LINFL are significant and can influence RGDP but the independent variable LTOT is not significant at 0.05 level of p value to explain RGDP (See results in Appendix Table 2) Independent variables are jointly significant to explain dependent variable. This matter was checked using F statistics. Null hypothesis Ho : B1=B2=B3=B4=B5=B6=0, Alternative H1: Not all Bs are simultaneously equal to zero. If the p-value of F statistic is less than 5 percent (0.05) we can reject the null and accept alternative hypothesis. If we can reject null hypothesis, it means that all the independent variables jointly can influence dependent variable. In this case as shown in the OLS results F statistics for joint hypothesis is 20.39 and p value is 0.00 so we can reject the null hypothesis and can accept alternative hypothesis. It means that all the independent variables jointly explain dependent variable. We plotted the histogram of residuals the applied jarque-Bera statistics to check the normal distribution of residuals and the null hypothesis was that residuals are normal distributed results show that jarque Bera statistics (0.617478) and p value is 0.73 which is greater than 0.5 (See Appendix Fig4)thats why we cannot reject null hypothesis and we accepted that residuals are normal distributed.
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7.1 Serial or Autocorrelation and Model Specification Tests Results
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Serial correlation can be formed in the model because of incorrect model specification, incorrect functional form, and incorrectly transformed data or because of incorrect model specification. For this purpose Breusch-Godfrey Serial Correlation LM test was applied and its results showed that F statistics is 0.37 and p value 0.69 and Observed R-squared is 0.94 and p value is 0.63. Since p values are more than 5 percent (p>0.05), we can not reject null hypothesis meaning that residuals (u) are not serially correlated which is desirable (See Appendix, Table 3). We also plotted correlograms of residuels which shows that Q statistics is insignificant with large p values which means that there is no serial correlation in residuals, and no autocorrelations and partial autocorrelations at all. Then we applied White Heteroscedasticity test. Heteroscedasticity is a term used to describe the situation when the variance of the residuals from a model is not constant and it is not desireable. When the variance of the residuals is constant, we call it homoscedasticity which is desirable. In this test Null Hypothesis was that Residuals (u) are Homoscedastic and Alternative hypothesis that Residuals (u) are Hetroscedastic. White heteroskedasticity tests results show that the p-value of Observed R-squared is more than 0.05 which show that we can not reject null. So residuals do have constant variance which is desirable meaning that residuals are homoscedastic (See Appendix, Table4). Given that the model is well-specified (to be argued in our case) as in OLS Regression Results t statistic of variable TOT is 0.42 and p value is 0.68 which is more than 0.05 and we cannot reject null hypothesis (H0 : B6=0)which means this variable TOT has no significance in this model so we can drop this variable. For this purose we applied Wald-coefficient Restrictions Test. In Wald Test Ho : B7=0 and result showed that p values of F statistics and Chi-square both are more than 0.05 so we cannot reject null hypothesis, which means the coefficient of variable TOT is 0 and it has no significance in the model. So we dropped this variable from the model because it is tested that it has no significance in this model and our estimation equation was as under (see Appendix, Table5) DLRGDP = 0.07293461184 0.2080456134*DLTDS + 0.2136987951*DLDSR -
0.3885645645*DLED + 0.4339552472*DLGCF + 0.0562451565*DLINFL This estimation equation shows that Debt Service to GDP ratio and External Debt to GDP ratio affect RGDP negatively whereas, Debt Service to exports ratio, Gross Capital Formation and Rate of Inflation have a positive effect on output. The individual coefficients represent respectively, elasticities with respect to output.
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8. Conclusion
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This study attempts to evaluate how external debt is possibly hitting economic growth in Pakistan. The study tries to explore the linkage between economic growth and external debt by using the set of major macroeconomic and external debt indicators. A number of equations are estimated, however, we report only that equation which include the variables found consistently significant. The results of the various diagnostic tests are reported and the tests did not detect any problem of hetroscedasticity, non-normality and serial or autocorrelation. None of these tests reported were nothing to suggest that the model was mis-specified. The goodness of fit, also called the overall significance of the model, as measured by R squared, shows that about 79.27 percent of the variations in the dependent variable (LRGDP) is explained by the explanatory variables. This overall significance test of the model indicated that explanatory variables jointly are statistically significant. The results of estimated equations showed that the coefficients of most of the independent variables have expected signs and are statistically significant, except for TOT variable. The sign of the coefficient of TOT variable is positive and it is not statically significant thats why it is dropped from the model. The results suggest a negative impact of stock of external debt to GDP ratio on the output (Real GDP) and it was expected and aligned with the theory. The results tally with the findings of similar studies. And this result confirms that an excessively high stock of external debt affects economic growth negatively, and as it is statistically significant, hence the main hypothesis that debt to GDP ratio has negative impact on economic growth is not rejected. The results also suggest a negative impact of Debt Service to GDP ratio on output which was expected. These findings support the hypothesis that debt service, which requires the use of foreign exchange earnings in repaying loans to creditors, divert resources from productive domestic investment and consequently, hinders economic growth. However, the impact of debt service to export ratio on economic growth is positive and statistically significant. The impact of Gross Capital Formation to GDP ratio is positive and statistically significant; supporting the findings of the earlier studies that capital formation is the main source of economic growth. Furthermore, the coefficient is quite robust in the estimated equation. Further, focusing on the perspective of mobilization of private investment in developing countries, our model suggests that higher GDP growth rate attracts private investment and helps in mobilizing resources towards investment. However, external debt stock to GDP and Debt servicing to GDP does hamper economic
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crowding out.
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growth, and may leave less funds available to finance private investment in the country leading to
The estimates for inflation are significant but the degree of effect is relatively lower. It has been said that inflation may stimulate growth at low and containable levels but can impact negatively on growth at high levels. The results show that current inflation rate stimulates economic growth.
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References
Amoateng, Kofi. Ve Amoako, Adu.B.(1996): "Economic Growth, Export and External Debt causality: The case of African Countries." Applied Economics, Vol 28, pp 21-27
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Asian Development Bank (December 2002) Escaping the Debt Trap; An assessment of Pakistan's External Debt sustainability, working Paper no.1 pp 4-5 Chowdhury, Khorshed(1994): " A Structural Analysis of External Debt and Economic Growth: Some Evidence From Selected Countries in Asia and Pacific", Applied Economics, Vol 26, pp1121-1131) Clements, B., Bhattacharya, R., and Nguyen, Q., (2003), External Debt, Public Investment, and Growth in Low-Income Countries. IMF Working Paper 249. Cunningham, Rosemary, T. (1993): " The Effects of Debt Burden on Economic Growth in Heavily Indebted Nations", Journal of Economic Development Economics, Vol 52, pp 169-187) Economic Survey of Pakistan 2004-5, 2006-7, 2007-8, 2008-9, 2009-10 An online publication by accountancy.com.pk Elbadawi, A. I., J. B. Ndulu., and N. Ndungu (1996), Debt overhang and economic growth in SubSaharan Africa, A paper presented to the IMF/World Bank conference on External Financing for Low Income Countries in December Fosu, Agustin K (1999) " The External Debt Burden and Economic Growth in the 1980s: Evidence from Sub-Sahara Africa", Canadian Journal of Development Studies, Vol 20, No 2, pp 307-318 Gul, Adnan (2008) Pakistan's Public Debt: The shocks and aftershocks, http://mpra.ub.unimuenchen.de/11427) Krugman, Paul, 1988, " Financing Vs. Forgiving a Debt Overhang," Journal of Development Economics, Vol. 29, pp 253-268) Krueger, Anne O. (1987): "Debt Capital Flows, and LDC Growth, American Economic Review, Vol 77, pp 159-164) Mehmood, Tahir., Rehman, Hafeez-ur., (2008) Evaluation of Macro Economic Policies of Pakistan(19502008), Journal of Political Studies, pp 60-61) Pattillo, C., Poirson, H., and Ricci, L., (2002), External Debt and Growth, IMF Working Paper 69. WP/2002/69. ).
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State Bank of Pakistan Annual Report 2008-2009(October 30 2009)
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World Bank. World Debt Tables/Global Development Finance/World development Indicators (various years). Washington, D.C. The World Bank Zaidi, S, A., (2005) Issues in Pakistan's Economy, pp 2) Zafar, Rehan, Muhammad., 2009 The Debt Trap: IMF, the World Bank and Pakistan,
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Appendix
Table 1: ADF test Results(E View3 out put):
LRGDP ADF with 1st difference ADF Test statistic 1% critical value 5% critical value 10% critical value LTDS LDSR LED LGCF LINFL LTOT
-5.21052 -4.2092 -3.5279 -3.1949
-8.90956 -4.2092 -3.5279 -3.1949
-8.07327 -4.2092 -3.5279 -3.1949
-8.17143 -4.2092 -3.5279 -3.1949
-4.24217 -4.2165 -3.5312 -3.1968
-6.79357 -4.2092 -3.5279 -3.1949
-6.61211 -4.2092 -3.5279 -3.1949
Fig 4 : Normality Test (Histogram and Jarque-Bera Statistic)Result

14 12 10 8 6 4 2 0 -0.10
Series: Residuals Sample 1971 2009 Observations 39 Mean Median Maximum Minimum Std. Dev. Skewness Kurtosis Jarque-Bera Probability 9.99E-17 0.005248 0.108182 -0.099329 0.053354 0.194876 2.522423 0.617478 0.734372
-0.05
0.00
0.05
0.10
Table 2: OLS Regression Result (E View3 out put):

Dependent Variable: DLRGDP, Method: Least Squares Variable Coefficient Std. Error t-Statistic C DLTDS DLDSR DLED DLGCF DLINFL DLTOT R-squared Adjusted R-squared S.E. of regression Sum squared resid Log likelihood Durbin-Watson stat 0.073160 -0.210158 0.214033 -0.393300 0.447286 0.057763 0.031321 0.792689 0.753818 0.058142 0.108174 59.46913 1.828697 0.009699 0.079846 0.073280 0.076052 0.148980 0.017022 0.074603 7.543000 -2.632026 2.920755 -5.171493 3.002315 3.393504 0.419834 Prob. 0.0000 0.0130 0.0064 0.0000 0.0052 0.0019 0.6774 0.071389 0.117181 -2.690725 -2.392137 20.39289 0.000000
Mean dependent var S.D. dependent var Akaike info criterion Schwarz criterion F-statistic Prob(F-statistic)
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Table 3: Breusch-Godfrey Serial Correlation LM Test (E View3 out put):
Breusch-Godfrey Serial Correlation LM Test: F-statistic Obs*R-squared 0.369992 0.938822 Probability 0.693848 Probability 0.625371
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Table 4: Hetroscedaticity test (E View3 out put)

White Heteroskedasticity Test: F-statistic Obs*R-squared 1.430272 15.50780 Probability Probability 0.214680 0.214833
Table 5: Wald Test (E View3 out put)

Wald Test: Equation: Untitled Null Hypothesis: C(7)=0 F-statistic Chi-square 0.176260 0.176260 Probability Probability 0.677412 0.674607
Table 6: Data series used in OLS Regression analysis (1970-2010)

Year RGDP (Real GDP) ED (External Debt Ratio of GDP 34 34.4 30.8 71.9 55.2 48.4 47.7 47.5 44.6 43.8 39.8 36.5 34.3 41.5 40.3 40.7 44.1 47.7 44.2 42.2 48.7 46.8 TDS (Total Debt Service ratio of GDP 1.8 1.7 1.3 3 2.2 2.2 1.9 2.1 1.8 2.2 2.5 2.1 1.6 2.2 2.3 2.5 2.8 3.3 2.9 2.8 3.1 2.9 DSR (Debt Service ratio of Export receipts 52 43 21 24 19 24 22 27 25 26 25 20 20 24 26 32 30 30 25 24 25 22 TOT (Terms of Trade) 87 90 83 96 106 67 71 109 105 126 111 97 89 89 95 93 90 96 96 90 90 78
1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991
10027 10602 9309 6325 8773 11340 13338 15126 17820 19708 23690 28101 30726 28692 31152 31145 31899 33352 38473 40171 40010 45451
GCF (Gross Capital Formation ratio of GDP 16 16 14 13 13 16 17 19 18 18 18 19 19 19 18 18 19 19 18 19 19 19
INFL (Rate of Inflation GDP deflator, annual %) 4 5 6 16 25 24 12 9 9 7 9 10 9 5 10 5 3 5 10 9 6 13
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1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 48635 51478 51894 60636 63320 62433 62191 62973 73952 72309 72306 83244 97994 109502 127325 142893 164500 162300 173600 49.9 49.5 50.1 50 50.6 50.2 49.3 50.2 57.5 51.1 54.9 51 44.7 37.3 33.5 32.2 27 31.2 30.3 3.1 3.2 3.4 3.4 3.4 3.6 3.8 2.6 2.1 2.8 1.6 1.6 3 1.3 1.2 1.1 1.2 2.1 1.7 22 24 26 25 25 27 27 20 18 21 13 12 24 10 10 9 10.3 18 15.7 20 21 20 19 19 18 18 16 17 17 17 17 17 19 22 23 22 19 10 9 13 14 8 13 8 6 25 8 2 4 8 7 10 8 16 20 10
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83 81 101 103 100 102 124 116 98 91 91 82 79 74 65 63 55 57 56
Source: World Development Indicators (WDI) & Global Development Finance (GDF) http://databank.worldbank.org/ddp/home.do and Economic Surveys of Pakistan (several issues)
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The Model for Optimization of Manpower Scheduling Plans in New Industries with Linear Programming
Mohammad Taleghani (Corresponding Author)
Associate professor , Department of Business Management & Accounting, Tonekabon branch,

Islamic Azad University, Tonekabon, Mazandaran , Iran Mahmood Samadi Largani
Assistant professor, Department of Business Management & Accounting, Tonekabon branch,

Islamic Azad University, Tonekabon, Mazandaran , Iran Seyyed Javad Mousavian Masters, Department of Business Management, Rasht branch, Islamic Azad University, Rasht, Iran
Abstract The problem of workforce optimization has recently experienced a huge success in view of its growing importance in the operations research community. More than ever before there has been a high proliferation of research articles in the area of staff scheduling. The recent advancement is heightened as a result of a special issue offered by an academic journal in the current year. Despite the diversity of approaches and knowledge integration in the field of staff scheduling, little or no research has been made relative to the determination of an optimal level of shifting jobs in service organizations. This work is important in this direction. A linear programming model was developed to determine the minimum size of the workforce of an organization. The focus is actually on jobs that require shift schedules among the workers with the utmost aim of reducing operational cost. The literature contains an update that reflects the recent rapid development of the field.
Keywords: Personnel Scheduling, Job Shift, Workforce Size, Operational Cost, Optimality
1. Introduction In the last two decades, dynamism, complexity, globalization, and international competition have been putting enormous pressure on businesses to improve the efficiency of their operations. In achieving this, research works have focused not only on the scheduling of jobs
but also on the scheduling of personnel (Aickelin and Dowsland (2000), Andrea and Meisels (2006), Beddoe and Petrovic (2003)). More recently, production systems in their urge to meet up with the ever increasing production demand have resolved to work around the clock. The term Job shift is used to describe this phenomenon which has become part of many production systems. Experience, coupled with research findings has shown that the bulk of
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operational costs in many production systems are incurred from the desire to cater for the human resource. The problem of workforce optimization has recently experienced a huge success in view of its growing importance in the operations research community (James and kamiyama (2002), Mason and Nielsen (2007), Meisels, Gudes, and Solotorevsky (2006), Wren (2006)). The recent advancement is heightened as a result of a special issue offered by an academic journal in the current year. Despite the diversity of approaches and knowledge integration in the field of staff scheduling, little or no research has been made relative to the determination of an optimal level of shifting jobs in the small scaled service organizations (SMEs) (Meisels, Gudes and Solotorevsky (2007), Rhian and Silvestro (2000), Warner (2006)). This work is important in this direction. The desired goal of most production systems is to utmost operate at a minimized cost. Personnel scheduling have become a much recent focus to attaining the desired optimality in operations by most production systems. For actualization of efficiency and effectiveness of operations, the application of personnel scheduling models cannot be undermined especially when job shift is the basis of operations.
2. Problem Description The problem that all operations managers face day in and out is that of optimality in allocating (human and material) resources. The challenges posed by the limitation of resources on the global level constitute a threat to managers. Such problems as provision of basic and modern working facilities, development and implementation of training programmers, avoidance of delayed payment of wages and inadequacies in paid wages, provision of motivating incentives, constraint on space availability for operations and the effectiveness and efficiency of organizational span of control are only a few of the key problems faced by managers with poor personnel scheduling skills. The attainment of optimality in personnel scheduling is the focus of this paper. Consider a system with N workers operating on a daily routine of j shifts on different days i. The utmost goal of the management of this system is to ensure that size of her workers is on the optimal level. With this, losses associated with low productivity resulting from undersized workers population as well as costs incurred due to oversized workers population would be minimized. Idleness on the part of any shift worker while on duty is against the interest of the management. The occurrence of this phenomenon is an indication of oversized workers population. Workers off duty are permitted to be either absent from work or idle while in the system. The inability of workers to meet the target for a particular shift j could be attributed to undersized workers population. These problems as highlighted thus far have motivated this research work.
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3. Model Formulation A shift model, developed by Beasley as presented in his Operations Research (OR) note, formed the basis for the development of the shift model for this paper. Some significant differences that exist between the present work and Beasley's lie in the following: (i) a shift system already in existence was considered in his model however, in this work the focus is on a newly intended shift system. (ii) the scheduling process of his model allows for a continuous flow of new workers into each new day as long as the span of their working duration in a particular shift is yet to be completed. This however may not always be the case in reality where each new day and shift is faced with the entry of new set of workers considering the fact that the older workers are yet to complete the total number of working days requires of them. Our context, of a new worker as regards Beasley's work is not necessarily a new employee, but someone new to the group of workers in the different shifts of each working day. The model presented in this paper, is a case of reality for most shift systems. However, it would precisely be of much benefit to newly intended shift systems. We considered the fact that a set of shift workers is first employed into the system's units where worker's scheduling is practiced. The management timetabling policies for the workers as in the assumption acts as a guide to knowing when another set of workers would be needed since the currently employed workers would certainly go on job off. As such, we tend to optimize the use of the workforce resources. The model formulation is oriented around a cyclic process. Cyclic in the sense that the first working day and shift schedule for each worker is noted and used as a base mark or datum for determining when the scheduling operation of a particular worker in the system would be terminated. This is based on the fact that any further shift schedule would be a repetition of the initial ones. A cycle is completed when a worker, having participated in the three different shifts and on different days, returns back to the actual day and shift as it was at the inception stage. Subsequent shift schedules may only result in repetition. Since the employment of shift workers into the system varies, it implies that the attainment of the cyclic process would very among the workers. However, workers employed on the same day and on the same shift, would complete the cyclic process at the same time. 3.1 Model Assumptions and Limitations The workforce scheduling model presented in this work is feasible and applicable in several knowledge domains, only if the conditions discussed hereunder are met. The conditions are: 1. A three shift system of 8, 6, and 10 hours respectively is operated. This sums up to 24hrs. Below is a sequential breakdown of the shift flow: Morning shift between 8:00am and 4:00pm;
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Afternoon shift between 4:00pm and 10:00pm; and Night shift between 10:00pm and 8:00am The duration per shift is eight hours for the morning shift and six hours for the afternoon shift. The night shift has duration of ten hours since it is starting two hours earlier than the expected time i.e 10.00pm instead of 12.00am. This is meant to prevent the night shift worker from some likely constraints associated with that period of time e.g. live insecurity and transportation scarcity. These constrains among others vary from one city to the other. 2. A worker is assigned to work in only one shift schedule per day. 3. A worker is expected to work for five days in a week after which an off is observed. 4. A worker goes on a day off after a morning shift has been completed and resumes on the next shift on the sequence as shown in 1 above. 5. A worker goes on a two day after an afternoon shift has been completed and resumes on the next shift on the sequence as shown in 1 above. 6. A worker goes on a three day after a night shift has been completed and resumes on the next shift on the sequence as shown in 1 above. 7. Any day of the week could be considered as the inception stage of the model development. In this study, Sunday was used as the inception stage of the model. 8. A new worker can be employed to the system on a particular day di to fill a particular shift j. If it would be partly or wholly void of workers as a result of workers going on an off without any substitute available for the concerned shift, workers ejection, workers transfer or deliberate resignation of workers from the system. 9. All the days of a week are working days.
3.2 Model Notations Nij- number of workers that would start work on day i and shift period j. Cij- constraint on the number of workers needed for current day i and shift j. di- different working days in which the shift schedules are carried out. The general problem formulation is that of a linear optimization i. e. maximizing or minimizing a linear objective function subject to a set of linear constraints on the variables. The following is a statement of the generalized linear programming problem. Generalized objective Function The objective function of model takes the form as shown below Optimize Z= Ni,J+Ni,J+1+Ni,J+2+.+Ni+n,J+Ni+n,J+1+Ni+n,J+2 The above is a set of variables whose numeric values are to be optimized. At the inception of the shift system, the number of workers employed on the first working day di for the different
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shift schedules j are represented as Ni,J,Ni,J+I and Ni,J+2 for the morning, afternoon and evening shifts respectively. The need to employ new workers as the shifting operations advance has resulted in the following notations as used in the model namely; Ni+n,J Ni+n,J+I and Ni+n,J+2. These notations represent the number of workers that may be employed into the system at a latter day n from the inception day of the shift schedule as the need arises. In the context of this work, the employment of new shift workers or the scheduling of existing workers into a new days operation may not necessarily affect the entire shift schedules of that day. This phenomenon, as seen in the constraint equations, depends primarily on two factors, namely:(i) the need on ground for new workers to be employed into the system; and (ii)the timetabling routine structure of shift schedule in the case of already employed workers.
Subject to constraints The constraint equations as represented below for each day, are made up of three distinct equations. Each of these equations represents the three shift schedules as practiced daily in the system studied. They are the morning, afternoon, and night shifts. Three distinct cases are associated with the constraint equations. These are described in the generalized forms of the constraint equations as thus:
Case l:
Nij Cij. In an elaborate form, this could be written as

j =1 i =1
Day d i Nij Cij

N (i, j + 1) C (i, j + 1) N (i, j + 2) C (i, j + 2)
This is an inception stage of the system. Here, the first set of workers is employed into the different shift schedules. The shift schedule for each day has its own characterized constraint of workers size. Case 2: N (i + n, j ) C (i + n, j ). In an elaborate form it could be written as
j =1 i =1 3 i+n
Day d i + n N (i + n, j ) C (i + n, j )
N (i + n, j + 1) C (i + n, j + 1) N (i + n, j + 2) C (i + n, j + 2 ) This case describes a situation where by the system's management, as a result of shortage of shift workers, decides to employ new workers into the system. This could result from some probable factors such as: (i) workers going on job off without any assurance of substitute on ground for replacement, (ii) workers ejection and (iii) workers transfer or deliberate resignation of workers from the system. The period n denotes a latter day from the inception of the shift in which a new worker is employed the system.
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Case 3:
3 i 3 i+n j =1 i =1 j =1 i =1
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Nij + N (i + n, j ) C (i + n, j ) An extension of this equation could be
Day d i + n Nij + N (i + n, j ) C (i + n, j ) N (i, j + 1) + N (i + n, j + 1) C (i + n, j + 1) N (i, j + 2) + N (i + n, j + 2) C (i + n, j + 2)

The three sub equations as seen in case 3, which are representing the three shift periods may not be functional at the same time. The condition for functionality of any one of these equations is based on the fact that workers from different shift groups (usually by employment difference) though of the same shift have a convergence in the timetabling of their shift schedule such that they would have to work together as a group.
Model Objective Function The interest is in minimizing the workforce size benefit of the firm i. e. Minimize Z= N11+N12+N13+N61+N62+N63 Constraints: case example
Written as:
Sunday d1: Nij C1 j;

j =1 i =1 3
Monday d2: Nij C 2 j

j =1 i =1 3
Tuesday d3:
Nij C 3 j
j =1 i =1 3 1 j =1 i =1 1
Wednesday d4: Nij C 4 j Thursday d5: Friday d6:

3
Nij C 5 j
j =1 i =1 6
Nij C 6 j
j =1 i = 6 3
Saturday d7: Sunday d8: Monday d9: Tuesday d10:
Nij + Nij C 7 j : k = 0,1,2

j =1 i = 6 6 j =k i=k 1
2k 2k
Nij + Nij C8 j
j =1 i = 6 3 j =0 i =0
Nij + Nij C 9 j : k = 3,2,1

j =1 i = 6 3 j = k i =1
3 k 1
Nij + Nij C10 j : k = 3,2,1

j =1 i = 6 j = k i =1
3 k 1
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Wednesday d11: Thursday d12: Friday d13:
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Nij C11 j : k = 3,2,1

j = k i =1
3 k 1
Nij C12 j : k = 3,2,1; L = 6,1

j = k i =1
3 k L
Nij C13 j : k = 3,2,1 : L = 1

j =k i=L 3 L 6
3 k L + 5
Nij + Nij C14 j : k = 0,1,2 : L = 3,2,1

j = L i =6 j =k i=k j = k 3 i = k 3 k 1 1
k 1 k 1
3 L 6
Nij +
j = L i =6 L 6 j =3 i =6
Nij C15 j : k = 3,2; L = 3,2,1

j = k +1 i =1 K 1 1
k 1
k 1
Nij +
j =3 i =6 m 1 2 L 6
Nij C16 j : k = 1,2; L = 1,2s Nij C17 j : k = 1,2; L = 3,6; m = 1

j = k +1 i =1
Nij +
j = k +1 i =1
Wednesday d18: Thursday d19: Friday d20:
L 2 j L 6 j =3 i =6
Nij +
Nij C18 j : k = 1,2; L = 6
K 1
Nij + Nij C19 j : k = 3,0; L = 3; m = 1,2

j =0 i =0 j = 2 i =1 0 0 j = 2 i =1
m 1 L 3
k 2m
Nij + Nij C 20 j : L = 6; m = 2
j =0 i =0
m 1 L
Nij C 21 j : m = 2
j =m i =6
m 1 6
Nij C 22 j : m = 2
j =m i =6
m 1 6
Nij C 23 j : m = 2
j =m i =6 m +1 6
m 1 6
Nij C 24 j : m = 2C
j =m i =6 0
24 j
Wednesday d25:
Nij C 25 j :
j =2 i =6
4.Conclusions and Future Directions Latest experiences in industrial applications have shown that the synthesis of workforce scheduling problems and solutions can break new grounds in the field of personnel scheduling as well as in operations research generally. In this context, the new paradigm of workforce roistering is presented as a new approach to the control and supervision of
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workforce in an organization, our motivation for writing this article came from several sources. The main driver behind this work was the uneasy feeling that something was wrong with the present approach to scheduling of workforce, particularly, for small businesses. The popular consensus among professional managers is the use of intuition rather than scientific based methodologies. The application of scientific principle has numerous benefits, primarily: (i) a clear understanding of the problem; and (ii) proper planning for project implementation. There is therefore the growing need for systematic approaches, one of which is treated here. This problem is least attended to in the literature. Thus, there is a need to create a depth of understanding necessary to improve on the monitoring and controlling of small business workforce scheduling. Second, even though the problem of scheduling workforce has been the focus of some studies, there is no documentation to show that the novel approach presented here has ever been reported. The idea behind our model is to reduce the operational cost and ensure optimality. For future directions, the application of techniques of sensitivity analysis for minimum and maximum sensitivity parameter estimation may present an interesting direction for navigation. A difficulty with sensitivity analysis as currently practiced is that its utility depends entirely on the validity of the test criteria used. As such the concept of validity must be well explored as a means of further improving on the quality of results generated by the models. The future holds promising results for researchers and practitioners in the development of new methodologies based on the existing mathematical frameworks presented in this work. If this area is successfully developed and applied, the emerging results are expected to save billions of dollars by enabling modelers to find optional solutions to large and complex applied workforce scheduling problems. Again, workforce roistering research can be a focal point for development, application, and evaluation of combinatorial procedures, simulation techniques, network methods and heuristics. For those newly entering this area of study or those young in its pursuit, there is an exciting future filled with important discoveries. Good beginnings have been made, but there are ,more challenges in recognizing how far one has to go than in drawing satisfaction from past accomplishments in literature. The workforce scheduling should attack the problems of inability in developing user friendly proprietary packages. A large amount of efforts and financial investments should be employed in the development of workforce scheduling software. This paper is a call to rethink the way develop software. Consequently, researchers and practitioners should refocus efforts on the relevant dimension of software from both producer perspectives are: accuracy, capacity, features, completeness, conformance, flexibility, serviceability, stability and structure ness. From a consumer perspective, relevant dimensions include: capability, communication, completeness
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conformance, features, flexibility, simplicity and stability. Thus, we have a population of problems that should keep researchers and practitioners investigating into workforce scheduling measurements for decades to come. The paper offers an authentic and below the surface explanation and insight into this fascinating and rapidly evolving field of personnel scheduling. The paper is recommended not only to the curious new entrants, but also to the practitioners since it offers a well integrated overview of roistering.
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References Aickelin , U., and Dowsland k. (2000). Exploiting problem structure in a Genetic Algorithm Approach to a Nurse Rostering problem, Journal of scheduling, Issue 3, pp. 139-153.
Andrea S., and Meisels A., (2006) solving Employee Timetabling problems by Generalized Local search, selected papers from 6th Congress of the Italian Association for Artificial Intelligence AI* IA 99: Advances in Artificial Intelligence, Bologna, Italy, LNAI 1792, pp. 380-390. Beddoe G.R. and petrovic S., (2003) . A Novel Approach to finding Feasible solutions to personnel Rostering problems. Proceedings of the 14th Annual Conference of the production and Operations Management society (POM), savannah Georgia, united states. James, T. and kamiyama A., (2002) On Manpower Scheduling Algorithms, SIAM Review, vol. 24, No. 3,pp.275-287. Mason, A.J., Nielsen D. (2007). PETRA: A programmable Optimization Engine and Toolbox for personnel Rostering Applications, 15th Triennial International Federation of Operational Research Societies (IFORS) Conference IFORS 99, August 16-20. Meisels, A., Gudes E., and Solotorevsky G. (2006). Employee Timetabling, constraint Networks and knowledge-Based Rules: A Mixed Approach, in [BUR96], pp. 93-105. Meisels, A., Gudes E., and Solotorevesky G. (2007). Combining Rules and Constraints for Employee Timetabling, International Journal of Intelligent Systems, 12, pp. 419-439. Rhian S., and Silvestro C. (2000). An Evaluation of Nurse Rostering practices in the National Health Service, Journal of Advanced Nursing, Blackwell Science Ltd., vol. 32 No. 3, pp. 525-535. Warner, M.D., (2006) Scheduling Nursing personnel According to Nurses preference: A Mathematical programming Approach, operations Research vol. 24 No. 5, pp. 842-856. Wren, A.W., (2006) Scheduling, Timetabling and Rostering A special Relationship, in [BUR96], pp. 46-75.
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Quantifying the Role of Marketing Productivity Metrics in Marketing Performance Measurement

Zubair Azam MS Scholar Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology, Islamabad Imran Qamar Assistant Professor Shaheed Zulfiqar Ali Bhutto Institute of Science and Technology, Islamabad Abstract
Marketers are understandably preoccupied with measuring marketing performance. For this purpose certain Marketing productivity measures have been proposed by Past researches. However, among the many possible marketing performance measures available, which few should be chosen? On the one hand, the key measures must be simple enough to be usable and on the other hand they must be comprehensive enough to assess the marketing productivity and its impact on marketing success. This paper presents an annotated literature review that provides the foundation for the development of a list of the most valuable marketing performance measures. These performance measures are selected on the basis of a number of criteria, for instance the measures need to occur frequently in literature, they must be valuable to most companies as well as they must have predictive power. Thus, analysis of major measures being considered useful by Marketing and Finance managers has been carried out. Finally, the implications for marketing practice and future research are discussed.
Keywords: Marketing Performance measurement, Marketing Productivity, Marketing metrics, Marketing Success Measures. 1. Introduction
The measurement of marketing performance has been a central concern in marketing for decades (Morgan, Clark, Gooner, 2002) and Marketing Science Institute and American Marketing Association have repeatedly assigned marketing metrics as a top research priority in recent years. As there are no perfect and absolute measures available for measuring marketing success (Ambler & Kokkinaki, 1997), the question about the most appropriate metrics for marketing performance measurement has been a widely discussed issue among marketing academics and professionals (e.g. Zahay & Griffin, 2010; Lenskold, 2007; Ambler & Roberts, 2006). Lately, Different metrics like shareholder value and CLV have been emphasized (e.g. Greenyer 2006; Doyle 2000; Lukas et al., 2005; Srivastava et al., 1998). However, considering the importance of literature review, a scanning process of the main literature regarding marketing, performance measurement and general management science was carried out. A bottom-up approach (from latest research paper to older ones) has been adopted. This scanning process has identified three main areas around which the current knowledge on marketing measurement is built. Furthermore, they explore the objectives that this research study aims to investigate. Ambler, Kokkinaki and Puntoni, (2004) and Mouncey (2006) indicate that there are few empirical researches that aim to investigate the connection between marketing and corporate objectives. In this context, this research will explore the more relevant literature on marketing measurement and from that develop a thorough model that comprises the major theories so that a complete overview of the phenomenon can be obtained. Through this, major Multinational companies operating in Pakistan are investigated in order to define the current
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situation concerning marketing measurement tools and techniques being implemented by Marketing and Finance executives. In this context, Ambler et al., (2004) conducted a research on marketing metrics in order to establish the criteria of metrics selection and to define which metrics are used to assess marketing. This study is the rational continuation of Ambler et al., (2004) work in order to complete the gap left in it. In fact, the research also investigates the importance allocated to marketing metrics and the actors involved in their development and implementation.
2. Literature Review
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As we have discussed previously, this research study presents a review of literature concerned with Marketing Productivity, Brand equity and Customer Equity. 2.1. Marketing Productivity Charles Sevin has been appreciated as being one of the first scholars who incorporated the concept of productivity into Marketing Field. In his work, Marketing Productivity Analysis, he described marketing productivity as the ratio of sales or net profit to marketing expenditure, according to a specific segment of the market (Ambler et al., 2004). Then, marketing productivity was divided into 2 areas by Thomas (1984), one related to the management of the marketing mix/tools and the other one related to bringing efficiency of the marketing expenditure. Therefore, a company needs to create an effective marketing mix in order to target its segments and then perform efficiently the actions needed to obtain the desired output. A more detailed definition of marketing productivity is given by Rust et al., (2004). They introduce marketing productivity as the relationships between all the marketing expenditures and financial variables like sales, profit ratio/Margin and shareholder wealth/equity/value. Same sort of concept has also been discussed by Hall (2010) where he explores that cultivating long-term relationships contribute to productivity, the brand and Revenues. Rust et al., (2004) proposed a chain of marketing productivity. The chain is a framework used to evaluate marketing productivity that embraces tactical and strategic marketing activities in order to establish their relationship to financial measures. The framework initiates from the marketing strategies that include promotion strategies, product strategies and any other strategy that is related to marketing. These strategies, then, generate tactical marketing activities like advertisement campaigns, branding programs, loyalty enhancement schemes or any other activities that can contribute towards producing a marketing impact. However, the activities taken into account in this framework include only actions that generate expenditures that can be directly connected to marketing. As a result of these activities, customer satisfaction, attitude towards the brand, loyalty and other customer-centered measurements are influenced, generating at the firm level variations in marketing assets (brand and customer equity). However, it has also been suggested that to make marketing more productive, certain changes need to be implemented at both corporate and strategic levels while goals of marketing activities must be aligned with corporate vision (Seth and Sisodia, 2002; McGrath, 1992). A broader approach to measuring marketing performance was proposed by Morgan et al., (2002) in order to establish marketing productivity. They concluded that marketing productivity is more related to determining the efficiency of marketing activity while marketing audit is concerned with marketing effectiveness. Thus they proposed a model of marketing performance assessment (MPA), and this model is being considered one of the very concise and elaborative models for marketing performance assessment. Marketing productivity has been used in developing certain marketing metrics by Ambler (1997, 2004, 2006). A metric is a measuring system that quantifies a trend, dynamic, or
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characteristic (Farris et al., 2010). Ambler et al., (2004) conducted a major empirical study concerning the process of selection of the metrics utilized to assess marketing. They proposed a framework, to assess marketing, based on the connection between input and output in agreement with the marketing productivity theory. It focuses on the linkages that connect marketing activity and investment (input) to financial outcomes (output). From all the discussion above regarding marketing productivity, it can be deduced that marketing practitioners and academics are successful in developing structured systems to measure the impact of marketing on companies revenue, profit and shareholder value. However, although the systems mentioned above have strong academic and practical relevance, there is a gap between theory and practice. In fact, there are few empirical evidences that companies use this system or that these methods are perceived to deliver the results expected. 2.2. Brand and Customer Equity Marketing impact, as discussed above, has a dual effect in both the short-term and the longterm. While marketing productivity theories emphasis on both the effects, brand and customer equity are focused exclusively on the long-term effects that marketing activity generates. Srivastava and Reibstein (2004) assert that the use of brand equity and customer equity is an appropriate approach to long-term measurement. However, these two systems can be considered to be the same measurement from two different perspectives of analysis (Mouncey, 2006). In fact, it can be argued that for some companies, as for example firms in the fast moving consumer goods industry, brand equity is a more appropriate measurement because they may not have a customer database. Whereas, for companies that operate in the business to business area, customer equity can provide more accurate and reliable results (Ambler et al., 2004). The examples of such companies can include all the companies related to Telecommunication business etc. 2.2.1. Brand Equity Branding and Brand Equity have been topics of interest to marketing researchers for many years. A brand can be defined as a name, term, sign, symbol, or design, or combination of them which is intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of competitors (Kotler, 2006, pp. 274). The context and meanings of brand equity has been debated in a number of distinct ways and for entirely different purposes. The concept of brand equity has been discussed in the accounting and marketing literatures, and has the aim to connect marketing impact, especially brand management, to long term focus and results (Wood, 2000). Farquhar (1989) defines brand equity as the value added by the brand name to a product or service. Aaker (1991, 1996) and Keller (1993) have both provided conceptual schemes that link brand equity with various consumer response variables. Specifically, Aaker (1991) identified five major consumer-related bases of brand equity: Brand loyalty; brand awareness; Perceived quality; other brand associations; and Proprietary brand assets. Keller (1993) proposed a knowledge-based framework for creating brand equity based on two dimensions: Brand awareness; and Brand Image. Among the determinants of brand equity, brand loyalty has been found most prominent, consistent and Influential (Atilgan et al., 2005). They verified the findings of Yoo et al., (2000), but this time in a different country and context. Other researchers have found the same results also (e.g. Kepferer, 2004; Jelsema, 2007). However, Jelsema (2007) presented the most comprehensive illustration of the components of Brand management and how the interact with each other.
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Srinivasan et al., (2005) define a framework to assess brand equity that involves both customer preferences and financial variables. In fact this method compares the incremental contribution gained by a brand to a base product. This approach considers three main sources that constitute brand equity. The three areas that Srinivasan et al., (2005) consider to be the core of brand equity are: Brand Awareness, Brand Preference and Brand Availability. Each of these variables influences the probability that a product is chosen in lieu of another, thus creating value for the firm. These variables are then compared to the probability of a base (generic) product and the differential is aggregated to form brand equity. Even though brand equity is considered to be an important method of marketing measurement, it is not free of critics. In fact, Ambler (2004) defines brand equity as an elephant, because it is such a big concept that people have difficulty in describing it. Therefore, because there are a variety of definitions, this may lead different people to have different interpretations of brand equity (Ambler, 2004). 2.2.2. Customer Equity After the founding of brand equity, Blattberg & Deighton (1995) introduced a comparable concept of customer equity. This theory considers the customer base of a firm as a valuable asset that can be measured using the customer lifetime value (CLV). The rationale of customer equity is to find the right level of customer retention and customer acquisition that maximizes the value of customer equity. There are numerous models that describe customer lifetime value. Berger & Nars (1998) describe different mathematical methods to determine the customer lifetime value according to diverse feasible scenarios, variables such as purchase frequency, overall customer turnover, customer share of wallet, etc. that can or cannot interfere in the estimate. A general definition of CLV is the present value of all the profit generated from a customer (Gupta & Lehmann, 2003). Rust, Lemon and Zeithamel, (2004) proposed a model to measure marketing performance associated to customer equity analysis. This framework was derived from combining the workings of others researchers and it is central because it is the first endeavour to amalgamate the current literature of customer equity. The model connects marketing activity to the improvement of one or more drivers of customer satisfaction. Consequently once a customer is more satisfied that customer tends to be more loyal or attracted by the company. These improvements lead to a better CLV and therefore to a better customer equity value. The ratio of the CLV to the marketing investment, determines the return on marketing investment. An expansion to this model has been proposed by Venkatesan & Kumar (2004). They put forward a variation of the above model that involves the incorporation of different channels in the system. In addition, they established that CLV is a very good tool to segment customers according to their profitability. These models based on customer equity have been challenged by recent researches who disagree with some of the assumptions that marketers have held for a long time regarding the financial impact of marketing, as for example regarding the positive correlation between loyalty and profitability (Sheth and Sharma, 2001). It has been empirically proved that for specific products, this postulation is not always valid. In fact, Reinartz & Kumar (2000) have empirically verified that in a non-contractual circumstance the assumption that, loyal customers are characterized by increased lifetime spending, decreased costs of serving, and lower price sensitivity are not always true. The discussion on the subject of brand and customer equity has highlighted many current theories and concepts. It is debatable that brand equity is more reliable for companies that do not have identified customer, where customer equity is demonstrated to be more effective.
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2.3. Marketing and Shareholder value
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From a more financial perspective the return on investment (ROI) has involved the literature of marketing measurement in order to institute the added shareholders value of marketing activity. Furthermore, it is considered to be one of the hottest issues that is affecting businesses at present (Munoz, 2005). Day & Fahey (1988) evaluate an approach of assessing market activities in order to probe into shareholders value. The approach called Value-Based Planning is founded on the concept that managers should be evaluated on their ability to make strategic investments that promise returns greater then their cost of capital (Day & Fahey, 1988). At some stage in analysis, Day & Fahey (1988) identified the method developed by the Alcar Group Inc., a consulting company, as the best documented valuation methodology. The method is essentially based on the following components: Present value (of the present year), Residual value (of the next year) Less the market value of the debt. Lenskold (2002) proposed a different approach to ROI and marketing activities. In fact, he divides the variables that influence ROI into: Customer lifetime value, Total customers, and marketing expense. Cook and Talluri (2004) advocate a customised system of Return on marketing investment (ROMI). This framework implies that each company has to put in place an ad hoc set of metrics and procedures with the intention of achieving reliable results. This method does not present any empirical evidence nor is it backed up by relevant literature references. However, this model highlights the value of the people involved in the measurement and their relationship. A different viewpoint of analysis has been followed by White, Miles and Smith (2001). They explored the effects of marketing on shareholders for Small and Medium Enterprises (SMEs). The main difference from the other approaches consists of the fact that this study analyses companies that usually are not quoted on the stock market and therefore, it utilizes owners value in the assessment. In conclusion, Return on Investment theories have demonstrated to be a weak approach to the assessment of marketing value. However, these are the methods that are used at board level to assess investment in relation to shareholder value (Cook and Talluri, 2004) and for this reason; they have to be taken into consideration in the review of the main literature of marketing performance measurement. 3. Research Questions The study is intended to identify major marketing metrics being applied to assess relationship of marketing productivity with marketing performance measurement and whether they are perceived to be effective or not. In addition, the study will assess the impact of marketing success on firms performance. As literature has been extracted from 3 main areas i.e., marketing productivity, customer and brand equity and shareholders value of marketing activity, so following research questions are devised. 1. What is the current situation of companies regarding Marketing measurement?
2. Which metrics are perceived to be important within marketing productivity category to assess marketing performance? 3. How much impact marketing performance has on firms overall performance?
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4. Methodology
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4.1. Instrumentation The research design is based on Relativism approach because of the implied suppositions made in development of Research questions. The study focuses on correlations instead of focusing on causality or understanding of the phenomenon. The content of questionnaire is based on the conceptual framework proposed in the literature review. The questionnaire is thus divided into 3 categories, general information, Importance of Marketing Measurement, Marketing productivity, and 9th and 10th questions are measuring marketing performances impact on overall firms performance. A five-point Likert scale, ranging from very useful to Not applicable, was developed to assess the relationship of each measure to the particular category. To get general information regarding respective business and the manager, introductory questions are modeled. Two questionnaires are developed, 1 for researcher-administered way and 2nd for collecting data through personalized e-mails. However, to reduce the chances that managers might not be having sound understanding of the terms being used in Questionnaire, a glossary of terms has been attached at the end of questionnaires being sent through e-mails. This step has been taken after consulting 12 Marketing and finance managers from Warid telecom, Wateen telecom, Bank Alfalah, Dewan Motors and Faisal Bank, MEI-PAK and 6th sense Consultation. 4.2. Sample The sample size for collecting data regarding this study was decided to be a figure around 150 observations while all the persons being surveyed were marketing and finance executives. And as it is a managerial sample, observations around 150 were reliable for generalization of results. The data was collected through mixed Random sampling techniques in which Snowball sampling was used to collect data from different managers through referrals from the previously interviewed managers, while stratified sampling technique was implemented to group finance and marketing managers according to their nature of industry. 5. Data Analysis
The statistical techniques to be applied depend on the structure of collected data. Before description of the findings of the survey, the profile of the respondents and comparative tests will be conducted, in order to describe the sample and determine its degree of external validity. The external validity is the extent to which research findings can be generalized beyond the immediate research sample or setting in which the research took place (Gill and Johnson, 2002). According to Hussey and Hussey (2003), low response rates and missing values may bias the data and thus may not be the representative of the population. To do so, a screening process was conducted to remove the survey questionnaires with missing values and thus 102 observations were obtained. In order to identify whether there are differences in the perception of importance of marketing measurement between marketing and finance managers a t test has been conducted. The results reveal (see Table 2) that there is a difference in the perception between the two groups of .43 on a 5 point Likert scale. Finance managers perceive marketing measurement to be less important then marketing managers; this difference is supported by a statistical significance (2-Tailed) of .074. Therefore, there are only 7.4% of possibilities to have obtained this result by chance. Apart from slightly greater concerns of large companies, there were no significant differences between the importance attributed to marketing measurement and the respondents from the different companies.
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Table 1: T-test on Importance of Mrketing Measurement

Mean Marketing Department Finance Department Difference a) equal variances assumed 4.19 3.76 .43 Std. Deviation 1.09 1.26 -0.17 Sig. (2-tailed) .074a
To measure Marketing productivity metrics being used, the respondents were asked to indicate, on a 5 point scale, the importance of the metrics for assessing marketing productivity. Table 2 ranks the results for marketing productivity metrics according to their average score for importance. Table 2: Descriptive Analysis of responses regarding Marketing Productivity Metrics
A second stage of analysis has been conducted grouping the metrics into three categories according to the phenomenon that they measure, namely: financial, customer and market metrics (Ambler et al., 2004). A Cronbachs alpha test has been conducted in order to identify whether the scales used in the measurement of these three areas are reliable. The results (Table 4) demonstrate that the scales are very reliable, having values higher than .70, which is considered the minimum value of reliability. Therefore, the metrics have been grouped and the results of their scores have been averaged into a single measure to represent the categories.
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Table 3: Reliability Test for Marketing productivity Metrics

No. of items Financial metrics Customer metrics Market metrics 4 8 4 Cronbachs Alpha 0.807 0.837 0.826 Aggregate Mean 4.43 4.03 3.70
Table 3 shows that the financial metrics are considered to be the most important, followed by customer metrics and market metrics, this result confirms the importance of the financial evaluation of marketing. The last part of the survey concerned the relationship between finance and marketing department and the actors involved in the measurement of marketing, as these factors are considered important in the measurement of the return on marketing investment (Cook and Talluri, 2004). Table 4: Descriptive analysis of responses to coordination between finance and marketing departments
The respondents were asked to identify the typology of relationships between the marketing and finance department of their company. Table 5 shows that the large majority of the respondents (38.23) consider that there is a regular, productive discussion about marketing effectiveness and budgeting. However, the second highest score (26.61%) is the scale that represents close relationships between the departments. 6. Discussion The first objective of this study is to explain the current state of companies regarding marketing measurement. Marketing measurement has been defined through the literature review as a three dimensional phenomenon, upon which this paper has based the research. However, before discussing the findings, a series of general findings will be discussed in order to better understand the current situation of companies operating in Pakistan. From the data that emerged, marketing measurement is of fundamental importance for almost all companies; in fact over 70% of the respondents consider it to be important or very important. These data support the growing interest in marketing measurement that has been found in the literature as Lehmann (2004), MSI (2002) and Woodburn (2005). However, it is remarkable that there are 15% of the respondents who consider marketing measurement to be
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not at all important. The reason for this may rely on the fact that for a low level of marketing investment, companies value marketing measurement as less important, as is demonstrated by the work of Ambler et al., (2004). Furthermore, analysis of the data proves that marketing and finance managers have different perceptions of the importance of marketing measurement. Marketing managers consider the measurement to be much more important than their colleagues; this finding confirms Woodburns (2005) consideration that marketing is losing importance due to measurement issues and therefore marketing practitioners are becoming more concerned about it. However, it was surprising to find that there are no differences in the importance of marketing measurement among companies of different sizes. It was expected that higher scores would be obtained from large companies than from small companies due to the differences in the amount of their marketing investment but the respondents were responding according to their perception of marketing. Therefore, this can be seen as a growing interest, also from small businesses, about the importance of measuring marketing more efficiently. In order to represent the current situation of companies about marketing measurement, the research identified the actors that are involved in the process. It is clear from the data that the agents involved in the development of the measures are mainly from the marketing department, followed by finance, market research agencies, IT staff, external agencies and consultants. However, the differences in involvement between marketing staff and the other actors are consistent. It can be argued that only marketing people are involved in marketing measurement. This finding is very interesting, because from this can be deduced that one of the causes for the lack of financial metrics, as highlighted in the literature, is caused by the low interest of marketing practitioners in financial metrics as has been demonstrated by the data analysis. Furthermore, when analyzing the relationship between marketing and finance departments regarding budget allocation and measurement issues, it is clear that there are substantial differences in their perceptions. In fact, while marketing managers perceive the relationship to be limited and not helpful, finance managers consider that the two departments work together closely and efficiently. This finding proves that there are issues in the two departments concerning measurement. In fact McGrath (1992) considers the alignment of the two departments to achieve effective measurement procedures to be fundamental. Furthermore, this finding contrasts with what is prescribed in the models of Morgan et al., (2002) and Cook & Talluri (2004) in which the relationship between departments is considered to be an important component to measurement marketing. The findings disclose possible hidden tensions going on between the marketing and finance departments relating to budget allocation. The differences in opinion between marketing and finance managers are also concerned with the importance of marketing measurement itself. In fact marketing managers perceive marketing measurement to be more important than the finance managers do. The reasons for these differences may be explained by the different responsibility that the two departments have in assessing marketing. In a predictable manner, all the marketing managers indicated they are responsible for marketing measurement, regardless of the seniority of their role. Whereas, finance managers are not responsible, except for some exceptions in large companies for managers with high seniority. Therefore it can be deduced that the major pressure for the measurement leads to this result. However, as highlighted in the findings, there is a limited number of companies where finance managers are actively and responsibly involved in the measurement. This identifies a possible future trend where actors from different departments are becoming responsible for assessing marketing, supporting cook and Talluris (2004) theory of the cross-functional team entrusted with the development and implementation of marketing measurement systems.
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In order to make marketing more accountable, firms have to link marketing measurement to high level business performance goals such as shareholder value. The creation of cross-functional teams to develop marketing measures can diminish the differences in metrics selection and align the company to a more customer centric vision. In order to better evaluate the real financial outcome of marketing, firms do not have to focus on a singular metrics typology but they have to investigate the linkages that might occur between them. The results show that conventional metrics are not perceived to be effective; therefore, it is advisable to conduct frequent revision of measurement efficiency in order to keep the key performance indices updated. Marketing plans should be integrated in the broader spectrum of the companys strategic plan, so that the contribution made by marketing activities becomes more traceable. 7. Future Research Recommendation Based on the findings of this research, it would be interesting to explore the view of marketing and finance management within the same company to observe whether the differences of perceptions highlighted in this study are confirmed. Furthermore, the research of marketing measurement can be enriched comparing companies that operate b2b and b2c, but also in different sectors and with different marketing budgets. Another area of research would be to investigate the reasons why companies seem to utilize metrics that are not perceived to be important by their management. Furthermore, it could be interesting to investigate the process of metrics selection in relation to performance. This would generate a greater understanding of the development of measurement system and their applications. Finally, this research did not consider operational issues connected with marketing measurement, thus it would be fascinating to determine whether the costs and the complexity of the metrics that are used by the companies are considered to be sufficient or not. Furthermore, identifying which parameters are used to establish the efficiency of the metrics would improve the understanding of the metrics development process.
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The Effectiveness of scientific attitude toward Physics teaching through Inquiry Method Verses Traditional Teaching Lecture Method of female students at Secondary School Level in Pakistan Shafqat Hussain Ph.D (Scholar) Foundation University Islamabad Dr.MuhammadTayyab Alam Foundation University Islamabad Dr Muhammad Muqsud Alam Bukhari Principal Foundation University Islamabad Sarfaraz Ahmad Ph.D Scholar Foudation University Islamabad Nasir Ahmad Ph.D Scholar Foudation University Islamabad Abstract This study was designed to find the comparative effects of scientific attitude toward Physic of females students of Grade 9 teaching Physics through inquiry teaching method and traditional lecture method teaching. The objectives of the study was (a ) to compare the scientific attitude toward physics Grade 9 of female students teaching Physics through inquiry teaching method (ITM) and traditional teaching lecture method (TTLM).one hundred and twenty (120) sciences females students of grade 9, from two schools served as sample of the study. Students of each school were divided into two equivalent groups i.e control and experimental group on the basis of pre scientific attitude toward Physics test. Experimental groups were taught through inquiry method and control group by traditional lecture method for twenty two weeks. Post scientific attitude test were administered after treatment to assess the difference in scientific attitudes toward Physics of groups. The data obtained were tabulated and analyzed to compute Mean, Standard deviation and t-value at level 0.05 through SPSS 16.0 software. The post scientific attitude to Physics test shows that experimental group was significantly better than the control group. Keywords: Effectiveness ; scientific attitude ; Physics ; Inquiry Method ; Traditional Teaching Lecture Method of female students at Secondary School Level in Pakistan Introduction Teaching and learning is an active, deliberate and orderly giving information ,skill, attitudes ,ideas and thoughts, it focuses on maximize learning. Teaching and learning is due ability to share and enhance knowledge but the emergence of teaching as profession is recent. In teaching of science, a main objective is to develop learners/students problem solving capacities. It is very important for our educational system and it is vital and basic subject of curriculum. Science gives us an opportunity of critical thinking and integrates mans concepts of natural environment and benefits of the environment. Physics is considered difficult subject by students and teachers also face difficulties in its teaching. In last two decades numbers of studies has been launch for learners/students teachings and thoughts and difficulties in concept of Physics and processes. The study is to determine the to measure the scientific attitude toward Physics of females students of grade 9 after teaching Physics through inquiry teaching method and traditional lecture teaching method.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Attitudes
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Attitude describes the assessment of something or someone. Attitudes based on our feelings, emotions, knowledge and behaviuor and may be manipulated future behaviour. In prospective of science subject studies learning attitudes are evaluation which may be described as a power of thinking and behaviour. Attitude always has a direction and the direction may be towards someone or something. Attitudes are highly multifaceted and have effects on learning. Reid & Skryabina, (2002), gave following four areas of attitude 1. Attitude of students towards study. 2. Attitude towards the subject. 3. Attitude towards applications what has been studied. 4. The scientific attitude.
Attitude towards science

How do pupils feel and think about science. Motivations of students, their interest and attitude toward science, their desire to become great scientists, researchers became interested after the investigation of Noll 1935 the measurement of scientific attitudes (Shrigley, Koballa & simpson 1988). Morse and Morse stated that if students attitude towards science is positive then their attitude towards science curriculum, science teachers and science classroom will also be positive. Positive attitude towards science is directly proportional to success in science courses. Attitude also has an effect on the classroom learning environment (Morse and Morse 1995).
Attitude towards Physics

Eridemir stated that students consider Physics as a most difficult among the all science subjects and very few students opt it as compared to chemistry and biology. He further said that not only school students consider it difficult but the opinion of university students was same (Eridemir, 2009). Students dislike science lectures and they dont prefer the science specially Physics (Matterm and Schau 2002, Rivard and Straw 2000 Dieck 1997, Boylan 1996). Osborne et al stated that students opt for Physics when there is no alternate for them, and then they are studying Physics compulsory. They further added that English students perceive it as an elite discipline and only suitable for gifted students (Osborne et al 1998). Eridemir cited Miller 1961 that positive and negative attitudes of the students do have an effect on their achievement, interest and motivation (Eridemir, 2009). Anderson (1982) gave following five components of attitude. 1. The emotional components In this component the attitude includes cognitive as well as behavioral components. Emotions are also involved in emotional component. 2. The target Feeling can direct towards target or away from it. The common targets associated with attitude are schools, curricula, achieving the set objectives which link with science subject area with in school. 3. Direction Attitude can be regarded as positive when these are directed toward when their direction toward the targets. On the other hand attitudes are regarded as negative when these are directed away from the target. The attitude can be measured by giving adjective and opposite statements which are related to liking or disliking , satisfied or dissatisfied and favourable or unfavorable (Anderson, 1982).
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4.
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Intensity Attitudes differ in direction and intensity as well. One may experience and express his/her feeling in more intense way and other may not do so (Anderson, 1982). 5. Consistency Feelings of the same person about a particular object may vary in different in setting and situation. Consistency of attitude may be varying over the period of time. RESEARCH METHODOLOGY All females students studying science in Grade 9 in district Abbottabad was population of research study. The Sample of research study was one hundred and twenty (120) female students studying science of Grade 9 from two schools were taken sample of research study in district Abbottabad Pakistan. Two groups were made in each school on bases means scores pre scientific attitude toward Physics test. One group is called experimental group and is called control group, the experimental groups were given a treatment i.e. teaching through inquiry method in the Physics laboratory and the control groups were treated by traditional teaching lecture method in Physics class rooms. The pre scientific attitudes towards test and post scientific attitude toward Physics test were research instruments. The contents of this research study were made up from topics from Physics book for 9 Grade Class published by khyber Pukhtoon Khyawa Text Book Board Peshawar 2010 and thirty two lessons were made on bases inquiry method and thirty two lessons traditional lecture method. The face validity and contents validity of Pre scientific attitude toward physics test was confirmed by judgmental validation by an experts committee and pilot testing. The reliability of pre scientific attitude toward Physics test was calculated using split-half method (odd-even). The reliability pre scientific attitude toward Physics test was 0.85 by Spearman Brown formula. The work was carried out for the period of twenty two (22) weeks.
th th
NULL
HYPOTHESES
OF
RESEARCH
STUDY:
The following hypotheses were tested to achieve the objective of research study: H01. There is no significant difference between scientific attitude toward Physics in Physics as subject of female students and those taught Physics Grade 9 through inquiry teaching method (ITM) and male students taught by traditional lecture teaching (TTLM) at secondary level. H02. There is no significant difference between scientific attitude toward Physics in home work and test Physics of female students and those taught Physics Grade 9 through inquiry teaching method (ITM) and male students taught by traditional lecture teaching (TTLM) at secondary level. H03. There is no significant difference between scientific attitude toward Physics in way you to learn Physics of female students and those taught Physics Grade 9 through inquiry teaching method (ITM) and male students taught by traditional lecture teaching (TTLM) at secondary level. H04. There is no significant difference between scientific attitude toward Physics means scores achieved of female students and those taught Physics Grade 9 through inquiry teaching method (ITM) and male students taught by traditional lecture teaching (TTLM) at secondary level.
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RESULTS Table 1 : Comparisons of attitude towards the Physics mean scores of experimental and control group girls on pre scientific attitude toward physics test Items Comparisons N Mean S. D t. value
Physics as subject
Exp girls Con girls
60 33.88 5.05 0.17 60 33.70 6.43 60 23.93 3.71 0.95 60 24.67 4.71 60 43.22 4.03 1.63 60 41.47 7.28 60 33.67 6.77 0.76 60 33.2 10.10
Home work and test in Physics Exp girls Con girls Like to learn Physics. Exp girls Con girls Overall achievements Exp girls Con girls
Graphical representation for Mean, S.D and t. values of experimental girls and control girls in Physics as subject, home work and test in Physics, like to learn Physics and overall attitude toward Physics on basis pre attitude scientific attitude test. Table: 2 Comparisons of attitude towards the Physics mean scores of experimental and control groups girls on post scientific attitude toward Physics test Items Comparisons N Mean S. D t. value Physics as subject Exp girls Con girls Home work and test in Physics Exp girls Con girls Like to learn Physics. Exp girls Con girls Overall achievements Exp girls Con girls 60 66.13 6.09 16.0 60 44.47 8.53 60 35.08 2.47 13.38 60 25.77 4.80 60 90.57 8.66 22.43 60 49.15 11.38 60 63.92 12.03 28.01 60 39.80 16.00
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Graphical representation for Mean, S.D and t. values of experimental girls and control girls in Physics as subject, home work and test in Physics, like to learn Physics and overall attitude toward Physics on basis pre attitude tes. DISCUSSION Table 1: shows that mean scores of attitude toward Physics of experimental girls group in Physics as subject (M =33.88, S.D =5.05) ,control girls group (M = 33.70, S.D = 6.43) and t = 0.17, Home work and test in Physics in (M =23.93, S.D =3.71) ,control girls group (M = 24.67, S.D = 4.71) and t = 0.95, Like to learn Physics experimental girls (M =43.22, S.D =4.03),control girls group (M = 41.47, S.D = 7.28) and t = 1.6 and overall achievements the mean scores (M =32.67, S.D =6.77) ,control girls group (M = 33.2, S.D = 10.10) and t = 0.76. The t-values are less than critical value at 0.05 levels (02.02), which show no significant difference between means scores in pre scientific attitude test of these groups. Hence both the group was same in scientific attitude toward Physics before the treatment. Table 2: shows that mean scores of attitude toward Physics of experimental girls group in Physics as subject (M =66.13, S.D =6.09), control girls group (M = 44.47, S.D =8.53) and t = 16.00, Home work and test in Physics in (M =35.08, S.D =2.47) ,control girls group (M = 25.77, S.D = 4.80) and t = 13.38, Like to learn Physics experimental girls (M =90.57, S.D =8.66), control girls group (M =49.15, S.D =11.38) and t = 22.43 and overall achievements the mean scores (M =63.92, S.D =12.03) ,control girls group (M = 39.80, S.D = 16.00) and t = 16.00. The t-values are greater than critical value at 0.05 levels (02.02), which show significant difference between means scores in post scientific attitude test of these groups. Hence the experimental girls groups more converge toward Physics than control boys group as a result of treatment.
Conclusion The research study shows that female students whose taught through Inquiry teaching method develops more positive attitude towards Physics as compared to those whose taught through traditional teaching lecture method in subject Physics for Grade 9.
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Reference
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Anderson, R. D. (1982). Science meta-analysis project. Boulder, CO: Colorado University. ED 223475. Dieck, A. P. (1997). An Effect of a Newsletter on Children's Interest in an Attitude Toward
Science. Unpublished Master's Thesis, Arizona State University.

Erdemir & Bakrici, N. &. (2009). The Change and the Development of Attitudes of Science
Teacher Candidates Towards Branches . Kastamonu Ducation Journal, 17(1), 11-170.

Mattern & Schau, N. (2002). Gender Difference in Attitude Achievvement Relationships Over
Time Among White Middle School Students . Journal of Research in Science Teaching
39(4), 324-340. Millar, R., & Osborne, J. (Eds.). (1998). Beyond 2000: Science education for the future. London: Kings College Reid & Skryabina (2002). Attitude Towards Physics: Research in Science and TEchnological Education. Rivard & Straw, L. P. (2000). The Effect of Talk and Writing on Learning Science. Science Education, 84, 566-593.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Innovative Interface for Enhancing of the Learning Capability of Children
Principle author/Corresponding Ashraf Ullah Affiliation Address: Blekinge Institute of Technology, Sweden University of Science & Technology, Bannu Pakistan Co-authors Salam Ullah Khan University of Science & Technology, Bannu Pakistan
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Sadaqat Ali Khan Bangash Affiliation Address: University of Science & Technology, Bannu Pakistan Kamran Khan Tatari Sarhad University of Science and Information Technology, 36B, Chinar Road University Town, Peshawar, Khyber PukhtoonKhwa, Pakistan
Abstract In this paper an effort has been made, how to improve the learning capability of children through an innovative interface. The proposed interface supports three area of learning i.e. reading, listening and speaking. Typically children are not attentive during the lesson. However they have natural tendency towards mobility, playing, graphics and animation. Keywords: HCI, Innovative Interface, Touch Screen, Voice Recognition, Multi-touch technologies. INTRODUCTION Human computer interaction is the study of interaction between users and computers, the study of machine and human being. Human-computer interaction is a discipline concerned with the design, evaluation and implementation of interactive computing systems for human use and with the study of major phenomena surrounding them. This discipline is concerned with humans who interact with computer technologies. How to make the computer that are easy to understand, about its functionality etc [1]. Innovative interface is about the new interface technologies which changes the way we perceive and manipulate digital information [2]. This paper describes the suggested interface to enhance the learning capability of children. It will improve their reading, listening and speaking skills. The interface is functional and control through their voice, touching the screen. They like mobility and frustrated to sits at one place for a longer period of time. Most of the time they cant focus on their reading skills, in order to get their focus graphics and animation can be used as a supporting tool in the reading process which will also help them awakening sense of belonging [4]. Problems and Challenges From children point of view the following problems are indentified. Mostly they face problems while interacting with mouse and keyboard. They like mobility and frustrated during stress condition.
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Human mind is sharp while reading, however during reading mind is diverted from reading towards thinking. This problem is not only concerned with children but with every human being. They are more affected because their mind control is weak. With little bit disturbance their attention is diverted during the lesson. They like graphics and animation. For example video games have graphics and animation therefore their mind is actively involved in such games.
Advantages of the Proposed interface There are some advantages of our proposed interface, which are discussed below. Attention the proposed interface in such a way that their attention will be more focus towards the lesson while interact with touch sensitive screen interface. Mobility the proposed interface system is lightweight, easily movable, incorporating the state-of-the-art hardware technology. Ease of use- simple structure, such as power control, volume control and microphone control buttons. Touch screen- the interface is composed of touch sensitive screen it directly accept data without using keyboard or Mouse. Voice recognition- the interface has voice recognition capability. Adaptive the interface will be easily adaptable for new design lessons. Proposed interface Basic structure The proposed interface device has three buttons power control, volume control and microphone control. The figure 3 only shows the simplicity and overall structure of the interface device. The size and weight are related with hardware designing of the interface device. The interface is controlled by using two technologies that are touch sensitive screen and voice recognition.
Figure 3, Structure of Proposed interface.
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Innovation The interface is innovative because it is being controlled with voice recognition and touch sensitive screen. There are various lessons. Lessons are open according to their demand, by touching the screen. Working and operation of interface The interface has various lessons according to their need. Such as first lesson support the alphabets with response of graphical things along with spelling and pronunciation. The second lesson is support graphical things with response of full text spelling along with pronunciation. Third lesson show numerical values with response of graphical things. Fourth lesson for voice recognition and final fifth lesson is for entertainment. The first lesson which supports the alphabets is working such as; when they touch the alphabet A the picture of an apple will appear with full text spelling along with pronunciation. When they touch letter B the banana will appear with full text spelling along with pronunciation and so on. The second lesson shows the graphical things, when they touch graphical thing full text spelling is appeared along with pronunciation. The third one supports the numerical values. It shows the numerical values such as 1, 2, 3, 4, 5 till to 10. When the children touch 1 with finger, one graphical pencil will appear with voice conversation one and so on. The fourth one supports the voice, the built in microphone has detect their voice. When they pronounce letter A the graphical apple is appear along with spelling and pronunciation. Such like for other alphabet letters. The last lesson will support entertainment such as moves, poems and songs. There are three icons one for moves other for poems and third one for songs. These things are open according to their demand, by touching the screen.
Basic Features Touch screen

The interface is touching sensitive, so it is simple to understand with little bit training. When the children touch the objects on screen the object is appeared with full text spelling and along with voice conversation. Touch screen save space, combine, display and input space and allow dynamic simulation of electromechanical control such as button and switches. Provide high level of immediacy in interaction directly with their fingers [7]. It provides ease of use and faster input rate [7, 8, 9].
Voice recognition
The interface has voice recognition to improve the reading capability of the children. If they cant speak correct spell of A the function will not trigger to appear apple along with text spell and pronunciation. The children understand their mistake and will reverse to previous lessons. Voice activation is already used to control the devices. It is used for email writing, dial the phone, close or exit the programs. Some sophisticated dictation software can be used with voice macros to trigger a series of functions by voice command. This technology already used for those applications which support people who do not like to use key board or mouse. It is also useful for disable people. The voice recognition is used for level dictation application for doctors, Lawyers and teenagers with special vocabularies [3].
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Installing new lessons The interface will support the new design lessons according to the requirements of children. Outcomes results This will be very attractive due to innovative interface of touch screen and voice recognition. This will easily movable due to its light weight by using modern hardware technologies. The children will be enjoying from graphics and mobility. During the lesson their attention is change because they are always thinking. They are seeing on various things such as trees or towards birds. This problem will remove due to touch of finger. When the child will touch the alphabet or graphics then their full attention will toward the alphabet or graphics. During the study the children are frustrated. The device will having movies, poems and songs etc that will remove the frustration of children. Advantage The suggested device structure will be simple have three control buttons, power control, Microphone control and volume control. The suggested interface will movable. Easy accepting data, due to touch sensitive screen [6]. Due to animation, graphics and touching on screen are supportive to learn lesson soon. The voice recognition will improve the speaking because when children say A the graphical apple will be appeared with full spelling along with pronunciation. If the children cannot say correct alphabet A the function will not trigger, then they understand the mistake and they will try to learn correct spell of A by using first basic lesson. The interface is affective if they are improving in education. Removed the old lessons and install the new design lessons according to their requirements. Disadvantages It will expensive due to touch sensitive screen, voice recognition and hardware technologies to make the device light weight movable. Having internal rechargeable batteries may be the interface required high power with less running duration. Related work Voice activation is already used to control PC, or other aspects. Digital software for writing letters and email, open or save documents, dial phone, open, close or exit a programs. Some more sophisticated dictation software can be used with voice macros to trigger a series of factions. Such like applications are used by people who cant use a mouse or keyboard [3]. Touch screen are already using in mobile, PDAs, digital video cameras and in high-end remote controls [6].
Figure 2: Touch Sensitive Screen Phone [6]
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Future work It is possible that it will become more attractive interface for children by using up-to-date hardware and software technologies. If we use surface technology and multi-touch technology then they will able to write and paint with specific joystick. And this will improve the writing aspects of this interface. Now it will cover the four aspects of learning, reading, speaking, listening and writing. It is also possible that children open books, videos and pictures from internet, if internet card are introduce. If we will introduce the Bluetooth technology then the children will be share data with one other. Detection of children is also possible if Radio-frequency identification (RFID) is implemented in this interface. Conclusion Most of children facing problem when interact with computer, especially while considering mouse and keyboards the reason is that control is weak leads to attention change during the lesson. They like graphics, animations, games and playing. By using touch sensitive screen and voice recognition they will easily enter data. The children will enjoy the graphical features of the interface. The suggested interface will provide safety and faster easy way for learning.
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References
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[1] Hewett. et al, Definition of HCI, ACM SIGCHI Curricula for Human-Computer Interaction, page no 5. [available online], http://sigchi.org/cdg/cdg2.html#2_1 [accessed 26 may, 2009]. [2] Mahoney, D. P. Innovative Interfaces: From the functional to the fantastic, new interface technologies are slowly changing the way we perceive and manipulate digital information. Computer Graphics World February, 2000. [3] Rogoff, R. Voice activated GUI-the next user interface, In Procedding of IEEE Internation Professional Communication Conferrence IPCC 2001. Sante Fe, NM, USA. Page no 117-120, ISBN: 0-7803-7209-3. [4] Michael, M, S. et al, Enhancing Reading Comprehension through Touch User Interface Technology, Journal of Literacy and Technology. [5] Minsky, M. R. Manipulating simulated objects with real-world gestures using a force and position sensitive screen, SIGGRAPH Computer Graph 18, 3 (Jul. 1984), 195-203. DOI= http://doi.acm.org/10.1145/964965.808598. [6] Poupyrev, I and Maruyama, S. Tactile interfaces for small touch screens, In Proceedings of the 16th Annual ACM Symposium on User interface Software and Technology (Vancouver, Canada, November 02 - 05, 2003). UIST '03. ACM, New York, NY, 217-220. DOI= http://doi.acm.org/10.1145/964696.964721. [7] Minsky, M, Manipulating simulated objects with real-world gestures using force and position sensitive screen in SIGGRAPH84. 1984: ACM p. 195-203. [8] MacKenzie, S and Soukoreff, R, Text entry for mobile computing: models and methods, theory and practice, Human-Computer Interaction, 2002. 17(2). p. 147-198 [9] Sears, A and Shneiderman, B, High Precision Touchscreens: Design Strategies and Comparison with a Mouse, International Journal of Man-Machine Studies, 1991. 43(4): p. 593-613. Dietz, P and Leigh, D DiamondTouch: a multi-user touch technology, In Proceedings of the 14th Annual ACM Symposium on User interface Software and Technology (Orlando, Florida, November 11 - 14, 2001). UIST '01. ACM, New York, NY, 219-226. DOI= http://doi.acm.org/10.1145/502348.502389
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Perception about Career among Secondary Level Students
Aijaz Ahmed Professor, Federal Urdu University, Education Departmental, Pakistan
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The purpose of selecting this topic was to explore the perception of youth about the selection of future career, studying at secondary level as their decision taken here drives their life throughout. The importance of careers does not confine to individuals interest, rather it goes beyond the limited domain to the national interest. Competent and capable individuals extensively play their role in national development that ultimately leads to broad based change in the society through prosperity and well being. This research study is based on Quantitative Research Methods. The responses are examined through numerical processes, which later help to approve or deny the hypothesis. Data collection was done through a questionnaire pertaining questions based on students thoughts of future careers in class IX and X level. Data was collected from 10 branches of a private sector leading chain of schools of Gulshan Town Karachi where 50 students of Science Group only, gave their responses of the 10 items of the questionnaire. The frequency distribution of the responses showed that the students are quite satisfied with their options selected in grade 9s. It was found that the majority of the boys wanted to join engineering as their profession and medical was selected by the girls. Less interest was shown in the subject of humanities. Moreover, Most of the students feel comfortable with studying their courses. The respondents also were of the view that they would not like to continue working in their fathers profession. Overall result shows that the youth has clear understanding about their future and adversaries of life. They seem quite capable also in achieving their targets. They only need guidance and proper counseling about professions and available options about career. Keywords: Perception ; Career ; Secondary Level Students INTRODUCTION The importance of careers does not confine to individuals interest, rather it goes beyond the limited domain to the national interest. Competent and capable individuals extensively play their role in national development that ultimately leads to broad based change in the society through prosperity and well being at lower strata of the society, especially, which are the real change agents. The basic purpose of education is to produce an able and competent cadre of individuals who can become, at later years, an effective human resource for nations growth. Although education brings behavior changes in individuals also but the benefits of education are multi-dimensional, which particularly serve the broader national interests. While the researcher selected this topic, there had been few considerations in mind that were linked with the national interest and ability of youth to look beyond the limited sphere around them. At the doorsteps of maturity, boys and girls start dreaming about their careers. They visualize themselves as the most prominent personality. Boys either want to be a brave individual, fighting against the adversaries of the society or an icon in business that can change everything within no time. He also desires to bring change in the lives of the deserving; the poor and the hungry disturb him. In result he wants to choose a career where he could have control over resources for a positive change. On the other hand, girls also desire to become independent with personal resources and help those women and girls who need specialized treatment. They think endlessly. They want to be teachers, because they do not like the way they are taught. They even do not understand why they are being taught the subjects which they dont like. Social seclusion of women and girls also affects their minds, especially when they see poor women and girls without much resources to treat their diseases and address health concerns. Girls also dream to become good mothers as or even better than their own mothers. In short, whatever they see missing in others want to acquire that in their future life. These all desires and aspirations ultimately lead to a healthy and prosperous nation. The purpose of taking this topic was to explore the perception of youth, studying at secondary level, about their future. At this level, students have to make a choice about their studies; either they would go into one field of knowledge or the other. Their decision at this level drives their life throughout. A sensible and thoughtful decision always pays the individual with prosperity and respect in the society, whereas, a slight mistake can lead a young person into confusion and lifelong misery of searching for a right path. It ultimately affects the national interest at later stages. The world is now moving very fast, and the time has come when this competitive society accepts only those, having right qualification and right skills.
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METHODOLOGY This research study is based on Quantitative Research Methods. The researcher examines the responses through numerical processes, which later help to approve or deny the hypothesis. The quantitative research also helps researchers control over procedures and keeps the focus very specific. SAMPLING To collect data, a questionnaire was developed with a purpose to track the thought processes of students generally both gender students of classes 9th and 10th. Due to limited time and limited opportunity to contact several schools, only one chain of schools was selected for the purpose. This limitation confined the collection of responses of students studying in Science Group only. As a matter of fact, their responses seem quite interesting. The ethical obligation of the researcher was considered particularly by keeping the respondents anonymous. It also provides confidence to the respondent to provide accurate information. Moreover, the problem of reliability and validity of research findings also addressed. The analysis of responses is mostly based on the frequency distribution through Relative Frequency (R.F) because the topic is such where the researcher analyzed the inclination of students towards one side or the other. Relative Frequency (RF) is calculated when the relative share of each group in total engagement is to be known. The relative frequency of a data class is the percentage of data elements in that class. DATA COLLECTION Data collection for this search study was taken from the students of The Educators. Around 50 girls and boys students were selected randomly to fill the questionnaire. They were given ample time to think and reflect. Only ten multiple choice items were given to the students. The questions were not set in any particular sequence, hence the students were asked to respond in whatever way they like. Due to the controlled situation 100% responses were sought. At some instances students marked more than one choice, whereas, they were required to respond to the one option. In this way some responses may be counted more than 100%. DATA ANALYSIS A. Personal Information 1. Class:
Class
9th 10t h
44%
56%
Class 9
th th
f 66 84 150 = Class frequency f Sum of the frequencies n 66 = 0.44X100 150 44% R.F(10th Class) = Sum of the frequencies n 84 = 0.56X100 150 56%
R.F (%)* 44% 56% 100%
10
Total *Relative Frequency Calculation: R.F(9th Class)
Class frequency f
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VOL 3, NO 4 The main focus of the study was to acquire the general perceptions among 10 grade students about career. It was assumed that the students at secondary level (9th and 10th classes) usually get somehow the clear understanding of career selection. They start thinking about the professions that they will choose in future. In fact, they stand at the cross section of options. Considering the purpose in mind a sample of 56% students, including both girls and boys were selected from class 10th and 44% students, both girls and boys, were selected from class 9th. This criterion also demonstrates the diversity of responses from different age groups, despite the fact that all the responses shall be evaluated as a whole. 2. Field of study:
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Field of Study Science Humanities Commerc e
0%
100%
Field of Study Science Humanities Commerce Total Calculation: R.F(Science) Class frequency f Sum of the frequencies n 150 = 1X100 150 = 100% Class frequency f Sum of the frequencies n 00 = 00X100 150 = 0% Class frequency f Sum of the frequencies n 00 = 00X100 150 = 0% =
f 150 0 0 150
R. F (%) 100% 0% 0% 100%
R.F(Humanities) =
R.F(Commerce) =
This question was intended to explore the interest of students and the school to provide multidisciplinary opportunities to students. It is evident that majority of schools offer science subjects and also students find science subjects more beneficial for future prospects. The respondents of this study are also the student of science group; 100%. Contrary to the fact, the later responses would reveal that students also like to opt. other subjects, whereas they are put in science subjects only because others parents, friends or relatives consider science for them more useful.
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3. Age of Respondents:
Age of Respondents
13 y ears 14 years 15 years 16 years 17 years
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4% 32%
6% 26%
32%
Age 13 years 14 years 15 years 16 years 17 years Total Calculation: R.F(13 Years) =
f 9 39 48 48 6 150
R.F (%) 6% 26% 32% 32% 4% 100%
Class frequency f Sum of the frequencies n 9 = 0.06X100 150 = 6% R.F(14 Years) = Class frequency f Sum of the frequencies n 39 = 0.26X100 150 = 26% R.F(15 Years) = Class frequency f Sum of the frequencies n 48 = 0.32X100 150 = 32% R.F(16 Years) = Class frequency f Sum of the frequencies n 48 = 0.32X100 150 = 32% R.F(17 Years) = Class frequency f Sum of the frequencies n 6 150 = 0.04X100 = 4% The age of the students was felt as the most important factor in ensuring reliability of data. According to the data it was observed that most of the respondents range between 14 to 16 years. Biologically, the 14-16 years children are considered as self dependent in personal affairs. They start thinking about themselves. This characteristic provides ample space to target this group than more mature students at higher secondary level.
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VOL 3, NO 4 The majority of the respondents range from 14 years (26%) to 16 years (32%). Some of the responses seem the representative of free thought. They mentioned also that they did not like science subject or they are put in this (science) group because their parents like this field of study. Some girls also mentioned other choices. Varied answers of the respondents provide validity to this study. 4. Gender:
Gender
Boys 9th Girls 9th Boys 10th G irls 10th
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18% 32%
26% 24%
Gender Boys 9
th
f 27 39 36 48 150
R. F (%) 18% 26% 24% 32% 100%
Girls 9th Boys 10 Girls 10 Total Calculation: R.F(Boys 9th Class) Class frequency f Sum of the frequencies n 27 = 0.18X100 150 = 18% = Class frequency f Sum of the frequencies n 39 = 0.26X100 150 = 26% = Class frequency f Sum of the frequencies n 36 = 0.24X100 150 = 24% Class frequency f Sum of the frequencies n 48 = 0.32X100 150 = 32% =
th th
R.F(Girls 9th Class)
R.F(Boys 10th Class)
R.F(Girls 10th Class) =
Among the total target group 38% girls have also shared their views about career, whereas 62% boys at both 9th and 10th grades participated in the research. To elaborate the statement, I have calculated both genders separately. During the analysis of the data it was revealed that girls in both the classes were more in numbers as compared to boys: 26% and 32% girls and 18% and 24% boys respectively. Therefore, the views expressed here are almost equally representative.
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5. Profession of the Father:
Profession of the Father
GS 20% PB PJ 2% 30% Retired
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48%
Professions of the father Govt. Service Pvt. Business Pvt. Job Retired Total 45 72 30 3 150
R.F (%) 30% 48% 20% 2% 100%
Class frequency f Sum of the frequencies n 45 = 0.30X100 150 = 30% R.F(PB) = Class frequency f Sum of the frequencies n 72 = 0.48X100 150 = 48% R.F(PJ) = Class frequency f Sum of the frequencies n 30 150 = 0.10X100 = 10% R.F(Retired) = Class frequency f Sum of the frequencies n 3= 0.02X100 150 = 2% This question was also very important to ask, because the professions of father, usually, also drive youth to take interest in their studies or the profession that they see around them all the time. According to the data it is revealed that around 48% parents earn their bread and butter through their personal business. Secondly, 30% Government officials send their children to schools. It is also important to mention that the area where this school is situated is an affluent area, where people have sufficient resources to admit their children in a private school. The science subject is in the interest of parents to engage their children in an earnable profession; either personal business or a government job.
Calculation: R.F(GS)
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6. Accommodation:
Accommodation
Flat Single Unit Home
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20%
80%
Accommodation Flat Single Unit Home Total Calculation: R.F(Flats) = 30 120 150
R.F (%) 20% 80% 100%
Class frequency f Sum of the frequencies n 30= 0.20X100 150 = 20% R.F(SUH) = Class frequency f Sum of the frequencies n 120= 0.80X100 150 = 80% As mentioned above the students have come from affluent families. The majority of the students live in single unit homes (around 80%). This information shows that the future opportunities for most of the respondents are quite safe. They can choose a variety of options at higher levels of education. B. Questionnaire: 1. Why are you studying?
Why are you studying?
My parent s forc ed me I like s tudying I am inspired by someone I dont know blank
14% 9%
2%
7%
68%
Why are you studying? My parents forced me I like studying I am inspired by someone I dont know Blank Total
F 12 114 15 24 3 150
R.F (%) 7% 68% 9% 14% 2% 100%
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VOL 3, NO 4 The purpose of this question was to enquire about the interest of students whether they like studying or not. Around 68% students responded in positive. This was so because they live in an environment where external pressures and aspirations provide them ample room to think and reflect over options. They observe around them the benefits of education. Despite the fact that majority students like studying but there was also a cadre of students, 14%, who were clear in responding that they didnt know why they were studying and what future prospects lie for them. Such students need counseling and coaching for career development. Some students also, around 7%, mentioned that their parents forced them to study. Although I could not record further that if their parents had forced them to study then what was their choice? Around 9% students were inspired by someone around them. It reveals that the environment around a student influence their choices of disciplines also. 2. Do you like courses that you are studying at this level?
Do you like courses that you are studying at this level?
No Yes
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32%
68%
Do you like courses that you are studying at his level? No Yes
f 48 102
R.F (%) 32% 68%
Total 150 100% In Pakistan, generally, the students are put in field of study that they dont like. Although 68% students responded in positive that they like courses which were being taught at secondary level, but there were also a considerable number of students, around 32%, who did not like courses of study, which are linked with science group. This information provides us considerable evidence that a considerable number of students shall go clueless in choosing their careers. Such students particularly need professional guidance for subject selection at very early stages. 3. What field of study do you like most?
What field of study do you like most?
Sc ienc e Humanities Commerce I don't k now
8% 14% 0%
78%
What field of study do you like most? Science Humanities Commerce I don't know Total
f 117 0 21 12 150
R.F 78% 0% 14% 8% 100%
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VOL 3, NO 4 The responses of this question validate the answers of the previous question. Responding to this question there were 14% students who liked commerce related subjects, rather they were put in science subjects. The influence of environment and personal liking and disliking shape the future of student, but the consideration of parents and others about subject counseling is revealed quite imperative for better career options. 4. What do you like around you?
What do you like around you?
Natural Objec ts Mec hanical Objects 4% 0% 34% I don't like anyting around me Did not Respond
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62%
What do you like around you? Natural Objects Mechanical Objects I don't like anything around me Did not Respond 93 51 0 6 62% 34% 0% 4%
Total 150 100% Although the scope of the choices seem quite broad but specifying natural objects had revealed that students feel their surroundings and they get inspiration from natural objects. Around 62% students like natural objects around them, while 34% students like mechanical objects around them. The student who marked natural objects might become writers, journalists and scientists, whereas the students who marked mechanical objects might choose to go into engineering related fields. This observation provides clear understanding that students at this stage need career counseling opportunities at school level as well. 5. Would you like to join the profession of your parents?
Would you like to join the profession of your parents?
Yes No I don't know
16%
26%
58%
Would you like to join the profession of your parents? Yes No I don't know
f 51 117 24
R.F (%) 26% 58% 16%
Total 150 100% Children get inspiration from their parents. In some cases it happens in reverse. It was strange to reveal that more than 50% (around 58% students) do not like the profession of their parents. Comparing the question no 5 at section A above with this question the conclusion can be drawn that majority of students do not like to join the business profession. They would join any other profession that they like most. Around 26% students liked the profession of their father. The responses of this question reveal that most of the students think independently and have choices in their minds about their career.
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6. Who inspire you most?
Who inspires you most?
Doc tors Engineers Teachers Any other
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30%
22%
12%
36%
Who inspire you most: Doctors Engineers Teachers Any other
f 33 54 18 45
R. F (%) 22% 36% 12% 30%
Total 150 100% This question was intended to gauge the external factors which influence students in choosing careers. Although majority of students (36%) get inspiration from engineers, but 30% of the students like to get inspired by other professionals. It reveals that a considerable number of students like to go into varied professions. 7. Have you ever discussed with your parents, friends or teachers about the profession you like most?
have you ever discussed w ith... you like most?
Yes No I don't k now about it
14%
6%
80%
Have you ever discussed with your parents, friends or teachers about the profession you like most? Yes No I don't know about it
f 120 21 9
R.F (%) 80% 14% 6%
Total 150 100% The results of this question reveal that the majority of students at this level starts thinking about their career seriously and discusses their matters with parents. It also reveals that parents provide them appropriate forums to share and discuss the problems and aspirations of their children.
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8. What profession do you like to choose in future?
What profession do you like to choose in future?
Medical Engineering Teaching Any Ot her
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28%
26%
6% 40%
What profession do you like to choose in future? Medical Engineering Teaching Any Other
f 39 60 9 42
R.F (%) 26% 40% 6% 28%
Total 150 100% Referring to the previous questions, now it is evident that most of the students like to join professions which provide them tangible feeling. Although they are at the door steps of maturity but they do not like to think about intangible aspects of education. 9. Do you have dreams about your future career?
Do you have dreams about your future career?
Yes No I don't know
6%
2%
92%
Do you have dreams about your future career? Yes No I don't know
f 138 9 3
R.F (%) 92% 6% 2%
Total 150 100% One of the objectives of the research was to find out the thought process of students about their future professions. The students who also have dreams about their future prospects ultimately get them. It is unfortunate that our socioeconomic structure does not support our youth to get the same profession that they desire to achieve.
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10. How do you rate your efforts to achieve good grades in exams?
How do you rate your efforts to achieve good grades in exams?
High Low I don't know
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6%
10%
84%
How do you rate your efforts to achieve good grades in exams? High Low I don't know
f 138 9 15
R.F (%) 84% 6% 10%
Total 150 100% Efforts in achieving desired goals in career, one has to strive very hard for cognitive development. Learning advanced concepts in different disciplines students have to give considerable time to internalize and understand them with creating linkages between different facets of knowledge. The responses against this question were very encouraging. Around 84% students declared themselves hard working and in result they seem serious about their future. Their desire to achieve good grades is usually high and they do not want to take their studies superficially. CONCLUSION Considering the outcome of the research, it is quite satisfying that students at secondary level start thinking about their future. They feel about their immediate surroundings. They have choices to opt in their lives. It was found that most of the students desire of joining engineering related professions, therefore, it can be assumed that the young girls and boys think more about the concrete aspects of life. They give lesser attention to the professions which are more linked with mental processes, such as humanities. Science discipline has appeared as the most demanding of subjects as compared to other disciplines. Parents also find it more appropriate to engage their children into subjects which can ensure better employability in future. But on the contrary students look into this matter differently. According to the findings it is find out that science is not the only choice for them. Among all, few consider themselves fit for other professions as well. Most of the students feel comfortable with what they study in their courses. They find studying more rewarding than wasting their time in other activities. Their seriousness could be gauged through other responses as well where majority of respondents have shown somehow the same interest. The youth is seen as indifferent from their surroundings, but the analysis of the data reveals an adverse result. According to the data, majority of students observe different situations happening continuously around them. It also portrays their vibrant engagement with their various interests. It was quite interesting that most of the respondents replied in negative when they were asked whether they would join the profession of their father. The majority seemed uninterested to join such professions which they see around them continuously. The results also show the independence of thinking process of the youth. When the students were asked about dreaming their careers they unanimously agreed that they see dreams about their future. Such habits show the seriousness of the students at such a young age. In result of the study there is no doubt to mention that the youth has clear understanding about their future and they have clear understanding of all the adversaries of life. They seem quite capable also in achieving their targets. They only need guidance and proper counseling about professions and available options about career.
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RECOMMENDATIONS 1. Girls and boys are the integral part of a society. It is almost impossible to develop a whole nation with the development of one gender. There is an immense need to create an educated mass which could cause national development. 2. Schools should create an office of career counselors who could guide students in choosing the most appropriate field of study in future. 3. Informal guidance sessions between teachers and students should be held on regular basis. 4. Teachers and parents should focus on education which could benefit the youth from different angles: it should bring behavior change as well as create monitory prospects. 5. Teachers should take care of their students in providing them proper guidance and counseling
References Athanasou. J, (2008) International Handbook of Career Guidance. Sydney: Springer Press Barry A. (2005)critical reflection on career education and guidance. Routledge Falmer. Edward. R, (1975) Career Guidance a Handbook of Methods. Routledge Falmer. Watts . A (2008) education and guidance. Routledge Falmer Edwin. L (2001) Vocational guidance and development in the schools. Geneva: Houghton Mifflin company. Ginzberg. E (1999) Who Needs It, Who Provides It, Who Can Improve It? New York: Mc Graw Hills Watts. A and Ronald. G, (2009) Career Guidance Policies in 37 Countries: Contrasts and Common Themes. International journal for educational and vocational guidance Volume 4, numbers 2-3, 105-122, DOI: 10.1007/s10775-005-1025-y Super, Donald E. (1983) Assessment in career guidance: Toward truly developmental counseling. Personnel & Guidance Journal, Vol 61(9), May 1983, 555-562. Herr, Edwin L.; Cramer, Stanley H.(1988)Career guidance and counseling through the life span: Systematic approaches (3rd ed.).Glenview, IL, US: Scott, Foresman & Co. (1988). xvi, 576 pp. May. D (2004) Power Etiquette What you dont know can kill your career: Kalahari.com Edwin L. Herr, Stanley H. Cramer, Spencer G Niles (2006) Career Guidance and Counselling through the lifespan: Systematic Approaches 6th Edition. amazon.com Gerald. C ( 2006) Student manual for theory and practice of counseling and psychotherapy: amazon.com

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Assessment of the Development Plan of Viability of ICT for the Oil Company Employees and Presenting an Assessment Model
Hassan Rastegarpour Faculty Member at Tarbiat Moalem University, Tehran, Deputy of Educational Research Institute Nosrat Riahinia Faculty Member at Tarbiat Moalem University, Tehran, Dean of Instruction Abstract Information and Communication Technologies (ICT) are important strategic resources. Effectively managed, they increase their presence in all aspects of human life and they have becoming a key contributor to organizational success in all sectors. This study presents information and communication technology (ICT) as a viable developmental plan for the employees of the Iranian oil company and presents a model. This article is a descriptive analysis of ICT for empowerment of the oil company employees. Questionnaire, Interview and Observation were the instruments of the study. Population consisted of 85 tenured employees of the company of which 72 (37 male & 35 female) returned their questionnaires who formed the sample of this investigation. Data were analyzed by descriptive and inferential statistics. The result indicates that: - The proposed ICT program satisfy the professional needs of employees This use of ICT increases interest and job satisfaction. The ICT program had direct effect on strategic decision making. ICT is an integral part of today's working environment. The use of ICT as a communication tool is essential. Ignoring ICT would be disastrous to anyone's career and the workforce. A model was presented as a guideline for the company employees. Keywords: Assessment, Development, Information Communication Technology, Model. Introduction ICT has become a major contributor to organizational success in all aspects of public and private organizations. That is why information and communication technology is becoming an essential part of the modern world. The popularity of ICT has brought about rapid technological, social, and economic alteration, that has happened in a network society around ICT (Castells, 1996). In today's business environment, organizations are obliged to become accustomed swiftly to rally new challenges and opportunities. A common strategy is to increase mobility in order to change the way in which organizations conventionally performed. Information Communication Technology simply involves technologies arising from scientific, technical and technological advancement in computer sciences, electronics and telecommunications. In an increasing interrelated world -this has brought technological advances in all different sectors of the society- quality education demands the dynamic and innovative ways to get the most out of the strengths of ICT. As a consequence, there is a pressing need to rethink and to restructure our educational enterprise, so as to tackle the technological challenges of this millennium (Roblyer, et al., 1997; Watson, 2001; Pearson, 2003). Lai & pratt (2004) believe that ICT is the driving force of foremost changes reshaping the world's economic, social and cultural pattern in the way people get hold of knowledge, and new teaching and learning strategies. ICT is becoming more cost effective and accessible for individuals in their personal lives, and at the work environment. The pace of change in
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technology requires organizations to be ready and responsive to get the most out of the emerging technologies. This poses a challenge for most organizations to compete and try to prioritize their needs in order not to neglect the needs of other areas in their corporation(Zhao & Cziko, 2001). Most organizations in Iran are seeking to increase the level of integration between their information systems to assist them in achieving cost efficiency savings. Like most industries, the ICT industry is facing skills scarcity. As a result, demands outweighs supply and this eventually leads to high assimilation costs. In making effective decision, leaders in the oil company need to be well informed and confident that investment they are considering will deliver identified business benefits on time and within budgetary constrains. Considering organizations have limited financial means, the execution of suitable information access controls needs to be balanced against risk and user accessibility to ICT system. Information and communication technology has the potential to speed up, improve, and expand skills; helps to generate economic means; provides opportunities for connection between any organization and the world (Davis and Tearle, 1999). ICT can also create a variety of tools to enhance and facilitate professional activities ( Kirschner & Woperies, 2003). Importance of the Study Planning, coordination, directing, supervision and educational assessment is considered as major part of policy making in order to accomplish goals and strategies on human resources. Curriculum planning based on needs assessment, supervision of experimental and theoretical instructional activities requires a divergent mechanism in this study in order to achieve instructional goals and strategies. Instructional designers, Curriculum developers, and Systems engineers, have tried to create an appropriate subsystem to have a efficient training program. However, due to the lack of harmonization in different departments in the oil company a successful outcome yet to become visible. The purpose of this investigation was to study the effect ICT and its proper application in the Iranian Oil Company. The goals of this study were: 1. Assessment of the present status of ICT in the oil company, and presenting a model. 2. Familiarize the employees of the oil company with the Viability of ICT for the developmental plan. 3. Study the effect and application of ICT training on performance of the employees.
Review of the Literature Rapid advances in Information and communication (ICT) have increased the number and size of information system (IS) projects as organizations seek to exploit this phenomenon (Irani, 2002). Information and communication technology have transformed our world in many ways. Yet, informal scholarly scientific communication forms a socio-technical interaction network in which communication is influenced by technology but defined by the social structures of scientists and their organizations (Kling, McKim, & King, 2003; Lamb, Sawyer, & Kling, 2000). ICT is considered as a key growth ingredient, specifically, in a dynamic business and highly competitive environments which requests using advanced ICT to improve resourcefully and cost effectively, in order to present to their customers, products and services of high quality in nature. There are many different aspects in ICT. Zhou & Wu ( 2009), Zhou & Zhang (2009) and Hwang (2005) see ICT as: software, hardware, networks and people. Carr (2003) believes ICT is a process which includes sequence of phases to treatment and transform the
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data into information. Recently ICT has expanded to include the role of ICT tools in marketing and seeking new customers. ICT is measured as a key issue for globalization, facilitating world wide flows of information, ideas, people and products. ICT includes all technology that facilitates the processing, transfer and exchange of information and communication services. It is considered as a subject of expertise that links information technology (computer and applications) and telecommunication networks (intranet and internet), that lets people and computers interrelate apart from physical location (Matzat, 2004). In order to have the utmost likelihood of success, ICT policies and strategies, like many other social initiatives, entails participation and support of all sectors of the economy and all levels of society (Kirschner & Woperies, 2003). ICT for development arises from the prospective it has to act as a potent enabler of development, to facilitate access to information and knowledge resources in a cost effective manner and its aptitude to improve the delivery of basic services. The utilization of ICT tools has an important influence on the organization and all of its elements including people, culture, process and tasks (Lievrouw& Carley, 1990). According to Hsu, et al (2002) there are three major roles for ICT. They include: administrative, operational and competitive, and it is the competitive one that is becoming most important. Four dimensions for describing ICT practices has been introduced (Matzat, 2004): operational support, business process support, manages support and innovation support. Weill et al. (1989); Pinsonneault & Rivard(1998), suggest that ICT is an effective tool to share, covert, accumulate and establish knowledge management systems that influence the organizational management philosophy and the way organizational members are managed. Also, ICT is making possible fundamental changes and improvements in the way management work and improving decision making. ICT application influence the nature of organizational structure, processes, procedures, internal and external communication process and organization size ( Raymond, 2000; Brynjolfsson, 1993; Rogers, 2002). The literature showed that most developing countries still have a long way to go to realize the benefits of ICT tools ( Gholami et al., 2006).
Methodology The research method adopted is qualitative research that aims to generate a descriptive explanatory utilization of ICT developmental plan in the Iranian oil company. Therefore, the research method incorporates induction, deduction and verification of the data collected. Data were collected through a variety of methods: Interviews, Questionnaire, and Observation. This study was carried out in the Iranian Oil Company.
The goals of the study were to: Assess the present ICT model used by the Iranian Oil Company, present a model developed by the researcher through investigating the literature, and compare the two. Introducing the potential of ICT and its application as a viable developmental plan. Study the impact and the application of training program of ICT on the employees performance . Population Due to the limitation of the population in this study, sample consisted of 85 employees that comprised the total population. From the total number of participants 72 questionnaires were returned.
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Instrument The instruments of the study consisted of interviews with the top management and a researcher made questionnaire which was distributed amongst the employees. In addition, the available documents of the company was studied and reviewed. Data Analysis and Findings The participants in this study consist of 37 males and 35 females. The two youngest were between the ages of 20-30 (27.8 %). The eldest 2 were of the age of 51 and up (2.8 % ). 37 of the participants had a bachelor degrees (51.3 %), two had associate degrees (2.8 %). Seventeen of them had between 11- 15 years of work experience (23.6 %), and 14 had the work experience of 1-5 years (19.4 %). Table-1 Employees response on the compatibility of goals & instructional plans with the growth of ICT.
Very weak Very good Excellent 54.2 20.8 12.5 15.3 19.4 25 20.8 22.2 15.3 16.7
22.3 Excellent 12.5 8.3 30.6 16.7 15.3
Questions
1 2 3 4 5 6 7 8 9 10
Knowledge on Computer Parts Knowledge of ICT Printers & Other Accessories Operating system: Installation of Soft/Hardware Word Processing for Texts Utilization of Computers for Making Power point Using Computers for Statistics and Calculation. Connecting to the Web Internet, Search Engines, & Resources Using Computer for E-Mail
9.7 1.4 6.6 9.7 5.6 9.7 6.9 8.3

5.82
2.8 22.2 13.9 5.6 8.3 9.7 11.1 11.1 16.7

10.14
9.7 20.8 26.4 27.8 16.7 16.7 26.4 22.2 18.1 23.6
20.84
33.3 51.4 27.8 34.7 50 34.7 34.7 29.2 44.4 31.9

37.22
2.8 4.2 1.4 6.9 1.4 5.6 2.8 5.6 4.2 2.8
3.77
Mean Percentage of Responses
As it is evident from table-1, most employees (about 59.52 %) chose excellent and very good as their response. This indicates that the employees of the Iranian Oil Company believe that they agree with the growth of ICT program. They also think that this program is appropriate for reaching their goals and the objectives of the program. Table-2 Employee response : Practicality of ICT on employee performance
Very weak Very good Weak Good
Questions
1 2 3 4 5
Communication with other Organization via e-mail Installation of Computer Parts Make & Present Power point in Conferences Safe Storage of Personal Data Make Written Document
5.9 9.7 4.2 5.6 1.3
10.8 9.7 4.2 1.4
25 19.6 18.1 20.8 15.3
33.3 45.8 30.6 45.8 51.4
12.5 6.9 12.5 11.1 15.3
11.66 6.32 19.76 41.38 16.68 11.7 Mean Percentage of Responses Table-2 Shows that 58.06 % of the employees chose excellent and very good as their response, 19.76 % chose good, 5.6 chose weak and very weak. The result indicates that most of the employees feel that ICT influences their job performance.
No response
469
No response
Weak
Good
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Table-3 Employee response on difficulties in application of ICT program
Very weak Very good
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1 2 3 4 5 6 7 8
Compatibility of goals & instructional plans Knowledge of Instructors Presentation Skills of Instructors Motivating the Students Quality of Questions & Answers Use of Instructional Materials & Soft wares Appropriate Time of the program execution Appropriate practical exercise
3.86 1.4 -
5.6 4.2 1.4 1.4 2.8 5.6
9.7 4.2 9.7 13.9 16.7 16.7 13.9 19.4
45.8 33.7 37.5 43.4 49 43.1 47.2 49
34.7 55.6 51.4 40.3 31.9 36.1 30.6 23.6
Excellent
Questions
4.2 1.4 1.4 1.4 2.8 4.28 1.4
0.65 0.65 2.7 13 43.6 2.11 Mean Percentage of Responses As the data in table-3 indicates, 81.6 % of the employees responded Excellent and very good, 13.02 % Chose good, and 1.63 responded weak and very weak. This means that the employees are aware of difficulties of conducting such programs. Table-4 K2 test for the difference between observed & expected responses
Amount 1 2 3 4 5 Low Medium High Low Medium High Low Medium High Low Medium High Low Medium High
Observed 7 49 16 2 29 41 8 54 10 1 31 40 5 47 20
Expecting 24 24 24 24 24 24 24 24 24 24 24 24 24 24 24
O-E -17 25 -8 -22 5 17 -16 30 -14 -23 7 16 019 23 -4
K2 40.75 33.25 56.33 34.75 37.75
Data in table-4 indicates all five K2 tests P-value less than 0.05, thus they were all statistically significant.
470
No response
Weak
Good
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Table-5 K2 test for the differences between sex & program compatibility
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20-30 31-40 41-50 51 and up Total
Strong 5.6 9.7 6.9 22.2
Medium 18.1 26.4 20.9 2.8 68.2
Weak 4.2 5.5 9.6
Total 27.8 41.6 27.8 2.8 100
Index K2
Table-6 The result of K2 test: sex and employees need in the program Observed Degree of Freedom Significant 4.25 6 0.64
Based on the information in table-5, observed K2 was larger than critical K2 (9.48). Therefore, there was a significant difference between the opinion of males and females in regard to the attentiveness of ICT and program plan, Conclusion This study sets out a better understanding of how the nature of the conditions in the Iranian Oil Company employees favors the successful integration of information communication technology in their system to ensure quality of ICT training. From this main premise several specific objectives stated were considered to have possible implications on the integration process. These objectives include: 1) Access to ICTs, 2) Utilization of ICTs ( in teaching/learning, etc.), 3) Effect of ICTs, 4) Sustainability. It was clear from the findings of the study that the integration of ICT is not just a matter of furnishing the company with computers without training the employees. It is not just allocating few hours for computer literacy skill development. ICT integration is using the computers effectively in the working environment to allow employees to master how to apply such skills in meaningful ways. The reasons for integration of ICT necessitate that employees play a vital role in the future of their working environment. From employees' perspectives, it was clear that they felt they were ill prepared to integrate ICT into their working program. The gap between personal use and use in working place was enormous. What became clear from the findings is that successful application of ICT in any sector may only be assured by adequate coverage of needed areas. Identified gaps should be filled through the employees' participation. Information communication technology is a powerful tool for the development plan for Iranian Oil Company, and a vehicle for preparing the employees' for the future. While information and the new communications technologies have a potentially large impact on growth, their effective use may be constrained by lack of skills, and financial resources.
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References
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Brynjolfsson, E. & Hitt, L.M. (2000). Beyond computation: information technology, organizational transformation and business performance. Journal of Economic Perspectives, 14 (4): 24-48. Carr, N.G. (2003). IT doesn't matter. Harvard Business Review, May: 41-49. Castells, M.(1996). The Rise of the Network Society (vol. 2).Oxford: Blackwell Publishers. Davis, N. E. & Tearle, P. ( Eds.) (1999). A core curriculum for telematics in teacher training. Tele-teaching 98 Conference , Vienna. Hsu, W., Lee, M. L. and Zhang, J. (2002). Image Mining: Trends and Developments. Journal of Intelligent Information Systems, 19 (1). pp. 7-23. Gholami R., Lee S.Y.T, and Heshmati Al. (2006). The Causal Relationship between Information and Communication Technology and Foreign Direct Investment, World Economy 29 (1), 43-62. Hwang Y. (2005). Investigating enterprise systems adoption: uncertainty avoidance, intrinsic motivation, and the technology acceptance model, European Journal of Information Systems 14, 150161. Irani, Z.( 2002). Information systems evaluation: Navigating through the problem domain. http://www.sciencedirect.com/science?_ob=MImg&_imagekey=B6VD0-46BS994-2Kirschner, P. & Woperies, J. H.(2003). Mind tools for teacher communities. Technology, Pedagogy, and Education, 12(1), 127-149. Kling, R., McKim, G., & King, A. (2003). A bit more to it: Scholarly communication forums as socio-technical interaction networks. Journal of the American Society for Information Science and Technology, 54(1), 47-67. lai, K.W. & pratt, K. (2004). Information and communication technology (ICT) in secondary school: the role of the computer coordinator. British journal of Educational Technology, 35,N4, 4 61-4 75. Lamb, R., Sawyer, S., & Kling, R. (2000). A social informatics perspective on sociotechnical networks. Paper presented at the American Conference on Information Systems, Long Beach, CA. Lemke, C. & Coughlin, E. C.(1998). Technology in American Schools. Seven dimensions for gauging progress. Milken Exchange Commission on Educational Technology. Lievrouw, L. A., & Carley, K. (1990). Changing patterns of communication among scientists in an era of telescience. Technology in Society, 12(4), 457-477. Matzat, U. (2004). Academic communication and internet discussion groups: Transfer of information or creation of social contacts? Social Networks, 26(3), 221-255. Pinsonneault, A., & Rivard, S. (1998). Information technology and the nature of managerial work, MIS Quarterly, 287311. Raymond, F. (2000). Delivering distance education through technologyA pioneers experience. Campus-Wide Information Systems, 17(1), 49-55. Pearson, J.(2003). Information & communication technologies and teacher education in Australia. Pedagogy and Education, 12(1), 39-58. Roblyer, M.D., Edwards, J., and Havriluk, M. (1997). Integrating Educational Technology into Teaching. NJ: Prentice Hall. Rogers, P. (2000). Barriers to adopting emerging technologies in education. Journal of Educational Computing Research, 22(4), 455.
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Watson, G.(2001). Professional development that engage with teachers, heart and mind. Information Technology for Teacher education, 10(1 7 2), 17-19. Weill, P., and M. Olsen (1989) Managing Investment in Information Technology: Mini Case Examples and Implications. MIS Quarterly, March, 217. Zhao,Y. & Cziko, G. A. (2001): Teacher adoption of technology: A Perceptual control Theory perspective. Journal of Technology and Teacher Education, 9(1), p 5-30. Zhou, H and Wu, H. (2009) . The integration of wireless sensor networks, remote sensing and geographic information systems for autonomous environmental monitoring. In: IADIS International Conference on Applied Computing 2009, 19 -21, Rome, Italy. Zhou, H and Zhang, Z. (2009). Adaptive end to end QoS Provision for real time multimedia applications in wireless network . In: 5th International ICST Mobile Multimedia Communications Conference, 7-9, London, United Kingdom.
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EXPLORING THE DEVELOPMENT OF INDUSTRIES: THE CASE OF PAKISTAN Hafiz Abdur Rashid
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Lecturer at Hailey College of Commerce, University of Punjab, Lahore.

Mian Muhammad Ashraf (Corresponding Author)
M.Phil scholar at Superior University of Lahore

ABSTRACT
The Study explores the development of industries of Pakistan and analyzed the factors that participate for the industry development. For this, the study is conducted in Pakistan and a sample of 30 years has been selected for this study for the period of (1974-2003) with annual frequency. Depending on the availability of data we have selected the longest possible sample period to avoid the small sample bias. Data on all the variables have been collected from World Development Indicators. Six variables have been selected for this study. Value added in Industry (VI) has been used as dependent variable to represent the economic growth. Whereas, Machinery and transport equipment (ME), Inflation (I), Exports of goods and services (EXGS), Finance (F), and Electric power consumption (kWh) (EPC) have been used as independent variables.
Keywords: Economy of Pakistan, Industrial Sector Development, World development Indicators, Multiple-regression, Introduction
Industry anxious amid manufacture, taking out and processing of organic materials, or an appendage of commercial enterprise concerned with the output of a particular manufactured goods or services. In reality, economy of any country based on the industrial sector and Industry considered as a back bone of country. Industry development depends upon assessment of their demands and practice of interaction and to fulfill those demands according to standard criteria. Major focus of industry is quality in terms of research and on practices regarding development. This can be done through practical projects with regard to industry and establishing practices of research related activities with relevant institutions. The research perform act as a alleyway to formulate advancement towards innovative ideas and
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cost-effective techniques of production. For R&D activities, industry is causative their share to the government for the expansion of such activities and also for the improvement of product improvement related research. In 1960s and 1970s, the light industry expands rapidly, mainly sugar refining, fertilizers, textiles, and other manufactures produced from local untreated materials. In the year 1970s, the lot of investment has been made by the government and made the countrys first steel milling operations and shop- building. The government also provides special support for production of chemical fertilizers. In early 1980s, Pakistan Industrial Development Corporation with credit IDA established and developed an industrial estate for small and medium scale industries. Pakistan Industrial Development Corporation assists SMEs in terms of credit, raw material, managerial and technical assistance, support for marketing and access to production facilities. In 1980s, industrial growth remains steady and textiles, cotton processing, food processing and petroleum refining sectors remain under concentrations. Tremendously considerable part of industries is Textile sector for Cotton textile production in Pakistan due to large scale of employment in industrial sector thats accounted as 19% and 60% of total growth in year 2000/01. At present, Pakistan has turned into self-reliant in cotton textile and export considerable quantities. The textile industry engages employees 38% of the industrial work force, contribution to GDP is 8.5%, accounts for 27% of industrial value-added and 31% of investment. Industries important sector include like food processing, chemicals manufacture, and the iron and steel industries. Pakistan's largest industry accounting to some extent more than 27 of value-added production is food processing. Steel industry of Pakistans annual production is 1.1 million tons and employed 14,500 workers. Pakistan steel industry produce billets, coke, pig iron, sheets and galvanized sheets, hot and cold rolled coils. In Pakistan, first time Japan make a joint venture for tin-planting plant and Pakistan began its operations. Moreover, ten plants of fertilizer are in Pakistan, which of them six are state owned and other four are private. Total annual production capacity of fertilizer plants is 4.65 million tons. In Pakistan, cement industry has started its operations. The industry working with an annual production capacity of 19.2 million tons. Production in 1999/00 was 9.9 million tons, up 4% from 1999/98. Pakistan has 21 cement plants, four are state owned and remaining 17 are private. Chemical industry of Pakistan produces chemicals in numbers which are used by other industries such as caustic soda, soda ash and sulfuric acid and few other industries exist in Pakistan which produce vegetable ghee, rubber tubes, refined sugar, electric motors, urea,
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air conditioners, fans refrigerators, radios, electrical consumer products (light bulbs, sewing machines, TV sets, and freezers) and pharmaceuticals (Industry Pakistan). Industrial sector accounts for about 24% of gross domestic production (GDP) of Pakistan. Specific policies for industry reform are observed in Pakistan in years 1988 and 1990s; further to boost private investment in priority sectors the additional policies are used. Policies are based on inducement for foreign investment in the course of agreement for profit repatriation. Banking sector regulations and assuage of investment and an uncomplicated way of access to loan and freedom of tax on major concern area like exports, power and agriculture based industries. Further more, equity participation also encouraged by government to evade volatility through rising leverage. To make investments more aggressively in the time of reform period institutions like Islamic and other investment institution were launched. These policies are also very crucial for both borrowers and lenders to estimate the substitute of cost of capital and measure up to it with peril quality of the firm for assessment of their future cash flows. (Nishat, 1999). For prediction and explaining the national market volatility, industry plays very crucial role. As internally some industries are more unstable than the other, reason is the stock index behavior is attributed to industrial composition, (Grinold, Rudd, and Stefek, 1989). However, global integration was also represented at high level by few sectors, the finance sector is the main example, (Roll, 1992). In the same way, transportation sectors, fuel and energy and consumer goods are tremendously significant in favor of any country index, (King, 1966). Industry components of discrepancy demonstrate to a great extent that less modifications has been made from sub-period to sub-period. Noteworthy, degree of difference and brunt of authoritarian approach on cost of investments was also experimental across various sectors, [(Isimbabi, 1994); (Prager, 1989)]. Numerous sectors of industries benefit from tax exemptions or holidays, added compensations in shape of fiscal benefits and easy way to get loans on based of concessions akin to agricultural support industries, such as power projects. Government also takes part to boost foreign exchange earnings through special consideration of export endowment to export dominant firms and on other side special relief given on import duties on raw materials and machinery. In period of 1990s financial reforms make an effort to condense leverage across firms and equity contribution contribute to the progress or growth of Pakistan. Greater level of leverage can be the cause of firms of larger instability in income of
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instability in industry earnings in the KSE, (Nishat, 2000)
I. RESEARCH QUESTION
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the firms, (French, Schwert, and Stambaugh, 1987). Leverage is only major cause for the
How do the sources machinery and equipment, Inflation, Exports of goods and services, Finance, and Electric power consumption (kWh) affect the development in the Industrial sector of Pakistan?4
II. OBJECTIVE OF THE STUDY
The objective of this study is to determinants factors which effects the development of Industries in Pakistan. After analyzing the effects of different factors on the Industrial Sector Development, relative importance may be given to those factors according to their contribution in the Industrial Sector Development.
DATA AND METHODOLOGY I. DATA
A sample period of 30 years has been selected for this study for the period of (1974-2003) with annual frequency. Depending on the availability of data we have selected the longest possible sample period to avoid the small sample bias. Data on all the variables have been collected from World Development Indicators. Six variables have been selected for this study. Value added in Industry (VI) has been used as dependent variable to represent the economic growth. Whereas, Machinery and transport equipment (ME), Inflation (I), Exports of goods and services (EXGS), Finance (F), and Electric power consumption (kWh) (EPC) have been used as independent variables. The description of variables has been given below:
DEPENDENT VARIABLE:
Value added in Industry: Industry keep in touch to ISIC division 10-45 and contain manufacturing (ISIC divisions 15-37). It embraces value addition in the sector of mining, manufacturing (also reported as a separate subgroup), structure creation, electrical energy, irrigate system, and gas. The net output of any sector is calculated after adding up all outputs and subtracting intermediate inputs and thats called Value added. The value added is calculated exclusive of making deduction for depreciation of fictitious assets or reduction and dilapidation of natural resources.
1-Calculated using the data from WDI mark 2007 COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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INDEPENDENT VARIABLES:
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1. Machinery and transport equipment: In the manufacturing sector the value added is the sum of gross output less the value of midway inputs used in production for industries classified in ISIC major division 3. Transport equipment and machinery encompass ISIC groups 382-84. 2. Inflation: the annual growth rate of the GDP implicit deflator shows the rate of price change in the economy to measure the Inflation as a whole. The ratio of GDP in current local currency to GDP in stable domestic currency is the GDP implicit deflator. 3. Exports of goods and services: Value of all produced goods and other marketable services provided to the rest of the world represent the exports of goods and services. This includes the goods value, stowage, assurance, transportation, travel, royalties, license fees, and other services, such as communication, edifice, fiscal, information, commerce, individuals, and government services. They keep out the labor and property income or factor services as well as transfer payments. 4. Finance: Basically Finance has concerned with the sum of money outside banks and demand deposits excluding those of central government. This sequence is commonly passed on to as M1 is a narrower definition of money than M2. All data is in existing home currency. 5. Electric power consumption (kWh): The production of power plants and collective temperature and power plants less transmission, circulation, and transformation losses and own use by heat and power plants measures the Electric power consumption.
6. QUALITY OF DATA:
7. It is really tough to comment on quality of the secondary data. However, the above definitions of the variables show that the variables measure the concepts which we intended to measure. Given that the data have been collected according to the above definitions of the variables, For the purpose of analysis the data used in this study is valid. The very important to note that above all definitions of variables have been taken from the user guide of the World development Indicators which is the source of the data used in this study. No data values are missing from any series. Data on World
Development Indicators are taken from the basis consideration to be mainly reliable.
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8. METHODOLOGY
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Model description and Variables: To achieve the objective of the study following model is used: VAIt = 0 + 1ME + 2INFt +3EXGSt + 4Ft + 5EPCt + Ut VAI ME = INF = EXGS F EPC = value added in industry Machinery and equipment Inflation = = = Export of Goods and Services Finance Electric Power Consumption
To present the overall picture of the variables the descriptive statistics are used. The scatterplot matrix is used to view the relationships among the variables used in this study. This matrix shows all the possible two dimension plots of the variables. A table of correlations among variables is also a part of the study. This table provides the values and signs of the coefficients of correlations. This table also provides the P-values of the test of the null hypothesis which states that the said variables are not correlated to each other. This table is also helpful to check the problem of multi-collinearity. The large correlations between the predictor variables indicate the problem of multi-collinearity. Since the objective of this study is to check the dependence of the industrial sectors development on different factors as stated above, in this study Ordinary Least Square (OLS) method of multiple-regression is used to estimate the effects of those factors on the industrial sectors development. The objective of the regression in this study is to find such an equation which could be used to find the predicted value of the industrial value added for a given set of values of growth rate of Machinery and transport equipment(ME),Inflation(INF), Exports of goods and services (EXGS), Finance (F), and Electric power consumption (EPC). The specified multiple regression equation takes the following form: VAIt = 0 + 1ME + 2INFt +3EXGSt + 4Ft + 5EPCt + Ut
(1)
As specified in the above equation VAIt is the dependent variable and other five variables are independent. Since all the variables are time series, subscript t denotes the time period. 0 is the constant term. 1, 2, 3, 4, and 5 are the partial regression coefficients of the independent variables. A partial regression coefficient represents the change in dependent
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variable, ceteris paribus, due to one unit change in independent variable. Et is the error term. To test the significance of the individual coefficients t-test is also employed in this study. Overall goodness of fit of the model is checked through F-test and the adjusted coefficient of determination (adj. R2). To test the problem of autocorrelation Durbin Watson (DW) test is also conducted.
JUSTIFICATION OF THE METHOD:
This study has used the descriptive statistics to present the overall picture of the variables. For the initial look on the relationship between different variables the scatter-plot matrix is used. This matrix shows all the possible two dimension plots of the variables. Magnitudes and signs of the correlation coefficients are provided in the table of correlations. This table is used to view the strength and direction of the relationship between the variables. This table also provides the P-values of the test of the null hypothesis that states that there is no correlation between two variables. This table is used to indicate the problem of multicollinearity as well. The method of multiple-regression is used to estimate the effect of multiple predictors on the predicted. Considering the objective of this study the multiple-regression analysis is used in this study to estimate the partial regression coefficients of the independent variables and their statistical significance. We have used the method of multiple-regression because there are five independent variables in this study and all of them are scale variables.
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EMPIRICAL FINDINGS
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In this part of the study empirical findings have been shown and interpreted. Table 3.1 presents the descriptive statistics which show the overall picture of the variables.
Table 3.1 Descriptive Statistics Descriptive Statistics
N Exports of goods and services Industry, value added Machinery and transport equipment Electric power consumption Inflation Finance Valid N (listwise) 30 30 30
Minimum 9.24 21.93 6.74
Maximum 17.36 25.45 12.99
Mean 13.6648 23.5619 9.5646
Std. Deviation 2.61415 .95385 1.72869
30 30 30 30
6.96E9 2.44 2.56E10
6.05E10 25.44 1.69E12
2.8775E10 9.9481 4.1704E11
1.73270E10 5.72936 4.35840E11
In the table the lowest (minimum) values, greatest (maximum) values, mean values and the standard deviation values of all six variables have been exposed. The idea regarding central tendency of values of variables represented by the Mean values. Observations of each variable are taken 30. The extreme values and Standard deviation (minimum to maximum comparison of values) give the inspiration about the dispersion of the values of a variable from its mean value. Since different units of measure have been used for different variables the dispersion of a variable using standard deviation cant be compared to that of other variable unless both the variables have the same unit of measure. But still these statistics are helpful to have an idea about the central tendency and the dispersion of a variable in absolute terms rather than relative terms.
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Figure 3.1
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Scatter-Plot Matrix Figure 3.1 exhibits the scatter plot matrix. In this matrix we intend to have some idea about the relationship between Value Added in Industry and other variables. This matrix shows the positive relationship between Value Added in Industry and Electricity power
consumption and between the Machinery and Equipment. There is no specific relationship between Value Added in Industry and Finance and between Inflation. The relationship between Value Added in Industry and Export of Goods and Services seems to be negative. These results have been confirmed by the table of correlations. Table 3.2 represents the table of correlations. This table reflects correlation between variables used in the research most of them are positively and highly correlated. Exports of goods and services is positively and significantly correlated to Industry value added, Machinery and transport equipment, Electric power consumption & Finance and have a negative and insignificant relationship with Inflation. Industry value added is positively and significantly correlated to Exports of goods and services only and do not have any significant relationship on all other variables. Machinery and transport equipment is positively and significantly correlated to Exports of goods and services, Electric power consumption & Finance and have an insignificant relationship with Industry value added and Inflation. Electric power consumption is positively and highly significantly correlated to Machinery and transport equipment, Exports of goods and services & Finance while relationship with Industry value added and Inflation is insignificant. Correlation between inflation and all other variables are negative and insignificant. Finance is positively and significantly correlated to Exports of goods and services, Electric power consumption & Machinery and transport equipment and has negative and insignificant relationship with Industry value added and Inflation. From all these findings it is clear that Inflation is not significantly correlated with any of the above variable and industry value added is only significantly correlated with exports of goods and services.
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Table 3.2 Correlations
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Exports Machinery of goods Industry, and Electric and transport value power services added equipment consumption Inflation Finance Exports of goods Pearson Correlation and services Sig. (2-tailed) N Industry, value Pearson Correlation added Sig. (2-tailed) N Machinery and Pearson Correlation transport equipment Sig. (2-tailed) N Electric power consumption Pearson Correlation Sig. (2-tailed) N Inflation Pearson Correlation Sig. (2-tailed) N Finance Pearson Correlation Sig. (2-tailed) N 30 .517** .003 30 .554** .001 30 .819** .000 30 -.020 .916 30 .645** .000 30 30 .167 .378 30 .205 .277 30 -.115 .546 30 -.012 .952 30 30 .729** .000 30 .083 .662 30 .656** .000 30 30 -.154 .415 30 .922** .000 30 30 -.183 .333 30 30 1 .517** .003 30 1 .554** .001 30 .167 .378 30 1 .819** .000 30 .205 .277 30 .729** .000 30 1 -.020 .916 30 -.115 .546 30 .083 .662 30 -.154 .415 30 1 .645** .000 30 -.012 .952 30 .656** .000 30 .922** .000 30 -.183 .333 30 1
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Table 3.3 presents the results of the regression analysis. The results show that all of the independent variables except Machinery and transport equipment and Electric power
Table 3.3 Regression
Variables (Constant) Exports of goods and services Machinery and transport equipment Electric power consumption Inflation Finance
Std. Error 1.404 .106
Cofficents
t.test 13.576
Sig.Level .000 .004
.933
3.224
.120
.205
.941
.356
.000 .025 .000
-.101 -.257 -.702
-.164 -1.697 -1.679
.871 .103 .106
consumption significantly affect the Industry Value added as shown by the values of the tstatistic and the corresponding P-values. t-test is used to test the significance of the individual partial regression coefficients. Null hypothesis in this test is set as the partial regression coefficient is zero. This test shows that the coefficients of all the predictors except Machinery and transport equipment and Electric power consumption are statistically significant at less than five percent level of significance. Coefficient of Exports of goods and services has the positive sign while inflation and finance have negative signs. The effect of the inflation and finance on the industry value added is negative and it is statistically significant. The magnitude of the partial regression coefficient of the Exports of goods and services is 0.933, which suggests that holding other factors constant an increase of one unit in this variable would raise the industry value added by 0..933 units. Other things equal, the value of the partial coefficient of the finance reflects the change of 0.702 units in industry value added due to one unit change in the finance. The partial regression coefficient of inflation is
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inflation would reduce the industry value added by 0.257 units.
DEPENDENT VARIABLE: INDUSTRY VALUE ADDED
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negative which represents that, given no change in other factors; an increase of one unit in
Necessary statistics have been shown in table 3.4. The value of the coefficient of determination (R2) is 0.653. The adjusted coefficient of determination (adj. R2) shows is adjusted for the degrees of freedom. The value of the adjusted coefficient of determination
Table 3.4 Necessary Statistics
(adj. R2) is not affected by the inclusion of the irrelevant variables. The value of the adjusted Coefficient of Determination(R2) Adjustad coefficient of Determination(Adj.R2) Durbin Watson Statistics .653 .596 1.887 5.484 .002 F. Statistic Sig.(F.Statistic)
coefficient of determination (adj. R2) is 0.59, which shows that fifty nine percent variations in industry value added are explained by the variations in independent variables. The value of Fstatistic is statistically significant at less than five percent which exhibits that in the estimated model at least one of the partial regression coefficients is different from zero. The value of Durbin-Watson statistic is 1.887 which is very much supportive (close to two) and reveals that there is no serial correlation in the error term. Figure 3.2 represents the plot of the studentized residual against the unstandardized predicted values. This plot shows that the spread of the studentized residuals is constant.
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Figure 3.2
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Plot of Residuals against Fitted Values for the Industry Value Added Data
This shows that the evidence of heteroscedasticity does not exist. Only one residual is between -3 and -2. This shows that residuals are normally distributed.
SUMMARY AND CONCLUSION
This study has investigated the factors which are responsible for the development of industries for the period 1961-2005 in the case of Pakistan. After observing the scatter plot matrix and the correlations ordinary least square method of multiple-regression has been used for this purpose. The industry value added has been used as dependent variable. The study could not find any impact of Machinery and transport equipment and electric power consumption on industry value added. The impact of inflation and finance are found to be negative and statistically significant. Yet, the effect of exports of goods and services is found to be positive and statistically significant. An industry value added also directed to as gross domestic product (GDP) by-industry, is the contribution of government sector or a private industry to overall gross domestic product (GDP). The value added components composed with reparation of human resources, taxes on production and imports less subvention, and gross operating surplus. The Difference between an industrys gross output (consisting of sales or receipts and other operating income, commodity taxes, and inventory change) and the
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services that are purchased from all sources) is equal to value added.
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cost of its intermediate inputs (including energy, raw materials, semi-finished goods, and In this regard our results support the findings of Dollar (1992) who also found the negative impact of exchange rate depreciations on the economic growth in the case of 95 countries. Khan and Aftab (1995) found that the Marshall-Lerner stability condition was absent for the period 1983-1993 in the case of Pakistan. The absence of this condition shows that the demand for imports and exports of Pakistan is less elastic. The less elastic demand for imports and exports of Pakistan might be the reason of this negative effect. This situation suggests that monetary authority of Pakistan should peg the exchange rate at the lower level. The results show that independent variables Exports of goods and services, Inflation and Finance significantly affect the Industry Value added as shown by the values of the tstatistic and the corresponding P-values. The impact of Machinery and transport equipment and Electric power consumption on Industry value added of Pakistan is not statistically significant. Positive and significant impact of exports of goods and services on industry value added suggests that Pakistan should focus on export for higher productivity of local industry. Partial regression coefficients of finance and inflation suggests that Pakistan should take some measures to provide easy and timed capital or finance to the industries and control the inflation to improve industry value added rate. Although this study has included many important determinants in the analysis on the basis of theoretical narrations, yet in future studies it would be useful to include some other variables in the analysis as well.
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References
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Grinold, R., A. Rudd, and D. Slefek (1989) Global Factors: Fact or Friction. Journal of Portfolio Management 16:1, 7989. Isimbabi, M. J. (1994). The Stock Market Perception of Industry Risk and the Separation of Banking and Commerce. Journal of Banking and Finance 18, 325349. Khan, S. R. and S. Aftab (1995), Devaluation and the Balance of Trade in Pakistan Paper presented at the Eleventh Annual General Meeting and Conference of Pakistan Society of Development Economists, April 18-21, Islamabad. King, B. F. (1966) Market and Industry Factors in Stock Prices Behaviour. Journal of Business 39, 139190. Nishat, M. (1999) The Impact of Institutional Development on Stock Prices in Pakistan. Unpublished Doctoral Dissertation, Auckland Business School, University of Auckland. Prager, R. A. (1989) Using Stock Price Data to Measure the Effects of Regulation: The Interstate Commerce Act and the Railroad Industry. Rand Journal of Economics 20:2, 280293. Roll R. (1992) Volatility in US and Japanese Stock Market: A Symposium. Journal of Applied Corporate Finance 5:1, 2535. Nishat, M. (2000) The Systematic Risk and Leverage Effect in the Corporate Sector of Pakistan. The Pakistan Development Review 39:4, 951962. French, K. R., G. W. Schwert, and R. F. Stambaugh (1987) Expected Stock Returns and Volatility. Journal of Financial Economics 19, 329.
Websites:
Economic Survey of Pakistan 2010-11 Extracted from: http://www.finance.gov.pk/survey_1011.html Industrial Bulletin. Engineering Development Board of Pakistan 2007. Industry of Pakistan -growth, annual, sector. Extracted from: http://www.nationsencyclopedia.com/Asia-and-Oceania/Pakistan-INDUSTRY.html Http//www.en wikipidia/economy of Pakistan. Report on textile vision 2005. Extracted from: http://www.pakistaneconomist.com/issue2000/issue43/f&m2.htm WDI(World Development Indicators)
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Trends of Manpower Migration from Pakistan

Imran Ahmed Lakha (Corresponding Author) M.Phil Scholar Hamdard Institute of Education and Social Sciences (HIESS) Hamdard University, Karachi - Pakistan Dr. Farooq Aziz Assistant Professor, Department of Business Administration, Federal Urdu University of Arts, Science and Technology Gulshan-e-Iqbal Campus, Karachi - Pakistan Abstract This paper reviews manpower migration trends from Pakistan and identify the causes, supportive networks and migratory movements. The objective of this research paper is to understand different aspects of manpower migrations from Pakistan i.e. overseas migration awareness, migrants professional categories, role of government and private entrepreneurs and migratory movements of Pakistani workers to different parts of the world and recommendations for further improvement in manpower export from Pakistan. The findings include; overseas manpower migration as the outcome of low wages, poor working conditions, lack of basic amenities and unemployment condition in Pakistan. On the whole the paper tries to analyze the size of Pakistani labour force globally. The analysis is based on data gleaned from the records of the Bureau of Emigration and Overseas Employment and other research studies. On the basis of findings, the paper recommends that government should focus on improving the synergy between migration and development policies; in particular enforcing labour legislation more strictly, with necessary simplification and modification of laws where necessary in the areas such as maintaining Pakistani migrants database, reduce transaction costs, upgrade the workers skills through formal training, study the nature of emerging skill requirements abroad, monitor the labour markets of the major labour-importing countries, carry out negotiations on labour contracts. Key Words: Migration, Migrants, Emigrants, Manpower Migration 1. INTRODUCTION Migration has played an important role in history as it has occurred throughout human history. Definition of the word Migration can be "the movement of people from one place to another". Briefly it is the movement of people from one place in the world to another sometimes over long distances or in large groups for the purpose of taking up permanent or semi-permanent residence, usually across a political boundary. It is a complex social process that affects many aspects of socioeconomic life. People who migrate are called migrants or, more specifically, emigrants, immigrants, or settlers, depending on historical setting, circumstances and perspectives.
Modern Migrations can be classified as Manpower Migrations. With the development of capitalism, the size of human migrations increased throughout the 19th century. Inter-state migrations caused by the relative over population of certain countries and a shortage of manpower in others became more common. This type of Migration also referred as
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International Migration. In this kind of migration movement to a new home in a different state, country, or continent is occurred. It occurs when peoples cross state boundaries to stay in the host state for some minimum length of time. External migration has been a constant factor in Pakistans history. Initially it starts from rural to urban areas locally. Next migratory wave took place in the form of international migration, from urban centers in Pakistan to urban centers in overseas. Overseas migration started on limited scale in early 1950s, when people started moving abroad to United Kingdom, and United States. These people were educated and belonged to well off families. Later on in 1970 and onward un-skilled and semi-skilled people belong to lower middle class started migrating to Middle East region. The Middle East, with its vast oil wealth, has provided many opportunities for overseas labourers to work and earn a living, building and maintaining infrastructure in various Arab states, especially in the Persian Gulf. Rich income and benefits attracted more and more people for overseas migration, as it provided a solution to lower living standards; on the other hand it helped Government to overcome unemployment as well.
1.1 Review of Literature In general the findings from research studies suggest varied pictures on particular subjects and overall migration factors. For instance Nisar, Zakir, Maqbool, Sial, and Waqar (2008) investigated the determinants of international migration from Pakistan and analyzed the push and pull factors affecting international migration. Montserrat (2007) assessed the short and medium term perspective of migratory movement between Pakistan and Western Europe (Catalonia). Hisaya (2009) studied the history of US migration from Pakistan, and Abrar (2005) studied the experiences of migrant workers in Gulf Corporation Council (GCC) States, from various South Asian Countries, focusing on short-term contract workers whereas EBDM (2009) study report assessed the dynamics of Illegal Migration, Human Smuggling & Trafficking (IMHST) from Pakistan. Most of the studies includes remittance factor and reveal that it reduces poverty and play an important role in sending countries economies. In particular, Ahmed, Sugiyarto, and Jha (2010) examined the impacts of foreign remittances on household welfare, and National economy; on the other hand Iqbal and Sattar (2005) examined the spending of workers remittances on consumptions instead of productive investments. 1.2 Migrants Occupation Categories Pakistani manpower is engaged in more than 40 occupations overseas in around 50 countries. According to Bureau of Emigration and Overseas Employment (BE&OE) workers occupations categories are classified into four major categories as:
a) Professional: A professional refers to a person having impressive competence in a

particular activity, or a person who has obtained a degree in a professional field. The term professional is used for highly educated and can perform commercially in a particular field. With respect to emigrants generally Engineers, doctors, nurses, managers, teachers are classified as professional migrants.
b) Skilled: Skilled workers possess special knowledge or skill in his work. This
ability or skills may have gained on job. A skilled worker may have attended an institute, college, or university and possess certificate, diploma or degree. With respect to emigrants electricians, carpenters, plumbers, drivers, surveyors, drafts
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man, designers, machine operators, accountants, computer programmers are classified as skilled migrants.
c) Semi-Skilled: Semi-Skilled worker refer to a person who has undergone for a

shorter training for some period, or who have learned a limited part of any trade. A semi-skilled worker may have attended an institute or gained limited working experience on job. A skilled worker may have attended an institute, college, or university and possess certificate, diploma or degree. With respect to emigrants, chauffer, room service waiter, painters, pipe fitters, tailors, masons, clerical and administrative staff is classified as semi-skilled migrants.
d) Un-Skilled: Un-Skilled workers refer to persons who possess no knowledge, no

specialized skill. Work perform by an un-skilled person can be perform by any worker. An un-skilled worker may have attended school and possesses primary or middle level education certificate. General labours are classified as un-skilled migrants. According to Pakistans Bureau of Emigration and Overseas Employment (BE&OE), category wise highest number of skilled workers (16,30,725 ), followed by Un-skilled workers (15,24,859), Highly Skilled (2,39,019), Semi-Skilled (93, 444) and the least number Highly Qualified (57,184) workers proceed abroad for employment during the year 1971 to 2004 from Pakistan.. Gender wise manpower migrations from Pakistan were primarily of male workers.
2. Supportive Factors in Overseas Migration Decision-Making The magnitude and direction of international manpower migration flows are influenced by several factors i.e. economic prospects, wage differentials between sending and receiving countries, skill demands, immigration policies, cost of migration, geographical distances, and cultural differences. The Push-Pull theory of migration has outlined the economic impacts of migration in sending and receiving countries. The factors of migration such as unemployment, demographic conditions, low living standard in home land accounts for push factors in sending countries, whereas better economic opportunities, political freedom, labour demands are counted as pull factors of receiving countries.
In Pakistan labour migration for overseas employment had been one of the major elements in reducing local unemployment problem and to boost up foreign exchange through workers remittances. Due to prevailing un-adequate economic conditions such as short of basic life necessitates, lack of employment opportunities and resources act as the push force for either local migration towards economically well urban centers or overseas migration as the final choice. Having prior knowledge and migration information and access to supportive networks also are contributing factors of overseas migration. Supporting conditions in the host counties is an important factor in the overseas migration decision. In Pakistan usually people has some relative, or friends working abroad that contribute in providing information and resources for intending migrants who in most cases are the head of their households.
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2.1 Family Contribution In Pakistan instead of individuals, family contributes for migration decision. The cost of migration is borne by family in context of family survival thinking and to gain several benefits as in return. A better income is expected to be generated by migrant member of the family. Well being in terms of household expenditures, better housing, living standard, children education, paying of debts, and option for business investment are the core factors behind overseas migration decision. The selected family member for migration has to perform with full ability and show capacity for traveling abroad and further establish himself to generate substantial income which can be shared with the remaining family members in Pakistan. In sum its a joint investment. 2.2 Social Networks Support
Social networks also play important role in overseas migration. In general, people need resources to migrate and those who have not access to these resources and information cans migrate. The first generation of migrants are therefore always from relatively well off background. Once they form a social network in destination countries then the poorer people also get access to these supporting networks for migration. Information based social networks are the basis of new generation, theory of migration. According to this theory whoever has information and resource can migrate, while finances become the secondary necessity. Pakistani workers seek overseas employment through their social networks. Usually these networks consist of family member, relative, friend and fellow tribesmen who have earlier migrated abroad and ready to facilitate the new comers. Expatriates communities and family networks plays vital role in increasing migrant flow. Due to strong relations and social ties among members of communities in Pakistan, personnel references and sponsorship for overseas job is very common. People migrate using their personal relationships, mostly through immediate family member, relatives, and friends. Assistance provided by these references varies from visa and job arrangements, accommodations, financial support, migration informations, which also helps in diminishing risk being in a strange place, and reduces migration cost as well. However Majority of migrants go overseas on visit visa and overstay illegally there for job purpose and remain stay without proper documents until they are caught by authorities and deported.
3.
Pakistan Migratory Phenomenon
Overseas migrations from Pakistan started in early 50s which gradually increased in numbers till 1970 and onwards. According to Pakistans Bureau of Emigration and Overseas Employment (BE&OE) there were about 4 million Pakistani residing abroad and have formed overseas Pakistani communities in various parts of the world by the year 2004/2005. Regional wise largest number of Pakistanis has been settled in Middle East which hosts approximately 2 million Pakistanis. In Europe major concentration can be found in United Kingdom. In North America, United States (USA) hosts a considerable number of Pakistani emigrants followed by Canada. 3.1 Methods of Migration Pakistani migrants used three different methods for overseas migration namely through relatives residing overseas in the destination country (sponsorships), agents (overseas employment promoters), and also try to obtain tourist visas. All these procedures are associated with costs. Cost wise high amounts are charged by agents for their entire support in migration, followed by sponsorship option which tends to be safe and secure, as relative in
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destination country assist in all means. The third, tourist visa option is a low cost but time consuming and often refused as tourist visa does not allow living and working in destination country and count as an illegal migration. Usually in Pakistan un-skilled workers tends to apply through agents. Although this option costs high as recruiting agents charges are at least 10 times higher than the officially prescribed fees, the poor workers even borrow money on high interest to meet these migration costs. Table 1 shows an estimated cost of emigration from Pakistan.
Table: 1: Estimated Costs of Emigration from Pakistan
Source: Vaqar Ahmed, Guntur Sugiyarto, and Shikha Jha (2010), page 8 3.2 Role of Government Institutions
The process of overseas labour/manpower migration plays a vital role in economic progress. Government of Pakistan considers international migration as one of the major source of revenue and tries to operate international manpower migration from Pakistan under State Management System. Government has made policies on migrant protection; overseas employments, recruitment laws and signed bilateral agreement with receiving countries for safeguard of Pakistani migrants abroad. Government strategy was to maximize to professional/skilled manpower migration in systematic way in order to workout best terms and conditions for Pakistani workers. Government institutions i.e. Ministries and departments/ division such as Ministry of Labour and Manpower (MLMOP), Overseas Pakistanis Division (OPD), Bureau of Emigration and Overseas Employment (BE&OE), Overseas Employment Corporation (OEC), Overseas Pakistanis Foundation (OPF) have been engaged with overseas Pakistanis with focus to improve welfare of overseas Pakistanis and make plans to boost manpower exports systematically from Pakistan through a planned strategy.
3.3. Private Entrepreneurs (Agents) In Pakistan most of the international migration channels though private entrepreneurs officially termed as Overseas Employment Promoters (OEPs). Government has strengthened the OEPs to explore the international labour markets. Involvement of these intermediaries necessitates the process of manpower migration mostly interacting with facilities such as advertisement of overseas job demands, initial applicants screening, interview of candidates, job offer contract signing with selected candidates, medical tests, endorsement of working visas/permits, checking immigration rues and procedures with dealing with authorities, registration of emigrating workers with Protector of Emigrants department and finally arrangement of travel and accommodation. There are several (OEPs) agencies promoting these services in Karachi, Lahore, Rawalpindi/ AJK, and Peshawar for
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overseas employment. These private entrepreneurs have been actively promoting overseas manpower migration from Pakistan.
3.4 Manpower Migrations from Pakistan
According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) Pakistani immigrants were estimated during the financial year 2004-05, as 3.97 million throughout the world. Data showing in Table 2, the highest percentage/ number of Pakistanis abroad were 1,893,373 (47.6%) in Middle East followed by 1,095,034 (27.6%) in Europe and 851,385 (21.4%) in America. In Asia and Far East region there were 72,793 (1.8%) Pakistanis followed by 37,964 (1.0%) in Africa and 23,000 (0.6%) in Australia & New Zealand. According to Overseas Pakistanis Division, the estimated number of total stock of Pakistanis living abroad by 2004, was around seven million which includes non registered by BE&OE, illegals/over-stayers and students throughout the world.
Table 2: Statement showing distribution of number overseas Pakistanis living/working/studying in different regions/countries of the World as on 30.06.2004 REGION-WISE DISTRIBUTION S. No 1 2 3 4 Regions No. of Overseas Pakistanis Africa 37,695 America 851,385 Asia and Far East 72,793 Australia and New 23,000 Zealand 5 Europe 1,095,034 6 Middle East 1,893,373 Total 3,973,549 Source: GOP (Government of Pakistan), Year Book 200 -2005: Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), Islamabad, page 26 3.4.1 Middle East Middle East region has been a major destination for Pakistani professional/skilled workers since 1970s. The region has employed large number of professionals, skilled and un-skilled manpower from Pakistan. Due to low Arab population, un-availability of technical experts, and higher standard of their living, foreign migrant workers fill jobs that are considered not attractive by the local workers. Workers, who migrated from Pakistan to Gulf region, were mostly construction workers and general technical staff. Due to enormous benefits; economic policies in Pakistan were hence directed towards the goal of creating maximum overseas employment opportunities for Pakistani workers and to establish a strong workforce of skilled manpower through trainings to meet the demands of technical staff in Middle East region.
The Pakistani migrants population in Middle East is shown in Table 3. According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) by the year 2004/2005, in GCC States, Saudi Arabia had the largest stock of 1,100,000, Pakistani migrants followed by U.A.E 500,000, Kuwait 100,000 Oman 85,000 Qatar 52,500, and
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Bahrain 45,000. Some other countries like Yemen, Syria, Jordan, Iraq of Middle East region also have smaller number of Pakistani migrants. Table: 3 Overseas Pakistanis in Middle East S. No Country No. of Overseas Pakistanis 1 Bahrain 45,000 2 Jordan 8,000 3 Kuwait 100,000 4 Oman 85,000 5 Qatar 52,500 6 Saudi Arabia 1,100,000 7 UAE 500,000 8 Others 2,873 Total 1,890,500 Source: GOP Year Book 2004-2005 Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), page 30 3.4.2 Europe In Europe, Pakistanis started migrating to United Kingdom (UK) since early 1950s. United Kingdom has been hosting the largest group of Pakistani emigrants from Asia. Pakistani migrants population in European countries is shown in table 4. According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) by the year 2004/2005, the largest stock of Pakistani migrants were present in United Kingdom (UK) 800,000 followed by Germany 52,668, France 50,000, Norway 36,400 Denmark 20,250 Italy 18,624 and Belgium 14,500. Some other European countries such as Austria, Sweden, Switzerland, Ireland, Portugal, Spain also hosting number Pakistani migrants varies from 2000 to 6000.
Table 4: Overseas Pakistanis in Europe S. No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Country Austria Belgium Denmark France Germany Greece Ireland Italy Netherlands Norway Portugal Spain Sweden Switzerland United Kingdom Others Total No. of Overseas Pakistanis 3,500 14,500 20,250 50,000 52,668 32,500 7,000 18,624 40,000 36,400 6,000 2,000 5,250 2,415 800,000 3,927 1,095,034
Source: GOP Year Book 2004-2005 Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), page 29
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3.4.3 North & South American Continents In the North America, United States of America (USA) has been the major destination of Pakistani migrants.. Migration from Pakistan to USA started after the mid-1960s in result of relaxation in U.S. immigration policy for South Asia. According to U.S. Census bureau there were about 100,000 Pakistani migrants in USA by 1990. Another major destination of Pakistani immigrants in North America is Canada. Overseas migrations from Pakistan to Canada began in early 1960s. Immigration was mostly done on the basis of advanced education and professional skills of the migrants. Table 5 indicates the Pakistani migrants population in North America. According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) by the year 2004/2005, USA had the largest stock of Pakistani migrants 600,000, followed by Canada 2, 50,000. Table: 5 Overseas Pakistanis in North America Country No. of Overseas Pakistanis Canada 250,000 USA 600,000 Others 1,385 Total 851,385 Source: GOP Year Book 2004-2005 Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), page 27 S. No 1 2 3
3.4.4 Africa The worlds second-largest and second most populated continent is Africa. The continent has 1.0 billion people living in 61 territories. The Pakistani migrants population in Africa is shown in table 6. According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) by the year 2004/2005, the largest stock of Pakistani migrants were present in Libya 30,000, followed by South Africa 2,500, and Kenya 1862. Table 6: Overseas Pakistanis in Africa Country No. of Overseas Pakistanis Kenya 1,862 Libya 30,000 South Africa 2,500 Others 3,602 Total 37,964 Source: GOP Year Book 2004-2005 Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), page 27 3.4.5 Australia & New Zealand S. No 1 2 3 4
Australia is the worlds 13th largest developed economy, ranking high performances in many international comparisons such as quality of life, health care, life expectancy, public
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education, human development, economic freedom, protection of civil liberties and political rights. People started migrating to Australia from Pakistan in the early 1970s on small scale. Immigration numbers significantly increased in the 1990s and afterward. Migration towards New Zealand was also on small scale. Pakistani migrants size around 3,000 in by 2001 which has been growing at a fair pace across many parts of the country. Table 7 indicates the Pakistani migrants population in the continent Australia. According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) by the year 2004/2005, the highest number of Pakistanis has been migrated to Australia 20,000 followed by New Zealand 3,000.
Table: 7 Overseas Pakistani in Australia and New Zealand Country No. of Overseas Pakistanis Australia 20,000 New Zealand 3,000 Total 23,000 Source: GOP Year Book 2004-2005 Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), page 29 S. No 1 2
3.4.6 Asia and Far East (Excluding Middle East) The worlds largest and heavily populated continent is Asia. Pakistani immigrants in Asia and Far East (excluding Middle East) are shown in Table 8. According to Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division) by the year 2004/2005, the largest of stock of Pakistani migrants in Far East Asia can be found in Hong Kong (20,000), followed by Japan (12,500), Iran (11,500), Malaysia (10,000), and South Korea (7000). In North and West Asia, Pakistani migrants can be found in Iran (11,500), Ukraine (1,620) and Russian Federation (1500). Some other Asian countries such as Brunei Darussalam, China, North Korea, Indonesia, Bangladesh, Vietnam, Myanmar, Nepal, Sri-Lanka, Maldives, Azerbaijan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan also hosting small number of Pakistani immigrants. Table 8: Overseas Pakistanis in Asia and Far East (Excluding Middle East) S. No Country No. of Overseas Pakistanis 1 Hong Kong 20,000 2 Iran 11,500 3 Japan 12,500 4 Malaysia 10,000 5 Philippines 1,000 6 Russian Federation 1,500 7 Singapore 1,600 8 South Korea 7,000 9 Thailand 1,980 10 Ukraine 1,620 11 Others 4,093 Total 72,793 Source: GOP Year Book 2004-2005 Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), page 28
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4. Conclusions The paper sets out to overview the factors contributing in the out flow of manpower migrations from Pakistan and presence of Pakistani manpower in different parts of the world. The outcome of this exercise will be the agenda for understanding migration and future research on this subject with reference to manpower export from Pakistan. The study will contribute in advancement of scientific pattern inquiry on the subject, making it vital and considerable force in the economic growth and development in manpower migrations from Pakistan.
The manpower migration of people across borders is part of the globalization process. Skilled workers constitute the bulk of international migration flow from underdeveloped countries towards developed world. Pakistani migrant workers seek both low skill and high skill jobs in overseas and offer their services in exchange with a better income which would not been possible for them to earn in their home land. This good income is usually sufficient enough to meet their expenses while the large portion of the income is sent to the home country as remittances for the family. These remittances directly benefits individuals household as well as national economy in terms of gaining foreign exchange. Several push factors became the cause of manpower migration from Pakistan, such as severe economic hardship, insufficient income, increased working hours, un-adequate working environment, continuous poverty, hunger, burden of debts etc. Mostly people see overseas migration as the ultimate survival. People consider overseas migration as a resource to gain better wage and more secure life along with better education for children, however employment and better income is the main motivation behind overseas migration trends from Pakistan. Overseas community connections, job expertise, overseas demands, play a significant part in migrants early decision, whereas the better income opportunities help finalizing it.
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References:
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Nisar Ahmad, Zakir Hussain, Maqbool Hussain Sial Ijaz Hussain and Waqar Akram (2008), Macroeconomic Determinants Of International Migration From Pakistan: Pakistan Economic and Social Review Volume 46, No. 2 (Winter 2008), pp. 85-99 Enterprise for Business & Development Management-EBDM (2009), Baseline Study on Illegal Migration, Human Smuggling and Trafficking in Pakistan: Study conducted with collaboration by Action Aid/ European Unions AENEAS Programme 2004-06 Aliya H. Khan and Lubna Shehnaz (2000), Determinants of Internal Migration in Pakistan: Evidence from the Labour Force Survey, 1996-97: The Pakistan Development Review 39 : 4 Part II (Winter 2000) pp. 695712 Montserrat Feixas Vihe (2007) Migration Movements between Pakistan and South Western Europe: Pakistani migratory networks in Catalonia: University of Barcelona Hisaya ODA (2009), Pakistani Migration to the United States: An Economic Perspective: (IDE) Institute of Developing Economic, (IDE) Discussion Paper No.196 Vaqar Ahmed, Guntur Sugiyarto and Shikha Jha (2010), Remittances and Household Welfare: A Case Study of Pakistan, Asian Development Bank-ADB Economics Paper Working Series No 194 Ather Maqsood Ahmed and Ismail Sirageldin (1993), Socio-economic Determinants of Labour Mobility in Pakistan: The Pakistan Development Review 32:2 (Summer 1993) pp. 139-157 Zafar Iqbal and Abdus Sattar (2005), The Contributions of Workers Remittances to Economic Growth in Pakistan: Pakistan Institute of Development Economics (PIDE) Research Report Series No.187 C.R.Abrar (2005), Labour Migration from SAARC Countries: Reality and Dynamics: Research Commissioned by BATU-SAARC, Refugee and Migratory Movements Research Unit, University of Dhaka Roger Plant (2008), Temporary Contract Labour in the Gulf States: Perspectives from two sender countries: A summary paper based on studies commissioned by the International Labour Office for the Gulf Forum on Temporary Contractual Labour Abu Dhabi, 23-24 January 2008 Dr. Ijaz Shafi Gilani (2008), A Case Study of Pakistani Labour Force in the Gulf: Gilani Research Foundation GOP (Government of Pakistan). (2007). Pakistan Employment Trends 2007: Youth. Ministry of Labour, Manpower & Overseas Pakistanis, Labour Market Information and Analysis Unit, Islamabad.
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GOP (Government of Pakistan),Year Book 200 -2005: Ministry of Labour, Manpower & Overseas Pakistanis (Overseas Pakistanis Division), Islamabad Government of Pakistan, (2009), National Emigration Policy: Policy Planning Cell Labour and Manpower Division, Ministry of Labour and Manpower, Islamabad
Other useful sources
. www.ilo.org International Labour Organisation www.iom.int International Organisation of Migration www.oecd.org Migration flows to major OECD countries www.migrationinformation.org Migration Information Sources http://www.beoe.gov.pk/ Bureau of Emigration and Overseas Employment (BE&OE) Government of Pakistan http://www.opf.org.pk/ Overseas Pakistanis Foundation (OPF) Ministry of Overseas Pakistanis, Government of Pakistan http://www.oec.gov.pk/ Overseas Employment Corporation (OEC) Government of Pakistan http://www.molm.gov.pk/ Ministry of Labour and Manpower (MOLM) Government of Pakistan
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THE IMPACT OF ADVERTISING ON BRAND LOYALTY WITH THE MODERATION OF CONSUMER BUYING BEHAVIOUR; A CONCEPTUAL FRAMEWORK Aamna Shakeel Abbasi Army Public College of Management Sciences Department of Management Sciences Ordinance road Lalkurti Zip code: 46000, State code: 66 Ali Muslim Bin Aqeel Army Public College of Management Sciences Department of Management Sciences Ordinance road Lalkurti Zip code: 46000, State code: 66 Ali Naseer Awan Army Public College of Management Sciences Department of Management Sciences Ordinance road Lalkurti Zip code: 46000, State code: 66
Acknowledgements: Mr. Adnan Riaz and Ms Fozia Malik have remained specially supportive and encouraging during the course of completion of this research study and have provided the author with their useful and knowledgeable guidance. ABSTRACT This paper epitomizes the substance of advertising on the purchasing behaviour of the consumers. Likeability, persuasiveness and brand personality created by the advertisement are the key factors which weight the intentions of the consumers regarding the brand and the purchasing behaviour. With more ad likeability the purchase behaviour will be strongly influenced. A creative and well executed ad has the power to persuade the consumers regarding their purchase decisions and behaviour. Similarly brand personality created in the ad has a direct impact on the purchasing behaviour of the buyer because the users relate the brand dimensions with their own personality traits. Therefore the paper concludes that the positive impact of all these dynamics on the buying behaviour of the consumer actually escorts towards consumer brand loyalty which is the main dimension of getting competitive lead in this dynamic era. Keywords: Likability, persuasiveness, brand personality, buying behaviour, brand loyalty. 1. Introduction Advertising can be sketched reverse to the commencement of the traced record as it is the worlds second oldest profession. The custom of Rock art and wall painting can be traced back to Ancient Greece, Ancient Rome and India which is practiced to this day in many parts of the world (Kotler and Armstrong, 2008). Various cryptograms depicting diverse events and offers have been dug up by archaeologists in the states around the Mediterranean Sea. Walls were painted by Romans to make known the gladiator fights; pictures were painted by Phoenicians to sponsor their merchandise on hefty rocks along the spectacle course (Kotler and Armstrong, 2008). History depicts that bill boards and out door advertising are the most aged type of advertising. With the
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VOL 3, NO 4 expansion of the town and the cities and due to the inability of the masses to read different sort of merchants used different images coupled with their trades just as cobbler a boot, tailor a suit, blacksmith a horse shoe. Merchants used street callers to announce their whereabouts for the expediency of the shoppers. As the education became an obvious need as well as the printing, the urbanized form of advertising began to inflate. With this the tradition of news paper advertising and hand bills emerged and became common. With more economic expansion and the success of print advertising and hand bills the idea of mail order advertising surfaced and then radio advertisement and then leading towards Tele vision advertising. Even with the advent of electronic advertising consumers are keener to disburse attention and route the information in print advertisement (Wright, 1974; Batra, 1986). Now with the trends of E-commerce and globalization the advertisers are encountering new boundaries and are moving forward to web advertising adding to the dot com boom. 21st century has actually given birth to online advertising by focusing on a relevant frame work, selfeffacing and low profile ads seeking to help rather then overwhelming the users. This has come with analogous efforts and an escalating drift of interactive marketing. The magnitude of effective advertisement in the current spirited era is enhanced as the companies strive to pull off competitive positioning through better advertising their products and services endeavour to differentiate their offerings in the mind of their consumers and customers. Effective advertising is related towards likeness, persuasion and attitude towards the advertisement (Mehta, 2000; Stone et al., 2000). Now companies are devoting huge budgets on advertising aspiring to persuade the customers. Firms are willing to spend millions and billions of money on making an ad of 60 seconds or even less as they know that an attractive ad will grab the attention of the customers, change their opinion regarding the product or the service, persuade them to purchase and ultimately enhancing the sales to increase the profit. Companies are now shifting to Google ad words and Google ad sense to persuade the viewers. The importance of advertising in the current situation cannot be denied as it is the initial as well as the most important step in reaching and persuading the audience (Siropolis, 1997). We see advertisements every where around us, on the Tele vision, radio, internet, mobile, carts, banners, sign boards, bill boards, news papers, magazines, trade journals and in store advertising. Due to this imperativeness of advertising in the modern era the education of advertising is also becoming extensively common in bachelors, masters and the doctorate degrees. A flow of advertising awareness is normally accredited to the strapping relation ship between cultural and technological modifications. Advertising is seen as a vital element for economic growth and success of the companies Ryans (1996) but actually companies emphasize diminutive on the advertising research refuting its significance. Hence the advertising research is the determinant to success of an ad in any realm. Hence the companies should not merely focus on the production of an ad to enhance the sales solely but to identify the needs and taste of their customers depending upon the culture (Fam 2006a) through advertising research and then fulfilling these needs through the creation of an eye catchy ad to clutch the awareness of the customers and finally persuading them to purchase their offerings. The advertisement strategies should be creative, artistic and should be executed in an artful manner to gain long term benefits, brand loyalty and competitive advantage through emotional bonding, persuading the buying behaviour of the customers by changing their intentions regarding the market offerings, creating a unique brand personality and brand image. 2. Literature review
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There is a mishmash of studies that pull glimmer on the atrociousness of advertising and its prominence on consumer buying behaviour. In present world it has become dramatically difficult for the companies and the advertisers to lead the concentration of their viewers and consequently have a brunt on their buying behaviour (Robinson, 1997). In fact looking at advertisements is considered to be a squander of time and effort by the majority people (Collett, 1994; Hollis, 1995). This habitually ends in wide awake attempts to steer clear of advertisements (Byrant and Zillman, 1994) and rebuttal to retort to advertisements (Cummins, 1996). The advertisements which are liked by the audience are considered to be finer and of high quality for enhancing the assenting perceptions and the genuine brand image. With the passage of time it is now understood that advertising likeability plays a vital role in influencing the consumer behaviour (Beil and Bridgewater, 1990).
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2.1. Brand loyalty
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Previous studies have shown that positive consumer behaviour through effective advertising lead to brand loyalty. To fabricate and sustain the consumer loyalty mass media advertising is supplemented with more direct and interactive methods (Baldinger and Robinson, 1996; Stewart, 1996). Brand loyalty results in meaningful marketing gain, minimization of business costs and elevating business leverage (Aaker, 1991), confrontation between the loyal customers to offering of the competitors (Dick and Basu, 1994) and uplifting revenues (Reichheld, 1996). It is a vital link moving the market share and relative prices (Chauhduri and Holbrook, 2001). Oliver (1999) argued that it is imprudent to conclude loyalty merely from recurring buying pattern or behavioural loyalty. Jacoby and Kyner (1973) integrated the two contradicting approaches, behavioural loyalty and attitudinal loyalty to define the term brand loyalty. Hypothesis 1: Brand loyalty is positively increased by increasing consumption behaviour. 2.2. Buying Behaviour Consumer buying behaviour is given huge importance in the literature study of advertisements effectiveness. According to Ajzen and Fishbein (1980) forecasting the consumers purchase behaviour is a source of computing their intentions to procure just earlier than they make the actual purchase. The actual consumer behaviour is leaded by the individual intentions (Ajzen, 2002). Personal attitude has a great control on the buying behaviour when encountered with social pressures (Cooper and Donald, 2001) on the other hand Future actions or the behaviour can be connected to the intentions that allow the individuals to attain the particular objectives influenced by the social forces (Baggozi and Warshaw, 1990). The specific action of consumer depends upon the beliefs about the benefits engaging with that exacting action or behaviour (Peter and Olson, 1996). Consumer buying behaviour is influenced by the liking of the advertisement (DuPlessis, 1994a; Smith et al., 2006), the emotions that form the attitude towards an advertisement (Morris et al., 2002), which then influences the buying behaviour of consumers (Allen et al., 1992). The attitude towards advertisement is not only a strong factor in determining the effectiveness of the advertisement but also work as an interceding variable between advertising and buying intentions of the viewers (Shimp, 1981), purchasing decision and behaviour depends entirely on the advertisement without any assessment of the product itself (Gorn, 1982). Hypothesis 2: Increased buying behaviour will augment the brand loyalty. 2.3. Likeability There is a wide range of data that suggests the weight of advertisement likeability for envisaging the intentions and behaviour of consumers. The review of the literature proposes diverse ideas, Some believe that likeability and attitude towards advertisement is a result of cognitive viewpoint which can foresee the consumer behaviour (Fishbein and Middlestadt, 1995) others assume that likeable advertisement corresponds to two times more effective then an average advertisement (Beil and Bridgewater, 1990) still others concluded that likeability of advertisements depends upon the element of entertainment and information provided ( Halley and balldinger, 1991). DuPlessis (1994b) considered involvement as an imperative aspect of likeability of advertisements whereas product category (Beil and Bridgewater 1990) and culture (Fam 2006a) were proposed as an important dimension in likeability of ads. Likeability is a noteworthy factor in advertising effectiveness having an impact on the consumer intention and buying behaviour (Mitchell and Olson, 1991) whereas if the advertisement is able to create a positive notion then it will make possible the consumer involvement ( MacKenzie and Lutz, 1989) mounting the capability to stimulate and affect the buying behaviour ( Brown, 1991) developing liking for the brand and then translating this likeability to purchase intention ( Smith et al., 2006). Hypothesis 3: Brand loyalty is positively increased by advertisement likability. 2.4. Persuasiveness Different ideas have been proposed depicting on the significance of persuasiveness of ads. Wells (1997) believed that successful ads are persuasive, informative and salient whereas the persuasion is associated to ad liking (Fishbein and Ajzen, 1975) in the context of involvement and relevance (Beil and Bridgewater, 1990). Persuasion is related to Brand salience in TV advertisements (Haley et al., 1984), affective and cognitive responses (Holbrook and Batra, 1987a), brand differentiation strategies in ads (Stewart and Furse, 1986), advertising content (Mcewen and Leavitt, 1976; Pechman and Stewart, 1989). Therefore the advertisers should
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VOL 3, NO 4 clearly focus on the creativity and the execution of the advertising strategies in a strategic manner to persuade the viewers. Hypothesis 4: Brand loyalty is positively increased by advertisement persuasiveness. 2.5. Brand Personality Brand personality is considered as the central element of brand identity (Aaker, 1996). The view of personality creation in advertising actually retorts to the propensity in modern culture to worth personal relationships. It actually refers the imperativeness of relationships in personal life. Brand personality sways the assessment phase in the consumer buying behaviour and for this phase and the general target advertisement is measured to be the most effectual communication means (Brassington and Pettitt, 2000) the expressive face of the brand image which is the vital facet of brand equity (Ouwersloot and Tudorica, 2001). The most common method for personality creation in advertisements is perhaps celebrity endorsement. But this was practiced back a century (Erdogan and Baker, 2000), but Redenbach (2000) observed that this custom is still eminent currently. Brand personality reveals that how people deem about a particular brand rather then thinking about what that brand does (keller, 1998) distinguishing the brand on extent to detain a persons traits and extending it to the realm of the brand. Supported by the human personality traits (Batra, Lehman and Singh, 1993), Sincerity, Excitement, Ruggedness, Competence and Sophistication (Aaker, 1997) as the big five brand dimensions related to brand personality. Hypothesis 5: Brand loyalty is positively increased by brand personality. Insert table 1 here There are some other factors such as social pressures, personal attitude, future intentions and consumer buying behaviour which are interlinked to each other and give an enhanced impact on buying behaviour and brand loyalty. Insert figure 1 here 3. Methodology
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As it is a conceptual framework paper therefore the methodology being used for developing the conceptual framework is the thorough study of previous literatures by eminent authors on effective adverting campaigns and the advertising factors leading towards brand loyalty. Keeping in view the basic purpose of the paper different authors ranging from David Aaker and Philip Kotler, to Armstrong has been studied to develop the conceptual model for this study. The thorough study of the past researches suggested that likeability, persuasion and brand personality are those major facets of advertising that have a huge impact on the consumer buying behaviour and intentions and that the positive buying behaviour of the consumer will produce brand loyalty.
Insert Table 2 here
4. Theoretical framework This vast array of knowledge depicts that organizations and advertisers should be taking care of the different factors of advertising particularly brand personality, persuasiveness, likeability factor in their advertisements to affect the buying behaviour of the consumers. Here Likeability, persuasiveness and brand personality are the independent variables; consumer behaviour is the moderating variable whereas brand loyalty is dependent variable. The advertisers should more likely emphasize on an integrated mix or combination of all these factors to possibly influence the intentions and the purchasing behaviour of the consumers because positive intentions
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VOL 3, NO 4 and purchasing behaviour will lead to loyal consumer and customer base for that particular brand which is the ultimate goal of every company. Insert figure 2 here 5. Discussions
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Consumers nowadays consciously avoid the advertisement considering them annoying (Bishop, 1997; Byrrant and Zillam,1994) therefore research conducted on this area suggested that likeability is the most effective advertising strategy to minimize this problem (Sacharin, 2001). Advertisers should focus on advertising strategies that would greatly impact on the purchasing behaviour of the masses. If an advertisement will not be liked by the consumer his intention regarding the brand will not positive and he will not purchase that product depending upon his disliking regarding the ad. There fore the advertisers should focus on the likings and disliking of the masses while creating an ad because ultimately the ad and the brand is for the consumer and if ad will not be liked, the product also will not be purchased. Advertising likeability usually has a strong and positive impact on the consumer buying behaviour (Beil and Bridgewater, 1990; Mitchell and Olson, 1991). In general informative and entertaining ads are liked by the consumers which eventually impact on their purchasing intentions and behaviour. Effective advertisement strategies focus preferences of people to make them watch the ad, involving them fully and then augmenting the sales and profits by influencing the buying behaviour of the users. Likeability of the advertisement also depends upon the culture and social values. As many international researchers have observed the cultural differences in the content of the advertisement (Mueller, 1992; Nevett, 1992; Cheng and Schweitzer, 1996) therefore cultural values should never be compromised while making the ad because they have huge impact on the overall likeability of the advertisement. In general consumers are not easily persuaded by certain advertisements because they have their own needs and demands and they will not get easily involved in an ad until they will find something related to the satisfaction of their needs. Some consumers are only persuaded by ads having strong body language while others by proper communication rhetoric and selling techniques adopted by the advertisers. Stanton Herbst (2006) demonstrated that the collective known market strengths i.e. the brand share, the number of the competing brands and the brand loyalty have a much stronger impact on the persuasion as compared to the element of creativity in the ad. Furthermore Petty and Cacioppo (1986) advocated two roads to persuasion, a central analytic route and a peripheral route that is affective and holistic. Personality tests and conflict approach inventory should be devised by the advertisers to better assist their advertising strategy in persuading the users to reach their goals. The strategy should be formulated and executed keeping in view the diverse personalities of the users to persuade them. As persuading the consumer depicts the overall buying behaviour of the user. Persuasive advertising eventually boost the sales to a remarkable point. If the advertisement will not be persuasive the real purpose of the advertising campaign will be demolished because they will not purchase the brand until they are persuaded by the advertiser. In other words the success of the advertisement depends upon the extent to which the ad is able persuade and convince the general populace. Every successful advertisement should have a unique brand personality to influence the behaviour of the users. Advertising by generating or reinforcing the brand personality adds to the brand equity and the overall value. It also assists to gain the market share and offers prolonged competitive position. Endorsers, cryptograms, images and execution rudiments are the major advertising elements that chip in to the brand personality. Every person has certain personality traits and he relates his personality traits with the brand personality shown in the advertisement. For this purpose the human personality can be conceptualized by using a trait approach (Anderson and Rubin, 1986). A trait is any discerning feature through which an individual may differ from other (Guilford, 1973). If a relationship is subsisted among the human traits and brand dimensions related to brand personality then the buying behaviour of the consumer will be strongly influenced by this relative ness among the traits. Generally people are having sentiments for certain celebrities so the advertisers need to identify those celebrities to endorse them to create a brand personality so as to influence the buying behaviour of the consumers and will also lead to brand loyalty. Consumer buying behaviour is typically influenced by the set of beliefs and the attitude the consumer has regarding the brand and its benefits. Sometimes the positive emotions shown in the advertisement develop positive attitude towards the advertisement (DeCock and DePelsmacker, 2000) and sometimes a positive consumer behaviour regarding the product (Walker and Dubitsky, 1994). Sometimes the advertisements over exaggerate the benefits and depict the advantage in such an artful manner that it sturdily pressurise the buying
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VOL 3, NO 4 behaviour and the intentions regarding the brand. Likeability of the ad results in enhanced purchased intentions (Smith et al., 2006) and has a brawny impact on the buying behaviour. Sometimes the emotional perspective shown in any ad also influences the purchasing behaviour of the users. The marketers and the advertisers should understand the psychology of the humans depicting their behaviour regarding certain actions. For example consumers are more amenable to food advertising when they are hungry so understanding this behaviour of the consumers likeable ads should be developed, executed and placed on the media in the late after noon. The factor of culture should not be compromised as it has wide force on the purchasing behaviours. Brand managers at the present time are inducing extraordinary efforts in creating brand loyalty and maintaining it through proper use of advertisement strategies. The companies should understand the imperativeness of loyal customer base in this competitive era. Effective advertisements tend to generate loyal customers. Brand loyalty often refers to repeat purchase (Jacoby and Chestnut, 1978; Oliver, 1999). Brand personalities assist the firms in creating brand loyalty. In the current state of affairs companies should employ online advertising to provide an interactive edge to the users to broaden the brand loyalty. Huge market share can be captured by loyal customer base. Indeed brand loyalty is a factor which can be generated by effective advertising, will increase the profits (Reichheld, 1996) and relative prices and high market share (Chaudhuri and Holbrook, 2001) will provide the brand a superior position in the eyes of the customers leading to sustainability. Therefore companies should identify the needs and demands of the consumers to create an effective advertisement so that likeability should be created. If an ad is liked by the person then it can persuade him. Similarly unique brand personalities relating to the human personality traits depicted in the ad can also create likeability and persuasion which can affect the consumer buying behaviour and change their intentions regarding the brand which results in brand loyalty. Insert figure 3 here 6. Importance of Brand loyalty
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The importance of brand loyalty cannot be denied for the creation and growth of strong brands. Companies are now millions and billions of amounts on their advertisement campaigns. The more the number of the competitors in the market the more the companies are trying to get the loyal customer base. Marketing is all about the human psychology. Marketing actually starts from the customers and ends on the customers. By advertising the companies want to create strong brand positioning, perception and differentiation of their products and services in the minds of the customers. Companies should make a blend of all the promotional and advertising strategies to fit the needs and preferences of the specific target market. Successful companies not only mean to enhance the sales through advertising campaigns but also to create brand equity and brand loyalty which leads them towards competitive advantage in this dynamic era. The basic point behind superior advertising campaign or marketing a product or service it to create brand awareness among the consumers. The advertising should be aimed to create unique brand image and position of the brand in the mind of the consumers. This brand image should be definable and memorable because ultimately this brand image creates awareness among the target market which is actually the first step in creating brand value and loyalty. This exclusive brand image will then create brand equity. This brand equity is actually the brand preference which the consumers make after watching the ad and by comparing it with other related brands. If positive brand image is created by the ad then the brand will be preferred by the consumer creating the brand equity and leading towards brand loyalty which means repeat purchase of the brand finding it valuable after the first purchase. If a brand delivers what it promises in the ad then brand loyalty would be created forming a loyal customer base with repeat purchase intentions regarding the brand. The more the advertising campaign of the brand would be effective and the more it delivers what it promises in the campaign the more it would be able to create brand loyalty and brand value which would help to sustain the competitive advantage. If the company has an effective marketing strategy but it is not fulfilling what has been shown in the ad then one time purchase is possible but not the repeat purchase. Therefore companies not only try to attract the new customers by advertising but also to retain the old ones through advertising and fulfilling of promises. 7. Conclusion In this paper it has been demonstrated that marketing edge can be gained by formulating and executing effective advertising strategies. Research has proved that advertisers need to create likeable, persuasive ads supporting a brand personality to influence the buying behaviour of the users. Likeable and persuasive ads will have a direct impact on the purchasing behaviour and the future intentions regarding the brand. A link between brand
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VOL 3, NO 4 personality dimensions and the human traits have been identified by this research which narrates that buying behaviour of the consumer will be positive if the ad consists of a unique brand personality relating to their own exclusive persona. It has also been declared that likeability, persuasiveness and brand personality not only influence the buying behaviour but eventually lead towards brand loyalty through effective advertising generating and retaining a huge loyal customer base. 8. Future research As this paper aims at formulating a conceptual framework for effective advertising leading towards loyal customer base through positive consumer behaviour therefore this research raises few interesting challenges for the future researchers. This paper aims at building the conceptual model highlighting the meaning of advertising effectiveness through creating ad likeability, brand personality and persuasion to influence the purchasing behaviour of the consumers. The more positive buying behaviour the more a customer will be loyal to the specific brand. Understanding the significance of these advertising factors leading towards brand loyalty will no more be exhaustive for the future researchers hence the future researchers might work on the underlying factor affecting all other advertising dimensions i.e. consumer psychology. For making an effective ad the advertiser need to understand the psychic of the consumers while putting himself in the shoes of the customer. Understanding the psychology of the consumers is of great significance as marketing and advertising is all about understanding the human nature and behaviour to provide the desired outcomes in the form of brand loyalty. 9. Limitations of the study The ideas proposed in this paper are meaningful in clarifying the significance of advertising factors to create brand loyalty. Yet at the same time it has some limitations due to which the generalizations should be made with watchfulness and consideration as the conceptual framework proposed in this study cannot be generalized to all types of ads. As the type of ad, the medium being used and the product or service being advertised vary, their likeability factor, the degree of persuasion and significance of brand personality also differs. At the same time the awareness and background knowledge of the consumers also create different results providing different outcomes as suggested in this study.
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Appendix
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Human personality traits Self confidence Dominance Aggressiveness Sociability Defensiveness
Brand personality dimensions Sincerity Excitement Ruggedness Competence Sophistication
Table 1 Relation of human personality traits with the brand dimensions
Social pressures
Future intentions
Personal attitude
Buying behaviour
Figure 1 The link between social pressures, personal attitude, future intentions and consumer buying behaviour
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Factors Likeability Sources Beil and Bridgewater (1990), Brown (1991), DuPlessis (1994b), Fishbein and Middlestadt (1995), Robinson (1997), Smith et al., (2006).
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Likeability results from cognitive viewpoint providing entertainment information resulting in purchase intention Ads with Informative content, salience, cognitive responses and brand differentiation strategies are persuasive The distinguished brand identity creating brand image based on or related to the human personality traits Personal attitude, emotions when encountered with social pressures create future intentions relating to the buying behaviour Brand loyalty results in marketing gain, market share, uplifting revenues and elevation of business leverage
Persuasiveness
Fishbein and Ajzen (1975), Haley et al., (1984), Stewart and Furse (1986), Pechman and Stewart (1989) Beil and Bridgewater (1990), Wells (1997).
Brand Personality
Batra, Lehmann and Singh (1993), Aaker (1996; 1997), Keller (1998), Brassington and Pettitt (2000), Ouwersloot and Tudorica (2001)
Buying Behaviour
Ajzen and Fishbein (1980), Bagozi and Warshaw (1990), Allen et al (1992), DuPlessis (1994a), Cooper and Donald (2001), Ajzen (2002), Morris et al., (2002), Smith et al., (2006). Jacoby and Chestnut (1978), Aaker (1991), Dick and Basu (1994), Riechheld (1996), Oliver (1999), Chauhduri and Holbrook (2001).
Brand Loyalty
Table 2 Review of contributions made on the advertising factors.
Likability Buying Behaviour Advertising factors Persuasion Brand personality
Brand Loyalty
Figure 2 The theoretical framework for this paper
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Advertisement campaign
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Brand image
Brand equity
Brand loyalty
Brand value
Figure 3 Importance of advertising campaigns in generating brand loyalty
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Struggle to Juggle Gender and Work Life Balance
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Mr. Aqeel Younis (Corresponding Author) Senior Research Associate (Life Institute for Excellence) Life Development Foundation G-11 Markaz Islamabad- Pakistan Ms. Sehar Zulfiqar Lecturer (Management Sciences Department) National University of Modern Languages and Sciences, Islamabad Ms. Hira Arshad Research Associate (Life Institutes for Excellence) Life Development Foundation G11 Markaz Islamabad- Pakistan Mr. Muhammad Imran Research Associate (Life Institutes for Excellence) Life Development Foundation G11 Markaz Islamabad- Pakistan
Abstract This study reframes the traditional view of male breadwinner-female homemaker model in Pakistan and further explores the opinion of doctors and medical consultants about gender division of labor, desire for spouse working (in same profession) and their preferences of working for extra time either for pay or for some other reason. It further assesses the impact of Strain-Based conflict, Role-Based conflict and Time-Based conflict on Work-Life conflict and that of Work-Life conflict, Life-Work conflict and Perceived Organization Support on Work-Life balance. A model is developed and estimated that presents a quantitative analysis of work-to-life balance of doctors from the cities of Islamabad and Rawalpindi based on gender and nature of employment. Non-probability convenience sampling as sampling technique, survey questionnaire as research instrument and correlation and regression were used as statistical tools. The study generated 78% response rate. Key Words: Work Life Balance, Work Life Conflicts, Gendered Division of labor, Work Force Diversity, Paramedics Staff. 1. Introduction: The human resource components of most organization have become more diverse and more sophisticated. In addition, other significant changes continue to occur in the HRM area. Till date, much of the research literature and theories has been cited to witness the fact. In order to maximize organizational effectiveness, organizations are trying to manage and fully utilize human potentialindividuals' capabilities, time, talents, work satisfaction and life satisfaction may be at the cost of family life. They ensure that employees are able to meet the organization's goals and claim that they are providing organizational support to the employees. In this situation, the employees should act positive towards the work as well as towards the family; as only these positive feelings drive them to balance work and life. The line dividing family life and work life has gradually blurred. Pakistan being a collectivist country, has always shared the norms and values of male-breadwinner/female-homemaker model. Cultural norms and values are fast facing the changes like women entrants in work force, both parents working, more broken homes etc resulting in intensification of the need to integrate work and family life as a part of every days reality and a bitter one too. Undeniable is the fact that sometimes employers forget employees have lives outside the workplace, and its not uncommon nor necessarily a weakness if employees cant leave their troubles at home. It shall be realized that a balance between work and family life can only be promised via an integration of energy and practices of a full set of institutions affecting work and family life. Imagine life as a game in which you are juggling some five balls in the air. They are work, family, health, friends and spirit and youre keeping all of these up. You will soon realize that work is a rubber ball. If you drop it, it will bounce back. But the other four balls; Family, Health, Friends and Spirit- are made of glass. If you drop one of these; it will be irrevocably scuffed, may be lost forever Bryan Dyson (CEO of Coca Cola)
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2. Literature Review: 2.1 Life-Work Conflicts: Family interference with work occurs when family-role responsibilities hinder performance at work (e.g. a child's illness prevents attendance at work) Higgins et al. (1994). 2.2 Work-Life Conflicts: Work interference with family arises when work activities impede performance of family responsibilities (e.g., long hours at work prevent a parent from being home for meals with the family) Higgins et al. (1994). Workfamily conflict occurs when an individual has to perform multiple roles that require time, energy and commitment (Greenhaus & Beutell. 1985). Based on the work of Kahn et al. (1964), Greenhaus & Beutell (1985) defined work-family conflict as a form of inter-role conflict in which the role pressures from the work and family domains are mutually incompatible in some respect. 2.3 Work Life Conflict and Gender: Gender may influence the ability to balance work and family in a number of different ways (Higgins et. al,. 1994). There is a significant body of research linking gender and work-family conflict (Barnett & Baruch. 198'; Duxbury & Higgins. 1991; Gutek et al. 1991: Jick & Mitz. 1985: Keith & Schaefer. 1980. 1991: LaCroix & Haynes. 198': Pleck. 1985; Skinner. 1980: Yoydanoff. 1988). Research indicates that employed women spend many more hours that employed men on family and household chores and more hours on work and family activities in total (Hochschild. 1989: Piotrkowski. Rapoport, & Rapoport, 1987; Pleck, 1979, 1983, 1985: Rexroat & Shehan, 1987; Voydanoff. 1988). 2.4 Gendered Division of Labor: The focus on gender acknowledges that despite the many changes in gender roles in the past 20 years, tradition prescribes a different emphasis between work and family for men and women" (Gutek et al.. 1991, p. 561). The gendered division of labor, with the wife caring for the family and the husband assuming the breadwinner role, is no longer a viable option for many couples Higgins et al. (1994). The literature also indicates that men have more control over the distribution of their time which in turn should make it easier for them to satisfy both work and family expectations. By way of explanation men have traditionally perceived that they can fulfill their family-role expectations simply by being a good provider without having to meet many additional demands within the home (Barnett & Baruch. 1987).
Women are twice as likely as men to report the work life imbalance, and with good reason: despite a massive influx into the workforce, women retain the greater share of responsibility for child care, elder care and domestic chores (Work-Life Compendium 2001). Women also report having more to worry about each day. Men on average worried about three things on a daily basis (their immediate family, job and money). Women worried about up to 12 things, including their immediate family, job and money, but also their extended family, the home, the social and academic lives of the children, social connections with neighbors and friends, and more (Hatter, Vintner et al. 2002; O'Brien & Shemilt 2003). a) Women should report more role overload and interference from family to work than men. b) Men should report more interference from work to family than women (Higgins et. al, 1994). It predicts that hours spent working in the opposite sex's domain ought to have a greater psychological impact on a person's perceptions of work-family conflict than hours spent in his or her own domain (Gutek et al. 1991). Thus women should report higher levels of interference from work to family than men, while men should report higher levels of interference from family to work (Gutek et al. 1991). The priorities of working women in decreasing order are; children, work, spouse and self. Since women tend to balance careers and family life, career womens time and energy shortfall may affect their job performance and retention in universities and other work organizations. Eventually these women face excessive work-family strain, which indicates competing demands between work and family domains. Thus eventually higher levels of work-family conflict and lower levels of role quality are strongly related to heightened levels of stress in working women (Isaacson & Baylor, 2003).
Karasek (1979) provides a third framework with which to predict gender differences in work-family conflict. Karasek (1979) identified two key operating forces: role demands and control, and postulates that it is the combination of low control and heavy role demands that is consistently associated with high levels of stress. Karasek's model suggests that the amount of work-family conflict perceived by an employee will be associated
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VOL 3, NO 4 with the employee's work and family-role demands and the amount of control he or she has over these demands. The research literature has consistently reported that womens work and family-role demands are higher than men's (e.g. Pleck. 1985; Rexroat & Shehan. 1987). Women are unable to take time away from the work role to satisfy family expectations (Barnett & Baruch. 1987). Women, therefore do not have the same control over the distribution of their time as men because the time spent satisfying work or family expectations is mutually exclusive. This lack of control should lead to a greater perception of interference from work to family and from family to work for women. Empirical results have consistently shown that women experience higher levels of work-family conflict than men (Duxbury & Higgins. 1991; Gutek et al., 1997; Voydanoff. 1988). Because very little research is available relating gender and the components of work-family conflict, the weight of the empirical evidence led us to hypothesize that women will experience higher levels of each of the subcomponents. The gender role- expectations theory is based on traditional socio-cultural role expectations, which prescribe that men take primary responsibility for the breadwinner role, while women assume primary responsibility for the family (see Galinsky et al. 1991; Hochschild. 1989; Schwartz. 1992). This theory suggests that role expectations will affect men's and women's perceptions of work-fami1y conflict differently (Gutek et al.. 1991). Women complain that a major cause for their worries is the fact that men still leave most of the housekeeping, childcare, shopping and cooking to them the share volume of work can be daunting. Women face stress from a number of situations and factors such as pregnancy, having a new baby, looking after children, caring for elderly relatives, bereavement, bullying in the workplace, sexual harassment, and balancing work and home life (Women in Business, 2003). 2.5 Work Life Conflict and Marital Status: Herman and Gyllstrom (1977) found that married persons experienced more work-family conflict than unmarried persons. One of the consequences of the inability to balance work and family demands is the increasing level of work-family conflict experienced by employed parents (Higgins et al. 1994). Further complicating is the finding of Higgins et. al. (1994) that one of the most significant changes in the labour market over the last decade has been the dramatic increase in the participation of women with children in the labour force. It is very difficult to work 10 or 12 hours a day, come back and be a perfect Dad and be a perfect partner something has got to give! (Mark Johnson, 34-year-old construction worker). Indeed, single female parents appeared to have a slight advantage over married female parents in that they spent about 10 fewer hours per week on home related responsibilities (Burden, 1986). Burden (1994) reviews the work of Belle (1982) and Guttenberg et al. (1980) Marriage appears to be a time consuming enterprise for women parents. Female parents in particular were at greatest risk for low levels of health and energy (F = 2.495, p = .0169), while single respondents, females, and parents reported lower levels of life satisfaction. Results tended to confirm numerous studies on stress and depression which find single mothers to be at highest risk for both (Belle, 1982; Guttenberg, Salasin, & Belle, 1980). Working women are healthier, show more self acceptance, greater satisfaction with life, freedom from emotional disturbance, fewer physical symptoms, greater longevity, increased marital satisfaction, and have adolescent daughters with higher achievement patterns (Belle, 1982; Guttenberg, Salasin, & Belle, 1980; Hofferth & Moore, 1979; Hoffman & Nye, 1974; Kanter, 1977). 2.6 Work Life Conflict and Nature of Employment: Employment is a major factor in enabling women to leave and stay away from abusive relationships (Ellsworth, 1980; Strube & Barbow, 1984). Hall and Gordon observed that women with part-time jobs may be spread very thin and experience role overload; not only do they work outside the home, but they may be full-time housewives as well. It may be that part-time employment (for women at least) does not necessarily lighten family time demands and might even increase the total array of pressures to which the person is exposed. Hall and Gordon (1973) found that married women who are employed part time were more likely to experience home-related conflicts than women who are employed full time. Numerous studies indicate that employment is a major factor increasing the physical, emotional and financial well-being of women (Burden, 1986).
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Theoretical Model: Strain-Based Conflict
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Role-Based Conflict
Work-Life Conflict
Time-Based Conflict
Life-Work Conflict
Work-Life Balance
Perceived Org Support 3. Research Methodology: This study follows a relational approach in order to determine the relationship among Strain-Based conflict, Role-Based conflict, Time-Based conflict, Work-Life conflict, Life-Work conflict, Perceived Organization Support and Work-Life balance. The total of 100 doctors in health industry from the cities of Islamabad and Rawalpindi responded against the survey instrument. The respondents selected for this study were specialist, medical officer, physician, surgeon, professor and other medical consultants. The study generated 78% response. For this study non probability sampling technique was used. Survey questionnaire was used as research instrument and organizations were visited personally. Responses for each factor were taken on a five point Likert scale where 1 meant strongly disagreed and 5 meant strongly agreed. Pearson Correlation and Multiple Regression analysis were used to identify the association and intensity of each predicator variable on the dependent variable. 4. Results, Analysis and Findings: 4.1 Correlation Analysis: The results appear to be quite in harmony with the literature review i.e. Work-Life and Life-Work Conflicts have a negative association with the Work Life Balance. The most significant association to Work Life Balance turns out to be Perceived Organizational Support with a correlation value of 0.618 as shown in Table C1. Role based conflicts appear to have a correlation of 0.460. Another important correlation value turns out to be that of 0.573 between Perceived Organizational support and Role Based Conflict. (Insert Table C1 and Table C2) Married employees reported positive association between Time-based conflict and WLC and between strain Based Conflict and WLC in contrast to single employees. Similar is the case with Strain-based Conflict and WLC but for both married and unmarried employees. Unmarried employees reported noteworthy negative associations between dependent variable WLB and two of the independent variables WLC (-0.385) and LWC (0.536) respectively as shown in Table C2 . As compared to the strain-based strains, role based and time based conflicts exhibited positive associations with WLB. Interestingly, Married employees reported a higher level of association (0.451) between Role Based Conflict and Work Life Balance as compared to the single employees (0.204). POS however maintained a strong positive association with WLB, with the overall correlation of 0.618. The association as held more favorable by married employees (0.624) as compared to the single employees (0.533). Another valuable finding is the overall association of POS and Role based conflict (0.573). Strain based conflict exhibited a moderate positive association with WLC in case of single and married male respondents (0.372 and 0. 373) respectively. The reported levels o association were however lesser in case of single and married females for WLC and Strain Based Conflict ( -0.116 and -0.271) respectively. Role based conflict for single females showed a meager association with WLC (0.112) in contrast to association with LWC (0.422). Married females showed no association of Role based strain and Work Life Conflict, however, with LWC the reported level of association is determined to be 0.359. Correlation analysis of single and married male in case of WLC is moderately negatively associated with WLB (i.e., -0.255 and -0.238 respectively). Whereas the correlation values of WLC of single and married females
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VOL 3, NO 4 yield significant positive association with WLB (i.e., 0.520 and 0.478 respectively). LWC are reported moderate to significantly positively associated with WLB both in case of single and married females (0.404 and 0.320) respectively. Single and married females reported a weak negative association of Strain based conflict with WLC (-0.116 and -0.271) while single and married males reported positive association with values 0.372 and 0.373 respectively. (Insert Table C3) POS reported significant positive associations with WLB in case of all four cadres o respondents under investigation (i.e., Single and married males and females). As compared to male respondents, single and married females reported moderate positive association of POS with WLC and LWC respectively. The same relationships as reported by male respondents were negatively associated meager values. Time based conflict expressed a positive association with WLB in case of self employed respondents. Virtually it can be translated as having no time based strain due to the possible flexibility options. In case of Permanent Employees, WLB showed a significant negative association with WLC (-0.468) and LWC (-0.215). Strain-based conflict was negatively correlated with WLB in case of Contractual employees (-0.348). (Insert Table C4 and Table C5) POS however reports a positive association with Role based Conflict in case of Permanent Employees (0.602), Contractual Employees (0.617) and Self-employed respondents (0.584). It is likely to assume that people responding higher levels of Role based conflicts still reported the provision of POS. Out of the three types of conflicts (Role-based, Strain based and time based) only strain based conflicts churned out the moderate to significant positive associations with WLC for all the three types of Occupational status (Permanent employees 0.338, Contractual employees 0.246 and Self-employed respondents reporting association levels of 0.327) respectively. 4.2 Analysis of respondents disfavoring Gendered Division of Labor: WLC and LWC exhibited negative associations with WLB for the respondents who did not favor the Gendered Division of Labor. Relationship of WLC with Time based, Role based and Strain based conflict of such respondents were 0.350, 0.204 and -0.006 respectively. POS and WLC conflict reported an association of 0.019 only. A significant positive association was determined between POS and Role based conflict i.e., 0.579. (Insert Table C6) 4.3 Analysis of respondents favoring Working Spouse: Correlation values of WLC and WLB exhibited a meager negative association (-0.053) and LWC and WLB (0.156) in case of respondents who favored the spouse shall be working. However, the association values of WLC with TBC, WLC and SBC are (-0.032, -0.338 and 0.064). POS and WLB are significantly positively associated (0.729). The level of association between POS and LWC (0.049) and between POS and WLC (0.246). 4.4 Analysis of respondents favoring spouse working in the same profession: Association among WLC and WLB (-0.065), LWC and WLB (0.264), SBC and WLB (-0.282), WLC and TBC (0.398), WLC and SBC (0.204), WLC and RBC (0.046) and POS and WLB (0.640) are as shown in Table C6. (Insert Table C7) 4.5 Regression Analysis: The research study has been carried out in order to examine the impact of Strain-Based conflict, Role-Based conflict and Time-Based conflict on Work-Life conflict and that of Work-Life conflict, Life-Work conflict and Perceived Organization Support on Work-Life balance. Table R1 depicts the regression outcomes for overall response of all doctors in health industry from the cities of Islamabad and Rawalpindi on one side and that of single and married on the other. These regression models are noteworthy and significant except R1-Single-Model-II. The output in the case of model (Overall), 39% variability is explained in W-L-Balance and 14% variability is explained in WL-Conflict. Perceived Organizational Support POS (0.567) and Strain-Based conflict (0.306) are high impact creators in WL- Balance and WL- Conflicts respectively. Whereas LW-Conflict (0.032) and Role-Based conflict (0.153) are the lowest impact creators in WL- Balance and WL- Conflicts respectively as per Table R1 Model(overall). Similar results are noted for the model (Single) and model (Married) with little variation as shown in Table R1. (Insert Table R1) Table R2 depicts the regression outcomes for gender-based response of all doctors in health industry with its comparison with marital status. These regression models are noteworthy and significant except R2-FemaleModel-II and R2-MarriedFemale-Model-II. The output in the case of model (Male), 37% variability is explained in WL-Balance and 25% variability is explained in WL-Conflict. Perceived Organizational Support POS (0.543) and Strain-Based conflict (0.376) are high impact creators in WL- Balance and WL- Conflicts respectively. Whereas LW-Conflict (0.009) and Role-Based conflict (0.22) are the lowest impact creators in WL- Balance and WL- Conflicts respectively as per Table R2 Model(Male). Similar results are noted for the model (Married Male) and significant results of model (Female) and model (Married Female) with little variation that in model (Married Male) Time-Based conflict (0.419) are high impact creators in WL- Balance instead of Strain-Based conflict (0.354) as shown in Table R2. (Insert Table R2)
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VOL 3, NO 4 Table R3 depicts the regression outcomes for response of all doctors in health industry comparative to their nature of employment (as Permanent, On-Contract and Self-Employed). Among these regression models only two are noteworthy and significant and i.e. R3-Permanent-Model-II and R3-On-Contract-Model-I. The output in the case of model (Permanent), 212% variability is explained in WL-Conflict. Strain-Based conflict (0.311) is high impact creators in WL- Balance and Time-Based conflict (0.055) is the lowest impact creators in WLConflicts as per Table R3 Model (Permanent). The output in the case of model (On-Contract), 285% variability is explained in WL-Balance. LW-Conflict (0.421) are high impact creators in WL- Balance and WL-Conflict (0.165) is the lowest impact creators in WL- Balance as per Table R3 Model (On-Contract). (Insert Table R3) Table R4 depicts the regression outcomes for doctors who support Gender Division of Labor (GDL), those spouses not working and if working they are not in the same profession. All six regression models in table R4 are noteworthy and significant. The output in the case of model (Favor Gender Division of Labor), 34% variability is explained in WL-Balance and 30% variability is explained in WL-Conflict. Perceived Organizational Support POS (0.453) and Strain-Based conflict (0.575) are high impact creators in WL- Balance and WL- Conflicts respectively. Whereas WL-Conflict (0.067), LW-Conflict (0.075) and Time-Based conflict (0.245) are the lowest impact creators in WL- Balance and WL- Conflicts respectively as per Table R4 Model(Favor Gender Division of Labor). Similar results are noted for the R4-Spouse-NOT-Working-Model-I and R4-Spouse-NOT-Working-in-the-same-Profession-Model-I with little variation as shown in Table R4. On the other side rest of the models have quite different results. as in Model II(Spouse-NOT-Working) and Model II(Spouse-NOT-Working-In-The-Same-Profession) 28.8% and 50.6% variability is explained WL-Conflict respectively. And Time-Based Conflict (0.41) and Strain-Based conflict (0.679) is realized as the highest impact creators in WL- Conflicts respective to their models. Whereas Role-Based-Conflict (0.149), and Time-Based conflict (0.092) are the lowest impact creators in WL- Conflicts respective to their models as per Table R4. (Insert Table R4) Table R5 depicts the regression outcomes for doctors who disfavor Gender Division of Labor (GDL), those spouses working and if working they are in the same profession. All regression models in table R5 are noteworthy and significant except R5-Spouse-IS-Working-Model-II. The output in the case of model (NOT Favor Gender Division of Labor), 55% variability is explained in WL-Balance and 12.8% variability is explained in WL-Conflict. Perceived Organizational Support POS (0.753) and Time-Based conflict (0.331) are high impact creators in WL-Balance and WL-Conflicts respectively. Whereas LW-Conflict (0.084) and RoleBased conflict (0.039) are the lowest impact creators in WL-Balance and WL- Conflicts respectively as per Table R5. Similar results are noted for the R5-Spouse-IS-Working-Model-I and R5-Spouse-IS-Working-in-thesame-Profession-Model-I and Model II(Spouse-IS-Working-In-The-Same-Profession) with little variation as WL-conflict (0.065) as the lowest impact creator in WL-Balance as shown in Table R5. (Insert Table R5) Table R6 depicts the regression outcomes for doctors who Requirement/No Requirement and Paid/Unpaid for Extra Time. These regression models are noteworthy and significant except R6-Paid-for-extra-Time-Model-II. The output in the case of model (Required Extra Time), 47% variability is explained in WL-Balance and 36% variability is explained in WL-Conflict. Perceived Organizational Support POS (0.63) and Strain-Based conflict (0.46.6) are high impact creators in WL- Balance and WL- Conflicts respectively. Whereas LW-Conflict (0.018) and Time-Based conflict (0.017) are the lowest impact creators in WL- Balance and WL- Conflicts respectively as per Table R6 Model(required Extra Time). (Insert Table R6) Perceived Organizational Support POS is the highest impact creators in WL-Balance. Similar results are noted for the model (Single) and model (Married) with little variation as shown in Table R1. The output in the case of model (Not Required Extra Time), 38.9% variability is explained in WL-Balance and 23.8% variability is explained in WL-Conflict. Perceived Organizational Support POS (0.619) and Time-Based conflict (0.408) are high impact creators in WL- Balance and WL- Conflicts respectively. Whereas LW-Conflict (0.156) and StrainBased conflict (0.245) are the lowest impact creators in WL- Balance and WL- Conflicts respectively as per Table R6 Model(Not Required Extra Time).
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of Psychology, Vol. 67 No. 3, pp. 350-360.
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References: Arnold, H.J. and Feldman, C.C. (1982), A multivariate analysis of the determinants of job turnover, Journal
Barnett, R.C., & Baruch, G.K. (1987) Social Roles, Gender and psychological distress. In R. C. Barnett, L. Biener, & G.K. Baruch(Eds.), Gender & Stress (pp.122-143). New York: Free Press. Bartolome, F., & Evans, P.A.L. Professional lives versus private lives_ shifting patterns of managerial commitment. Organizational Dynamics, 1979, 7(4), 3-29. Belle, D. (Ed.). (1982). Lives in stress: Women and depression. Beverly Hills: Sage. Bohen, H.C., & Viveros-Long, A. Balancing jobs and family life: Do flexible work schedules help? Philadelphia: Temple University Press, 1981. Brief, A. P., Schuler, R.S., & Van Sell, M. Managing job stress. Boston: Little, Brown. 1981. Burke, R.J., Weir, T., & Duwors, R.E. work demands on administrators and spouse well being. Human Relations, 1980b, 33, 253-278. Dianne S. Burden (Jan., 1986), Single Parents and the Work Setting: The Impact of Multiple Job and Homelife Responsibilities Family Relations, Vol. 35, No. 1. pp. 37-43. Duxbury, L., & Higgins, C. (1991). Gender Differences in work-family conflict. Journal of Applied Psychology, 76, 60-74. Ellsworth, C. (1980). Formerly battered women. Unpublished research report of a study of women who had been away from an abusive situation for at least a year. University of Washington School of Social Work, Seattle. Fletcher, B. (1988), The epidemiology of occupational stress, in Cooper, C.L. and Payne, R. (Eds), Causes, Coping and Consequences of Stress at Work, John Wiley & Sons, Chicester, pp.3-43 Galinsky. E., Friedman, D., & Hernandez,. C. (1991). The corporate reference guide to work family programs. New York: Families and Work Institute. Gove, W.R., & Geerken, M.R. The effect of children and employment on the mental health of married men and women. Social Forces, 1977, 56, 66-76. Greenhaus, J., & Beutell, N. (1985). Sources of conflict between work and family roles. Academy of Management Review, 10, 76-88. Gutek, B. Searle, S., & Kelpa, L. (1991). Rational versus gender role expectations for work family conflict. Journal of Applied Psychology, 76, 560-568. Guttenberg. M., Salasin, S., & Belle, D (1980). The mental health of women. NY. Academic Press. Higgins, C., Duxbury, L. and Lee, C. (1994). Impact of Life-Cycle Stage and Gender on the Ability to Balance Work and Family Responsibilities, Family Relations, Vol. 43, No. 2. (pp. 144-150). Hochschild, A. (1989). The second shift. New york; Viking. Hofferth, S. L., & Moore, K. A (1979) Women's employment and marriage. In R E. Smith (Ed.), The subtle revolution: Women at work, (pp. 99-124), Washington DC: Urban Institute.
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Ivancevich, J. M., Matteson, M T., & Preston, c. Occupational Stress, Type A Behaviour, and physical well being. Academy of Management Journal, 1982, 25, 373-391. Jeffrey H. Greenhaus; Nicholas J. Beutell (Jan., 1985), Sources of Conflict between Work and Family Roles. The Academy of Management Review, Vol. 10, No. 1., pp. 76-88. Jick, T., & Mitz, L. (1985). Sex differences in work stress. Acdemy of Management Review, 10, 408-420. Jones, A.P., & Butler, M.C. A role transition approach to the stresses of organizatioanly-induced family role disruption. Journal of Marriage and the Family, 1980, 42, 367-376. Kahn, R. L., Wolfe, D.M., Quinn, R., Snoek, J.D., & Rosenthal, R. A. Organizational Stress. New York: Wiley, 1964. Kanter, R. M. (1977). Work and family in the United States. A critical review and agenda for research and policy. New York: Russell Sage Karasek, R.(1979). Job demands, Job decision, attitude and mental strain: Implications of job redesign, administrative science quarterly, 24, 285-307. Keith, P., & Schafer, R. (1980). Role strain & Depression in two-job families. Family Relations, 29, 483-488. Keith, P., & Schafer, R. (1991). Relationships and well-being over the life stages. New York: Praeger. Keith. P. M., & Schafer, R.B. Role strain and depression in two job families. Family Relations, 1980, 29, 483488. Kopelman, R.E., Greenhaus, J.H., Connolly, T.F. A model of work, family, and interrole conflict: A construct validation study. Organizational Behaviour and Human Performance, 1983, 32, 198-215. LaCroix, A., & Haynes, S. (1987). Gender differences in the health effects of workplace roles. In R.C.Barnett, L.Biener, & G.K.Baruch (Eds.). Gender and stress(pp. 96-121). New York: Free Press. Lee, M.D., & Kanungo, R. (1984). Work & Personal Life coordination in a chnaginh society. In M.D.Lee & R.N.Kanungo (Eds.), Management of Work and Personal Life: Problems and Opportunities (pp.1-9). New York: Praeger. Leong, C.S., Furnham, A., Cary, L. and Cooper, C.L. (1996), The moderating effect of organizational commitment on the occupational stress outcome relationship, Human Relations, Vol. 49 No. 10, pp. 1345-1363 Matteson, M.T. and Ivancevich, J.M. (1982), Managing Job Stress and Health: The Intelligent Persons Guide, The Free Press, New York, NY. Nelson, D.L. and Burke, R.J. (2000), Women executives: health, stress, and success, Academy of Management Executives, Vol. 14 No 2, pp. 107-21) Piotrkowski, C. S., Rapoport, R. N., & Rapoprt, R. (1987). Families and work. In M. Sussman & S. Steinmetz (Eds.), Handbook of Marriage and the Family (pp. 251-283).New York: Plenum. Pleck, J. (1979). Mens Family work: Three perspective sand some new data. The family Coordinator, 28, 481488.
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VOL 3, NO 4 Pleck, J. (1983). Husbands paid work and family roles: Current Research Issues. In H. Lopata & J. Pleck (Eds.), Research in the interweave of social roles: Jobs and Families (pp. 251-333). Greenwich. CT: JAI Press. Pleck, J. (1985). Working wives/working Husbands. Beverly Hills, CA: Sage. Pleck, J. H., Staines, G.L., & Lang, L. Conflicts between work and family life. Monthly Labor Review, 1980, 103(3), 29-32. Professor Zahid Mehmood speech in the 10th national conference entitled clinical psychology in the service of community published in HEC news and Views, a monthly magazine of Higher Education Commission July 2008. Rexroat, C., & Shehan, C. (1987). The family life cycle and spouses time in housework. Journal of Marriage and the Family, 49, 737-750. Schwartz, F. (1992). Breaking with traditions: Women and work and the new facts of life. New York: Warner Books. Skinner, D. (1980). Dual Career family stress and coping: A literature Review. Family Relations, 29, 473-480. Strube, M.. & Barbow. L. (1984). Factors related to the decision to leave a relationship. Journal of Marriage and Family, 46, 837-844. Sullivan, S.E. and Bhagat, R.S. (1992), Organizational stress, job satisfaction and job performance: here do we go from here?, Journal of Management, Vol. 18 No. 2, pp 353-374) Terry, D.J., Nielson M. and Perchard, L. (1993), Effects of work stress on psychological well being and job satisfaction: The stress-buffering role of social support, Australian Journal of Psychology, Vol. 45 No. 3, pp. 168-175 Voydanoff, P. (1988). Work role characteristics, family structure demands and work/family conflicts, Journal of marriage and the family, 50, 749-761.
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Table C1: Overall Correlation Results Table C1: Correlates of Work-Life Correlates and Work-Life Balance
1.WLBal 1.Work-Life Balance 2.Time-Based Conflict 3.Work-Life Conflicts 4.Life-Work Conflicts 5.Strain-Based Conflict 6.Role-Based Conflicts 7.Perceived Org Support 1.000 0.009 -0.157 -0.019 0.008 0.460 0.618 1.000 0.218 0.137 0.236 0.080 0.080 1.000 0.314 0.315 -0.104 -0.081 1.000 0.065 0.041 -0.048 1.000 0.106 0.195 1.000 0.573 2.TB Conf 3. WL Conf 4.LW Conf 5.SB Conf 6.RB Conf
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7.POS
1.000
Table C2: Marital- Status wise Correlation results

1.WLBal OVERALL SINGLE 1.Work-Life Balance MARRIED OVERALL SINGLE 2.Time-Based Conflict MARRIED OVERALL SINGLE 3.Work-Life Conflicts MARRIED OVERALL SINGLE 4.Life-Work Conflicts MARRIED OVERALL SINGLE 5.Strain-Based Conflict MARRIED OVERALL SINGLE 6.Role-Based Conflicts MARRIED OVERALL 7.Perceived Org Support SINGLE MARRIED 1.000 1.000 1.000 0.009 0.505 -0.036 -0.157 -0.385 -0.157 -0.019 -0.536 -0.009 0.008 -0.254 0.017 0.460 0.204 0.451 0.618 0.533 0.624 1.000 1.000 1.000 0.218 -0.099 0.241 0.137 -0.284 0.160 0.236 0.159 0.240 0.080 -0.128 0.070 0.080 0.158 0.053 1.000 1.000 1.000 0.314 0.549 0.291 0.315 0.535 0.299 -0.104 0.143 -0.133 -0.081 -0.492 -0.035 1.000 1.000 1.000 0.065 0.487 0.020 0.041 0.260 -0.001 -0.048 -0.215 -0.052 1.000 1.000 1.000 0.106 0.535 0.082 0.195 0.055 0.213 1.000 1.000 1.000 0.573 0.649 0.559 1.000 1.000 1.000 2.TB Conf 3. WL Conf 4.LW Conf 5.SB Conf 6.RB Conf 7.POS
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Table C4: Nature of Employment-Wise Correlation Analysis

1.WLBal PERMANENT ON-CONTRACT 1.Work-Life Balance SELF-EMPLOYED PERMANENT ON-CONTRACT 2.Time-Based Conflict SELF-EMPLOYED PERMANENT ON-CONTRACT 3.Work-Life Conflicts SELF-EMPLOYED PERMANENT ON-CONTRACT 4.Life-Work Conflicts SELF-EMPLOYED PERMANENT ON-CONTRACT 5.Strain-Based Conflict SELF-EMPLOYED PERMANENT ON-CONTRACT 6.Role-Based Conflicts SELF-EMPLOYED PERMANENT ON-CONTRACT 7.Perceived Org Support SELF-EMPLOYED 1.000 1.000 1.000 0.073 -0.214 0.382 -0.468 -0.009 0.146 -0.215 0.414 -0.094 0.163 -0.348 0.104 0.725 0.147 0.137 0.882 0.268 0.328 1.000 1.000 1.000 0.180 0.123 0.394 0.092 0.114 0.221 0.299 0.228 -0.038 0.006 0.374 -0.274 0.079 0.142 -0.258 1.000 1.000 1.000 0.404 0.636 -0.221 0.338 0.246 0.327 -0.188 -0.069 -0.042 -0.290 -0.166 0.203 1.000 1.000 1.000 0.126 -0.010 -0.056 -0.060 0.215 0.060 -0.063 -0.056 -0.069 1.000 1.000 1.000 0.320 -0.375 0.347 0.294 -0.229 0.687 1.000 1.000 1.000 0.602 0.617 0.584 1.000 1.000 1.000 2.TB Conf 3. WL Conf 4.LW Conf 5.SB Conf 6.RB Conf 7.POS
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Table C5: Correlation Analysis of Support for GDL, Spouse not working and Spouse not in the same profession
1.WLBal FAVOUR GDL SPOUSE NOT WORK 1.Work-Life Balance SPOUSE NOT IN SAME PROFESSION FAVOUR GDL SPOUSE NOT WORK 2.Time-Based Conflict SPOUSE NOT IN SAME PROFESSION FAVOUR GDL SPOUSE NOT WORK 3.Work-Life Conflicts SPOUSE NOT IN SAME PROFESSION FAVOUR GDL SPOUSE NOT WORK 4.Life-Work Conflicts SPOUSE NOT IN SAME PROFESSION FAVOUR GDL SPOUSE NOT WORK 5.Strain-Based Conflict SPOUSE NOT IN SAME PROFESSION FAVOUR GDL SPOUSE NOT WORK SPOUSE NOT IN SAME PROFESSION FAVOUR GDL SPOUSE NOT WORK SPOUSE NOT IN SAME PROFESSION 1.000 1.000 1.000 0.147 0.079 0.063 -0.027 -0.230 -0.256 0.068 -0.195 -0.332 0.244 -0.035 0.288 0.448 0.448 0.433 0.560 0.547 0.575 1.000 1.000 1.000 0.029 0.380 -0.038 -0.044 0.172 -0.152 -0.228 0.164 0.092 0.034 0.175 0.039 -0.010 0.170 0.249 1.000 1.000 1.000 0.191 0.278 0.109 0.352 0.419 0.398 -0.204 -0.009 -0.359 -0.251 -0.048 -0.158 1.000 1.000 1.000 0.072 0.112 -0.032 -0.145 0.089 -0.233 -0.103 -0.151 -0.466 1.000 1.000 1.000 0.429 0.164 0.430 0.190 0.221 0.499 1.000 1.000 1.000 0.606 0.527 0.619 1.000 1.000 1.000 2.TB Conf 3. WL Conf 4.LW Conf 5.SB Conf 6.RB Conf 7.POS
6.Role-Based Conflicts
7.Perceived Org Support
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2.TB Conf 3. WL Conf 4.LW Conf 5.SB Conf
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Table C6: Correlation Analysis of Disfavor of GDL, Spouse working and Spouse in the same profession
1.WLBal NOT FAVOUR GDL SPOUSE WORK 1.Work-Life Balance SPOUSE IN SAME PROFESSION NOT FAVOUR GDL SPOUSE WORK 2.Time-Based Conflict SPOUSE IN SAME PROFESSION NOT FAVOUR GDL SPOUSE WORK 3.Work-Life Conflicts SPOUSE IN SAME PROFESSION NOT FAVOUR GDL SPOUSE WORK 4.Life-Work Conflicts SPOUSE IN SAME PROFESSION NOT FAVOUR GDL SPOUSE WORK 5.Strain-Based Conflict SPOUSE IN SAME PROFESSION NOT FAVOUR GDL SPOUSE WORK 6.Role-Based Conflicts SPOUSE IN SAME PROFESSION NOT FAVOUR GDL SPOUSE WORK 7.Perceived Org Support SPOUSE IN SAME PROFESSION 1.000 1.000 1.000 -0.091 -0.124 -0.094 -0.336 -0.053 -0.065 -0.092 0.156 0.264 -0.152 -0.031 -0.282 0.493 0.396 0.473 0.649 0.729 0.640 1.000 1.000 1.000 0.350 -0.032 0.398 0.267 0.115 0.316 0.546 0.426 0.338 0.127 -0.063 0.072 0.151 -0.095 -0.109 1.000 1.000 1.000 0.599 0.416 0.447 0.246 0.064 0.204 -0.006 -0.338 0.046 0.019 -0.246 -0.039 1.000 1.000 1.000 0.130 -0.096 0.108 0.105 -0.078 0.225 0.018 0.049 0.266 1.000 1.000 1.000 -0.169 -0.087 -0.189 0.252 -0.038 -0.070 1.000 1.000 1.000 0.579 0.583 0.515 1.000 1.000 1.000 6.RB Conf 7.POS
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5.SB Conf
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Table C7: Correlation Analysis of Requirement/No Requirement and Paid/Unpaid for Extra Time:
1.WLBal REQUIRED EXTRA TIME PAID FOR EXTRA TIME NOT REQUIRED EXTRA TIME 1.Work-Life Balance NOT PAID FOR EXTRA TIME REQUIRED EXTRA TIME PAID FOR EXTRA TIME NOT REQUIRED EXTRA TIME 2.Time-Based Conflict NOT PAID FOR EXTRA TIME REQUIRED EXTRA TIME PAID FOR EXTRA TIME NOT REQUIRED EXTRA TIME 3.Work-Life Conflicts NOT PAID FOR EXTRA TIME REQUIRED EXTRA TIME PAID FOR EXTRA TIME NOT REQUIRED EXTRA TIME 4.Life-Work Conflicts NOT PAID FOR EXTRA TIME REQUIRED EXTRA TIME PAID FOR EXTRA TIME NOT REQUIRED EXTRA TIME 5.Strain-Based Conflict NOT PAID FOR EXTRA TIME REQUIRED EXTRA TIME PAID FOR EXTRA TIME NOT REQUIRED EXTRA TIME 6.Role-Based Conflicts NOT PAID FOR EXTRA TIME REQUIRED EXTRA TIME PAID FOR EXTRA TIME 7.Perceived Organization Support NOT REQUIRED EXTRA TIME NOT PAID FOR EXTRA TIME 1.000 1.000 1.000 1.000 0.112 -0.405 -0.062 0.159 -0.195 -0.188 -0.009 -0.142 -0.152 -0.104 0.401 -0.021 0.182 -0.617 -0.431 0.240 0.473 0.439 0.521 0.493 0.690 0.496 0.461 0.670 1.000 1.000 1.000 1.000 0.079 0.321 0.380 0.203 -0.012 0.113 0.449 0.116 0.073 0.422 0.264 0.144 -0.070 -0.168 0.250 0.242 0.049 -0.469 0.027 0.325 1.000 1.000 1.000 1.000 0.244 0.419 0.510 0.312 0.424 0.231 -0.058 0.359 -0.382 -0.060 0.354 -0.150 -0.312 -0.249 0.558 -0.047 1.000 1.000 1.000 1.000 0.212 0.319 -0.367 -0.057 -0.136 0.315 0.356 -0.068 -0.193 0.152 0.405 -0.139 1.000 1.000 1.000 1.000 0.115 -0.236 0.013 0.259 0.205 -0.238 -0.037 0.364 1.000 1.000 1.000 1.000 0.582 0.425 0.603 0.635 1.000 1.000 1.000 1.000 2.TB Conf 3. WL Conf 4.LW Conf 6.RB Conf 7.POS
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Table R1: Regression Analysis of overall Doctors and its comparison with Single and Married
OVERALL
MODELI MODELII
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SINGLE
MODELI MODELII
MARRIED
MODELI MODELII
Work Life Balance Work Life Conflict Life Work Conflict Perceived Org.Support Strain Based Conflict Role Based Conflict Time Based Conflict
-0.081 0.032 0.567 0.306 -0.153 0.194 0.143 0.101 3.443
0.047 -0.161 0.213 1.011 -0.411 -0.444 0.371 -0.101 0.786
-0.103 0.042 0.609 0.271 -0.171 0.222 0.147 0.100 3.101
R2 Adjusted R2 F
0.396 0.367 13.536
0.480 0.317 2.220
0.411 0.378 12.542
Table R2: Gender-Based Regression Analysis and its comparison with Marital Status
Male
MODELI MODELII
Married Male
MODELI MODELII
Female
MODEL-I MODELII
Married Female
MODELI MODELII
-0.110 0.009 0.543 0.376 -0.220 0.352 0.379 0.342 10.183 0.251 0.206 5.588
-0.131 0.028 0.593 0.354 -0.219 0.419 0.399 0.358 9.730 0.285 0.237 5.857
0.213 -0.048 0.528 0.281 0.268 -0.700 0.687 0.570 5.866 0.256 -0.023 0.919
0.209 -0.051 0.534 0.145 0.203 -0.722 0.624 0.435 3.314 0.378 0.067 1.215
R2 Adjusted R2 F
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Table R3: Regression Analysis and Nature of Employment
Permanent
MODEL-I MODELII
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On-Contract
MODEL-I MODELII
Self-Employed
MODEL-I MODELII
-0.188 -0.061 0.824 0.311 -0.245 0.055 0.834 0.814 41.769 0.212 0.118 2.249
-0.165 0.421 0.232 0.287 -0.018 0.102 0.285 0.166 2.393 0.065 -0.091 0.418
0.028 -0.018 0.266 0.545 -0.066 0.481 0.116 -0.124 0.483 0.275 0.078 1.394
R2 Adjusted R2 F
Table R4: Regression Analysis of Support for GDL, Spouse not working and Spouse not in the same profession
Favour Gender Division of Labour
MODELI MODELII
Spouse NOT Working

MODELI MODELII
Spouse NOT Working in SAME Profession

MODELI MODELII
0.067 0.075 0.453 0.575 -0.423 0.245 0.306 0.236 4.406
-0.118 -0.036 0.491 0.400 -0.149 0.416 0.288 0.229 4.857
-0.126 -0.049 0.528 0.679 -0.648 -0.092 0.506 0.442 7.857
R2 Adjusted R2 F
0.340 0.274 5.142
0.344 0.289 6.282
0.362 0.279 4.346
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Table R5: Regression Analysis of Disfavor of GDL, Spouse working and Spouse in the same profession
NOT Favour Gender Division of Labor
MODELI MODELII
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Spouse IS Working
MODELI MODELII
Spouse IS Working in SAME Profession

MODELI MODELII
-0.281 0.084 0.753 0.068 -0.039 0.331 0.128 0.023 1.461
0.069 0.049 0.697 0.077 -0.299 -0.092 0.121 -0.034 0.783
-0.065 0.092 0.499 0.090 0.037 0.425 0.165 0.089 2.170
R2 Adjusted R2 F
0.554 0.501 10.356
0.553 0.474 7.007
0.430 0.378 8.297
Table R6: Regression Analysis of Requirement/No Requirement and Paid/Unpaid for Extra Time:
Required Extra Time
MODEL-I MODELII
Paid for Extra Time

MODELI MODELII
Not Required Extra Time

MODELI MODELII
Not Paid for Extra time

MODELI MODELII
0.020 -0.018 0.630 0.466 -0.461 0.017 0.360 0.316 8.247
0.012 -0.111 0.499 0.116 0.014 0.295 0.114 -0.026 0.816
-0.252 0.156 0.619 -0.245 0.257 0.408 0.238 0.075 2.461
-0.098 0.078 0.634 0.431 -0.324 0.282 0.236 0.174 3.807
R2 Adjusted R2 F
0.477 0.441 13.359
0.277 0.163 2.431
0.389 0.259 2.976
0.472 0.429 11.036
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RELATIONSHIP BETWEEN SHYNESS AND CLASSROOM PERFORMANCE AT GRADUATION LEVEL IN PAKISTAN

Dr. Saeed-ul-Hasan Chishti Assistant Professor, International Islamic University, Islamabad. Saeed Anwar Ph.D Scholar International Islamic University, Islamabad. Shahinshah Babar Khan Pakistan Atomic Energy Commission Model College, Islamabad.
Abstract Shyness is a phenomenon that affects the overall personality of the students. According to Zimbardo (1977), Shyness is a fuzzy concept; the closer we look the more varieties of shyness we discover, he further states that The person, who is timid, frightened, and uncomfortable in the presence of others, is called shy. The major objective of the study was to check the relationship between shyness and classroom performance at graduation level in Pakistan. The sample was the students of B.com level. The researcher had used shyness questionnaire which was developed by Crozier (1995) for measuring shyness. Classroom performance was judged through the scores of B.Com I external examination, first term and second term examinations of B.Com II. Chi-square technique was used for data analysis. It was found that there was a negative relationship between shyness and classroom performance, as shyness increased, classroom performance decreased and as shyness decreased, classroom performance increased. The correlation between scores of B.Com I and shyness scores was found -0.705. The correlation between scores of First term result and shyness scores was found -0.737 and the correlation between scores of second term result and shyness scores was found -0.738. Keywords: Relationship ; Shyness ; Classroom Performance ; Graduation Level ; Pakistan INTRODUCTION Difference in human beings is a natural phenomenon. All human beings have their specific characteristics, qualities and personality traits. Some people are very social, extrovert; philanthropist and some people are introvert, antisocial, misanthropist and they like loneliness and seclusion. It is a common belief that shyness affects the individuals personality and the performance in the working field and kept the individual away from the social activities. This ultimately affects the relationships within the society. Shyness is discomfort and inhibition in the presence of others (Buss, 1986). Shyness is revealed in a classroom by taking a seat far from the lecturer, and in small conversational group by remaining on the fringe of the group and listening rather than talking (Buss, 1986). Some shy people are less easily identified. Their behaviours change after talking. They seem to shrink and begin avoiding eye contact. They may appear to others that they are extroverts but their surface appearance is not really manifesting that (Marshal, 1980). As far as learning and educational process is concerned, it is observed that there are different types of students. in normal setting, a class is a combination of students with different IQ levels, habits, cognitive powers and personality traits. During learning in the
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classroom students behave and react in different ways, according to their bent of mind. As over cleverness of students remains a problem for teachers, similarly shy students become a problem for a teacher. In a classroom, if a student does not ask question, even there is a bulk of questions was there in his/her mind, will ultimately affects the performance of the students. No doubt, shy students dont participate in the classroom activities due to their habit of shyness, decreases the performance level of the students at the end. It is common perception of teachers that the students who play role in the classroom activities, such as questioning, discussion and even point out the mistakes of other students also show good results in the examinations. Examinations check the skills, concepts, and grip of students over learned material in the classroom. Obviously, the students who took part actively in the classroom will do better in the examination because examination checks the abilities of students through different methods. This variation and difference in nature, attitude and approach is noticeable for teachers, educational practitioners and administrators. Review of Relevant Literature Shyness is not a precise term. It refers to feeling awkward or uncertain in social situations. It is associated with self-consciousness, excessive monitoring of behaviour and over-rehearsal of potential utterances. The shy person feels anxious and often (though not invariably) appears anxious to others. Shyness takes the form of hesitation in making spontaneous utterances, reluctance to express opinions and making responses to the overtures of others that reduce the likelihood of further interaction. Psychological approaches are different as for as shyness is concerned. Thus Leary (1986, p.29) argues that shyness should be restricted to a particular syndrome, the concurrent experience of anxiety and inhibited behaviour (hesitation, awkwardness). Shyness is compared to participation in social and academic groups and levels. It was believed that because of shyness, the individual would not participate in any social activity. Marshal Social anxiety has four types called embarrassment, shame, audience anxiety, and shyness. Shyness is discomfort and inhibition in the presence of others (Buss, 1986). Shyness is revealed in a classroom by taking a seat far from the lecturer, and in small conversational group by remaining on the fringe of the group and listening rather than talking (Buss, 1986). Some shy people are less easily identified. Their behaviours change after talking. They seem to shrink and begin avoiding eye contact. They may appear to others that they are extroverts but their surface appearance is not really manifesting that (Marshal, 1980). Heart rate is the most commonly used physiological measure in assessing social phobia (Buss, 1980). Shyness and inhibition are partially overlapping concepts in the views of some people. Inhibition is thought to be the more general concept, since it describes behavioural tendencies relevant for both social and non-social encounters, while shyness is only applicable to social situations (Jones, Briggs and Smith, 1986). Kegan, Reznick, Clarke, Snidman and Coll (1984) states behavioural inhibition as a tendency to show reluctance, withdrawal, and fearfulness especially when encountering novel situations, objects or people. Marshal (1994) claims that shy people choose educational paths and eventually careers solely in terms of their social anxiety. One researcher studying shy students determined that his subjects took a distinctly passive approach to their own educational development and failed to use available resources such as academic advisors or counsellors because of their fear of authorities. The avoidance led to discouragement and if they managed to enter higher education, they selected a career with least social interaction such as computer-related work, accounting and various types of research. Many people with this social anxiety dropped out of school early and some of them got their graduate equivalency
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degree. Bruch (1989) suggests if children do not have opportunities to learn social skills they might learn to fear new situations because they are unsure how to interact properly. Shyness is interpreted in different ways by different people. Generally speaking, socio-economic background influences the bent of mind, attitude and behaviour. The social settings, parental education, locality, schooling, family structure, norms, customs, traditions and conventions are responsible for shyness. Shyness is an emotion that affects the feelings, attitude and behaviour. Different authors have defined shyness in different ways. According to Zimbardo (1977), Shyness is a fuzzy concept; the closer we look, the more varieties of shyness we discover. The authentic definition of shyness is The person, who is timid, frightened, and uncomfortable in the presence of others, is called shy. According to Oxford Advance Learners dictionary shy person is nervous or embarrassed about meeting and speaking to other people. Another meaning is the person who is easily frightened and not willing to come near people is called shy. The Oxford English dictionary tells us that the words earliest recorded use was in an Anglo Saxon poem written around 1000 A.D, in which it meant easily frightened. To be shy is to be difficult of approach, owing to timidity, caution or distrust.(pp 1241) Difference in human beings is a natural phenomenon. All human beings have their specific characteristics, qualities and personality traits. Some people are very social, extrovert; philanthropist and some people are introvert, antisocial, misanthropist and they like loneliness and seclusion. As far as learning and educational process is concerned, it is observed that there are different types of students. During learning students behave and react in different ways, according to their perception and bent of mind. This variation and difference in nature, attitude and approach is noticeable for teachers, educational practitioners and administrators. Generally teachers are of the view that some students are confident, bold, and blunt and they feel comfortable in a classroom situation. Such students participate in all activities of the class. Some students remain passive in the class and they are not actively participant in class room activities. These students are considered diffident, shy and frightened who are reluctant to ask questions. They feel uneasy at the time of participation in class. Students conjecture that silence is golden tool to avoid embarrassment. If they are given chance to express their views, they show strange expressions like speechlessness, breathlessness, shivering, perspiration, blushing, shaky and stammering. They feel anxiety and it is very difficult for them to express their views and opinions.
Objective of the study

The objective of the study was to find the relationship between shyness and classroom performance. Hypothesis- 1 H 0 There is no significant relationship between shyness scores and B.Com I exams performance scores. H 1 There is significant relationship between shyness scores and B.Com I exams performance scores. Hypothesis-2: H 0 There is no significant relationship between shyness scores and 1st term exams performance scores.
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H1 :
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There is significant relationship between shyness scores and 1st term exams performance scores. Hypothesis-3: H 0 There is no significant relationship between shyness scores and 2nd term exams performance scores. H 1 There is significant relationship between shyness scores and 2nd term exams performance scores.
Material and method

Population
The population of the study was all students of the graduation level of Commerce college of Rawalpindi. A total of 252 students were enrolled in B.Com in 2009. Sample Total population (252) was divided into four groups (A+,A, B, C) on the basis of their marks in higher secondary school certificates. Number of student and their group according to grades is : Table No.1 Group and Number of students Group Number of students A+ 22 A 80 B 108 C 42 For the present study group C (42 students) was selected through cluster sampling technique. These students belonged to different social back grounds and status. They had different attitudes and behaviours towards their studies.
Instrument A questionnaire consisting 28 items was used for measuring shyness which was developed by Crozier in 1995. There were three options for each statement and the respondents were asked to choose one option according to their own choice. For each yes response 10 marks were given and zero mark was given for no response. Data Analysis The data were collected through personal visits to the College. Confidentiality was ensured to the students and the outcomes of the study were explained to them. After getting required data, the data was tabulated and analysed.
Table 2: Correlation between Shyness Scores and B.Com I Exams Scores N R PEr Range of Population R 42 -0.705 0.0523 -0.7573 to -0.6527 The above table shows that obtained value of correlation coefficient r = -0.705 ranged between -0.7573 to -0.6527 when the true correlation coefficient was calculated. As the lower limit of the population correlation is -0.7573, this indicates that there is strong inverse
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relationship between shyness scores and B.Com I examination scores. Hence null hypothesis is rejected and concluded that there is relationship between shyness scores and B.Com I examination scores. As shyness increases, classroom performance decreases and as shyness decreases, classroom performance increases Hypothesis-2: There is no significant relationship between shyness scores and 1st term exams performance scores. There is significant relationship between shyness scores and 1st term exams performance scores. Table 3: Correlation between Shyness Scores and First Term Exams Scores N r PEr Range of Population R 42 -0.737 0.0475 -0.927 to -0.5468 The above table No. 3 shows that obtained value of correlation coefficient r = -.737 ranged between -0.927 to -0.5468 when the true correlation coefficient was calculated. As the lower limit of the population correlation is -0.927, this indicates that there is strong inverse relationship between shyness scores and B.Com II first term examination scores. Hence null hypothesis is rejected and concluded that there is relationship between shyness scores and B.Com II first term examination scores. As shyness increases, classroom performance decreases and as shyness decreases, classroom performance increases Hypothesis-3: H 0 There is no significant relationship between shyness scores and 2nd term exams performance scores. There is significant relationship between shyness scores and 2nd term exams performance scores. Table 4: Correlation between Shyness Scores And Second Term Exams Scores N r PEr Range of Population R 42 -0.738 0.0474 -0.785 to -0.6906 The above table No. 4 shows that obtained value of correlation coefficient r = -0.738 ranged between -0.785 to -0.6906 when the true correlation coefficient was calculated. As the lower limit of the population correlation is -0.785, this indicates that there is strong inverse relationship between shyness scores and B.Com II Second term examination scores. Hence null hypothesis is rejected and concluded that there is relationship between shyness scores and B.Com II Second term examination scores. As shyness increases, classroom performance decreases and as shyness decreases, classroom performance increases
H0
H1 :
H1
DISCUSSION
Shyness is an important factor which may affect the academic performance and class room performance. After collecting the score of shyness and classroom performance of B. Com I and scores of first term and second examinations of B. Com II, Pearson correlation was used to check the relationship between shyness and classroom performance. All the null hypotheses were rejected and it was found that there was a negative relationship between shyness and classroom performance. As shyness increased, classroom performance decreased and as shyness decreased, classroom performance increased. The correlation between scores
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of B.Com I and shyness scores was found -0.705. The correlation between scores of First term result and shyness scores was found -0.737. The correlation between scores of second term result and shyness scores was found -0.738. The research results indicate that the students who are shy have the adversely effect on their academic performance, because shyness is a hindrance in achieving high grades in educational career. Those students who feel hesitation, they do not ask questions and moreover they hesitate to participate in class discussion. It is natural that when information and knowledge is less then student cannot be confident and bold. FINDINGS 1. Thestudentswhoareshyhavetheadverselyeffectontheiracademicperformance 2. Shynessisahindranceinachievinghighgradesineducationalcareer. 3. Shynesseffectsonthepersonalityofthestudents. 4. Shynessgraduallydecreasedtheperformancelevel.
RECOMMENDATIONS On the basis of findings and conclusions, the following recommendations are made: 1. Children may not be castigated, censured and criticized without any reason. 2. Teacher may encourage, motivate and persuade those children and students who are shy, because they need moral support and assistance from their teachers. 3. Shyness may be removed with the help of social interaction because it creates problems in public and social dealings. 4. Students may try to get rid of shyness by realizing themselves the importance of confidence because confidence is the first step on the road of success otherwise it will affect their career and education.
5. Parents and community workers may be educated so that they may play their role in order to remove shyness of children because it has negative and lethal impact on psychology of child and his academic performance.
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References
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Buss, A.H. (1986). A Theory of Shyness. In Jones, W., H. Cheek J., M. & Briggs. S., R. (eds) Shyness: Perspectives on research and treatment (pp.27-38). New York: Plenum. Bruch, M.A. (1989). Familial and Development Antecedents of Social Phobia: Issues and Findings: Clinical Psychology Review, 9:37-47. Bruch, M.A., Giordano, S. and Pearl, L. (1986). Difference between Fearful and SelfConscious Shy Subtypes in Background and Current Adjustment. Journal of Research in Personality,20:172 Crozier, W.R. (1995) Shyness and Self Esteem in Middle Childhood. British Journal of Educational Psychology. Pp. 21,118-121. Jones, W.H., Briggs, S.R. and Smith, T.G. (1986) Shyness: Conceptualization and measurement. Journal of Personality and Social Psychology, 51:629-39. Kagan, J., Reznick, J.S., Clarke, C., Snidman, N. & Coll, G., C. (1984). Behavioral inhibition to the unfamiliar: Child Development. Leary, M.R. (1986). Affective and Behavioural Components of Shyness: Implications for Theory, Measurement and Research. In Jones, W., H. Cheek J., M. & Briggs. S., R. (eds) Shyness: Perspectives on research and treatment (pp.27-38), New York: Plenum. Marshall, J. R. (1994). Social Phobia: From Shyness to Stage Fright. New York: Basic Books. Oxford Advanced Learners Dictionary (6th ed.) (2000). Oxford University Press. Zimbardo, P.G (1977). Shyness, Reading. MA: Addison-Wesley
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Role of Practical Work in the Teaching of Chemical Concepts at Secondary level-A Case Study
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Sarfraz Ahmed Ph.d scholar,Foundation University Rawalpindi Pakistan. Dr.Muhammad Tayyab Alam Head,Department of Research and Development Foundation University Rawalpindi Pakistan. Shafqat Hussain Ph.d scholar,Foundation University Rawalpindi Pakistan. Dr. Maqsood Alam Bukhari Principal,Foundation University College of Liberal Arts and Sciences Abstract The main intent of the study was to investigate the role of practical work in conceptualizing chemical concepts at secondary level. To investigate whether the practical work can effectively contribute in the meaningful learning of chemical concepts, the practical work was compared with the traditional teaching method and commonly known as lecture method. The research work lasted for twenty two weeks in the chemistry classroom and chemistry laboratory of Federal Government Boys Model F-8/3 Islamabad. Seventy six secondary science students of class ix were randomly selected and participated in the experiment. The design visualized for the study was the post-test only equivalent group design. The research study involved two groups i.e. experimental and control. Both the groups were equalized on the basis of 8th class science achievement scores. Multifaceted data gathering tools were used in order to gather the data i.e. formative assessment tools and summative assessment tools. The experimental group was taught through practical work and practical work was intentionally used as a way to make the learning meaningful. It was based on the psychological principle that when scientific ideas made concrete are learned meaningfully. The achievement measures were made by the summative tests called posttest. During the study the formative assessment was also carried out by the school administration. The instrument constructed was validated. The data gathered by the instrument was analyzed and given the shape of mean scores. To compare the mean scores of the experimental and control group, t-test was applied. The analysis of the data revealed that the practical work as a teaching method was more effective than the lecture method because the experimental group outperformed the control group. Another significant aspect of the study got revealed that the traditional ways of assessment were not suitable for the assessment of meaningful learning. Qualitative assessment modes were suitable for meaningful learning because these were not meant for rote learning. The study demanded that that there must be match between the learning and the way of assessment. The study emphasized to look in to the assessment system and science subjects be taught through practical work. Keywords: Role ; Practical Work ; Teaching ; Chemical Concepts ; Secondary Level-A Case Study Introduction This paper targeted to explore and critically discuss the role of practical work in the conceptualization process of chemical concepts at secondary level. Practical work has been a rich source of meaningful science learning. Practical work has been an instructional tool in the hands of science educators.Renner (1966) visualized that science is an active process because the processes that characterize science critically demand activeness not only on the part of the learner but also the teacher. Activeness is an integral part of good science. The centrality of practical work to science is because it serves many purposes. The practical work involves students in the scientific endeavor in which they think independently and make their
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own conclusions (Eugene &Chiapetta, 1989). They further assert that practical work provides the learners with concrete learning experiences.Tamir (1976) took a step forward and claimed that practical work along with conceptualization of concepts is also helpful in the development of positive attitudes towards science. He further rationalized the use of practical work as under 1. Complex and abstract nature of science content demand make this content concrete 2. Provide learners with opportunities to actively participate 3. Practical work along with concept formation promote the development of varied skills 4. Practical work is a source of enjoyment and motivation The stated functions are in the competency of practical work.Henry (1960) intends to limit the responsibilities of practical work and suggested that practical work should limit itself to processing of data and making predictions on the basis of this data rather than getting answers. Hurd (1964) viewed that practical work must be aligned to the classwork. The above discussion helps us to conclude that practical work should be confined to the verification phase.Lunetta and Tamir (1979) argue that practical work should forego lower order objectives and step forward to the higher order objectives i.e. more than the knowledge verification phase.Tamir(1976) while discussing the nature and function of practical work suspected that if the practical work goes beyond the verification stage it might be appropriate for certain selected learners while the majority may be disadvantageous. He conclusively suggested that practical work must have varied nature and be placed in the curriculum. Practical work and philosophy of Teacher Collette and Chiapetta (1989) asserted that the effectiveness of the practical work is highly dependent upon the philosophy of the teacher. If the teacher holds the narrow meaning of education i.e. pouring of information, the practical work will be deductive in nature. The practical work will verify the existing knowledge.Pella (1961) stated that if the teacher believes in the wider meaning of education i.e. transformation of information, the practical work will be inductive in nature. The practical work will act as knowledge construction tool. Hofstein,A and Namman,R.M (2007) while discussing the significance and meaningfulness of practical work noted and asserted that the meaningfulness of science to learners owes to practical work. They further indicated the narrow implication and demanded for the precise definition of practical work at secondary level. They further indicated the varied arrays of practical experiences such as Individual experiences Group form i.e. small or large groups According to Hofstein,A and Namman,R.M (2007) the practical works may be called investigations, inquiries, projects or field trips. They further indicated that the practical works may wide array of time and instrumentation. Hofstein,A and Namman,R.M (2007) reviewed the status of practical work in science education and criticized the effectiveness of practical work and claimed that the practical work is entirely fruitless and has frequently been used without precise and unelaborate purpose and demanded for looking into the real essence of practical work. Millar,R.(2004) demanded to bring about alignment between practical work and the goals of science education. The science education aims to Facilitate learners to comprehend and understand the scientific concepts and ideas as per their wants, interests and abilities i.e. developing students scientific knowledge
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To help learners to understand the methods that are prone to knowledge formation i.e. knowledge about science Millar further indicated the distinct school science purposes Adequate understanding of scientific concepts that are prerequisite for the active participation in the scientific world Well equipped and knowledgeable scientific work force The above stated purposes may act to base different criteria and require different content and stresses to achieve the purposes.Millar stressed to integrate the two aims of science education into a unified whole. The present study mainly focused the first aim of science education. The study focused to utilize the practical work as a tool to develop the scientific concepts of students at secondary school level. At school level generally the deductive mode of practical work is prevalent and in use because the learner can not be a complete substitute of a scientist. Millar (2004) revealed that the deductive mode of practical work can not be regarded as a complete transmission mode. Here the knowledge is not being transferred. In case of intangible concepts the transfer mode of learning fails to work. Meaning learning requires making sense of the ideas that are presented to the learning. Meaningful learning requires the active role on the part of the learner. It is already clear that the learner is passive when the information is being poured into the minds of the learner.Millar holds the view that the practical work must be used as a way to construct the meaning. It means school laboratory in real sense is a teaching laboratory and arrange must be made to successfully construct the meaning of the scientific concepts and ideas. Hypothesis Ho1 There is no significant difference in the achievement scores of students taught through practical work method and lecture method on posttest. Methodology The study primarily focused to compare the role of practical work and the traditional lecture method in the sufficient understanding of chemical concepts at secondary level. The students worked in small groups and the coordinators kept the groups on the practical tasks. The social orientation to learning was kept in contact through small groups. Keeping in view the demands of the work, posttest only equivalent group design was selected. Population for the Study The population of the study comprised of all 9th grade male science students in Federal Government Boys Model School F-8/3 Islamabad. Sample for the study About 120 students were promoted from 8th class to 9th class. Out of these 76 students were randomly taken as sample for the study. The achievement measures of 8th class science were taken in to consideration. The achievement measures were arranged in a descending order and randomized matched. The odd group assigned experimental group and the even group assigned control group. Gender Male Age level Treatment Practical work 38 13.5 Treatment Lecture method 38 13.5
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Data Collection Tools
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In order to collect the data the posttest practical achievement test was devised by the researcher. The groups were already equated on the base of 8th class science achievement teat. The 8th class science achievement was used as a criterion for the purpose of equalization. The posttest was administered at the end of the treatment in order to measure the gains. The treatment continued for 22 weeks (entire school year).
Sequencing the Learning Material

According to Curzon (2004) sequencing is a way to organizing learning experiences and aspects according to some well defined principles. The learning experiences should be organized as per psychological and logical principles.Taba (1962) described four sequences of exposition 1. Simple to complex 2. Expository order based on prerequisite learnings 3. Whole to part 4. Chronological order Taba (1962) stressed to take start from concrete experiential base. She further suggested establishing relevance between concrete experiences, instances and concept need to be developed. She further pointed out an important aspect that content ordering is a prerequisite to sequencing of learning.Johnstone (2000) pointed out that difficulties in chemistry are due to its intrinsic nature. He further indicated an important prerequisite to the concept formation. He strongly suggested of using examples and non-examples for the said purpose. By examples and non-examples the learners can directly form the concepts because they directly act on the environment.Johnstone (2000) recommended to give more time to macro, concrete learning experiences and practical work.Johnstone conceptualized the following sequence for the ideas in chemistry particularly up to secondary level. 1. Macro/tangible/concrete level 2. Sub micro /abstract/nonconcrete level 3. Symbolic/representational level
Hypothesis Ho1
There is no significant difference in the achievement scores of students taught through practical work method and lecture method on posttest.
Table 1: Achievement scores of the students in the subject of chemistry (Practical) gathered through post-test Group N Mean SD t-value p ________________________________________________________________________ Control 38 5.8 1.1 10.1(74) <.000 Experimental 38 8.2 0.9
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Figure 1. Comparative achievement scores of the students in the subject of chemistry (Practical) gathered through post-test assessment tool
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Conclusion
As our calculated value of t (t=10.1) is greater than the tabulated value of t (t=2.009 at 5% level of significance), Hence, the null hypothesis, There is no significant difference in the achievement scores of students taught through practical work method and lecture method on posttest was rejected.
Results and Discussion

The improvement in the conceptualization of chemical concepts by using the practical work as an improvement tool was analyzed on the basis of students gains on the posttest. Both the groups were equalized on the base of 8th grade science achievement scores. To find the significant difference between the mean scores of the two groups i.e. experimental and control t-test was used. Significant difference was evidenced between the means of experimental and groups. The results of the present study show: 1. Chemistry works at three levels i.e. macroscopic level, sub microscopic level and symbolic level 2. Chemistry as a subject mainly consists of abstract concepts 3. The students conceptualization of abstract or microscopic concepts is really problematic. 4. The concepts that are abstract need to be made concrete that is close to the psychological learning
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5. Practical work is not only a tool which makes and changes intangible concepts in to tangible form and helps students to move in between the three levels of thoughts as envisaged by Johnstone (2000). 6. When learners make solutions of different strengths they can frequently move in between the macro and sub micro levels. When students make sugar or ink solution they are dealing with sub micro and macro level simultaneously. When the students are making stronger solution of sugar or ink they are intentionally or non intentionally moving from sub micro to macro level. The students successfully reasoned the appearance of macro properties on the base of micro properties. 7. The practical work was student-centered but with the teacher as an active player in the organization of lessons and facilitated the students through questions, activities and proper structuring of the lessons to the construction of new knowledge. 8. As learning has been viewed as a social endeavor, the group format also provide impetus to the construction of new knowledge by the students at their cognitive level by the peer questioning, activities and discussions in small groups as per requirement of the concepts. The practical work also proved helpful in the understanding of the language of chemistry i.e. representation level of chemistry. 9. More activities along with cooperative groups need to be incorporated in to the lessons to make the classroom learning environment conducive to learning 10. The external aspects of learning need to be provided and improved according to the ways students learn.
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References
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Collete, A.T. & Chiappetta, E.L. (1989). Science Instruction in the Middle and Secondary Schools (6th Ed.). Columbus: Merrill publishing company. Curzon, L.B. (2004). The Teaching in Further Education: An Outline of Principles and Practice. MPG Books Ltd, Bodmin, Cornwall. Pp.195-199 Hofstein, A. & Naaman, R.M. (2007). The laboratory in science education: the state of the art Chemistry Education Research and Practice, 2007, 8 (2), 105-107 Hurd,P.D.(1964).Theory into action.Washington,DC:ERIC/SMEAC Clearinghouse. Johnstone, A.H. (2000). Teaching of Chemistry-Logical or psychological? Chemistry Education: Research and Practice in Europe, 1(1), 9-15. Lunetta,V.N.,and Tamir,P.(1979).Matching lab activities with teaching goals. The Science Teacher, 46(5):22. Pella,M.O.(1961).The laboratory and Science Teaching. The Science Teacher, 28(5):29. Renner, J. (1966).A case for inquiry. Science and Children, 4:30-33. Tamir,P.(1976).The role of the laboratory in science teaching. Technical Report No.10,Iowa City: University of Iowa Press. Henery,N.B.(1960).Rethinking Science Education ,59th Yearbook of the National Society for the Study of Education, Part 1.Chicago:University of Chicago Press. Millar, R. (2011).The Role of Practical Work in The Teaching and Learning of Science. The university of York.
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Health tourism, tourist satisfaction and motivation
Mohammad Taleghani (Corresponding Author) Associate professor , Department of industrial management, Rasht Branch, Islamic Azad University, Rasht, Iran Ebrahim Chirani Assistant professor , Department of industrial management, Rasht Branch, Islamic Azad University, Rasht, Iran Atefeh Shaabani Masters, Department of Business management, Rasht Branch, Islamic Azad University, Rasht, Iran
Abstract Motivation and satisfaction are two concepts widely studied in tourism literature; the relevance of these constructs being derived from their impact on tourist behavior but which focus at tourism in general. However the purpose of this paper is to undertaken realizing the need to examine closely the aspects of health tourist motivation and satisfaction, a relatively new player in the industry. This study intends to describe health tourist motivation and satisfaction based on known attributes and to understand key motivation and satisfaction dimensions. In addition identifying travel motivation and satisfaction levels of health tourists allows insight to the areas of strength and weaknesses of the local healthcare industry.
Keywords: Health tourism, health tourist, tourism motivation and tourist satisfaction.
Introduction Medical tourism also called medical travel or health tourism is a term initially coined by travel agencies and the mass media to describe to the rapidly growing practice of traveling to another country to obtain health care. Health tourism as a niche has emerged and has rapidly grown to become an industry where people travel long distances to other countries to obtain medical, dental and surgical care while simultaneously having a holiday. It has grown dramatically in recent years primarily because of the high costs of treatment in developed Western countries, long waiting lists, the relative affordability of international air travel, favorable economic exchange rates and the ageing of the often affluent post-war baby boom generation (Connell, 2006) Today, health care tourism is the highest growth world's tourism industry and in global scale is higher than oil and gold industry and is called as the third industry of the world and some countries such as Spain are living through this industry (Asadi Boshni, 1389, p.19). Now more than 30 countries in Asia, Africa and Eastern Europe are most active in the field of health tourism that among them Asian countries have won fame and first place and among the Asian countries five countries:
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VOL 3, NO 4 Thailand, Singapore, Malaysia, India and the Philippines had been identified as the major tourist destinations in Asia's health tourism market (Hosseini, 1387, p189). Research Significance Short distances due to the growth of the transportation industry and information technology cause to the formation of global markets for services and industrial and developing countries relying on its comparative advantages in competition with others search their share in these markets. Trade in services include about 22 percent of the global economy and plays a major role in the prosperity of the countries , such that more than two thirds of employment and gross national income of some developed countries allocated to them. The relationship between economic developments on health had been well identified. In new approaches, it is not only the health sector benefits from economic growth, but also it can create many businesses to the countries and in addition to creating new sources of financing for infrastructure development and technology, play an important role in the meta-sect oral strategies for sustainable development. Among this, health tourism is an issue which has a new look to the concept of using the health service (A summary of the articles of the Conference in capabilities of the northern provinces of the country in Tourism, 1389, p1). Significance and consequences of medical services can be summarized in employment, increase incomes and improve health care, prevent brain drain, tourism development and attracting foreign investors and ultimately elevate the status of countries in a global perspective (Salimpour, 1385, p45). Global health tourism revenue increased of about $ 20 billion in 2005 to more than 56 billion dollars in 2007 and this growth is expected to continue increasingly and until 2012 may reach about four and a half dollars (Sobouti, 1385,p13). Health tourism World Tourism Organization (WTO) is defined health tourism as: The services that leads to improve health and enhance the morale of the individual (Using mineral water, weather, or medical interventions) and is in the place of residence which takes more than 24 hours and less than a year (Hoobin.Ye.ben, 2010, p.1) Health tourism, is a form of tourism to preserve, enhance and retrieve physical and mental health of individuals that takes over 24 hours and less than a year (Health Tourism) and divides as following: Wellness Tourism Travel to health villages and areas having hot springs and mineral water (Spa) for relief from the stresses of everyday life and revitalizing without the intervention and medical supervision and in the cases where tourist has not clear physical illness is called health tourism. Curative Tourism Travel to the use of natural curative resources (Mineral water, salt, mud, etc) for the treatment of certain diseases or livelihood recovery under Therapeutic interventions is called curative tourism. Medical Tourism Travel to treat physical illness or a surgery done under the supervision of doctors in hospitals and medical centers is called medical tourism. In this type of health tourism, the patient may after treatment require the use of spaces and curative tourism services (such as Spas) (www.Wikipedia.com).
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VOL 3, NO 4 There is no one definition for medical tourism but it is generally accepted that this term is used to refer to travel activity that involves a medical procedure or activities that promote the wellbeing of the tourist. Figure 1 illustrates the components of medical and healthcare tourism (TRAM, 2006).
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As shown in the model, medical tourists move from their originating regions (their countries of residence) to destination regions (those regions where the care is available). The transit refers to both the actual mode and trajectory of the transportation utilized for this movement as well as any constraining and/or facilitating forces in the travel experience. A destination is a medical tourism destination, not just because of the healthcare facility available there, but also because of the additional provision of destination attractions, both natural and cultural. The core product is the healthcare provided, but tourist comforts do form an important hygiene factor in medical tourism (Messerli and Oyama 2004).
Figure 2: Comprehensive model of medical tourism Ghazali (2002) noted that most writers divide health tourism into three major components namely medical care, wellness and fitness a) The medical market seeks cure in ways of medicinal and spa treatments, surgical operations, alternative medicine and rehabilitation. b) The well-being tourism market requires the activity that rejuvenates, maintains the state of wellness physically, mentally and socially. c) The fitness market stresses more in getting the optimum level of fitness by performing more strenuous activities which eventually helps to maintain health and prevent ailments. Generally, the health tourism market can be divided into three broad segments: a) Surgeries like orthopedic surgery, heart by-pass surgery, cancer therapy, eye surgery, and organ transplantation. b) Plastic surgery or cosmetic surgery c) Health spas, weight loss exercise centers, hot springs and holistic treatment including wellness therapies. (Dosh , 2008 , p. 19)
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Medical Tourism Industry Certifications
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One of the primary concerns for health travelers is whether foreign providers can offer the same high-quality medical care they receive in their country of origin. This growing demand for foreign healthcare providers has prompted the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), the best known healthcare accreditation group in the USA, to form an international offshoot known as the Joint commission international(JCI). In 1999, the JCI began surveying and accrediting hospitals and healthcare facilities outside of the USA. There are now over 220 accredited hospitals worldwide and most are providing quality services for the medical tourism industry. Aside from the JCI, there are alternative non-profit groups providing accreditation for healthcare organizations in the USA. Also aside from the accreditation bodies based in the USA, there are a number of international accreditation organizations in the medical tourism industry that are based abroad. These organizations perform a similar international role as the JCI, providing accreditation to international or regional health providers. For example Trent Accreditation Scheme (TAS). (www.health-tourism.com)
Table 1: Opportunities and risks of health Tourism for Public Health5
Opportunities For exporting countries: - generate foreign exchange earnings to increase resources for health reduce brain drain upgrade health infrastructure, knowledge standards and quality For importing countries: - overcome shortages of physical and human resources in specialty areas - receive more affordable treatment
Risks For exporting countries: - create dual market structure may crowd out local population unless these services are available to local population - diversion of resources from the public health system For importing countries: - outflow of foreign exchange - difficult follow-up treatment
Motivation in Tourism The importance of motivation in tourism is clear; because it explains the causes for travel or reasons the particular options of tourism (Parino, 1988, p.75). Motives and needs cause to begin and continue to activities and to specify the total behavior of people ; in other words, motivation is the desire to try to provide targets or forces that cause people to behave a certain way.( Newstorm , J.and K.Davis,2004, p.104) The motivation of health tourists Motivational factors are physical needs that play an important role in a person's sense of physical balance. Imbalance that can near to equilibrium through a journey experience. (Crompton,1979,p.408-429) This group of passengers to use medical services travel to places where their desired facilities exist; therefore this journey are includes a variety of activities that are aimed at providing health or the individual or tourist health. Examples of this type of trips are as following:
Health Care
Travel to a place to go to certain doctors or clinics, in order to achieve a method of treatment which does not apply in the country or where the person is living.
1) Medical Tourism: Emerging Poles of Excellence , Wednesday 28 May ,International Conference Centre Geneva
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Bodybuilding
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Travel to a place or to deliver or set up especially for the loss / gain weight, studies and complete physical examination or special exercises. Many hotels and resorts equipped with some of these facilities.
Recovery and rehabilitation courses
Travel to a center, an organization that provides care to people or travel to a place that is known of the health and safety and people are travel there for recovery and rehabilitation course. Travel for keeping health is stretching a lot to attract tourists. In the past few decades, a generation of people who are accustomed to modern methods of treatment, to have reached retirement age. It is expected that these people are to seek some collections to maintain their health in old age while previous generations when they reach this age, do not such an expect. A large part of the generation has economic power to benefit from health care. High levels of knowledge and more attention to people's health has increased the appeal of these trips (Kazemi, 1386, p182). Needs are prompting to stimulate certain behavior and to understand the motivation. In this regard, it is essential that these needs are discovered and how they meet. What people buy is neither product nor service, but they expect consistency, desirability and benefits to meet needs (Crompton and McKay, 1997, p.425-439). For health tourism, in addition to discussing the costs, other factors such as quality of health care providers , the trip comfortable, and attractive destinations and security and stability of nations which are in search of the ideal destination for medical services, are effective. For the best service, low cost is usually the primary motivation that makes the health of tourists to travel to abroad and in addition to receiving medical services be benefit from a leisure opportunities. According to Yap , people travel for four types of healthcare: - Essential healthcare : where the care is not available in the home country, either because the country does not have that level of medical sophistication, or has yet to allow the particular procedure, or has long waiting lists due to resource constraints. - Affordable healthcare: where the care is available but out of reach the particular patient which simply cannot afford it. This could be because of high costs or insufficient insurance coverage. - Quality of healthcare: where the care available locally is perceived to be of inferior quality to the healthcare available overseas. - Premium healthcare : where traveling for healthcare is seen as a luxury and patients choose the healthcare of another country because it adds prestige and demonstrates that they can afford it or that they have the better sense to select it . ( Yap , 2007, p.25-26) According to Garcia -Altes , the short time for surgery is a key factor that enhances the ability of health destinations to attract foreign patients.( Garcia -Altes , 2005,p. 262-266)
Tourist satisfaction
Understanding the factors that bring satisfaction to tourists is one of the most important research areas in the tourism industry , because satisfied tourists want to share positive experiences with others and repeated their visit (Alen,Rodriguez & Fraiz,2007,p.153-160). Studies show that satisfaction level of tourists from a trip is a result of various factors. Satisfaction from the comparison of tourist's perception often from quality goods and services that they receive with their expectations before and during travel, is determined (Bigne&Andreu, 2004).
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Health tourist satisfaction
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Patient satisfaction is of paramount importance for medical service providers, not only because it is a quality indicator (Yellen et al., 2002, p.23-29) but also because of increased competition in the profession .One of the fastest growing industries in the service sector is the health-care industry. The rapid growth of this sector has been accompanied by dramatic changes in the environment, challenging health care managers and administrators to find alternative ways of remaining viable. These forces of change, that include competitive pressures, alternate health care delivery mechanisms, changing cost structures, monitoring by public and private groups, increased information availability, and a markedly better-informed clientele have begun to exert significant pressures on health-care providers to reassess their strategies. Many providers, with help from the research community, are beginning to realize that providing customer satisfaction is a key element of strategy and a crucial determinant of long-term viability and success. ( Andaleeb,1988,p.181) Thus ( Donabedian ,1988,92-173) suggests that "patient satisfaction may be considered to be one of the desired outcomes of careinformation about patient satisfaction should be as indispensable to assessments of quality as to the design and management of healthcare systems . " There is a growing consensus that assessment of the quality of hospital care should perceptions of overall care and patient satisfaction (Carmichael, 1996,p.45-48) Customer satisfaction represents a profitable competitive strategy variable because studies have shown that the public is inclined to pay more for care from quality institutions which are better disposed to satisfy customers needs (Boscarin ,1992,p.13-35) Its value as a competitive tool also derives from the fact that hospitals with better images have been able to translate these into increased utilization and market share.( Buscarino, 1992,p.13-35) Delivering customer satisfaction is also imperative because todays buyers of healthcare services are better educated and more aware than in the past. These buyers carefully study and monitor the options available to them; they are, therefore, more discerning buyers, knowing exactly what they need these changes are being driven by the abundance of information that is available to them from public and private sources. According to Heistand customers are relying less on doctors to choose the right hospital. Reflecting on the importance of the patients point of view ( Heistand ,1986,p.2) . Petersen suggests that: It really does not matter if the patient is right or wrong what counts is how the patient felt even though the caregivers perception of reality may be quite different. Hospitals that fail to understand the importance of delivering customer satisfaction may be inviting possible extinction. (Petersen,1988,p.25-35) Satisfaction is determined by both tangible and intangible factors. In the medical sense, the intangible components will be responsiveness, assurance and empathy by the doctors, nurses and attendants towards the patient. The tangible validation is what the patient would have accessed in the hospital such as medical equipment and drugs. For instance, a hospital could have the best technology in the world, but would not be able to satisfy the patient if he or she had a negative intangible experience during the course of the treatment in a hospital setting, both tangible and intangible elements are equally important in influencing the level of the patient's satisfaction.(R.Dosh,2008,p.30) Healthcare service posses certain characteristics that customers may find it difficult to evaluate after the event because they lack the necessary knowledge and skills to make the necessary judgments, and are obliged to trust
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VOL 3, NO 4 the providers (Zeithaml, 1981). However achieving high level of patient satisfaction can lead to loyalty and generate referrals that enhance long term success (Yucelt, 1994, p.11-27) In theory, satisfaction is the result of a subjective comparison between expectations and received product attribute levels (Oliver , 1980,p.460-469) Tam had measured nine factors as being the key aspects of the medical services encounter and influences on patient satisfaction. They are doctor's technical Quality, doctor's interpersonal care skills, quality of nurses, quality of support staff, efficiency of the appointment system, waiting time, duration of consultation, physical environment and respect for patient's privacy.( Tam,2007, p.732-745) Tam also included the overall satisfaction with the visit and intention to revisit and comments and suggestion which could be used to further improve or revise the service offerings to the patients. There is a positive impact of quality improvement on patient satisfaction and intention to revisit (Tam, 2007, p. 723-745). Babakus and Mangold had examined the usefulness of the SERVQUAL scale for assessing patient 's perceptions of service quality in the hospital environment. The study had measured the patient's perception and expectation with five dimension ( tangibility , reliability , responsiveness, assurance and empathy), intentions and overall rating (Babakus and Mangold , 1992,p.767-768) . Oon (2006) also used same instrument to measure patient's satisfaction in Island Hospital, but he had included additional dimensions of accessibility and affordability (e.g. adequate parking facilities, accessible location, and affordable charges). Mostafa used SERVQUAL to measure the current expectation and perception held by patients and identified the relevant service quality dimension used by patients to evaluate service quality.(Mostafa , 2005, p.516-532) Cho et al had measured 30 items which were developed based on three focus group interviews and the SERVQUAL scale and satisfaction (3 items) was measured using a previously validated scale( Cho et al , 2004, p.13-34) . Tucker and Adam considered accessibility, communication outcomes, caring and empathy dimensions in assessing the patient's satisfaction (Tucker and Adams , 2001, p.272-87) . Andaleeb had used a five factor model (communication with patients, competence of the staffs, staffs demeanor quality of facilities, perceived costs) which explains considerable variation in customer satisfaction with hospitals( Andaleeb , 1998, p.181-187) . Yildiz and Erdogmus used 40 items and identified 35 items which was labeled as nutritional care physician care, room atmosphere, procedures of incoming patients, room cleanliness and other serving in related to the patients satisfaction.( Yildiz and Erdogmus , 2004 ,p.581-859 ) Conclusion It is possible to identify five but not necessarily mutually exclusive categories of patient mobility : Temporary visitors abroad , Long-term residents , Common-borders , Outsourced patients , Medical tourists (2010, p. 2732 lunt Neil , Carrera Percivil) World Tourism Organization (WTO) is defined health tourism as: The services that leads to improve health and enhance the morale of the individual (Using mineral water, weather, or medical interventions) and is in the place of residence which takes more than 24 hours and less than a year (Hoobin.Ye.ben, 2010, p.1) Health tourism as a niche has emerged and has rapidly grown to become an industry where people travel long distances to other countries to obtain medical, dental and surgical care while simultaneously having a holiday. ( Connell , 2006,p.41-46)
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VOL 3, NO 4 Most Writers divide health tourism into three major components namely medical care, wellness and fitness (Ghazali,2002,p.25). Generally, the health tourism market can be divided into three broad segments: surgeries, plastic surgery and health spas, weight loss exercise centers ( R Dosh,2008,p.19) An important issue in health tourism industry and its global destinations is international credit which provides services to tourists. JCI and Trent are two of the most prestigious credentials. Various factors are determining tourist behavior including health tourist which the most important of them is in the framework of motivations and satisfaction determinates. Due to the different nature of health tourism with other branches of tourism, motivation factors and tourist satisfaction criteria is somewhat different and of course, due to its novelty, limited research has been done in this regard. A medical visit can be take place by motivation to get health care, bodybuilding recovery and rehabilitation courses. Research show that motivations of health tourists to travel to a health and leisure can be from travel expenses, services quality, the ease of travel, attractive destination, and safe destination (R Dosh, 2008, p.19). According to Yap, people travel for four types of healthcare: Premium healthcare, Affordable healthcare, Quality of healthcare, Essential healthcare (Yap, 2007,p.25-26) . Satisfaction of tourists, especially for purposes of seeking to create loyal customers and develop their markets is very important. The important point is that patient satisfaction comes from the comparison from their expectations with the services they receive and this comparison is based their understanding which in many cases not consistent with reality. Satisfaction in health care is determined by both tangible and intangible factors. In the medical sense, the intangible components will be responsiveness, assurance and empathy by the doctors, nurses and attendants towards the patient. The tangible validation is what the patient would have accessed in the hospital such as medical equipment and drugs (R.Dosh,2008,p.30). Other researchers such (Tam, 2007),(Babakus and Mangold , 1992), (Oon 2006) (Mostafa 2005) (Cho et al , 2004) (Andaleeb1998) (Yildiz and Erdogmus , 2004) have been assessed from health care centers in countries of destination . various aspects of patients' satisfaction from the hospitals which their research results can be used to measure health tourist satisfaction
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References
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Alen Gonzalez, ME , Rodriguez Comesana , L , & Fraz Brea , J A . (2007) . Assesing Tourist behavioral intentions through perceived service Quality and customer satisfaction . Journal of Business Research , 60 , 153-160 Andaleeb . syed saad , Determinants of customer satisfaction with hospitals : a managerial model . international journal of health care quality assurance 11/6(1998)181-187 Asadi bashani , health tourism and profitable highway , Iran newspaper , Ordibehesht 1389, sixteen years , number 4493, p 19 Babakus, E. and Boiler, G.W. (1992), An experimental assessment of the SERVQUAL scale Journal of Business Research, Vol. 24, May pp. 253-68 Boscarino, J.A. (1992), The publics perceptions of quality hospitals II: implications for patient surveys, Hospital and Health Services Administration, Vol. 37 No. 1, Spring, pp. 13-35. Carmichael, J. (1996), Figuring patient satisfaction into physician salaries, Managed Health care, September, pp. 45-8 Cho , W.H,Lee,H,Kim,C,lee,S,Choi,K.S.(2004) the impact of visit frequency on the relationship between service quality and outpatient satisfaction : A south korean study , Health Research and Education Trust , Vol . 39, No.1,pp.13-34 Chon,K.S.(1991).Tourism destination image modification process .tourism management,vol 12.pp.68-72 Connell,J.(2006)," Medical Tourism : Sea, Sun, Sand and .Surgery" Tourism Management. Crompton, J. (1979). Motivations for pleasure vacation. Annals of Tourism Research, Vol. 6, No.4, pp.408-424. Crompton, J.L. & McKay, S.L. (1997). Motives of visitors attending festival events. Annals of Tourism Research, Vol. 24, No.2, pp.425-439. Donabedian A. (1988), Quality assessment and assurance: unity of purpose, diversity of means , Inquiry, Vol. 25, Spring, pp. 173-92. Garci a Alte s, A. (2005), "Development of health Tourism Services" Spain Annals of Tourism Research , Vol.32, No.1,PP.262-266 Ghazali,M,2002, Travel health Experience among international to high Altitude Destinations of Sagarmatha National Park, Nepal and Tibet ,China Unpublished Ph.D thesis, University of Otago, New Zealand. George, B.P. and Nedelea, A. (2009). Medical tourism: An analysis with special reference to its current practice in India. International Journal of Leisure and Tourism Marketing. 1(2), 27-35 George,W.(Eds),marketing of Services, American Marketing Association , Chicago.IL. Heistand , M. (1986), NY Hospitals treat marketing-ills?, Ad week , Vol. 27, 27 July, p. 2 Hoobin.Ye .ben and .., Motivation and experiences of mainland Chinese medical tourists in Hongkong , tourism management xxx (2010), pp.1-3 Hosseini , seied hasan , what do you know about health tourism , trade world magazine , 1387, p.188-190 Kazemi, Mohamad, tourism management, Samt publishing (1386) , p.183. Lunt , Niel . Carera, Percivil (2010). " medical tourism ; Assessing the evidence on treatment abroad" Maturitas 66, pp.27,32.
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VOL 3, NO 4 Messerli, H. R., Oyama, Y. (2004). Health and wellness tourism - global. Travel and Tourism Analyst(August), 1-542 . Mostafa(2005) An empirical study of patients , expectation and satisfaction in Egyption Hospital. International Journal of Health care Quality Assurance , Vol .18 , No.7, pp 516-532 Newstorm , J.and K.Davis(2004), Organization Behavior .McGraw-hill Oliver,R.L.(1980).A cognitive model of the antecedent sand consequences of Satisfaction decisions. JournalofMarketingResearch,vol.27,pp. 460469 Oon k. p,(2006) service Quality and Travel motivation among Health Tourists in Island Hospital , penang . unpublished MBA dissertation , university of Malaya , Malaysia Petersen, M.B.H. (1988), Measuring patient satisfaction: collecting useful data, Journal of Nursing Quality Assurance, Vol. 2 No. 3 pp. 2-35 R Dosh. Dharmesh, health tourism an exploratory study on motivation , satisfaction and consumption behaviour of health tourism in malasyian private hospital (2008), p. 171. Sobooti , Ali, health tourism need comprehensive plan , Negareh magazine , number 15, 1385, p 13 Salimpoor, Habib, the review of history of exporting medicine goods and service to abroad , Homaye Saadat magazine , Bahman and Esfand 1385 , thirth year , number seventeenth. Tam J.L.M.(2007), linking Quality improvement with patient satisfaction : A study of a health service center. Marketing intelligence and planning , Vol.25, No 7, pp.732-745 TRAM (2006). Medical tourism: a global analysis, A report by Tourism Research and Marketing (TRAM), ATLAS. Tucker,J.L. and Adams , S.R.(2001) incorporating Patient Assessment of Satisfaction and Quality : An integrative Model of patients, Evaluation of their care . managing service Quality , Vol .11, No 4, pp272287. Yap, J. Y . C .(2007) , medical tourism and Singapore. Imtenational hospital federation reference book , pp. 2526. Yellen,E . Davis,G. and Richard ,R.(2002) the measurement of Patient satisfaction . Journal of nursing care Quality, Vol.16 , No.4 , pp23-29 Yildiz,Z. and Erdogmus, S. (2004) , measuring patient satisfaction of the Quality of health care : A study of hospital in turkey . journal of medical system , Vol.28, no .6,pp 581-589 Yucelt , U. (1994) An investigation of Causes of patient satisfaction /dissatisfaction with physician service . Health marketing Quarterly, Vol.12, No2,pp.11-27. Zeithaml,V.(1981)," How consumer Evaluation Process Differ Between Goods and Services" in Donnelly,J.and www.health-tourism.com
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Identifying Gaps in Digital Divide Comparison between localities in Sg. Petani, Kedah, Malaysia
Nur Zafifa Kamarunzaman Faculty of Administrative Science & Policy Studies, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah Malaysia Zaherawati Zakaria (Corresponding author) Faculty of Administrative Science & Policy Studies, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah Malaysia Azlyn Ahmad Zawawi Faculty of Administrative Sciences and Policy Studies, Universiti Teknologi MARA (Kedah), P.O. Box 187 Merbok, Kedah Malaysia Nazni Noordin Faculty of Administrative Science & Policy Studies, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah. Malaysia Mohd Zool Hilmie Mohamed Sawal Faculty of Information Management, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah Malaysia Azlan bin Abdul Rahman Faculty of Language Studies, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah Malaysia Hanir Idham Bin Hamzah Faculty of Administrative Science & Policy Studies, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah. Malaysia Mohd Muhriz Bin Nordin Faculty of Administrative Science & Policy Studies, Universiti Teknologi MARA, P. O Box 187, 08400 Merbok, Kedah. Malaysia Abstract The aims of this study were two folds: 1)To identify the residents perspective on the incidence of digital divide in rural and urban areas in Kedah; and 2)to examine the demographic factors, namely the age and socioeconomic which contributing to this problem. The research has been undertaken at Sg Petani, Kedah; and Bandar Laguna Merbok represented the urban area and Kampung Sg. Gelam the other locality. A total of 157 respondents from both localities were chosen by using Cluster Sampling technique. The findings indicated that there was significant result showing the rural area of the study had suffered the incidence of digital divide. Furthermore, the study has identified the education and age levels were leading to the problems, but income level vice versa. Keywords: Digital divide; Technology; Malaysia.
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1. INTRODUCTION Technology is very close to us in this globalization era. Millions of people have access the web daily for financial, health and government information, for job searches, entertainment and numerous other activities (Hargittai & Shafer, 2008). However, not all population participate and able to access the internet and get the advantage from the rise of technology. The tremendous enhancement of the technology has established the gap of the information and technology between people. The established gap will cause the situation where people who are left behind will face economy difficulties and gain lesser in terms of knowledge (Harada, 2001). The most suitable term for this problem is digital divide. According to Barzilai, Gomez and Ambikar (2008), the term digital divide was first introduced by the ClintonGore administration in 1996. It is referring to the gap between those who had access to new information communication technology (ICT) and those who did not (Jackson, Yong, Kolenic III, Fitzgerald, Harold & Eye, 2008). Digital divide also can be used to characterize a gap between information haves and have-nots. In other words, it is a study between those people who use or have access to telecommunications technologies, for example telephones, computers, the Internet and those who do not (Bibby, Mehta, Reidel & Sawyer, 2004; Munster, 2005). In Malaysia, the government had already taken action to bridge the digital divide problem. It was a part of an effort to prepare the society to cope with Knowledge-Based Economy, the type of economy which directly based on the production, distribution and use of knowledge and information (Organization for Economic CoOperation & Development, 1996). Government has emphasized the raising of the level of ICT usage for various people and sectors which include rural and urban society in order to enhance the economic growth and social quality of life. For instance, the Ministry of Housing and Local Government in Malaysia had implemented the project known as Bridging Digital Divide (BDD) with the objective of reducing the incident of digital divide between rural poor and urban affluent groups (Ministry of Housing & Local Government, 2003). Based on Ninth Malaysian Plan 2006-2010 report, government had spent 28.8 percent from ICT budget to close the digital gap (Megat Aman Zahiri Megat Zakaria, Baharudin Aris & Jamalludin Harun, 2007). Government had intensified the One Home One PC initiative which was launched in 2003, with the expansion of PC Gemilang 2 schemes and PC Mesti Beli schemes which targeted the first-time buyer and the lower income group (Economic Planning Unit, 2006). The effort done by the government to bridge the digital divide showed that the issue is important and need to be tackled. So this research purposely worked in identifying the community perspective towards digital divides and examine the demographic factors that contributing to this problem. 2. STATEMENT OF PROBLEM Malaysian government had taken action to close the digital divide, but this problem is still occurring, especially for the rural residents. The problem of digital divide creates huge gap and leave behind those who do not access the information. The digital divide creates unbalance of socio economic developments, quality of life and standard of living of our people. Therefore, Vision 2020 is far outreach by the Malaysian society. In order to transform Malaysian into a Knowledge-based Society and fully developed country by the year 2020, all Malaysian citizens should be an information-technology literate and digital divide should be reduced. Therefore the research aims were two folds: 1) to identify the existence of digital divide for both residents (i.e., rural and urban area); and 2) to examine factors that contribute to the digital divide phenomenon. 3. LITERATURE REVIEW Geographic location plays major role in determining the digital divide. Specifically the relationship of digital divide with the geographic location is referring to the difference between the urban and rural population. Basically the group that was affected towards digital divide is the rural people. According to Barzilai-Nahon and Rafaeli (2006), people who are living in rural areas associated with a higher incidence of digital divide. Problem of digital divide rise in the rural area because many of rural areas are lack in the development and the application of the information communication and technology. It was supported by Tengku Mohamed Faziharudean Bin Dato Tengku Feissal (2005) which argued that Malaysia has a very large rural population, and the rural area is still lacking in terms of physical telecommunication infrastructures and relevant ICT content compared to the urban population. For example, Economic Planning Unit (2002) reported that Kuala Lumpur which can be categorized as urban and metropolitan area has higher internet subscribers which is 10.4 per 100 inhabitants, whereas Kedah and Kelantan which covered by many rural areas only have 1.8 and 1.3 per 100 inhabitants. Urban populations have higher penetration on ICT compared to rural for many reasons such as affordability, educational and income level, working condition, the development and infrastructure of ICT facilities.
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Unequal development, infrastructure and the life styles of the citizens generate the phenomenon between both areas. The urban areas basically have better infrastructure and development. It was supported by Norizan Mohd Yasin (2007), which stated that geographic location is a factor that contributes towards digital divide and it is because certain location at rural area are lack of infrastructures such as internet connection and the electricity. From the findings by The Ministry of Energy, Water and Telecommunications Malaysia (2007), 90 percent out of 927 territorial divisions in Malaysia are still in the early penetration towards information communication and technology. In Malaysia, the development of infrastructure regarding ICT has tremendously increased at the urban area but not in the rural area. For example, Kuala Lumpur as urban and metropolitan area which has many facilities to access the ICT such as the development of Cyberjaya, cyber cafes, fast food with free wireless zone, shops that selling ICT materials such as computer, laptop and others, vis--vis. The findings by Tengku Mohamed Faziharudean Bin Dato Tengku Feissal (2005) in district of Tanah Merah which is one of the typical rural area at Kelantan, has only three cyber cafes to cater the community there. Comparing to Kota Bharu which is the only urban area at Kelantan, it has 57 cyber cafes. It proves that the infrastructure and facilities regarding ICT at urban areas is much better than rural area. This brings us to the first hypothesis: Hypothesis 1: There are significant differences on digital divide means score between rural and urban area from the residents perspective In this global era, technology and education are so important in order to achieve society that is knowledgeable, either for rural or urban residents. Different education level plays different role in adapting the ICT. So it is not possible to indicate that the education level can be one of the indicators to the digital gap. As reported by National Telecommunications Information Administration of America, education has consistently been a predictor of peoples access to the internet and it is likely to affect peoples level of web use skill as well (as cited in Hargittai, 2002). Barzilai-Nahon and Rafaeli (2006) on the other hand had identified that, lower education and lower income were associated with a higher digital divide. This category of people would avoid involving in using ICT devices as they think that it is not necessarily for them. In contrast, people tend to use the technology and internet when they have high level of education. According to Advisory Committee on Student Financial Assistance (2004), the higher a persons level of education, the more likely he or she will use a computer and the Internet. As the internet is perceived as a medium of communication, people who are highly qualified in education have higher possibilities to learn in handling and gaining knowledge about the digital devices. It is due to the process of learning where nowadays in the globalization era is requiring a large involvement of ICT especially in finding information. For example in Malaysia, many students who enroll in universities should take a course regarding to the introduction and the usage of ICT due to the changes of the governments interest which to breed more knowledge workers in future. Thus, they would have high tendency to practice the knowledge compared to those who do not have any knowledge in information and technology. Highly educated people basically have high tendency to find information over the World Wide Web and also exploring the ICT. Hargittai (2002) in the article entitle Second-Level Digital Divide: Differences in Peoples Online Skills, argued that people with higher levels of education are likely to have more exposure to computer technology in general, familiarity with which is an important first step in gaining access to the Internet. Level of education is also correlated to income and the ability to afford technological access. Basically people who have higher level of education get higher income compared to people who have lower level of education. In the other words, higher position requires higher qualification and higher position will earn more salary. So that, people who are having higher level of education basically earn more money and afford to get the technological devices and left behind those who have lower level of education. These arguments bring us to the second and third hypothesis: Hypothesis 2: There are significant differences on educational level with digital divide between rural and urban area. Hypothesis 3: There are significant differences on income level with digital divide between rural and urban area. It was apparent that the older populations were disproportionately affected by the digital divide (Potter, 2007). Simultaneously, age is perceived as one of the indicators which lead individual into a pocket of digital divide (Atkinson et al., 2006). Age differences have a strong influence on the diffusion of information and communication technologies into mainstream society. This may due to the cause that people with older age find it is difficult to learn new things as they feel that they are too old to catch up the evolvement of technology. However, the age factor can contribute to a different effect in this issue if we compare between the folks from the urban and also rural area (Potter, 2007). In the urban area the numbers of old folks who are digital literate
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VOL 3, NO 4 are more than the folks in the rural area. This is due to the fact that in the urban area they have more exposure and facilities concerning to the ICT. Meanwhile in the rural area, the limitation of facilities and exposure concerning to the ICT caused them to be more complacent with what they have and discourage them to see the importance of digital literate in this modern era of technology. Typically, the younger generation is more willing to adopt new innovations and changes compared to older generations. According to Soker (2005), younger generation has an easier adaptation in using and learning technology rather than the older generations. Younger generation nowadays born in ICT era, they have been exposed and socializing with it since the early years, and involve heavily in education which required them to use the ICT devices. For example, using the computer and internet in completing an assignment. According to the findings by Soker (2005) in 2003 only, 20 percent of old people had gone online compared to 65 percent of younger adults. It showed that the higher the age, the higher of the tendency of old people to be engaged in the digital divide problem. These bring us to the final hypothesis, which is: Hypothesis 4: There are significant differences on age with digital divide between rural and urban area. 4. RESEARCH METHODOLOGY The study was undertaken to ascertain the contributor/s of digital divide between urban and rural areas, namely between Bandar Laguna Merbok and Kg. Sungai Gelam, Sungai Petani, Kedah. Cluster sampling technique was used due to the large number of the population especially at Bandar Laguna Merbok. Survey executed on a population of 728 people. The breakdown was as such: the total respondent selected in Bandar Laguna Merbok was 80 respondents from 564 different terrace houses in first phase; while in Kg. Sungai Gelam, only 77 people were selected as respondent from total of 164 houses in this area. For the purpose of the study, the instrument score of reliability is = 0.837 for 32 items. 5. RESULT & DISCUSSIONS Hypothesis 1 - There are significant differences on digital divide mean score between rural and urban area from the residents perspective The result indicates that residents Bandar Laguna Merbok is a group which have, access, use and knowledge of ICT more than residents at Kg. Sungai Gelam. The digital gap occurs between these two groups and the rural people of Kg. Sungai Gelam are highly affected on the digital divide. It can be measured through the mean of both locations, where mean for Bandar Laguna Merbok is 52.7500 where mean for Kg. Sungai Gelam is 41.4416. The two-tail significant for digital divide indicates that p < 0.05. From independent sample test result, it can be seen that t (155) = -10.857, p < 0.05 where p < 0.01 and, therefore it is significant to say the incidence of digital divide existed at the rural area, namely Kg. Sungai Gelam. The findings have been supported by Barzilai-Nahon and Rafaeli (2006) who identified people who are living in rural areas associated with a higher digital divide. Simultaneously, Tengku Mohamed Faziharudean Bin Dato Tengku Feissal (2005), argued that rural area is still lacking in terms of physical telecommunication infrastructures and relevant ICT content compared to the urban population thus contribute to cleavage of digital divide between these areas. Hypothesis 2 - There are significant influences on educational level with digital divide between rural and urban area. The result from two-way ANOVA has shown the significant value for education level is < 0.01 which is p < 0.05, confirming there is significant influence on educational level with digital divide with respect to respondents location (F (2, 150) = 111.098, p < 0.05 which p = 0.039). On the other words, hypothesis 2 was accepted. A high education achievement does not guarantee ones will never fall under technology if the individual is located in rural areas. Locality plays an important role in equipping community to have access and facilities that support the technology usage. This finding rejected The National Telecommunications Information Administration of America research (as cited in Hargittai, 2002) and Olatokun (2009) premises on education variable as the predictor of digital divide reduction. Hypothesis 3 - There are significant differences on income level with digital divide between rural and urban area The output shown that there were no significant differences for income level with digital divide with respect to respondents location. The significant value for income level is 0.039 which is p < 005, so it stated there is the significant influence on income level with digital divide, however location of the respondent cannot be the predictor of digital divide based on the income level (F (1, 151) = 113.859, p > 0.05 which p = 0.097). Therefore, hypothesis 3 was rejected. The finding supported by Olatokun (2009) who discovered that there were gaps in accessing to and to use of ICT among high income earners and low income earners. Norizan Mohd Yasin (2002) also argued that income level would be the catalyst of the affordability to consume ICT materials and services regardless where individual located.
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Hypothesis 4 - There are significant differences on age with digital divide between rural and urban area The findings indicated that there was a significant difference on age with digital divide incidence where the significant value for age is 0.02, p < 0.05. The output also shows that there is a significant influence for age with digital divide with respect to respondent location. The influence of age on digital divide does depend on the location of the respondents, F (3, 149) = 119.852, p < 0.05 which p = 0.024 resulting the hypothesis accepted. Simultaneously, rural areas have evidence to face many restrictions, e.g., lack of infrastructure, socio-economic problem; which hamper the effort of government to increase community interest on the knowledge in ICT. 6. CONCLUSION Digital divide is a contemporary issue of all over the world, due to the enhancement of technology and transformation process towards knowledge based society. Digital divide is a gap between one who have, access and use of ICT, and one who do not. Based on the outcome of the research it shows that the demographic factors do indeed contributes to problems of digital divide in both areas. Geographic locations, education and level of income and age play a big difference in proving the significant influence between the two areas on what factors contributes to digital divide problems. However, this research stands on many limitations. Future research might want to consider on broadening the perspective in addressing the problem in terms of population and other variables. Qualitative measure should be considered to implement in order to increase validity of data.
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References Advisory Committee on Student Financial Assistance. (2004). Briefing Memo: The Digital Divide. Retrieved March 7, 2009, from http://www.ed.gov/about/bdscomm/list/acsfa/digitaldiv.doc Atkinson, J., Tan, J., Curtis, A., Cooke, P., McDonald, S., & Black, R. (2006). The Digital Divide in Albury City. Charles Sturt University. Research Paper. Retrieved March 4, 2009 from http://csu.edu.au/research/ilws/research/publications/docs/2006report35.pdf Barzilai-Nahon, K., & Rafaeli, S. (2006). Gaps and Bits: Conceptualizing Measurements for Digital Divide/S. Retrieved March 4, 2009, from http://www.uwnews.washington.edu/ni/October/rc_parentID27342_thisID27365.pdf Barzilai-Nahon, K., Gomez, R., & Ambikar, R (2008). Conceptualizing A Contextual Measurement For Digital Divide/S: Using An Integrated Narrative. Retrieved March 4, 2009, from http://www.sbaer.uca.edu/research/swdsi/2003/Papers/071.pdf Bibby, E., Mehta, K., Reidel, J., & Sawyer, W. (2004). The Digital Divide in Vermont: A Policy Brief. Retrieved March 7, 2009, from http://crs.uvm.edu/digitaldivide documents/APCITY/UNPAN003176.pdf Economic Planning Unit (2006). Mainstreaming information and communications technology. Retrieved March 7, 2009, from http://www.epu.gov.my/rm9/english/Chapter5.pdf Harada, I. (2001). Colloquium: The Blueprint of the Digital Divide. Retrieved February 16, 2009, from http://unpan1.un.org/intradoc/groups/public/ Hargittai, E. (2002). Second Level Digital Divide: Differences in Peoples Online Skills. Retreived March 4, 2009, from http://chnm.gmu.edu/digitalhistory/ Hargittai, E., & Shafer, S. (2008). Actual versus Perceived Online. Retrieved March 28, 2009, from http://www.northwestern.edu/ipr/publications/ Jackson, L. A., Yong, Z., Kolenic III, A., et al. (2008). Race, Gender and Information Technology Use: The New digital Divide. Cyber Psychology & Behaviour, 11(4), 437-442. Megat Aman Zahiri, M. Z., Baharudin, A. & Jamalludin, H. (2007). Kemahiran Ict Di Kalangan Guru-Guru Pelatih UTM : Satu Tinjauan. Paper presented at 1st International Malaysian Educational Technology Convention. Retrieved July 18, 2009, from http://eprints.utm.my/5960/1/130-megatAman.pdf Ministry of Energy, Water and Telecommunication Malaysia (2007), Retrieved March 7, 2009, http://www.kettha.gov.my/bm/ Ministry of Housing and Local Government. (2003). Bridging Digital Divide. Retrieved March 7, 2009, from http:// http://bdd.org.my/ Norizan Mohd Yasin (2002). Digital Divide in Education: The Malaysian Experience. Paper Presented at 2002 International Conference on the Digital Divide: Technology & Politics in the Information Age. Retrieved March 7, 2009, from http://www.sisr.net/events/docs/0208yasin.pdf Olatokun, W. M. (2009). Analysing Socio-Demographic Differences in Access and Use of ICTs in Nigeria Using the Capability Approach. Issues in Informing Science and Information Technology, 6. Organisation for Economic Co-Operation and Development. (1996). The Knowledge-Based Economy. Retrieved March 4, 2009, from http://www.oecd.org/dataoecd/51/8/1913021.pdf Potter, K. (2007). The Digital Divide in North Carolina Public Libraries. Masters Paper. University of North Carolina. Retrieved March 4, 2009 from http://etd.ils.unc.edu/dspace/bitstream/1901/414/1/kellypotter.pdf Soker, Z (2005). Age, Gender, Ethnicity and the Digital Divide: University Students Use of Web Based Instruction. Electronic Journal of Society.
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Tengku Mohamed Faziharudean Bin Dato Tengku Feissal (2005). Digital Divide in Malaysia: Examining the Issues of Income, Workplace and Geographical Difference in Diffusing ICT to the Mass Public. Phd Thesis. Waseda University Retrieved July 18, 2009, from http:// dspace.wul.waseda.ac.jp/dspace/bitstream/2065/.../Honbun-3972.pdf
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An empirical study on the impact of Microfinance Institutions in enhancing SHG in Karur District, Tamil Nadu - India S. Radhika MBA., CA(Inter)
Assistant Professor, Department of Management Studies , Saranathan College of Engineering, Tiruchirappalli, Tamilnadu,
S. Anupriya MSc., M.Phil
South India,
Assistant Professor, Department of Mathematics J.J College of Engineering and Technology, Tiruchirappalli, Tamilnadu, South India.
Abstract
Microfinance is a general term to describe financial services to low-income individuals or those who do not have access to banking services. Microfinance has created significant worldwide attention as being a successful tool in poverty reduction and that it should never be seen as the only tool for ending poverty. This paper examines empirically the impact of Self-help Group based microfinance on the socio-economic characters like income, employment, literacy and migration of the rural households of Karur District. The overall objective of this paper is to examine the process through which SHG movement took shape in Karur district and brought about significant improvement in the living conditions of the SHG. The primary data has been collected through the structured questionnaire and direct interview from a group of SHG members in Karur District was conducted. Census method was employed and 184 members in self help group have taken for the study. The researcher used cronbachs alpha test in order to test the reliability of the collected data and the value is 0.744 which shows the data collected was reliable. Using Statistical Package for Social Science (SPSS) some of the relevant tests were carried out like factor analysis and multiple regressions. Based on the analysis and interpretation the researcher arrived at the major findings in this study and suggestions were given in such a manner that will be useful, relevant and significant to the present Indian scenario.
Keywords: Microfinance, SHG, Employment, Empowerment
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INTRODUCTION
The interest in microfinance has substantially increased during the last two decades. There are some lending agencies, donor agencies, developing and developed country governments, and non-governmental organizations providing loans for the development of microfinance. Microfinance is a broad range of financial services such as deposits, loans, payment services, money transfers, and insurance to poor and low-income households and their micro enterprises. Microfinance helps to promote economic growth and development. Microfinance is a critical element for an effective poverty reduction strategy. Improved access and efficient provision of savings, credit and insurance facilities in particular can enable poor women to smoothen or steady their consumption, manage their risks better, build their assets gradually, develop their micro enterprises, enhance their income earning capacity, and enjoy an improved quality of life. Developing countries have used microfinance services to reduce poverty. The studies have, in general, shown that microfinance services have also had a positive impact on specific socioeconomic variables such as childrens schooling, household nutrition status, and womens empowerment. Most formal financial institutions do not serve the poor because of perceived high risks, high costs involved in small transactions, perceived low relative profitability, and inability of the poor to provide the physical collateral usually required by such institutions. A microfinance institution has played a very important role in promoting credit facilities for self-help groups. Forming and nurturing small, homogeneous and participatory self-help groups (SHGs) of the poor has today emerged as a potential tool for human development. The SHGs have also become a forum for many social sector interventions. Self Help Group (SHG) banking is the primary mode of microfinance in India today, reaching over six million families. In spite of its considerable outreach, successful savings mobilization and high repayment rates, as with most other microfinance models, the financial viability of SHG banking has not been clear. SHG federations attempt to provide financial viability and sustainability to SHG banking. Tamil Nadu has become the second largest state after Andhra Pradesh in the self-help group (SHG)-bank linkage programme launched by the National Bank for Agriculture and Rural Development (Nabard).In this state, 209,197 SHGs were credit linked with a financial
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assistance of Rs 2,791.65 crore in 2009-10, taking the cumulative number of SHGs credit linked to 852,791 (including repeat doses) with a bank loan of Rs 9,394.70 crore. Most banks were lending to Microfinance Institutions (MFIs) for expanding their SHG portfolio, since MFIs provide faster financial access to the SHG clientele with cheaper delivery costs. SelfHelp Group (SHG) is a programme implemented in Tamil Nadu about 12 years back by Sewa Bharati. After a decade it has become a silent revolution of economic empowerment and socio-political system of the State. Since 1999, Sewa Bharati has been working in this micro credit delivery system, which has attracted the attention of the entire nation. To start with the scheme was introduced for women but now it is getting popularity among men too. Sewa Bharati alone is guiding more than 4,000 women SHGs and 400 men SHGs throughout the State.
REVIEW OF LITERATURE
Dadhich (2001) stated that effective implementation of micro-finance can be a means not only to alleviate poverty and empower woman but also be a viable economic and financial Proportion. Raghavendra (2003) reported that the average participation level of SHG members has been quite good. Officials of Commercial Banks and RRBs together account for 50 per cent of total participation followed by Co-operative banks at45 per cent and the balance 5 per cent by NGOs. Southern region accounts for over 2/3 of total proportion. Satya Sundaram (2005) stated that micro-finance in India is making steady and satisfactory progress. NABARD has set a goal of covering 10 million poor, i.e. one third of the countrys poor population through one million SHGs by 2003. Thorat (2005) stated that micro-financial services provided to the poor in sustainable manner is consistent with high repayment rates. Which meant that if the services to the poor were provided in a sustainable manner than the beneficiaries would go in for repayments that are quite high in consideration to a staggered manner of provision of services. Asokan (2005) reported that National Institute of rural development (NIRD) conducted a study on micro enterprises, which are developed by SHGs in Kerala. The characteristics of micro entrepreneurs under SHGs revealed that a high proportion (90%) of them were unemployed prior to joining SHG and tailoring was found to be the most preferred activity (47%). The study also found that the average monthly turnover of micro project taken by members of SHGs members was around Rs. 1917 and net profit worked out to be Rs. 700 per month. This indicates a high level of profit i.e. 60 per cent of individual units have investments less than Rs. 5,000. A study conducted in Tiruchirapalli rural area found that before starting micro- enterprises their
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annual income was increased to the tune of Rs. 50,879. Subbiah and Navaneetha (2006) reported that there are three models under the SHG's-bank linkage programme. About 72% of the SHGs are formed by NGOs/ government agencies and the like financed by banks. They stated the programme has been advantageous not only to members of SHG's but also to the banks. SavitaShankar (2006) conducted Studies on efficient credit models in micro finance in Tamil Nadu; the most popular model for the dispensation of micro credit in India is the group-lending model. As per Sa-dhan (Industry Association of Community Development Finance Institutions in India) data, group loans account for 93% of the microfinance in India. Reddy and Gupta (2006) studied the credit management in Self Help Groups(SHGs) under South Asia Poverty Alleviation Programme (SAPAP) revealed that the data on purpose wise allocation of credit showed that sample groups allocated 34 per cent, 22 per cent and 22 per cent of the total credit to small businesses, animal husbandry and agriculture respectively Under animal husbandry, members take loan to purchase milch animals, sheep and goats under agriculture members take crop loan to purchase, plough and bullock carts. The other major purposes include domestic consumption (13 per cent) and clearing of old debts (7 percent) and share of health and education is only three per cent. Thus the members in the sample groups have taken credit mainly (78 per cent) for productive/ income generating activities during the study period. Shylendra etal.,(2007) report the overall performance of the self-help group (SHG) intervention of the Sadguru Water and Development Foundation (SWDF) in India and identifies possible ways to take it forward for promoting savings and credit activities. The study was stated that Self-help groups have become an important instrument in the delivery of microfinance services like savings and credit for the poor.
Methodology Objectives
1. To study the role of Microfinance institutions in improving Self Help Groups in Karur District,Tamilnadu India. 2. To examine the various factors that enhances the overall satisfaction of SHG towards Microfinance Institutions.
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Hypotheses
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1. There is relationship among the factors that enhances the SHG through microfinance institution. 2. Low interest rate and processing & sanctioning of loan from Micro Finance Institutions ensure overall satisfaction of Self Help Group.
METHODOLOGY
The present study aims at developing insight on how Microfinance institution enhances SHG. Primary data was collected by the researcher with the help of structured questionnaire using interview schedule. Census method was absorbed by the researcher 184 (population) has been taken for the study. To test the reliability of the data collected, the researcher used cronbachs Alpha test and the value is 0.744 which shows that the data has satisfactory reliability and validity. Using Statistical Package for Social Science (SPSS) some of the relevant tests were carried out like factor analysis and multiple regression
Table -1 Reliability Statistics:
Cronbach's Alpha 0.744
N of Items 17
The Cronbach's alpha values were calculated to assess the internal consistency of the Questionnaire. Reliability refers to the confidence we can place on the measuring instrument to give us the same numeric value when the measuring instrument is repeated on the same object. For the Microfinance institution SHG questionnaire, the Cronbach's alpha value of 0.744 indicated adequate reliability.
Factor Analysis Hypothesis: There exist relationships among the factors that influence the impact of SHG Table 2: KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. Bartlett's Test of Sphericity 253.445 78 0.000
0.671
23854.127 861 0.000
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Kaiser Meyer Olkin measure of sampling adequacy index is 0.671, which indicates that factor analysis is appropriate for the given data set. KMO measure of sampling adequacy is an index to examine the appropriateness of factor analysis. High values between 0.5 and 1.0 indicate factor analysis is appropriate. Values below 0.5 imply that factor analysis may not be appropriate. Bartletts Test of Sphericity is used to examine the hypothesis that the variables are uncorrelated. It is based on Chi-Square transformation of the determinant of correlation matrix. A large value of the test statistic will favour the rejection of the null hypothesis. In turn this would indicate that factor analysis is appropriate. Bartletts test of Sphericity Chisquare statistics is 23854.127, which would mean the 13 statements are correlated and hence as concluded in KMO, factor analysis is appropriate for the given data set.
Table 3: Total Variance Explained Extraction Sums of Squared Initial Eigenvalues Loadings
Component 2.824 21.727 21.727 2.824 21.727 21.727 2.148 16.523 1 2.292 17.632 39.358 2.292 17.632 39.358 2.147 16.519 2 1.463 11.252 50.610 1.463 11.252 50.610 1.542 11.863 3 1.031 7.928 58.539 1.031 7.928 58.539 1.527 11.747 4 1.018 7.831 66.370 1.018 7.831 66.370 1.263 9.717 5 .916 7.046 73.415 6 .716 5.506 78.922 7 .645 4.959 83.881 8 .543 4.177 88.058 9 .478 3.681 91.738 10 .431 3.313 95.051 11 .365 2.805 97.856 12 .279 2.144 100.000 13 Extraction Method: Principal Component Analysis. Eigen Value represents the total variance explained by each factor. Percentage of the total variance attributed to each factor. One of the popular methods used in Exploratory Factor Analysis is Principal Component Analysis, Where the total variance in the data is considered to determine the minimum number of factors that will account for maximum variance of data.
Rotation Sums of Squared Loadings

16.523 33.042 44.905 56.652 66.370
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Table 4: Rotated Component Matrix(a) Particulars 1 2
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3 0.158 0.088 -0.161 -0.115 0.167

0.852 -0.073 0.059
4 0.561 -0.146 0.103 -0.069 -0.191 0.132 0.131 -0.068 0.269 0.078
0.892
5 0.211 0.636 -0.121 0.193 0.164 0.005 0.119 -0.024 -0.246

0.778
Benefit Derived by SHG MFI helps in eradicating the poverty

Finance availed beneficial to me
-0.028 0.449
0.786
0.371 -0.112 -0.089 0.097 0.148 -0.097 0.800 0.793

0.667
Using MF for the intended purpose Business established without MFI facility is not possible
Low Interest Rate Loan Availability Processing and Sanctioning of Loan Installment Factor Hospitality and Services Procedure of beneficiary activities Group meeting procedures and record keeping Involvement in the decision making of your children future
Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a. Rotation converged in 26 iterations.
0.746 0.776 -0.079 0.096 -0.018 0.075 0.001 -0.056 -0.380 -0.028
0.139 0.012 0.054 0.150 0.814
0.027 -0.005 0.435 0.209
-0.144 0.175 0.059
0.473 0.048
Rotation Method: Varimax with Kaiser Normalization:
Interpretation of factors is facilitated by identifying the statements that have large loadings in the same factor. The factor can be interpreted in terms of the statement that loads high on it. The factors of a study on SHG of 13 individual statements. Out of 13 factors, 5 individual factors contribute more towards enhancing the SHG. 1. Procedure of beneficiary activities 2. Low Interest Rate 3. Hospitality and Services 4. Finance availed beneficial to me 5. Installment Factor
MULTIPLE REGRESSIONS
Test of Multiple Regression was applied to study the association among various factors in measuring the overall satisfaction of SHG towards the services of Microfinance.
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Model 1
a.
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Table -5: Model Summary Adjusted R R R Square Square
Std. Error of the Estimate 0.262
.972(a)
0.945
0.936
Predictors: (Constant), Business established without MFI facility is not possible, Hospitality and services, Processing and Sanctioning of loan, Finance availed beneficial to me, Installment Factor, MFI helps in eradicating the poverty, Low Interest Rate, Using MF for the intended purpose, Loan Availability, Benefits derived by SHG members through MFI
In the above model summary table shows R-Square for this model is 0.945 this means that 94 percentage of the variation in overall retention programs of customers (dependent variable) can be explained from the 10 independent variables. The table also shows the adjusted Rsquare for the model as .936. Any time another independent variable is added to a multiple regression model, the Rsquare will increase (even if only slightly). Consequently, it becomes difficult to determine which models do the best job of explaining variation in the same dependent variable. The adjusted R-square does just what its name implies. It adjusts the R-square by the number of predictor variables in the model. This adjustment allows the easy comparison of the explanatory power of models with different numbers of predictors variable. It also helps us to decide how many variables to include in our regression model.
Table -6 :ANOVA(b) Sum of Squares df 75.543 4.404 79.947
Model 1
Regression Residual Total
10 64 74
Mean Square F 7.554 109.781 0.069
Sig. .000(a)
a. Predictors: (Constant), Business established without MFI facility is not possible, Hospitality and services, Processing and Sanctioning of loan, Finance availed beneficial to me, Installment Factor, MFI helps in eradicating the poverty, Low Interest Rate, Using MF for the intended purpose, Loan Availability, Benefits derived by SHG members through MFI b. Dependent Variable: Satisfied with MFI presently dealing in
The ANOVA table, as displayed in the above table shows the F ratio for the regression model that indicates the statistical significance of the overall regression model. The larger the F ratio there will be more variance in the dependent variable that is associated with the independent variable. The F ratio =109.781. The statistical significance is .000- the sig. So reject the null hypothesis. There is relationship between independent and dependent variables
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Table 7: Coefficients(a)
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Model (Constant)
Low Interest Rate
Unstandardized Coefficients Std. B Error -0.213 0.094 0.005 .132 0.002 0.02 -0.017 -0.046 -0.049 0.03 0.282 0.013 0.034 .018 0.037 0.037 0.033 0.041 0.038 0.058
Standardized Coefficients Beta

0.174
t -0.756 7.229 0.158 7.504 0.054 0.537 -0.512 -1.131 -1.281 0.518 0.71
Sig. 0.452 0.000 0.875 0.000 0.957 0.593 0.611 0.262 0.205 0.606 0.480
Loan Availability
Processing and Sanctioning of loan Installment Factor
0.006
0.255
0.002 0.018 -0.019 -0.041 -0.045 0.02 0.031
Hospitality and services Benefits derived by SHG members through MFI MFI helps in eradicating the poverty Finance availed beneficial to me Using MF for the intended purpose Business established without MFI facility is not possible
0.038 0.053 a. Dependent Variable: Satisfied with MFI
From the above table it is clear that Low interest Rate and Processing & Sanctioning of loan has highest beta value (0.174 and 0.255 respectively) and highly significant at 0.000, which really determines the overall satisfaction of Self Help Groups towards Microfinance Institutions.
CONCLUSION
Developing countries have used microfinance services to reduce poverty. The studies have, in general, shown that microfinance services have also had a positive impact on specific socioeconomic variables such as childrens schooling, household nutrition status, and womens empowerment. In India, Micro finance is well recognized as an effective tool for poverty eradication and enhances the growth of SHG. Nowadays Micro finance institution plays a vital role in providing financial services to the SHG. The study found that the low interest rate and sanctioning and processing cost are considered as a two crucial variables used to enhance the growth of SHG. So the Microfinance Institutions should maintain the low interest rate and reduce the processing time and cost in order to retain the existing SHG and also inviting the new members in SHG for poverty alleviation throughout Tamilnadu.
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References
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Aguilar, G.V. (1999) "Does Microfinance Improve the Living Conditions of the Poor? An Overview of Impact Assessment Tools," in Alternative Finance. ITDG Publishing: Luxembourg. Bardoloi, G 2005, Grassroots Institutions, Rural Development and Environment Management in North East India, KB Publication, Guwahati. Borbora, S and Mahanta, R 2001, Micro finance through SHG and its impact: Gupta, M.S. 2008, Micro finance through SHGs An Emerging Horizon for Rural Development, Indian Journal of Commerce, Vol. 61, No.3, July-Sept Polliger, J., Outhwaite, J., & Cordero-Guzman, H., (2007) The Question of Sustainability for Microfinance Institutions, Journal of Small Business Management, 45(2). Piyush Tiwari and S.M.Fahad- Microfinance Institutions in India (Concept Paper). R. Srinivasan and M S Sriram Microfinance in India: Discussion (2003). Vijay Mahajan and G Nagasri, BASIX-Building Sustainable Microfinance Institutions in India (1999). Ritu Jain, Kushawaha, R.K and Srivatav, A.K., 2003, Socio-economic impacts through self help groups. Yojana, 47(7):11-12. Selvachandra, M., 2004, Microfinance through self help. Kisan World, 31(12): 23-24.
WEBSITE www.mixmarket.org www.kdid.org www.bus_standard.com www.gdrc.org
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Factors Affecting the Audiences Trust to SMS Advertising in Isfahan city

Hossein Rezayi Dolat Abadi University of Isfahan, Iran Faculty of Administrative Science & Economics , Department of Management
Bahram Ranjbarian University of Isfahan, Iran Faculty of Administrative Science & Economics , Department of Management
Mohsen Nadian (Corresponding author) University of Isfahan, Iran Faculty of Administrative Science & Economics , Department of Management
Abstract: Recent dramatic advances in information and communication technologies have provided new and more efficient methods of marketing for businesses. One of the results of such advances is the invention of SMS advertising which because of some characteristics such as ubiquity, flexibility, low barriers of time and space and low cost considered as an effective media among others for advertising and gained increasing attention from practitioners. But a problem with SMS advertising is that not everyone trusts the messages which received through this media. The aim of present study is to examine factors affecting the audience's trust to SMS advertising in Isfahan city. The research is based on data that obtained through a survey study. It is noteworthy that the analysis of collected data was done by spss17 software. The findings indicate that, perceived advertiser trustworthiness is the most important factor that affects the audiences trust to SMS advertising. Keyword: Short message service, SMS advertising, The audience's trust. Introduction: Mobile devices are a new phenomenon that is growing rapidly. The growth of mobile technology means have been faster than other technology in the past (Lee et al,2005) . The capabilities and functions of mobile phones are increasing rapidly that led to the development of marketing communications beyond the traditional approach. Today, with dramatic advances in information and communication technologies, new forms of advertising are explored. A new type of ads is post ads on mobile that because of the proximity and availability of permanent cell phone owners has increased the chance of advertisement to be seen. Unique characteristics of mobile advertising can include ubiquity (Pietz & Storbacka, 2007), making personal (Turban et al, 2007), flexibility (Pietz & Storbacka, 2007), low barriers of time and space (Mort & Drennan, 2002). This characteristic of mobile advertising that has led Mobile has great potential for advertising. So the mobile is good channel that can be used to send messages advertising according to the point where the user is and require that the user has at that moment and a tool that uses, the best message will send to him (Barwise P & Strong P,2002). Leung note that the number of mobile phone users worldwide reached more than 3.3 billion people, thus adoption of mobile commerce is increasing. (Leung, 2007). A public sector use of mobile technology is a Short Message Service(SMS). SMS, is used extensively worldwide (Leung, 2007). SMS allows users to send messages can be caused by letters and numbers (Leung, 2007). Informa Telecoms and Media industry has predicted global mobile advertising revenues will amount to 12.9 billion dollars in 2013 (Jaques, 2008). According to short life of advertising via SMS the investigations in the field of this technology has not been significant. Most studies have examined the variety of factors influencing the acceptance of mobile phone marketing from both COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 consumers an organization perspectives. One major research stream focuses on consumer acceptance and adoption of mobile services in general, such as multimedia messaging service, online gaming and other wireless services (Foulds and Burton, 2006; Hung et al., 2003; Kleijnen et al., 2004). Another more specific field of research focuses on consumer perceptions and attitudes towards the use of the mobile phone for marketing and commercial application (Barnes and Scornavacca, 2004; Barwise and Strong, 2002;Bauer et al., 2005; Carroll et al., 2007; Leppaniemi and Karjaluoto, 2005). More recently, Merisavo et al (2007) examined the drivers of SMS advertising acceptance among Finnish consumers. Through large-scale survey research, they found that the usefulness and context of the message were significantly associated with consumer acceptance of advertising sent via this medium. The primary focus of this research is on the factors that affect the audiences trust to SMS advertising. The audience's trust to advertising messages can be investigated in two dimensions. First is the real confidence that the audience has about advertising claims being made in the short message advertising that in many studies has been named as validity instead of the term trust. In the second, the audience's trust in SMS advertising means that short message advertising that the user has received does not contain any risk for him. Thus the existence of such media for advertising, marketers are interested to know what factors affecting the audience trust to this type of advertising. That is the reason why the present study tried to examine factors affecting the formation of audience's trust to SMS advertising in the Isfahan city. 2. Background and hypotheses Trust is context-dependent structural. In an environment where everything is decisive, because there is no risk, there is no need to trust. Trust is required in an uncertain and uncontrollable environment where there is mutual dependence. Thus trust is required in two situations: first when consumer is in a situation with risk and uncertainty that can assess the vulnerability and second is when consumer interdependence situation and he wont earn his interests without trust the other person. Simply create trust on the one side associated with the risk vulnerability and uncertainty (Chen, 2003). Trust is a foundation for the success of e-commerce and mistrust is one of the major barriers to developing e-commerce and mobile commerce. Most researchers have been defined trust as an attitude or an expectation. In contrast trust can be conceptualized as a behavioral intention: tendency to believe that trusted person behavior as a reliable would be expected (Panichpathom, 2000). Trust has been defined as a public believe about electronic vendors that lead to behavioral intention (Geffen et al, 2003).Also trust has been defined as a combination of integrity, honesty and compassion that the electronics retailer plans to increase the potential customers by reduction risk among them (Jarvernpaa & Todd,1997) and even as a set of beliefs and specific competence, honesty and good faith that leads to certain destinations. In the field of mobile commerce that, the relationships gets E-form , instead of facing and exchange information documents and possibly money electronic messages are transported and moved on the waves ,the issue of trust seems to be very important. In general, the introduction of mobile commerce is like a radical change in traditional methods of communication. Such a revolutionary change can be successful only when all the users trust to this new system. It is important to note that the technological aspects of mobile commerce when combined with the customers trust will attract them (Geffen et al, 2003). Because there arent reliable guarantees that the advertising companies through a short message dont do deceitful activities, trust is vital to this advertising. Such actions could include unfair price, inaccurate information, violation of privacy and personal information and unauthorized use of credit card information. Previous studies have shown that the trust directly increases intends to purchase and decreases customers perception of risk. In other words, price is not dominated on the web, but trust will be (Geffen et al, 2003). Researches have shown that trust in the electronic world is dependent on many factors. These factors are not limited and include the audiences perception of the advertiser reputation, the audiences perception of the advertiser corporate size, the audiences reliability about advertiser corporate, benefits and risks perceived by the audience, perceived privacy, perceived usefulness, the inner desire of consumers to have trust and experience and knowledge of consumer (Benamati et al,2007; Teo et al,2007). In this study has been attempted to consider factors that influence formation of audiences trust to SMS advertising among the citizens of Isfahan city and for this purpose is used the model that Lee and Turban have proposed for consumer trust (Lee and Turban,2001) but the model is adjusted for the implementation with other contributing factors of trust. The audiences trust to SMS advertising is affected directly through his perception of the advertiser's company reputation, perceived size of advertiser corporate, perceived trustworthiness of the advertiser corporate, perception of privacy and perceptions about risks and benefits derived from SMS advertising. Then research model is shown in figure 1.
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VOL 3, NO 4 Audience perception of advertiser corporate reputation and size is important factor because this factor can help audience to trust the corporate and provide guarantees for the ability, integrity and goodwill of other corporate sectors. A company's reputation, which include the buyers believe that the seller of corporate product is honest and concerned about the customer needs (Jarvenpaa &Tractinsky,2000). Several studies have shown that perceived corporate reputation is a determining factor in trust to internet shopping (Chen et al,2002; Koufaris,2004). When the perceived reputation of the company is positive, consumers will have more confident to company advertisement. Customer perceived size of company is customer perception about the size of advertiser Company. Then customers believe that larger company more understands their interest which acts to its promises to the consumer. Apparently consumers believe a large company provides services for them and they will support consumer need and will be able to compensate defect of products (Koufaris,2004). Jarvenpaa and Tractinsky (1999) stated that the company size and reputation are likely interaction because it is more likely that a larger companies remains in the business longer and the larger and most famous companies are more trusted. If a consumer believes that the ability and motivation of advertiser's company to deliver goods and services is consistent with the expected quality, it can be said that there is trust (Jarvenpaa & Tractinsky ,2000). Perceived privacy is a kind of self-concept that a user has in system that maintain the privacy of personal information. Topic of privacy in e-commerce and mobile commerce will affect consumer buying behavior (Furnell,2004). Violations of consumer trust according to an invasion of privacy or misuse of personal information will have negative effect on willingness to buy companys products (Monsuwe et al,2004). Mobile commerce like traditional shopping has the risks and benefits. Although somebody avoid m-commerce because of its risks but also there are those who use it because of the benefits that they have received of ecommerce. Risk represents potential that there is in desired outcome when a person is exposed to a SMS advertising message. Perceived benefits show the audience believes that when he/she receive a SMS advertising, led to comfortable him/her. These benefits include greater convenience, saving time and spend less time to select the product or service. Based on the above mentioned model the following hypotheses are developed: H1. Customers perceived reputation of the SMS advertiser company in Isfahan city has an effect on their trust to SMS advertising. H2. Customers perceived size of the SMS advertiser company in Isfahan city has an effect on their trust to SMS advertising H3. Customers perceived trustworthiness of the SMS advertiser company in Isfahan city has an effect on their trust to SMS advertising H4. Customers perceived privacy in Isfahan city has an effect on their trust to SMS advertising H5. Customers perceived risks derived from SMS advertising in Isfahan city has an effect on their trust to SMS advertising H6. Customers perceived benefits derived from SMS advertising in Isfahan city has an effect on their trust to SMS advertising 3. Research Methodology This research can be categorized as descriptive survey research. The statistical population of this research was the citizens of Isfahan city. The sample size estimated to be 162. The data gathering instrument was a self administered questionnaire which consists of two sections. The first part designed to test the hypotheses which had been formed basis on Lee and Turban (2001) model, about consumers trust and the second part records the respondents' demographic data. The first part contains 23 items in total that questions from 1 to 3 measure the first variable (i.e., audience perceptions of advertiser corporate reputation) according to the research model. Questions 4 to 7 measure the second variable (i.e., audience perceptions of advertiser corporate size) according to the research model. Questions 8 to 11 measure the third variable (i.e., reliability inferred of the audience about advertiser corporate) .Questions from 12 to 14 measure the fourth variable (i.e., audience perceptions of privacy). Questions from 15 to 16 measure the fifth variable (i.e., audience perceptions of the risks to the advertiser). Questions from 17 to 19 measure the sixth variable (i.e., audience perceptions of the benefits) and eventually questions from 20 to 23 measure the seventh variable (i.e., audience trust to SMS advertising) according to the research model. All the items were measured using five-point Likert scale items with anchor points 1 = strongly disagree and 5 = strongly agree To analyze the hypotheses of the study, one-sample -test has been used. Also for testing the existence of linear relations between variables, Pearson correlation was used. Finally, to determine the extent of the effects of four variables (i.e., attention toward action, interest and desire for action) on conservation behavior, regression analysis has been used.
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VOL 3, NO 4 To test the reliability of data gathering instrument, a preliminary study has been conducted with a sample of 30. The results of the primary sample show that Cronbach alpha () index is 0.76, that indicate a good reliability. 4. Data Analysis and Findings Table 1 shows demographic data. As it is shown, most of the respondents were male with 20 to 30 years of age. Their level of education falls mostly on categories of bachelor degree and amount of income falls mostly on category of 600 to $ 800 a month and most of them are self-employed or government employees. Table 2 represents descriptive statistics of variables. As it can be seen, most of variables have a mean value of greater than 3 which among them the perceived advertiser reputation has the largest mean of 3.8272 while perceived advertiser company size has the lowest mean of 2.9634. Standard deviations range from 0.68764 to 0.73642 and audience perceived benefits have the largest standard deviation of 0.04892. Table 3 represents the Pearson correlation among factors influencing on audiences trust to SMS advertising. As it is shown, the correlation of most variables are significant at 95% confidence level (Sig<0.05). The correlation coefficient of audience perceived reputation of the SMS advertiser with audiences trust to SMS advertising is positive and equal to 0.572, so this variables has positive and significant linear relations with each other. Also, the correlation coefficient of audiences perceived trustworthiness of the SMS advertiser and perceived benefits derived from SMS advertising with audience trust to SMS advertising are positive and respectively 0.546 and 0.759, it means that there is a positive linear relation between perceived benefits derived from SMS advertising with audiences trust to SMS advertising. The perceived trustworthiness of the SMS advertiser with audiences trust to SMS advertising is 0.759 , which can be considered as a strong relation. The correlation coefficient of audience perceived risks derived from SMS advertising with audiences trust to SMS advertising is -0.682, it means that there is a negative and strong linear relation between perceived risks derived from SMS advertising and with audiences trust to SMS advertising. Also, the correlation coefficient of perceived privacy with audiences trust to SMS advertising is 0.113; it means that there is a positive linear relation between perceived privacy and trust to SMS advertising, even though its not so strong. Finally the correlation of perceived size of adviser company with audiences trust to SMS advertising is not significant (Sig<0.05), it means that there isnt linear relation between audience perceived size of adviser company and trust to SMS advertising. Table 4 shows the multiple regression analysis of factors influencing on audiences trust to SMS advertising. Regression analysis showed that among the independent variables, only perceived advertiser trustworthiness, benefits derived from SMS advertising, advertiser company reputation and perceived risks derived from SMS advertising are considered as the main predictors of audience trust to SMS advertising. In total, these four factors are explained 64.6% (R2=0.646) changes in audience trust to SMS advertising. According to table 4, as it is shown 49.5% of independent variable changes can be explained by perceived advertiser trustworthiness (R2=0.459), and 5.9% of its changes can be explained by audiences perceived benefits derived from SMS advertising (R2=0.059), and 5.3% of its changes can be explained by perceived advertiser reputation (R2=0.053) and finally7.5% of independent variable changes can be explained by perceived risks derived from SMS advertising (R2=0.075). Beta coefficients for regression equations expressing the values predicted for the independent variables. In other words beta coefficients show impact of these variables on audience trust to SMS advertising. Beta coefficients show that audience perceived advertiser trustworthiness and trust to SMS advertising has a positive and strong liner relation ( p<0.05 , = 0.613),and perceived benefits derived from SMS advertising and perceived advertiser company reputation have a positive linear relation with trust to SMS advertising ( p<0.05 , = 0.162) ( p<0.05 , = 0.139), and finally perceived risks derived from SMS advertising has a negative liner relation with to SMS advertising ( p<0.05 , = -0.246).Then perceived advertiser trustworthiness is the most important predictor audience trust to SMS advertising and other important predictor of trust in order of importance are perceived risks derived from SMS advertising, perceived benefits derived from SMS advertising and perceived advertiser company reputation. 5. Conclusion In this study the factors that influencing the formation of audiences trust in SMS advertising is examined. In fact, SMS have some main privileges such as ubiquity, making personal, flexibility, low barriers of time and space and low cost that made it as a good and effective media among others for advertising. Theoretical framework was suggested that six factors are associated with audience trust to SMS advertising. The results provide valuable insights into understanding the factors that affect the audiences trust to SMS advertising. The Pearson correlation test showed that among six studied variables affecting audiences trust to SMS advertising, five of them have positive and significant relations with audiences trust to SMS advertising as dependent variable, which by increase or decrease in one variable, another variable will increase or decrease. As a result
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VOL 3, NO 4 we can state that hypotheses 1, 3, 4 and 5 has been confirmed but hypothesis 2 was rejected. In other word, only the correlation of perceived size of Advertiser Company with audiences trust to SMS advertising was not significant. Furthermore, to understand which variable can predict better the audience trust to SMS advertising, we used regression analysis. The regression analysis revealed that audience perceived advertiser trustworthiness is the best predicting factor for audiences trust to SMS advertising. In fact, by increasing audience perceived advertiser trustworthiness, the probability of audience trust to SMS advertising becomes more. It can be concluded that the taking attention of audience is the first task that all advertisers should consider it in their advertising. Second, they should try to prepare context and requirements of creating perceived advertiser trustworthiness, as much as they can. For example enhancing the quality of goods and services, provide ideal after sales service for customer and have more feeling of responsibility for customers. But, there is an important point that we should note that, changes in audience's trust to SMS advertising won't be explained only by these four independent variables. In fact there are some other variables which justify the changes of audience trust to SMS advertising. Thus, it is recommended that future researches take in to consideration the probable influence of other variables.
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References Bauer,H.H., Barnes, S.J., Rechardt, T., Neumann, M.M., (2005). Driving consumer acceptance of mobile marketing: A theorical framework of empirical study. Journal of Electronic Commerce Research.Vol.6(3). Barnes, S. and Scornavacca, E. Jr (2003). Mobile marketing: the role of permission and acceptance. Proceedings of the Second International Conference on Mobile Business,Vienna, Austria Barwise P &.Strong P .(2002).Permission-based mobile advertising. Journal of Interactive Marketing .Vol 16( 1).14-24 Carrol,A. Barnnes ,S,J.Scornavacca,E. Fletcher,K.(2007).Consumer perceptions and attitudes towards SMS advertising :Recent evidence from New Zealand. International Journal of Advertising.vol ,26(1). 79-98. Chen, L., Gillenson, M & Sherrell, D. (2002). Enticing consumers online: An extended technology acceptance perspective. International Journal of Information and Management, Vol. 39(11). 705-719. Foulds, M. and Burton, S. (2006).Consumer use and rejection of an interactive telecommunications service: a network perspective. Working Paper (Series No. 2006-17), Macquarie Graduate School of Management, Macquarie University, Sydney. Furnell, S. (2004) .E-commerce security: A question of trust. Computer Fraud &Security. Vol. 2004(10). 10-14. Gefen, D., Karahanna, E.and Straub, D. (2003). Trust and TAM in online shopping: an integerated Model, MIS Quarterly, Vol. 27( 1). 51-90 Hoffman, D., Novak, T., & Peralta, M. (1999). Building consumer trust online. Communications of the ACM, Vol. 42( 4). 80-85. He,D., Lu,Y.,(2007) .Consumer Perception and Acceptance towards Mobile Advertising: An Empirical Study in China. Journal of Interactive Advertisement.Vol.9(2) Jarvenpaa, S., Tractinsky, N., (2000) .Consumer trust in an Internet store. Information Technology and Management, Vol. 1(1).45-71. Kleijnen, M., de Ruyter, K. and Wetzels, M. (2004).Consumer adoption of wireless services: discovering the rules while playing the game. Journal of Interactive Marketing, Vol. 18 ( 2). 51-61 Koufaris, M. (2004) .Customer trust in online commerce. In G. Yuan (Ed.), Web systems design and online consumer behavior (pp.252-260). Hershey, PA: Idea Publishing Group. Lee, M., & Turban, E. (2001) . A trust model for consumer Internet shopping. International Journal of Electronic Commerce. Vol. 6(1). 75-91. Lee, L.T. (2007). Digital media technology and individual privacy. In C.A. Lin and D.J. Atkin (Eds.), Communication technology and social change: Theory and implications (pp. 257-279). Mahwah, New Jersey: Lawrence Erlbaum Associates, Inc. Lee Chung-wei,Hu Wen-chen, Kou Weidong.(2005).Advances in security and payment methods for mobile commerce .IGI publishing . Leppniemi M.; Sinisalo J.; and Karjaluoto H. (2006). Mobile marketing research (2000-2005): Emergence, current status, and future directions. In Podnar, K. and Jancic, Z. (eds.), Comtemporary Issues in Corporate and Marketing Communications:Towards a Socially Responsible Future. Ljubljana, Slovenia: Pristop, 85-93 Leung , L. (2007 ).Unwillingness to- communicate and colleges students motives in SMS mobile messaging. Telematics and Informatics , Vo.24.115-29. Lwppaniem i ,Matti. Heikki,Karjaluoto.(2005).Factors influencing consumers willingness to accept mobile advertising: A conceptual model. International Journal of Mobile Communications, Vol 3 (3) 197-213 Merisavo, M., Kajalo, S., Karjaluoto, H., Virtanen, V., Salmenkivi, S., Raulas, M. and Leppaniemi, M. (2007). An empirical study of the drivers of consumer acceptance of mobile advertising. Journal of Interactive Advertising, Vol. 7 ( 2)., available at: http://www.jiad.org/vol7/no2/merisavo/index.htm Monsuwe, T., Dellart, B., & de Ruyter, K. (2004) . What drives consumers to shop online? A literature review. International Journal of Service Industry Management, Vol. 15(1). 102-121 Mort,G.S.,Drennan,J.(2002). Mobile digital technology: emerging No.s for marketing. Journal of Database Marketing .10(1).9-23. Pietz,M.Strobacka,L. (2007).Driving advertising into mobile mediums :Study of consumer attitudes towards mobile advertising and of factors affecting on them. Bachelor Thesis.Spring Semester
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VOL 3, NO 4 Teo, T., & Liu, J. (2007) .Consumer trust in e-commerce in the United States, Singapore and China .Omega, Vol. 35( 31). 22-38. Xu ,DJ.(2007).The influence of personalization in affecting consumer attitudes toward mobile advertising in China. The Journal of Computer Information Systems. vol ,47.Iss ,2.pp,9.
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Annexure
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Audience perception about Advertiser Company by SMS advertising

Audience perception of the advertiser's company reputation Audience perception of the advertiser's company size Perceived trustworthiness of the advertiser corporate
Audiences trust to SMS advertising

Audience perception about privacy
Audience perceptions about risks and benefits derived from SMS advertising
Figure1- Adjusted model of audience trust (Lee & Turban,2001)
Table 1. Descriptive Statistics Results

Characteristics Description Gender Age Female Male Less than 20 years 20 to 30 years 31 to 40 years more than 40 years Diploma and less Advanced diploma Bachelor Master Degree PhD and above Below 200 dollars 200 to 400 dollars 401 to 600 dollars 601 to 800 dollars More than 800 dollars Frequency 69 89 19 56 44 40 29 31 78 16 3 37 15 39 48 17 Percent 43.7 56.3 11.7 34.6 27.2 24.7 17.9 19.1 48.1 9.9 1.9 22.8 9.3 24.1 29.6 1.5
Education
Income
Table 2. Descriptive Statistics for preconditions for trust to SMS advertising

One-Sample Statistics N Company reputation Company size Company trustworthiness Perceived privacy Perceived risk Perceived benefits 162 162 162 162 162 162 Mean 3.8272 2.9634 3.7654 3.5309 3.0772 3.5432 Std. Deviation 0.69228 0.73642 0.71186 0.72562 0.69321 0.68764 Std. Error Mean 0.05439 0.05160 0.05593 0.05642 0.06381 0.064666
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Trust to SMS
advertisin g
perceived reputation of the SMS advertiser perceived size of the SMS advertiser company perceived trustworthines s of the SMS advertiser perceived privacy perceived risks derived from SMS advertising
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Table 3. Pearson Correlation of factors influencing on audiences trust to SMS advertising

perceived benefits derived from SMS advertising
Trust to SMS advertising

perceived reputation of the SMS advertiser perceived size of advertiser company perceived trustworthines s of the SMS advertiser
Pearson Correlation
1 0.572 0.031 0.049 0.118 0.759 0.043 0.113 0.028 0.546 0 -0.682 0 1 0.131 0.011 0.292 1 0.131 0.048 0.075 0.025 0. 259 0 1 0.016 0.041 0.189 0.008 0.022 0.029 -0.218 0.003 1 0.126 0.088 0.167 0.017 0.159 0.022 1 0.140 0.038
-0.120 0.064
Sig
Pearson Correlation
Sig
Pearson Correlation
Sig
Pearson Correlation
Sig
Pearson Correlation
perceived privacy
perceived benefits derived from SMS advertising perceived risks derived from SMS advertising
Sig
Pearson Correlation
Sig
Pearson Correlation
Sig
-0.306 0
Table 4.
Multiple Regression Analysis of factors influencing on audiences trust to SMS advertising

Cumulative 2
Independent variable
Company trustworthiness Perceived benefits Company reputation Perceived risks
R2
changes
Beta
p-value
0.459 0.518 0.571 0.646
0.459 0.059 0.053 0.075
0.613 0.162 0.139 -0.246
11.879 3.922 3.335 -6.268
0.006 0.002 0.028 0.014
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 4 The Effectiveness of Using a Suggested Program Based on Games and Visuals on Enriching English Vocabulary of First Grade Prep School Students
Dr. Mohammad Faid Mohammad Asst. Professor, Jeddah Community College King Abdulaziz University, Jeddah, Saudi Arabia
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Abstract
The single biggest component of any Language course is vocabulary. No matter how well the student learns grammar, no matter how successfully the sounds of language are mastered, without words to express a wide range of meanings, communication just cannot happen in any meaningful way. On of the purported benefits of games assisted instruction is that it increases students vocabulary. This study researched the effects of using games on students vocabulary in the language classroom. An English vocabulary test investigated the students English vocabulary level. The sample was 64 students at El Khairia prep school in Beni- Suef, Egypt. They were divided into two groups, 32 students for the experimental group and 32 students for the control group. A content analysis was performed for the first year prep graders .A list of necessary vocabulary was prepared .An achievement test was prepared according to the previously mentioned vocabulary list . An English vocabulary program based on games and visuals was prepared and administered on the experimental group of 30 students. It was found that there were statistical differences between the mean scores of the experimental and control groups as regards the English vocabulary test after the experiment in favor of the experimental group. The study suggested that more attention should be given to teaching vocabulary by using untraditional methods such as audio visual aids to motivate students to gain more vocabulary items.This paper seeks to contribute to the process of making vocabulary instruction more particularized, pedagogical, and practical by examining the relationship between specific aspects of enriching vocabulary and using games and visuals. Key Words: Effectiveness, Games and Visuals, English vocabulary, First grade Prep School Students
Introduction: Games and Instruction According to Read ( 2000) vocabulary is thought to be dominated by the dictionary , some say that it is the discovery of single words .Many second language learners think that to be excellent in vocabulary , it is vital to have the ability to memorize any new word that might be seen in any passage. Vocabulary knowledge involves memorizing the meanings of new words and the students are able to match the new words with their synonyms or know the dictionary definition or the equivalent word in L2. El-Baz et-al (2000) view Games as important because they are fun, they motivate students, they promote problem solving skills and cooperation. Games can be useful for intensive structure practice, Vocabulary development and spelling and for revision. Through games pulils practice vocabulary, grammar and structures. Playing and competition increase motivation. When students play a game, they use language communicatively. Games can thus help create a very effective and enjoyable teaching-learning situation. (P.75)
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Wallace (1982) suggests that vocabulary games have become more wildly used recently for two reasons. First, there is an emphasis on creating a positive atmosphere among students, especially children. Secondly, there is an emphasis on Real communication. If the game works properly and the students could understand and like it, this is a real achievement for their communication skills besides vocabulary. The competitive element is the most important factor. That makes games enjoyable to the children. The competitive element is balanced by the cooperative element too as the class is divided into teams and each team wants to win the highest score. p (105) Wallace (1982) says Games usually have to be carefully organized and clear, easily understood explanation must be prepared p (105). Some factors are important to guarantee the success of the game. They have to be suitable for the age, vocabulary and IQ of the students. They have to be suitable for the number of the students in the class as some games will be difficult to apply in a large class due to the big number of students. Galton, et al. (1992) tend to view group work as when children sit in groups in a classroom they are likely to achieve more if they are encouraged to co-operate either by working towards a common shared outcome or by making an individual contribution towards a common goal ( p.42) . Crow, j (1990) views that for children, to be able to participate in a mainstream classroom, they need to possess the social skills that enable them to initiate contact both with their classmates and with the teacher, and to learn to manage such contact in appropriate ways (p.147) Games and language learning:Bell ,H (1986) views that play helps enrich the pupils vocabulary and satisfy their needs to activity and moving. It gives tem pleasure and helps them make use of their free time. Ali (1989) views that play has become one of the inputs on which education depends in teaching children. Some educationists called for introducing different knowledge and activities in a semi- game form. Play has a vital importance in the lives of the children .It is necessary to develop them physically, socially, mentally and morally. It is also important for developing their muscles and building social relations with others. Play helps children to deal properly with their families and friends. Play teaches children the collective work spirit and the right and wrong concepts. Hassan (1984) views educational games as having gained more importance in teaching children. Some educationists gave their attention to the learner rather than the subject matter .The educational process depends on activity, the pupils can practice some activities through which they can acquire some concepts, skills and attitudes that may enable them to live in the society. Here are some techniques suggested by Hassan (1984) Matching: The teacher gives the children some pictures for some words taught in a column and the words of these pictures in another column. The pupils are required to match the pictures with the words. Word snap: Children are provided with an equal number of flash cards. Each pupil puts down a card in turn. When two cards with the same word are showing ,the first player who says the word aloud wins. Anagrams: The children have to unscramble the letters and make the correct words.
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Making sentences: Children are provided with sentences written in a sheet of paper with a space , they complete these sentences with the right words. Lucky Dip A large box is filled with small objects. The words corresponding to the objects are printed on cards and are placed on a table. Each player closes his eyes and picks up an object. He must then find the corresponding word. Playing Games: Ali (1989) views that play has become one of the inputs on which education depends in teaching children. Some educationists called for introducing different knowledge and activities in a semi- game form. Play has a vital importance in the lives of the children .It is necessary to develop them physically, socially, mentally and morally. It is also important for developing their muscles and building social relations with others. Play helps children to deal properly with their families and friends. Play teaches children the collective work spirit and the right and wrong concepts. Abd El Reheem tends to view play as having an important role in facing the individual differences among pupils. Abd El Reheems study indicated that play is the best style in education, through play pupils get some skills and experiences .Play helps decreasing the individual differences among pupils. It allows them to express their hidden abilities. (p 284) Hassan (1984) views educational games as having gained more importance in teaching children. Some educationists gave their attention to the learner rather than the subject matter .The educational process depends on activity, the pupils can practice some activities through which they can acquire some concepts, skills and attitudes that may enable them to live in the society. (P85-100) Picture games: Broadly, these kinds of games compare the contrasting pictures, considering differences or similarities and the relationship between pictures such as narrative sequence and describing key features. Guessing: According to Allen, (1983), another kind of vocabulary technique is that the teacher lets his students feel the need to learn some specific new words The need may produce learning(p.9) .For example, students may tend to learn new words to please their teacher. The teacher may assign a prize for those who learn these new words. The prize may be materially such as giving them new pen in front of all the class as a sign of encouragement and satisfaction. Write on the board: Doff (1988), presents some techniques for the teachers while presenting new words. Say the word clearly and write it on the board (p. 1).By doing so, the teacher addresses two senses in the children; the first is listening when he pronounces the new word to the students. The second sense is that of vision when he writes the word on the blackboard ,and as mentioned before, the more senses involved in the learning process, the more successful it is, and the easier it is for the student to remember that word .Doff (1988) adds Get the class to repeat the word in chorus. Doff (p .1). Practice makes perfect: Repeating is practice, and all of us know that practice makes perfect. Children may find some enjoyment and fun in repeating in chorus, repeating gives them the atmosphere that they are in a party and are singing a song and the teacher is the maestro for the orchestra.
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Repeating may let the shy children feel secure and let others feel the cooperative atmosphere in class. Translate into the child own language: According to Doff (1988) Translate the word in childrens own language(p.1). That technique might be suitable for prep school students as they still do not have enough English vocabulary and their vocabulary is still limited in general. Drawing pictures: Doff (1988) said Draw a picture to show what the word means(p.1) .The picture may be easier for the child to understand , as the children may find it difficult to understand abstract and complicated concepts.So, instead of explaining what a car is , the teacher can draw it and teach the children the meaning of the word car. Ask your pupils: Doff(1988) recommends another technique, he said Ask questions using the new words( P.1).By asking questions , the teacher stresses the new words and deepen them in the students minds. The students may answer his questions using the new target words.
Hypotheses of the study: The present study tested the following hypotheses: 1-There are no statistically significant differences between the mean scores of the experimental and control groups as regards the English vocabulary test before the experiment. 2-There are significant differences between the mean scores of the experimental and control groups as regards the English vocabulary test after the experiment. Instrument: The students were administered an English vocabulary test for prep first graders which consisted of 30 questions containing different language vocabulary questions such as multiple choice , matching and right or wrong . The program begins with a pretest session which is intended to let the teacher get acquainted with the amount of vocabulary known by the pupils and the vocabulary they do not know.
After administering the program start. The teacher starts the program units. During the first phase of the lesson key vocabulary is pre-taught. The lesson always contains a small text which is used to teach vocabulary in context. The vocabulary items which might be troublesome for the pupils are selected and presented for the pupils to explain the meaning of the new words for the pupils. This phase is followed by the teachers usage of the pupils guessing ability to know the meaning of the new word. The teacher writes the new word on the board and hangs the picture related to it. Then he directs the pupils attention to the word and the picture to let them know the meaning of that word. If the pupils cannot know the meaning of the new word, the teacher may give them a simple definition for that word in simple English words which the pupils can understand. He tries to give them some examples in their everyday life. He may use some face expressions or some voices of animals if he tries to define an animal for them. He might imitate the way the animal moves or flies or swims. Using Arabic is avoided, as much as possible, in this stage.
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But meaning can be conveyed by actions and other illustrations such as word cards and picture charts . In this stage the teacher has to check the pupils understanding through different ways. One of them is to ask them some questions related to the word words he teaches, for example, he may ask the pupils Does a cat have wings? By doing so, the teacher makes sure that the pupils know the word wings and they also know the word Cat. If they answered No he can be sure that they have got what he taught to them as a definition of the two words Cat and Wings . Other strategies might be used to check the pupils understanding of the new words presented by the teacher. The teacher may write the word on the board and hang different pictures on the board, then he lets the pupils match the word or words which they have just learnt with the pictures presented in front of them. But pictures have to be clear and expressive. The teacher may also use another technique to check the pupils understanding. He may use visual discrimination to tick the different word. e.g. lion tiger elephant apple. The pupils are required to discriminate the odd word which is apple because apple is fruit while the other three words are names of some famous animals. The next step is Drill During this step the teacher may pronounce the new words and pupils repeat after him till they can recall them correctly without any help from the teacher. Three kinds of drills can be used. 1- Choral repetition with pupils speaking together as a whole class. 2- Pair repetition with pupils speaking in pairs. One pupil may ask and the other answers and vice versa. This kind of drilling gives the pupils the courage and confidence to practice the new words. This also enables the teacher to correct any mistake in pronouncing the words done by the pupils. The teacher may ask the pupils to participate in role playing through the pair repetition. 3- Individual repetition which allows every pupil to speak individually. Following this stage, pupils learn to use the new word, words, or sentences in a meaningful context. They practice using the new words or sentences in playing language games such as Who am I game in which there is a definition of an animal, a human being, a plant or an object. The pupils are required to read the definition well and then they are to choose the best answer from different options, or they can mention the word without the existence of a choice list. By doing that, the pupils enjoy themselves and use the new words or sentences correctly and meaning fully under the teachers supervision. Because practice makes perfect pupils are encouraged by the teacher to practice different kinds of games which create a positive atmosphere among them.. Games provide the pupils with real communication which is needed to learn a foreign language. Yet the teacher may need some drawing skills to draw some simple figures on the board. The teacher may start drawing these figures on the blackboard, the first pupil who can guess what the teacher is drawing and who can write the word and pronounce it correctly will get the point. Using games in practicing the language will help the pupils to keep attentive most of the time of the lesson. For example, the teacher draws the figure of a lion on the blackboard and if the pupils cannot identify it he may give them the lions definition as following.
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Im an animal Im dangerous. I live in the forest and Im the king of the forest. Who am I ? Another pupil answers You are the lion . The next step will be the evaluation process. The teacher asks the pupils some questions based on the games and visuals presented in the lessons of the units of the program to check their understanding of the new words and sentences presented in the program.
Procedures of the study: 1-Reviewing previous literature. 2-Doing a content analysis for prep first graders, English course. 3-Preparing the suggested English program 4-Defining the objectives of the program . 5-Specifying the possible content of the program . 6-Identifying the potential teaching methodology. 7-Identifying the potential teaching strategies. 8-Defining the possible evaluation techniques. 9-Defining the program duration. 10-Refereeing the program . 11-Pretesting the experimental and control groups. 12-Administering the program to the experimental group. 13-Post testing the program . 14- Statistical analysis of the findings. Analyses: 1Testing Hypothesis one: Concerning the first hypothesis which states that there are no statistical significant differences between the members of the experimental and control groups on the English language vocabulary test before administering the suggested English vocabulary program Before the program was administered an English vocabulary test was performed on the experimental and control groups . Results were analyzed presented in table (1). Table 1 T value, Standard Deviations and Means of scores and free scores of the subjects of the Experimental and Control Groups in the Pre- Test of the English vocabulary test.
Group
N 32
Mean 18.19 17.63
S.D
Free scores
T.T
C.T
Significance
3.64 4.64 62 2.66 .39 N.S
Experimental Control
32
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Table (1) shows that:
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There is no statistically significant difference between the mean scores obtained by the subjects of the experimental and control groups on the pre test. Thus the first hypothesis of the study is affirmed. Such a result may indicate that any significant difference between the mean scores of the pupils in the two groups on the post English vocabulary test may be due to the English language vocabulary program.
Testing Hypothesis Two: Hypothesis two which states that There is a statistically significant difference (favoring the experimental group) between the mean scores of the members of the experimental and control groups on the English vocabulary test after administering the suggested English vocabulary program . The program was administered on the experimental group only. After that, the researcher administered the vocabulary posttest. The following table shows these results. T Value , Standard Deviations and Means of Scores of the Subjects of the Experimental and Control Groups in the Post- Test of English Vocabulary.
Group
Mean
S.D 4.57 3.5
Free T.T Scores
C.T 26.54
Significance .01
Experimental Control
32 32
46.59 19
62
2.66
Table (2) shows that there is a statistically significant difference between the means of the scores obtained by subjects of the control and experimental groups in the post test in favor of the experimental group. The experimental group got a higher mean (46.59) than that obtained by the control group (19.00).On the other hand, the mean scores of the control group in the post test of vocabulary test is (19.00) whereas, it was (17.63) in the pre test. This assures that there is no improvement in their competence in vocabulary level .A possible interpretation for such a result may be due to the traditional methods used by teachers inside the classrooms while teaching new vocabulary items. Teaching English vocabulary has been neglected for a long time. The reason behind that is that teacher heard very little about ways to help pupils learn new vocabulary, especially in this age. Most of them stress teaching grammatical structures to increase the accuracy of the language at the expense of fluency. Teachers always follow the following steps in teaching vocabulary in classes. Teachers translate most if not all the new words into Arabic. They do not encourage pupils to guess the meaning of the new words through giving them some example visuals, acting or explanations for the new word. Teachers do not give the pupils enough time to practice using the new words in a meaningful context such as using them in some language games and drills. They ask the pupils to recite and keep by heart the new words. By doing so, the pupils are not able to use the new words effectively and productively in different situations.
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These results may be attributed to the surroundings of vocabulary teaching techniques followed by the prep stage English language teachers, most of them are not specialized in teaching English language. These results may be due to the method and the content taught to the pupils. The content may lack some new interactive methods for better vocabulary teaching such as games and pictures. That is why pupils regard new words as a heavy burden that must be memorized. Pupils may not be given the same meaning nor the opposite of the new word. Pre-teaching activities may not be given to the pupils to make the vocabulary teaching an interesting Job for the pupils. That was one of the reasons that pushed the researcher to design the suggested program to enrich the pupils vocabulary.
Table number two shows that:
The experimental group pupils out performed those of the control group in their scores of the English vocabulary test. This indicates that there are significant statistical differences at .01 between the performances of the experimental and control groups in favor of the experimental group on the English vocabulary test. This may show the effectiveness of the suggesting English language vocabulary program in enriching the pupils English vocabulary. The value of T between the pre and post test for the experimental group was calculated before and after the experiment for the experimental group. The following table shows the results.
Experimental Group Pre Post
Means
Free scores 31
T.T 2.75
C.T 24.70
Significance Sig. at .01
18.19 46.59
Table (3) terminal Means, standard Deviations and T. Test for the scores of the experimental group pupils on the pre and post tests.
Table (3) shows that:
1-The experimental group pupils performance on the post English vocabulary test was better than their performance on the pretest. The means of the pupils, scores on the post test was (46.59) and on the pretest was (18.19) . It can be said that the suggested English language vocabulary program has contributed to a great extent to develop and enrich the experimental group vocabulary. 2-Another interpretation may be due to the different kinds of games pictures and other activities practiced by the experimental group pupils during the program which helped the pupils to gain more vocabulary and use them immediately in playing the vocabulary games, daring the different stages of the program. The games included in the program helped the pupils to concentrate longer and increased the readiness of the pupils to learn more new vocabulary. 3- Games and exercises that followed each lesson of the program helped build up vocabulary. Games were important because they are fun, they motivate pupils and promoted problem solving skills and co-operation. They were also useful for revision when practiced by the
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pupils themselves. Gomes proved to be a suitable means of learning for the pupils, especially young ones, 4-This findings are supported by what Jane piaget (1936) called, he stated that games and play in general contribute to activate the pupils and make them participate in the learning process, playing games transformed the pupils into active, interactive and participant with the educational situation around them. The same can be applied to pictures and drawings. They made the lesson full of life and liveliness. Pictures and drawings made the pupils attentive most of the time . Some pictures were also connected and included in the games. 5-Activities used in the program were also helpful to enrich the experimental group pupils vocabulary, for example, matching questions and different handouts distributed during the program made the pupils very interested in the new word given to them. Some pupils were asked to make themselves a vocabulary book in which they collected the new vocabulary and they were asked by the researcher to draw a picture of the new word when possible, and to use the new word in a sentence. Pupils were asked to share ways to learn new vocabulary some of them stated that they write the word many times, others write the word on a piece of paper and the picture on the other side of the page and then they begin to test themselves till they master the new word. 6-Activities used in the program helped the pupils to associate the new words with things which are meaningful to them. for example , once , in the first unit of the suggested English vocabulary program , the pupils were asked by the researcher to bring in a labeled photos of their family or get them to draw their family and label the relationships . 7-These results are in line with those of Abou Srie (1986 ) which investigated the effect of a designed program based on games on prep stage students learning of English as a foreign language . Results assured the effectiveness of the designed program which used games as a tool to develop the English language. 8-Abd EL Kareim (1988) concluded, among other things, that a program based on games increased the achievement in English language. Similar results were reached by Fadl (1999). 9-Witt ( 1995 ) concluded , among other things , that activities and role playing resulted in a statistically significant improvements in the pupils English language skills and mainly vocabulary . 10- patricia . V. (1996) recommended that teaching vocabulary through games, visuals and mainly teaching vocabulary in context had a great effect on the performance of the pupils concerning their vocabulary level. Heimlich and pittelmon (1986) encouraged teaching vocabulary to the extent that word knowledge can be referred to as the most important factor. Beck (1987) assured the effectiveness of using a suggested English language program to develop the vocabulary level of the prep first graders.
Conclusion: 1- Giving more attention to the untraditional educational programs. 2- Holding training courses for the English language teachers to train them on the upto-date teaching and evaluative techniques. 3- Training teachers to let the pupils participate and interact in the educational process through sharing playing games and different activities for the prep stage. 4- The continuity of the evaluative process through different stages of the lesson.
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5- Reviewing the programs which qualify English language teachers, especially, for the prep stage. Preparing and qualifying the non-specialist English language teachers to use the modern teaching techniques in teaching English. 6- Providing the prep- school libraries with the audio visual aids to help the pupils learn English properly.
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References
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Abd El Reheem, A --(1995). Education principles and teaching rules in K.G. Third Edition, Cairo, Dar El Nahda Al Masria. P.284. Abd El- Kareim, A.M (1988), The Effect of using Games in Teaching English as a foreign language on secondary school students Achievement and attitude toward the subject unpulished M.A Thesis, Cairo university. Abou- srie, H.A (1986). The effect of games on preparatory school students learning of English as a foreign language unpublished M .A . Thesis faculty of Education, Cairo university. Alen. V.F, (1983) ( Techniques in teaching vocabulary oxford university press, Inc.
Ali, S. A (1989). The Effect of using play as a teaching style in developing some Basic learning processes for the K.G children in Minia City. Unpolished M.A Thesis. Faculty of Education, Minia university, 1989. Bell. Huw. (1998) A replication of the lexical frequency profile unpublished paper. University of virginia. Crow , J. T ( 1990) " Receptive Vocabulary Acquisition for Reading Comprehension " Modern Language Journal , 70 , 244- 250 . Doff, Adrian. (1988). Teach English ; A training course for Teachers Cambridge university press. Cambridge university press UK. El- Baz, Addle Brahman El Ban (2000). school Based training Modules, Basic teaching techniques for pr paratory school English teachers. The Egyptian International publishing company. Galton , M & Williamson, J . ( 1992) "Group work in the Primary Classroom" Routledge , London , UK. Hassan, F. M.( 1984). The Academic games and Geography Teaching. The cutest educational journal: the second edition, Sept 1984, pp 84- 100. Hemlish, J, and pittelman , S; (1986). Semantic Mapping. Newark, Del. International Reading Association. Read, J ( 2000) " Assessing Vocabulary , Cambridge University Press . Cambridge , U.K. p 20 33. Patricia, P. and Patricia V. (1996). vocabulary teaching strategies: Effects on vocabulary recognition and comprehension at the first Grade level M. A. Wallace, M. (1982). teaching vocabulary. Heinemann educational Books. Bedford. Witt, D. E. (1995). Role- playing stregies for Instruction and Assessment. North EASTConference News letter; n. 37 pp. 14- 16.
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Appendix I A vocabulary Test For Prep First Graders
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Name ... School: ... Class: ...
Date: ...
Time Allowed Total Score:
1 Hour
30
Test Instructions
This test is designed to test some vocabulary skills 1- You need to read the questions of the test and choose only one correct answer. If there are two answers both of them will be deleted and no mark will be given. 2- You will have to look at the picture in front of the statement and show whether this statement is true or false.
3- In the multiple question, you have to choose the most suitable answer after reading the language game or looking at the picture.
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The pre post test

Look at the picture, then choose the right word 1- This is ( a cat a cow an elephant ) . 2- This is ( a book a pen a rubber ) . 3- I use the ( pen cup watch ) to write . 4- I like to eat ( banana apples grapes ) . 5- We all prefer ( meat fish salad ) . 6- This is a ( cat chicken sandwich ) . 7- ( An elephant A cat - a dog ) is big . 8- The ( rabbit - crocodile - Zebra ) is small . 9- It is ( one two five ) oclock . 10- The (dog horse tiger ) eats grass . 11- The ( monkey fox chicken ) eats small animals . 12- These are ( two five seven ) balls . 13- It is ( nine five six ) oclock . 14- Sameer is my friend, ( he she they ) is my neighbor .
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS 15- Camels have ( long short wide ) necks .
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II Tick () in front of the right sentence and (x) in front of the wrong one. 1. 2. 3. 4. 5. 6. 7. pan. 8. Im a machine, I have a screen, a keyboard and a mouse. Im a computer. 9. Im a fruit, Im yellow and tall. I am apple. 10. I can fly. I eat insects. I sleep in the day and wake up at night, I am the owl. 11. Im whit, you write on me. I am a paper. 12. I have no colour, you drink me. Im important for you. Im the milk. 13. It is a place. You prepare the food in it. I am the kitchen. 14. It is a machine. We watch football matches on it. It is the radio. 15. It is a place. You go to it to learn. It is the playground. I am an animal. Im dangerous, Im the strongest animal in the jungle Im the Zebra. I am big. I have long nose, I eat grass. I am the elephant. It is round, we play with it, we all like it. It is an orange. Im fat, I give milk. I eat grass. I am the cat. I am small, I have long ears, I run fast. I am the rabbit. Im a man, I teach you at school I am your teacher. Im a round thing if you look at me you will know the time. I am the
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Determinant of Audiences Satisfaction from News Broadcasting Programs in the Islamic Republic of Iran
Dr. Fereydoun Verdinejad (Ph.D., University of Tehran) Assistant Professor of Media Management University of Tehran Jalal-al-Ahmad Avenue., Faculty of Management ,Tehran ,Iran Dr. Mohammad Haghighi (Ph.D., University of Tehran)
Associate Professor of Marketing

University of Tehran, Jalal-al-Ahmad Avenue, Faculty of Management, Tehran, Iran Dr. Mohammad Bagher Saroukhani (Ph.D., La Sorbonne University) Professor of Sociology University of Tehran, Jalal-al-Ahmad Avenue, Faculty of Sociology, Tehran, Iran Shadi Golchinfar (Corresponding Author) (Ph.D., Candidate, University of Tehran) Ph.D. Candidate of Media Management
Abstract The Purpose of this research is to identify determinant of quality in news program and their relationship to Audience satisfaction. Population of this research was Tehran and we used questionnaire to gather data. Sample size was 390 and Stratified sampling method was used. For evaluation of model, exploratory and confirmatory factor analysis was used. Finding indicates that source credibility, Oddity, time and Technology are quality Determinant of news program and determine %76 of Audience satisfaction Keywords: Audience Satisfaction, Quality of news program, Iranian TV 1. Introduction One of the most vital applications of television is denoting and expressing the news for the various audiences that it holds. The importance of this application as to giving out information about the news is so grand that most channels are only dedicated to showing the news. People have various reasons for receiving and using news in their personal or professional life. Nowadays most television channels allocate portions of the news to different sections such as politics, social, economics, cultural and sports. Therefore audiences based on the traits of the news programs, select and use the specific programs. One of the main elements for media success is attracting excessive audiences, in due regards competitors must compete with one another in order to produce and broadcast programs that would attract the most audience. But the question still stands that what program with what characteristics would attract the audiences satisfaction and bring forth the plus added customer?. Hence the purpose of this research is to present a model which constitutes of elements that would be effective in bringing forth the audience satisfaction from news programs and presenting a scale for measuring and evaluating audience satisfaction from aired news programs from the Islamic republic of Iran.
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2. Customer Satisfaction
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Customer satisfaction is one of the most important issues both form a theoretical as well as scientific perspective for researchers and organizations (Dabholkar, Thorpe, & Rentz, 1996; Fournier & Mick, 1999; Meuter, Ostrom, Roundtree, & Bitner, 2000). Nowadays attracting consumer satisfaction is considered as one of the main attributes for organizational success. Hence the importance of this issue has been the highlight and objective of an array of organizations. Organizations continuously are striving to increase their service and product qualities (Bitner & Hubbert, 1994). In many researches product quality has been known as the determinate element for customer satisfaction (Cronin & Taylor, 1992; Oliver, 1993; Taylor & Baker, 1994; Meuter, Ostrom, Roundtree, & Bitner, 2000). Therefore in deliberation of effective attributes on customer satisfaction, we must initially consider and deliberate on the factors that constitute to the identification of a products quality. 3. Media Product Traits The literature illustrates that a product can be seen as a set of traits and characteristics. Media products in essence are completely unique, exclusive and complex. In general, media products have two core elements. The content element which contains the information imbedded. The physical element which contains the means of transferring the content element, for example radio, television etc. Although in order to sooth the generic publics needs both elements must be joined conjunctionally and at the same time , albeit research has shown that the demand for media products primarily rests in the content element and to an extent to the means of the transference of the content. (Albarran, Chan-Olmsted, & Michael, 2006) Hence the success for media products, yields in the ability to satisfy the needs and objectives of the potential and actual customers through developing contents that are educational, appealing, persuasive and entertaining. Consumers in the media literature are identified as Audiences. It is interesting to state that what audiences or the consumers of the media are exchanging for the programs that they are receiving, the exchange can be stated as their time and moment to the owners of the media. Media owners usually in order to stay in business, sale the moment and time to advertisers. Media products due to their content and shape are considered as services and in order to evaluate quality they must be measured based on service quality models. Media programs based on their content can be divided into two categories: Newsandinformativeprograms Entertainmentprograms
Measurement Models In News Broadcasting Programs The denotation of quality for media products can be defined as bellow: The generic evaluation and judgment of content and pattern of offering of the media product can be considered as quality of the media product. As denoted above the media products fall with in the service sphere, therefore in order to evaluate the quality of the media products such as news and other relative news products, models of service quality measurement can be pondered upon. One of the most prominent and valid measurement system is the service quality model or the SERVQUAL Model (Parasuraman, Zeithaml, & Berry, 1994) . The model is
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syntactic of the services provided (i.e. how the service is offered) and not the content it holds.
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Another model for measuring a quality of a service can be considered as the Technical/Operational Model (Arora & Stoner, 1996), which was first express by Groonos (1983). The method of measurement in this model is by evaluating both technical and operational quality. The technical quality can be understood as what is being offered and the operational quality can be understood as how it is being offered. 4. News Program Quality In the research at hand in order to measure the dimensions of news program quality and the fact that news programs fall with in the service category, the Technical-Operational Quality Model [11], will be used. The technical quality is understood as what the service is offering and the operational or technical is understood as how the service is being offered. The above illustrated in the news as well as media programs can be differentiated into two categories, the content of the news and the pattern of offering a direct news, hence : 4.1CONTENT OF NEWS In regards to the news content two factors are of vital importance, initially trusting the content of the news or the news being offered by the media and secondly, the strategic identification/selection of the news topics. In regards to the primary concern, vast research has been done with the topic of source credibility study. Source credibility is considered as the ability of being believable, thus the message being sent from behalf of the media must be believable. Source credibility is the level of trust and value that one gives to a particular source or a communication channel. In todays media the pursuit can be directed towards gaining the trust of their audiences. Different researchers have developed different attributes for evaluating trust in the news, for example honesty and perpetuity are two of the attributes denoted by researchers (Gunter, Campbell, & Touri, 2009; Rosengren, 1977).On the other hand other researchers have denoted trust as the equivalent of identity or authenticity. Authenticity in the news means that there can be no alteration in the accuracy of the news it self. McQuail (1992), for example, identified factualness, accuracy and completeness as key defining aspects of the truthfulness of news. (Gunter, Campbell, & Touri, 2009) 4.1.1. Strategic selection of the news or topics of the news In the literature and debate of communications and journalism the above stated is well known as the news value. The terminology states that news value can be best understood as the elective scales in order for an event to convert into news. The news values are embedded in the heart of the events and not in the intuition of the reporter. Albeit it is the reporters intuition which has an impact on discovering the news values which each event hold. The news values are defined in the literature of journalism and debated upon. the definition for theses attributes or the news values have altered the way which events are selected, they are no longer in the hands of the journalists own style of selection, rather it has taken a form of standardization. Bellow some of the news values are denoted:
Impact The events which constitute news values are considered as impact, the impressible of the term is based on the redundancy of the people of society.
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Prominence Individuals, objects and institutes which comprise of a reputation, constitute of news values. Conflict
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These events comprise of different interactions taking place in different forms between individuals, groups and nations, whether being humane against humane, humane against environment, humane against nature, natural disasters and cruelty against animals. News related to killings, robberies, wars, accidences, earthquakes and etc. these are the form of encounter news. This in any terms can be considered as events related to struggle and conflict that are the main concern of the media.
Exclusive and Amazing The events that are out of the ordinary have news value in this regards, generally the audience and the readers of such news denote the stated as headlines, for example: the oldest individual in the world, the highest skyscraper in the world, the smallest computer in the worlds and etc.
Magnitude and Redundancy in Portion and Repetition This attribute is mainly related to numbers and statistics, it does not matter that to what the numbers are related to, the portion and amount of the number is of concern which illustrates the news value towards the excess in the related portion/volume.
Proximity Audience mainly and initially are concerned with information related to their neighborhood, city, country and their adjacent countries. The proximity news value attribute is selected by two means: geography and virtual/moral, the geography proximity can be pondered upon in regards to city, country and adjacent countries, but the moral proximity can be seen as the comparability which one country has to another in regards to their culture, beliefs, anthropology, social and etc.
Timeliness Knowing when the event well takes place in the world of news rivalry is of vital importance. it is said that newspaper is like an infant that dies on the day of its birth, hence a successful newspaper is a newspaper that illustrates a momentum news a news which is in the present not the past, because the past bring forth a news which is obsolete and has burned out information, therefore readers are not willing to read the appointed offering. Therefore if the gap between the event taking place and the time that is needed for it to be interpreted in to the news the novelty of the news is higher. In order for the audience to feed their need for news as prompt as possible we need to provide the news as quick as possible so first, the need for news is obviated and secondly, the audience would not shift to another competition as to other news resources for that specific news. Medias which do not contain the novelty of news and information are stricken to the daisies of downfall circulation which is the medias cancer, although it is important to state that sometimes certain aspect of an outdated news can be brought forth for specific reasons, in that case it has news value.
4.2. Syntax for Presentation The syntax for presentation is related to the circumstances and conditions of presentation. The conditions of presentation could have different dimensions as well as variations.
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VOL 3, NO 4 Some of the dimensions of such an syntax could be pointed to their channel, time and syntax that they inform in regards to the broadcasting of the news and the imagery and sound technology that has been used. Insert Figure 1 Here-Conceptual Model of the Research 5. Research Method In regards to the fact that, the purpose of this research is to present a model for quality dimensions in the aired news network programs in the Islamic Republic of Iran and, Because the existing literature remains insufficient to provide a conceptual model of News Broadcasting quality, empirical research is required to clarify the detailed determinants of News quality and their influence on customer satisfaction. In order to identify the elements of audience satisfaction, initially a glance of the literature in respect to the topic has been conducted and than in-depth interviews with professionals have been conducted which the process has generated and identified 44 factors. In the second phase and after the identification of the elements, the Exploratory and confirmatory Factor analysis have been conducted in order to validate the model. The tool in use in this section was a questionnaire comprised of 44 questions. Insert Figure 2 Here-Research Steps The definitions for the attributes in this research have been denoted in table 1.in order to make the news values and news trust/credibility attributes operational in this research, the results from the previous research have been used. Attributes regarding the technological factors and, method of news presentation have been originated form in-depth interviews form professionals. In order to evaluate the justifiability of the questioners, the initial questioner has be given to top 5 professionals in this field, beforehand examination of 35 individuals have been conducted and some definitions and terminologies have been corrected. Insert Table 1 Here-Construct definition In the appendix the appointed elements to each attribute has be identified, a dimension liker scale has been used (1= I totally disagree to 5= I totally agree) 5.1. Population and Sample Statistics The population for this research is individuals above 15 that are residence of Tehran. The method of sampling for a better statistical result that would consider the whole region of Tehran used was Stratified sampling method. Based formula for sampling a sample volume of 384 was generated. But for grater certainties of the generated result, an amount of 500 questionnaires have been distributed in the 22 provenances of Tehran, the distribution, with respect to the population of each provenance has been distributed and collected. After primarily deliberation of the questioners, 390 questionnaires have been identified for further analysis. The results generated form the primarily questioners shows that more than half of the respondents were male between the ages of 21 to 45, and due to their educational status they mainly had a bachelors or masters degree , the table bellow would best illustrate the denoted population and sample statistics: Insert Table 2 Here- Attributes for population 5.2. Statistical analysis The research model shown in Figure 1 was analyzed primarily using SEM, supported by LISREL 8.3 software. Numerous researchers have proposed a two-stage model-building process for applying SEM (Hoyle, 1995; Joreskog & Sorbom, 1996; Hair, Anderson, & Tatham, 1998). Confirmatory factor analysis (CFA) was conducted to:Examine the reliability and validity of the measurement model, and the structural Model also was analyzed to test the associations hypothesized in the present research model. Bagozzi and Yi (1988) defined a factor loading exceeding 0.7 as evidence of
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VOL 3, NO 4 Convergent validity. From Table 5, the factor loadings for all constructs exceed the Recommended level of 0.7, indicating acceptable item convergence on the intended constructs. In order to test the efficiency Sample size the Bartlet test has been used. Which the results have been illustrated in table 3. Insert Table 3 Here-Bartlett Test At this phase of information analysis, form 44 factors, after exploratory factor analysis, only 11 factors possessed load of over 0.7. In table 4 outline of the analysis results have been expressed: Insert Table 4 Here-Summery of Measurement Scale Also the results shows that 11 factors identified with in the 4 attributes, source credibility, amazing news coverage, technology and the time which the news is being shown that the aggregated variance of 76% has been denoted in due regards to the audience satisfaction, which illustrates the fact that a proper justifiability of the attributes have been assigned in the questioner. The results are shown in table 5: Insert Table 5 Here-Total Variance Explained After extracting the primary elements for testing the model, a confirmatory Factor Analysis (CFA) has been used. Hence for testing the model and also based on the results of the exploratory factor analysis the bellow hypothesizes have been developed. Hypothesis
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Source credibility positively influences audience satisfaction . Technology factor positively influences audience satisfaction . Amazing news coverage positively influences audience satisfaction . The time of showing the news positively influences audience satisfaction .
6. Results The measurement model was first assessed by CFA. Previous research has noted that the normed between (the ratio 2 and the degree of freedom) provides direct statistical evidence for the test of model goodness of
fit (GFI) (Joreskog & Sorbom, 1996). The observed normed 2 for this model was 1.02( 40.90=; df =40) Smaller than the three recommended by Bagozzi and Yi (1988). Other fit indexes also show good fit for the measurement model. The GFI is 0.95, greater than the 0.9 recommended (Joreskog & Sorbom, 1996).Moreover, the adjusted goodness of fit index (AGFI) is 0.92, which is slightly low, but still acceptable (Bagozzi & Yi, 1988).Furthermore, the nonincremental fit index, such as the comparative fit index (CFI) is 1.00, exceeding the recommended cut-off level of 0.9 (Bagozzi & Yi, 1988). Finally, the root mean square error of approximation (RMSEA) is 0.013, which also suggests a good fit to the data (Bagozzi & Yi, 1988). In sum, the measurement model exhibited a fairly good fit with the data collected. Insert Figure 3 Here-Audience Satisfaction Model 7.Conclusion and Recommendation In the research at hand effective attributes that have an impact on audience satisfaction have been identified in regards to news programs, and a measurement scale has been developed in order to measure the quality of the news programs. The quality dimensions in the news program constitute of 76% of the audience satisfaction that are constructed of two main cores of content and execution. The content sphere of the core, illustrates the source credibility and coverage of amazing news are considered as quality and in the execution sphere, two categories
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VOL 3, NO 4 of time of showing the news and the technology in use is considered as quality of execution coverage of the news, also the quality of news perception illustrates the level of audience satisfaction form the news programs. Based on the generated results in this research, source credibility factor has the most impact on audience satisfaction. Medias which loose their credibility in the eyes of the beholder (i.e. audience) can not attract the satisfaction of their audiences and resulting in the decrease in their audiences. Although it is clearly obvious that the core essence of news programs and informative programs is the information element, hence the source of information is of crucial importance for the audience. Amazing news coverage whether being internal or external news develops a sense of audience satisfaction in todays news industry. Amazing news coverage can be considered as one of the seven amazing news values which creates a sense of advantage. The execution of the news program plays a vital part in the audiences satisfaction. In this section the time of showing the news and informative illustration of the time of presentation are also of crucial importance in the identification of audience satisfaction. Sound and imagery technology in the execution sphere can also be identified as having impact on audience satisfaction. The research at hand, generally expresses the quality defined in news programs and the various dimensions it holds form the audiences point of views and finally their impact on audience satisfaction have been addressed. Also a means of measurement has been developed for the measurement of news program quality. One of the most excessive limitations of this research has been the sampling of the population, due to the fact that only Tehran has been considered. In future research it is recommended that the research be extended to other parts and provenances of Iran.
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References
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Albarran, A. B., Chan-Olmsted, S. M., & Michael, O. (2006). Hand book of Media Management and Economics. Lawrence Erlbaum Associate,Inc. Anderson, E., & Sullivan, M. (1993). The antecedents and consequence of customer satisfaction for firms. Marketing Science , 12, 125-43. Arora, R., & Stoner, C. (1996). The effect of perceived quality and name familiarity on service selection decision. Journal of Service Marketing , 10. Bagozzi, R., & Yi, Y. (1988). On the evaluation of structrual equation model. Journal of Academy of Marketing Science , 16 (1), 74-94. Bell, A. (1991). The Language of News Media. Oxford: Blackwell. Bitner, M., & Hubbert, A. (1994). Encounter satisfaction versus overall satisfaction versus quality. London: in Rust,R.T and Oliver,R.L(Ed) Service quality:New Directions itn theory and practice,Sage. Cronin, J., & Taylor, S. (1992). Measuring service quality : a re examination and extension. Journal of Marketing , 56, 55-68. Dabholkar, P., Thorpe, D., & Rentz, J. (1996). A measure of service quality for retail stores: scale development and validation. Journal of Academy of Marketing Science , 24, 3-16. Fournier, S., & Mick, D. (1999). Rediscovering satisfaction. Journal of Marketing , 63 (4), 5-23. Groonos, C. (1983). A service Quality model and its marketing implication. European Journal of Marketing , 18, 36-44. Gunter, B., Campbell, V., & Touri, M. (2009). Blog,news and credibility. Aslib proceeding :new Information perspective , 6 (2), 185-204. Hair, J., Anderson, R., & Tatham, W. (1998). Multivariate Data Analysis with Reading. Upper Saddle River,NJ: Prentice-Hall. Hoyle, R. (1995). Structural Equation Modeling. Thousand Oaks,CA: Sage Publication,Inc. Joreskog, K., & Sorbom, D. (1996). LISREL8 : Structrual Equation Modeling. Chicago: Software International Cop. Joreskog, K., & Sorbom, D. (1996). LISREL8:Structural Equation Modeling. Chigaco,IL: Scientific Software International Corp. McQuail, D. (1992). Media Performance:Mass communication and Public Interest. London: Sage. Meuter, M., Ostrom, A., Roundtree, R., & Bitner, M. (2000). Self service technologies : understanding customer satisfaction with technology based service encounters. Journal of Marketing , 64 (3), 50-64. Oliver, R. (1993). Cognitive,affective and attribute base of the satisfaction response. Journal of Consumer Research , 20, 418-30.
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Parasuraman, A., Zeithaml, V., & Berry, L. (1994). Alternating scale for measuring service: a comparative assessment based on psychometric and diagnostic criteria. Journal of Retailing , 70, 20130. Rosengren, K. (1977). International news:four types of table. Journal of Communication , 27, 67-75. Taylor, S., & Baker, T. (1994). An assessment of the relationship between service quality and customer satisfaction in formation of consumer Purchase intentions. Journal of Retailing , 70 (2), 16378.
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Appendix, Questionnaire
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Attributes/Indicators News values Thenetworknewscoverallofthenewstopics,forexample[political,economical,cultural,sports, legal,artandetc. Thenewsprogramsonthenewsnetworkcoversallortheinternaleventswhichhasanimpacton Iran. Thenewsprogramonthenewsnetworkcoversalloftheexternaleventswhichhaveanimpacton Iran. Thenewsprogramonthenewsnetworkcoversalloftheexternaleventswhichhaveanimpactonthe globalsociety. Thenewsnetworkindevelopingitsnewsprogramspayscloseattentiontotheiraudienceswantsand needs. ThenewsnetworkcoverspropernewsinregardstoprominentIranianartistsforpresentation. Thenewsnetworkcoverspropernewsinregardstoprominentglobalartistforpresentation. ThenewsnetworkcoverspropernewsinregardstoprominentIranianpoliticiansforpresentation. Thenewsnetworkcoverspropernewsinregardstoprominentglobalpoliticiansforpresentation. ThenewsnetworkcoverspropernewsinregardstoprominentIranianathletesforpresentation. Thenewsnetworkcoverspropernewsinregardstoprominentglobalathletesforpresentation. Thenewsnetworkcoverspropernewsinregardstoincidences[e.g.robberies,murders,war,strikes, paradesandetc]inthecountry. Thenewsnetworkcoverspropernewsinregardstoincidences[e.g.robberies,murders,war,strikes, paradesandetc]outsidethecountry. Thenewsnetworkcoverspropernewsinregardstonaturalincidences[e.g.earthquake,floodsand etc.]inthecountry. Thenewsnetworkcoverspropernewsinregardstonaturalincidences[e.g.earthquake,floodsand etc.]outsidethecountry. Thenewsnetworkcoverspropernewsinregardstoamazinginternaleventsinthecountry[e.g.the oldestIranianmanintheworld,thetallestIranianmanintheworldandetc.]. Thenewsnetworkcoverspropernewsinregardstoamazingeventsoutsidethecountry[e.g.the oldestmanintheworld,thetallestmanintheworldandetc.]. Source Credibility Thenewsprojectedinthenewsnetworksistrustable. Thenewsprojectedinthenewsnetworkisbelievable. Thenewsprojectedinthenewsnetworksisjust. Thenewsprojectedinthenewsnetworksisrealandmomentum. Thenewsprojectedinthenewsnetworksshowsallthefactsandtruth. The time delegations to all of the topics in the news networks for different news[ e.g. social, political, cultural, economical, and etc.] are all balanced
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Figure 1-conceptual model for the research
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Quality dimensions of news programs Content of the presented news (Technical quality) Method of execution of the presented news (Operational quality)
News Quality
Audience Satisfaction
Figure 2-Research Steps
Table 1:Construct Definition
Attributes Source Credibility
News Values
Method of presenting the News Audience Satisfaction
Quality of the news as a whole
Definitions Believability off the message sent Factors for the selection process of the appropriate event and the transition to news Time and method of presentation of news The felling of happiness that the audience gets after receiving the news from a particular media The audience perception of quality
Resources (McQuail, 1992)
(Bell, 1991)
In-depth interviews with reporters In-depth interviews with reporters In-depth interviews with reporters
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Table 2: Attributes for population
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Attribute
Age Bellow 20 years 21-30 years 31-45 years 46-65 years Gender Female Male Education High school Post-graduate Bachelor Masters Doctorate
Table 6-Bartlett Test
KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy. Bartlett's Test of Sphericity Approx. Chi-Square df Sig. .821 630.348 55 .000
1.04% 63.8% 31.9% 2.8%
28% 72%
3.5% 8.5% 49.6% 34.8% 3.5%
Attribute/element
Table 7-Summery of Measurement Scale Mean S.D Factor Loading
Construct reliability
Source Credibility
Trust ability of the news Believability of the news Fairness of the news Reality/truth of the news Expressing the whole news
Technology
2.50 2.72 2.35 2.68 2.02
1.07 1.09 0.967 0.971 1.00
0.830 0.855 0.90 0.847 0.798 0.826
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Attribute/element Mean S.D Factor Loading
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Imagery Quality Sound Quality

Time of showing the news
3.64 3.90
0.943 0.752
0.843 0.903
0.77
Time of news is aligned with the audiences needs and wants Informing the time of showing the news
Amazing News Coverage
3.07
1.01
0.820 0.65
2.99
1.06
0.867
Internal amazing news coverage External amazing news coverage
2.98 3.02
1.04 1.01
0.837 0.873
0.720
Table 8-Total Variance Explained

Total Variance Explained Initial Eigenvalues % of Variance Cumulative % 41.305 41.305 15.349 56.654 10.902 67.556 9.266 76.822 4.498 81.320 4.263 85.583 3.880 89.463 3.247 92.710 2.715 95.425 2.694 98.119 1.881 100.000 Extraction Sums of Squared Loadings Total % of Variance Cumulative % 4.544 41.305 41.305 1.688 15.349 56.654 1.199 10.902 67.556 1.019 9.266 76.822 Rotation Sums of Squared Loadings Total % of Variance Cumulative % 3.612 32.833 32.833 1.667 15.155 47.988 1.603 14.573 62.561 1.569 14.262 76.822
Component 1 2 3 4 5 6 7 8 9 10 11
Total 4.544 1.688 1.199 1.019 .495 .469 .427 .357 .299 .296 .207
Extraction Method: Principal Component Analysis.
Figure 4-Audience Satisfaction Model
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THE DILEMMA OF POOR EDUCATION AT HIGHER LEVELS OF EDUCATION IN PAKISTAN Amir Razi Lahore Business School, The University of Lahore, Pakistan Muhammad Aamir (Corresponding author) Hailey College of Commerce, University of the Punjab, Lahore, Pakistan Syed Atif Ali Lahore Business School, The University of Lahore, Pakistan Zain Hassan Lahore Business School, The University of Lahore, Pakistan
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Abstract The purpose of our study is to find out the negligence of the poor education at higher levels of
education in Pakistan and to asses that who is the responsible for this dilemma. This is cross sectional Analytical and multi central study was conducted from January to June 2010. A group of 200 students and teachers was take part in this study out of which 100 were students and 100 were teachers and data was collected from different universities and university of Lahore is also included. In results, students and teachers both point out that the dilemma of poor education is majorly due to negligence of government. In recommendations, the government should be active in the field of education like political affairs. Key words: Dilemma, poor education, higher levels of education, negligence, government and association
1.
Introduction and Literature Review: A diamond is pretty in itself but it requires a lot of cutting & polishing before it will
sparkle into thousands colors. Man is like a rough diamond and requires polishing before all his parts start functioning. Education is only a way of cutting and polishing the mans human skills so that it may reach its full developed structure and it is not possible without higher education. Education is a process through which a nation develops its self consciousness by developing the self consciousness of the individuals who compose it (Khalid, T. 1998). Education is most important aspect of our life. It is a fundamental human right. There is no doubt that education is a technical competency along with mental, moral and aesthetic
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development. It may include subject specific guidelines from trained professional teachers. It is based upon the maturity and proficiency of mind. So, entire educational activities centered up on advancement of knowledge, general awareness and understanding of latest technical update. The prime aim of these activities is building strong foundation for proficient future. But nowadays narrow sense of education has remarkable developed and its certainly a major concern for all educational reformists. Under such sense, today mostly people take the education as a training undertaken for few years in any symbolic educational institution. The success of a nation is depend on the education provided by the institutes within the nation and how they utilizing their skills to develop themselves and their country. But when the people came into the institutes for the training of few years they cannot get the skills and after finishing the training, when they cant get a job they blame on different factors but the problem is actually in their own mind. If such person gets the education by the mind of learning the skills not to care of a good GPA, he might be got a good job by ignoring his GPA, which might be good or not. Because the arithmetic reading, writing will get you somewhere but not everywhere. Your educational attainment is, better your chances of creating opportunities for yourself and the better your opportunities are, and the better your quality of life is. There is no other way to make your life better but only education. Rapid economic development of a nation lies in the provision of education and skilled manpower (Ali, A. 1997). In Pakistan, education is divided into steps: Primary level, Secondary education, intermediate and then higher studies which are normally provided by the higher institutes like universities. But only a short percentage of the primary enrollment entered in the universities for higher studies. By the passage of the time, literacy rate of our country is increasing which is about 49.9% in 2010. It is, no doubt, good rate but less then 2009 (56.4%). The literacy rate of our country is good but the educated people are loosing their attitude and their minds trained during higher study. It is the dilemma facing by our country. Thats why we are facing so many problems because there is no use of skills by the graduates in their life which the higher education provides them. A system of Universal Primary Education is imperative. It is essential to the nation as a base for the entire structure of secondary and higher education from which will come leadership in all walks of life and support for technical developments in agriculture and industry (Five Year Development Plans 2005-11). Mostly, the people came into the institutes to get the higher education but they dont know that what does it means? Higher education is the phase when highest value addition in human capital takes place.
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Besides widening and strengthening the basic education base, great attention needs to be given to the higher education segment which is responsible for producing high value human capital both for domestic and international markets and it can only be happen when the education at higher level is good. I have never heard anyone argue that a teacher is not a model for children of how one should think and act. It is not a matter of should the teacher be a model, but rather that he or she is a model (Seymour Sara son). Nowadays a man is nothing but a question mark? All graduates are unable to get the job, why it is? All are known that the fresh graduates have the abilities to solve the problems. By knowing this, the upper management of organizations wouldnt like to offer jobs. Is the higher education they get is poor, if yes then who is the responsible for this poor education. Efficiency refers to the use of resources in such a way as to maximize the educational output(s) possible from their use. In the context of education efficiency is of two types. Internal efficiency, which is concerned with efficiency within the education system and external efficiency, which refers to the relationship between the education system and the general economy (ADB Report 2005). Education is seen as a process of the intellectual development of individuals through which their potentialities are developed and the culture of the people is transmitted to the following Generations. But education also contributes to the economic and political development of the individual and society at large. This is best achieved when the higher education is efficiently and equitably provided (Hamid & John December 2006). The Education Policy Draft states that the type and quality of education imparted to the youth of today will provide future leadership in various fields that will successfully steer the country towards socioeconomic development in the years to come. Therefore higher education may be seen as a prime concern of the society, the government and the individual (Government of Pakistan, 1998). The purpose of our study is to find out the negligence of the poor education at higher levels of education in Pakistan and to know that who is the responsible for this dilemma.
2. Methodology
It was a community-based cross-sectional analytical study, undertaken from January to June 2010. Two questionnaires were developed by students of university of Lahore. The first type of questionnaire was designed to know the point of view of the teacher and second type of questionnaire was designed to know the point of view of the student. The first part of questionnaires contain information regarding demographic and then the close ended questions asked and at last one open ended question is asked to get the view regarding negligence.
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Stratified random sampling technique was used in our survey to complete the survey the total of 200 samples was selected from the university population. On the basis of stratified random sampling technique our population was divided into two stratums. Stratum one based on students and stratum two based on teachers. These questionnaires were filled by different well renowned universities of Lahore. 100 questionnaires were filled from the students and 100 from the teachers.
3. RESULTS
The total of 200 participants participates in this study. In which 100 are students and 100 are teachers. The mean age of the male students is 20.26 1.151and mean age of female students is 20.42 1.586. The mean ages of the male teachers is 31.07 7.736 and mean age of the female teachers is 28.04 4.462. Table 1 shows the mean ages of the groups.
Table 1: Distribution of study groups of Age and Gender:
Study Group Students Teachers Male
Mean Age Female Total
20.26 1.151 31.07 7.736
20.42 1.586 28.04 4.462
20.34 1.394 29.71 6.617
Out of 100 students, the 23.8% male students say that their basics for higher education are poor and 29.8% of the female students say satisfactory. 29.8% of the male students say that higher education system of education is satisfactory and 30.2 of female students also say satisfactory. 27.6% of male students say that the learning environment of institution for facilitating learning is satisfactory and 26.6% of female students also say satisfactory. 24.0% of male students say that the attitude of the faculty during lecture is poor and 30.2% female students say satisfactory. 24.9% male student says that the examination system of the institution/ modes of assessments are satisfactory and 41.5% of female students also say satisfactory. 24.6% male student says that the institutions quality of education is poor and 32.1% of female students say satisfactory.25.5% of male student says that Mostly, the humanitarian skills provided by the institutes are very poor and 28.8% female students say
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27.0% of female student says satisfactory. (Table 2)
Table 2: Distribution of Students Remarks by Gender Gender Ver y Poo r % 17.0 Male Poo Satisfacto r ry Goo d Very Ver Goo y d Poor % % Female Poo Satisfacto r ry
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satisfactory. 29.8% of male students say that the higher studys effect on their life is poor and
Cases
Goo d
% 23. 8 12. 0
% 19.2
% 21,1
% 15. 8 15. 1
% 29.8
% 20.4
How strong are your basics for higher education? Higher education institutions system of education? The learning environment of institution for facilitating learning is? The attitude of the faculty during lecture is? The examination system of the institution / modes of assessments are? The institutions quality of education is? Mostly, the humanitarian skills in higher studies provided by the institutes are? Higher studys effect on our life?
18.9
14.5
Ver y Goo d % 19.5
19.0
29.8
26.4
12.8
15.1
30.2
28.3
11.3
19.1
17. 0
27.6
22.5
13.8
11.3
23. 2
26.4
24.0
15.1
22.1
24. 0 16. 3
20.0
18.8
15.1
17.0
15. 1 15. 1
30.2
26.4
11.3
14.9
24.9
24.4
19.5
15.1
41.5
15.1
13.2
17.0 25.5
24. 6 19. 8
21.0 19.9
20.4 22.0
17.0 12.8
15.1 13.2
13. 2 13. 2
32.1 28.5
24.5 28.1
15.1 17.0
21.3
29. 8
14.9
12.8
21.2
11.3
23. 2
27.0
17.0
21.5
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out of 100 teachers, 25.5% male teachers are strongly agree that the poor basics for higher education are the cause of student paying less attention to their study and 25.4% female teachers are also strongly agree with this. 27.3% male teachers are strongly agreed and 24.4% female teachers are agreeing that the learning environment affects the learning power of the students. 28.8% male teachers are agreed and 31.1% female teachers are agreed that the aim of the students nowadays is to earn a degree, not the skills. 25.1% male and 28.9% female teachers are agreed that due to poor educational background the students cant acquire necessary skills during + after higher education. 27.3% male teachers are agreed and 26.7% female teachers say neutral with that Mostly, students want to adopt their fathers business, thats why they dont concentrate much on their studies. 32.8% male teachers are agreed with that the attitude of some of the students during lecture affects the learning power of all the students and 31.1% female teachers are strongly agree with this. Mostly, students are cramming to pass the course, with this 25.5% male teachers are strongly agree and 24.2% female students are agreed. 26.0% male teachers and 28.9% female teachers are neutral with; teachers usually do their best to facilitate learning for all the students. You can lead a person to the university, but you cant make him think, with this 30.9% male and 33.3% female teachers are agreed. Less participation during the lecture reduces the learning skills for the students; with this 27.3% male and 31.1% female teachers are agreed. (Table 3)
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Table 3: Distribution of Teachers Remarks by Gender:
Gender Male Cases Strongly Disagree % 14.5 Disagree % 9.1 Neutral % 14.5 Agree % 36.4 Strongly Agree % 25.5 Strongly Disagree % 17.8 Disagree % 17.8 Female Neutral % 23.4
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Agree % 15.6
Strongly Agree % 25.4
The poor basics for higher education are the cause of student paying less attention to their study? The learning environment affects the learning power of the students? The aim of the students nowadays is to only earn a degree, not the skills? Due to poor educational background the students cant acquire necessary skills during+ after higher education? Mostly, students want to adopt their fathers business, thats why they dont concentrate much on their studies? The attitude of some of the students during lecture affects the learning power of all the students? Mostly, students are cramming to pass the course? Teachers usually do their best to facilitate learning for all the students? You can lead a person to the university, but you cant make him think? Less participation during the lecture reduces the learning skills of the students?
21.9
14.5
12.7
23.6
27.3
15.6
22.2
15.6 24.4 22.2
14.5
17.8
22.5
28.8
16.4
13.3
17.8
31.1
20.0
17.8
18.2
18.2
17.9
25.1
20.6
20.0
17.8
13.3
28.9
20.0
16.4
12.7
25.4
27.3
18.2
20.0
15.6
26.7
20.0
17.7
14.5
12.7
12.7
32.8
27.3
17.8
15.6
15.5
20.0
31.1
20.0
12.7
18.2
23.6
25.5
17.8
20.0
15.6
24.2
22.4
16.4
16.4
26.0
20.5
20.7
15.6
13.3
28.9
26.7
15.5
11.3
17.9
20.0
30.9
19.9
20.0
13.3
13.4
33.3
20.0
14.5
12.7
20.0
27.3
25.5
15.6
13.3
15.6
31.1
24.4
Out of 100 students, 22% says that the poor education at higher levels of education is due to negligence of the teachers, 34% says students and 44% says that it is due to negligence of government. Similarly, out of 100 teachers, 18% says it is due to teachers, 28% says Students and 54% says that it is due to the negligence of government. (Table 4). Also there is no association between Poor education at higher levels of education is due to negligence teacher
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-value is 0.368 >0.05 (Table 5).
Table 4: Poor education at higher levels of education among study groups:
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students, government and Study group. Because contingency coefficient value is 0.100 and p
Study Group
Students Teachers
Poor education at higher levels of education is due to negligence of? Governmen Total Teacher Student t % % % 100 22 34 44 100 18 28 54
Table 5: Symmetric measures Symmetric Measures
Value Nominal by Nominal N of Valid Cases

4. Conclusion:
Approx. Sig. .368
Contingency Coefficient
.100 200
According to responses, it is concluded that the dilemma of poor education at higher levels of education in Pakistan is due to government as in results 98 (49%) people point out to the government and 62 (31%) people point out to students and 40 (20%) of target people point out to teachers. Sometimes the basics for higher education of the students were not so good which might be due to the two system of education at basic level 1st is Urdu medium and 2nd is English medium thats why they cant concentrate much on their studies and the environment also affects the learning power of the students. There is no doubt that teachers do their best to facilitate learning but not all teachers. So to end up this dilemma mainly the government should have to become active and then students and teachers must be concentrates on their faults.
5. Recommendations: As we all know that the higher level is a stage at which a person is actually polished by the
well organized teachers. This level doesnt include only the efforts of the teachers but also the government of our country and the students. By go through a complete process we analyzed
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Which are summarized into following major factors? Government Students Teachers
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that almost all the factors are involve or responsible for this dilemma of poor education.
As the government is majorly responsible for the dilemma so the government has to think more on the education sector instead of political activities. The higher education commission also has to keep an eye on all the institutes. The government has to spend more on this sector instead of others like army and especially on political activities. As we found the students are also responsible for this dilemma. So students must have to concentrate on their studies forgetting that they had their own business. They have to try to learn the things not cramming to pass the course and they have to be regular and good at their attitude to learn in an effective manner. They have to try to think by own self on the topics. It is better way to learn. All the students must focus on that they have to get the skills not to get a piece of paper which nowadays have not a good value. Teachers are the role model for the Excellency of the learning of the students. The way in which an instructor is providing the skills is much countable because if he is not providing or not polishing the students, students cannot perform well in the coming life. So the teachers must be good at their attitude and have an equal eye on all the students. They should have to assess the students through practical work and make a proper check and balance on all the students by providing extra material related to the topics.
REFFERENCES
[1] Asian Development Bank Unpublished Report 2005 [2] Ali, A. (1997) Pakistan Today 1947 to 1997 2nd edition, Sethi Books, Lahore. [3] Five Year Development Plans and recently Education Sector Reform Plan and MidTerm Development Framework (2005-11) [4] Govt. of Pakistan (1998 a) The Ninth Five Year Plan (1998-2003) Ministry of Education, Islamabad. [5] Niazi, H.K. and Mace, J. The Contribution of the Private Sector to Higher Education in Pakistan with Particular Reference to Efficiency and Equity Bulletin of Education & Research. December 2006. Vol. 28, No. 2, pp. 17-42 [6] Khalid, T. (1998) Education, An Introduction to Educational Philosophy and History National Book foundation, Islamabad. [7] Seymour Sara son The MISEDUCATION in Pakistan 2009
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS ACADEMIES: A NEED OR A WANT?

Muhammad Aamir (Corresponding author) Hailey College of Commerce, University of the Punjab, Lahore, Pakistan Amir Razi Lahore Business School, The University of Lahore, Pakistan Syed Atif Ali Lahore Business School, The University of Lahore, Pakistan Zain Hassan Lahore Business School, The University of Lahore, Pakistan
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Abstract The purpose of this study was to find whether academies are a need of the society or if they
are just profit making institutes. This is a cross-sectional Analytical and multi central study, conducted from January to June, 2010. A group of 600 students, teachers and parents took part in this study. Three questionnaires were designed, one for students, 2nd for teachers and 3rd for parents, which include demographic portion and close ended questions. In results, 62% students were in the favor that academies are a need of the society while 38% students are against academies. 70% of the teachers are in the favor of academies while 30% of teachers say that academies are not a need of the society. Similarly, 58% of the parents say that academies are the need of the society while 42% of the parents say that academies are not the need of the society and they are merely a profit organization. Our conclusion shows that there is an association between study group (students, teachers and parents) and their responses. The academies should switch to knowledge base study instead of exam base study. Only that way they can be successful in a long run. The academies should improve their image in the society and they should be an extra tool for creative education rather than a substitute for school(s)/college(s).
Key words: Academies, school/college, Student, Teacher, Parent 1. Introduction and Literature Review: Academies around the world are known for their special kind of education or knowledge that
they provide. This is what the main purpose of academies is around the globe. The first academy was found in 385 BC by the Plato, purpose of which was to teach philosophy. The Chinese usually refer academies to a private establishments built away from cities or towns, providing a quiet environment where scholars could engage in studies and contemplation without restrictions and worldly distractions. But in Pakistan the concept of academies is
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completely opposite. In Pakistan academies teach same curriculum recommended by government to public and private sector institutes only. Academies go by the same curriculum in Pakistan and prepare students for examination to get good results. Although there are a lot of academies who train students in other field of education like learning other languages and preparing students for fashion designing, they are still popularly known to prepare students for school/college examination by giving them best guess papers. Every academy gives their guess papers. They teach students only selective studies out of the whole syllabus. Education is divided into steps: Primary level, Secondary education, intermediate and then higher studies which are normally provided by the higher institutes like universities. But only a short percentage of the primary enrollment entered in the universities for higher studies. For the students it is to give extra time and money to go to academies. They have to manage and go to both school/college and academy to study and get good results. Different books are recommended by academies and school(s)/college(s). And the students have to pay extra amount of money to attend academies. The parents and teachers have to give extra time to academies. So to learn all this we are conducting our research and trying to find answers whether academies are a need or a want of the society. In United Kingdom, academies are a different kind of Free State school. They aim to offer the very best standards of education and facilities. They have the freedom to structure their days and their curriculum a little differently. This is to allow them to achieve huge improvements in standards of education rapidly. Each Academy is different, but what unites them is their drive for excellence for all children to have the opportunity to excel and to achieve the very best they can. The topic of academies encompasses a wide range of sub-topics. To critically understand all of the issues and questions that arise in wide-ranging study of academies, we examine all the previous studies that were conducted regarding academies. On the basis of those studies we are going to determine what questions we should discuss in our study. Moreover it would be enlightening for us on what merits should we conduct for our study in Pakistan. All previous research and studies on academies are conducted in United Kingdom. PricewaterhouseCoopers LLP (PwC) was commissioned in February 2003 by the Department to conduct an independent longitudinal evaluation of the Academies initiative. The overall aim of the evaluation was to assess the effectiveness of the programme in terms of its contribution to educational standards and to examine the key features of Academies, including sponsorship, governance, leadership and building design. During the course of the evaluation,
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a definitive set of key research questions for this project to answer crystallized in the light of emerging conclusions. Over the course of the study, they have examined the first 27 Academies which opened between 2002 and 2005 as they have developed into fully operational schools, either from predecessor schools or as completely new Academies. (PwC, 2010) Another study done in the United Kingdom clarifies the existence of academies by saying Academies often replace a school where kids werent doing very well in exams, so some Academies are starting from a very low level of achievement. However, the statistics already look good. This study offers an opportunity for parents, teachers and students to explore the use of academies in Pakistan. Because this research has never been conducted in Pakistan in previous years so this would be a new study for the teachers and parents in knowing whether teaching and sending their children to academies is of any good or not. As a contribution to this practice it will help teachers to understand the idea of academies in the society. Also this study will help parents to know what students and teachers think about academies. Moreover general society will better understand whether academies are a need of the society or not. For the students it is to give extra time and money to go to academies. They have to manage and go to both school/college and academy to study and get good results. Different books are recommended by academies and school(s)/college(s). And the students have to pay extra amount of money to attend academies. The parents and teachers have to give extra time to academies. So to learn all this we are conducting our research and trying to find answers whether academies are a need or a want of the society.
2. METHODOLOGY It was a community-based cross-sectional analytical study, undertaken from January to
June 2010. Three questionnaires were developed by students of university of Lahore. The first type of questionnaire was designed to know the point of view of the students, the second type of questionnaire was designed to know the point of view of the teachers and the third type of questionnaire was designed to know the point of view of the parents. The first part of questionnaire contains information regarding demographics and then series of close ended questions were asked to get view regarding academies. To complete the survey the total of 600 samples were selected from academies and university population. These questionnaires were filled by 16 academies and teachers from 7 colleges. 200 questionnaires were filled by the students, 200 by teachers and 200 by parents.
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3.
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RESULTS A total of 600 participants are participating in our study out of which 200 are Students,
200 are Teachers and 200 are Parents. The mean age of male students is 19.67 2.880 and the mean age of female students is 18.11 2.210. The mean age of male teachers is 32.77 7.645 and the mean age of female students is 26.61 5.013. The mean age of male parents is 46.18 9.687 and the mean age of female parents is 44.62 7.918. Table 1 shows the mean ages of the groups.
Table 1: Distribution of study groups of Age and Gender Age Study Group Male S Students Teachers Parents Female S Total S
19.672.880 32.777.645 46.189.687
18.112.210 26.615.013 44.627.918
19.112.761 29.837.239 45.448.894
Table 2: Distribution of Students Remarks Strongly Strongly No. Of Disagree Neutral Agree Disagree Agree Responses Frequency Frequency Frequency Frequency Frequency Frequency (%) (%) (%) (%) (%) (%)
Cases
Some teachers 16 (8%) 30 (15%) 59 (29.5%) 71 (35.5%) 24 (12%) cant control their classes Teachers teach well 12 (6%) 41 (20.5%) 45 (22.5%) 69 (34.5%) 33 (16.5%) in School(s) / College(s) Academies teach 12 (6%) 26 (13%) 34 (17%) 64 (32%) 64 (32%) better than schools Teacher in School(s)/College(s) 9 (4.5%) 34 (17%) 41 (20.5%) 79 (39.5%) 37 (18.5%) know how to teach their subject(s) I joined Academy 112 (56%) 48 (24%) 16 (8%) 7 (3.5%) 17 (8.5%) for the sake of Fun/Time pass Teachers tell my parents how I am 27 (13.5%) 40 (20%) 40 (20%) 66 (33%) 27 (13.5%) doing at this Academy
200 (100%) 200 (100%) 200 (100%) 200 (100%) 200 (100%) 200 (100%)
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Since coming to this Academy my result has improved The facilities at my School/College are good Teachers are too strict at this Academy The staff behave well with me at School/College I joined Academy because I didnt concentrate on my lectures in School(s)/College(s) I prefer studying in Academy more than my School/College Evening Academies are more convenient than School(s)/College(s) My result has Improved by joining this Academy
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8 (4%)
16 (8%)
25 (12.5%)
74 (37%)
77 (38.5%)
200 (100%) 200 (100%) 200 (100%) 200 (100%) 200 (100%) 200 (100%)
19 (9.5%) 32 (16%) 15 (7.5%)
26 (13%)
46 (23%)
69 (34.5%)
40 (20%)
59 (29.5%) 45 (22.5%) 37 (18.5%) 27 (13.5%) 26 (13%) 52 (26%) 76 (38%) 31 (15.5%)
18 (9%)
32 (16%)
30 (15%)
75 (37.5%) 45 (22.5%)
16 (8%)
28 (14%)
25 (12.5%) 57 (28.5%)
74 (37%)
17 (8.5%)
28 (14%)
41 (20.5%)
58 (29%)
56 (28%)
200 (100%) 200 (100%)
10 (5%)
14 (7%)
16 (8%)
73 (36.5%) 87 (43.5%)
Students from different academies and different stages of education are asked different questions to check their perception of academies. Their responses are recorded and evaluated in our study. A question is asked from the students that if teachers in academies can control their classes and 52.5% of the students are in agreement of the question while 47.5% do not agree with this. Another question that is put forward in front of the students is if teachers in Schools or colleges teach well than academies. 62.5% of the students agree that teachers do teach well in schools and colleges while 37.5% did not agree to this. Another question that is put forward is if academies teach better than schools. 72.5% of the students say that academies do teach better than schools while 27.5% say that academies do not teach better than schools. A question is asked if teachers in schools and colleges know how to teach their subjects. 68% of the students are in the agreement that teachers know how to teach their subjects in schools and colleges but 32% disagree that teachers do not know how to teach
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their subjects. An interesting question asked by the students is if students join academy for the sake of fun or time pass. 84% of the students disagree with the question that they did not join academy for fun or time pass whereas 16% say that they join for fun. Another question is asked to students if the teachers tell the parents of the students about their progress in Academies. 56.5% said that yes, teachers tells about the progress of the students to their parents while 43.5% disagree to this question. An important question is asked to students if their result actually improved by joining academy. 82% students has positive influence that their result has improved by joining academy but 18% say that there is no significant improvement in their result. In question 8, we ask students if the facilities provided to them in schools and colleges are good or not. 66% of students agree that the facilities provided to them are good while 34% students disagree to this question. To know more about the environment of academies we ask students if the teachers in academies are strict in teaching. 57% students response is that teachers are very strict about their subjects and they teach it strictly while 43% respond inversely. A question is asked to students that how well staff behave with them in Schools or colleges. The results are clearly showing that 66.5% of the students are in favor of the question and agree positively to this question that staff behave well with them in schools and colleges while 33.5% disagree to this question. A very important question is put forward to students that did they join Academy because they dont concentrate on their lectures in schools and colleges. 67.5% of the students have opinion that yes, they join academy because they did not concentrate on their lectures in schools and college while 32.5% do not agree to this question. In another question we are asking the opinion of the students if they prefer studying in academy or do they enjoy more time in schools and colleges. 72% of the students response to this question is that they prefer studying in academy more than studying in academy while 28% of the students say that they enjoy studying in schools and prefer studying in schools or colleges. Are evening academies more convenient than to go to schools or colleges in the morning? The question is put forward in the questionnaire to know what students think about this. 67.5% students think that going to academy in the evening is more convenient than going to schools and colleges in morning while 32.5% response is against evening academies. A question is repeated in the questionnaire is that if the result has improved by joining academy? The ratio of positive answers is increasing and now 84% of the students think that there result is improving by joining academy and 16% say that there result is not improving by joining academy.
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Cases Teaching in Academy is much easier than School(s)/College(s) Students join Academy for other reasons than learning Parents think Academies are better than School(s)/College(s) Most Teachers in Academies are dedicated and committed to their Work An academy aims to improve the knowledge of the Students In Academies teachers are only concerned that their Students do Well in Exams The environment in Academies is more friendly than School(s)/College(s) Academies pay better than School(s)/College(s) Poor performance by Teachers is not tolerated in Academies Most Students in this Academy want to do well in Exams
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Strongly Strongly No. of Disagree Neutral Agree Disagree Agree Responses Frequency Frequency Frequency Frequency Frequency Frequency (%) (%) (%) (%) (%) (%)
10 (5%)
47 (23.5%)
20 (10%)
70 (35%)
53 (26.5%)
200 (100%) 200 (100%) 200 (100%)
29 (14.5%)
72 (36%)
48 (24%)
47 (23.5%)
4 (2%)
7 (3.5%)
37 (18.5%)
34 (17%)
89 (44.5%) 33 (16.5%)
6 (3%)
25 (12.5%)
26 (13%)
116 (58%)
27 (13.5%)
200 (100%)
6 (3%)
16 (8%)
32 (16%)
70 (35%)
76 (38%)
200 (100%)
9 (4.5%)
21 (10.5%)
48 (24%)
75 (37.5%) 47 (23.5%)
200 (100%)
11 (5.5%)
30 (15%)
52 (26%)
81 (40.5%)
26 (13%)
200 (100%) 200 (100%) 200 (100%) 200 (100%)
8 (4%)
44 (22%)
45 (22.5%) 81 (40.5%)
22 (11%)
12 (6%)
50 (25%)
55 (27.5%)
54 (27%) 109 (54.5%)
29 (14.5%)
4 (2%)
15 (7.5%)
26 (13%)
46 (23%)
Table 3: Distribution of Teachers Remarks
The researchers gave questionnaires to teachers and asked them a series of questions. They responded to different questions differently. Firstly our question is that teaching in
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academies is much easier than schools and colleges. 66.5% agree that teach is much easier in academies than schools and colleges while 33.5% disagreeing to this. Secondly we said that students join academies for other reasons than learning. That means for fun or time pass. The teacher who disagreed to this is more than those who agree to this with a percentage of 62.5% and 37.5% respectively. Thirdly we said in the questionnaire that parents think academies are better than schools and asked teachers to tick their opinion about this, and 69.5% agree that parents have a positive attitude towards academies while 30.5% think that the parents are against academies. Fourthly we said in the questionnaire that teachers in the academies are committed and dedicated to their work i.e. teaching and 78% agree to this opinion while only 22% disagree to this. Then we put up a statement in front of parents that the academy aims to improve the knowledge of the students. 81% teachers agree to this statement and 19% disagree to this statement. We again asked teachers to tick their opinions on the question that says in academies teachers are only concerned that their students do well in exams. 73% of the teachers agree with our point and 27% did not agree with us on this point. We asked teachers if the environment in the academies is much friendlier than schools and colleges. 66.5% agree with us on the statement while 33.5% say that there is a strict environment in academies. We asked teachers if academies pay better than schools. 63% agree that there is more income in academies than schools and colleges and 37% disagree with the statement. We put up a question which states that poor performance by teachers is not tolerated in academies. 55.5% agree with us on this while 44.5% disagree to this. In the end we ask teachers about the goal of students who join academies by saying that students in academies want to do better in exams and interestingly 84% agree with the question while only 16% dont think that students want to do better in exams.
Table 4: Distribution of Parents Remarks Strongly Strongly No. of Disagree Neutral Agree Disagree Agree Responses Frequency Frequency Frequency Frequency Frequency Frequency (%) (%) (%) (%) (%) (%)
Cases
Academies teach 21 (10.5%) 44 (22%) 35 (17.5%) 64 (32%) 36 (18%) better than School(s)/College(s) The teachers Are expert in their 17 (8.5%) 32 (16%) 34 (17%) 96 (48%) 21 (10.5%) subjects in the Academy `21 My children dont 11 (5.5%) 67 (33.5%) 46 (23%) 55 (27.5%) (10.5%) give time to studies
200 (100%) 200 (100%) 200 (100%)
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at home My child(ren) 42 (21%) enjoy attending the 11 (5.5%) Academy Since joining the Academy my 10 (5%) 33 (16.5%) Child(ren) result has improved Teachers give me feedback about my 10 (5%) 32 (16%) childs performance The quality of education has 15 (7.5%) 26 (13%) improved since the Academies opened Academies are more economical 31 (15.5%) 68 (34%) than School(s)/College(s) My child(ren) general knowledge 10 (5%) 62 (31%) has improved after joining this Academy Staff at Academies 13 (6.5%) 47 (23.5%) behave well than School(s)/College(s) The teachers are 14 (7%) 52 (26%) very strict in Academies
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57 (28.5%)
72 (36%)
18 (9%)
200 (100%) 200 (100%) 200 (100%) 200 (100%) 200 (100%)
32 (16%)
90 (45%)
35 (17.5%)
33 (16.5%) 89 (44.5%)
36 (18%)
45 (22.5%) 81 (40.5%) 33 (16.5%)
36 (18%)
48 (24%)
17 (8.5%)
51 (25.5%)
62 (31%)
15 (7.5%)
200 (100%) 200 (100%) 200 (100%)
65 (32.5%) 57 (28.5%) 49 (24.5%) 53 (26.5%)
18 (9%) 32 (16%)
We like to know the opinion of parents about academies and what do they think about academies. So we start with asking with most important question that do they think academies teach better than schools and colleges. 59% parents think that academies are better than schools and colleges while 41% think that they are not better than schools and colleges. Another question put forward in front of parents is to know if they think teachers are expert in their subjects in Academies. 67% of the parents think that teachers are expert in their subjects in academies while 33% think that they are not. We were very eager to know if children study at home or not. So we put up this question in front of parents if their children give time to studies at home or not. The result was very interesting. 49.5% of the parents responded that their children give time to studies at home while 50.5% say that their children dont give time to studies at home. Another question we are interested to know is if the children enjoy
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attending the academy or not. 59.5% parents say that their children enjoy attending the academy while 40.5% say that their children are not in the favor of academies. The same question that we asked students is also asked to parents if their children result has actually improved by joining academy. 70.5% of the parents have a view that their children have a positive influence on their results while 29.5% say that there is no improvement in their childs result after joining academy. We also asked parents if teachers give them feedback about their childs performance in academies. Interestingly 71% of the parents say that teachers contact them and tell them about their childs performance in studies while 29% of the parents think that teachers do not inform them about their childs performance in studies. We then asked for the opinion of parents in the questionnaire if they think that the quality of education has improved since the academies have opened and 68.5% of the parents agree that the quality of education has improved a lot after the academies have opened while 31.5% disagree and say that the quality of education has not improved since the academies opened. To know what parents think about the expense of the academies we asked the parents if academies are more economical or the schools and colleges. 58.5% say that schools and colleges are more economical than academies while only 41.5% agree that academies are more economical than school and colleges. We liked to know if the general knowledge of the children increases after joining academy and we think parents are the best to answer this question. So we asked them and 51.5% say that their childrens general knowledge has increased or improved after joining academy but 48.5% also say that there is no improvement in the general knowledge of the children. The question we asked to student is also asked to parents that what they think about the behavior of staff in academies as compared to schools and colleges. The results show that 54% of the parents agree to our opinion and say that staff at academies behaves well than schools and colleges while 46% disagree to our opinion. In the end we liked to know what parents like to tell us about the strictness of teachers in the academies and 54.5% agree that teachers are very strict in academies and 45.5% think that teachers are not strict in academies.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS 4. Analytical Reasons:
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Case 1 = Ho = (There is no association between study groups and responses) Case 2 = H1 = (There is an association between study groups and responses)
Table 5: Group x Response Cross tabulation Count Parent Group Total Table 6: Chi-Square Tests Chi-Square Tests Value Pearson Chi-Square df Asymp. Sig. (2sided) Teacher Student Response Frequency Support Against Total
1275 1396 1731 4402
925 604 1069 2598
2200 2000 2800 7000
65.246a
.000
H0 is Rejected and H1 Accepted
5.
Conclusion:
The results show that there is an association between the groups and number of
responses. That means that if one of the group is against the academies, than it affects the others groups as well. So with this we can conclude that the academies are a need of our society and they contribute a lot in teaching students and students enjoy learning from the academies. Teachers also love to teach in academies as it gives them good practice of teaching. From our chi-square test we can also conclude that if parents go against academies than it will affect the knowledge of students as they will not go to academies and it will also affect teachers because they will not have enough practice of teaching. Our study also showed that teachers enjoy teaching in academies and they have a highest ratio on answers supporting academies. The least support to academies is of parents compared to teachers and students. Academies are a vital part of our society and they teach students a lot which increases their knowledge as well.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS 6. Recommendations:
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Even if the students are in strong favor of Academies, there is a room for improvement for schools and colleges to give quality education to students. The students bears the extra cost of going to two places for studies and get good results. The academies should introduce new courses and teach students to make them more creative. They should bring courses like graphics designing, sports training and career consultancies. The academies should take students to education trips and give them the knowledge of the history of their country and other countries. They should give the students
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References
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[1] Dillon. J. (2005). The Heirs of Plato: A Study of the Old Academy (347-274 B.C.E.). New York: Oxford University Press. ISBN 978-0199279463
[2] H.C.Lee. T. (2000) Education in Traditional China: A History. ISSN 0169-9520. P 100
[3] DCSF.
(2010).
How
to
describe
Academies.
London.
Online
at
(http://publications.teachernet.gov.uk/eOrderingDownload/DCSF%20Academies%20 Guide_DESCRIBE.pdf). 2-3. [4] White. D. (2010). Social Studies for Kids.Want vs. Need: Basic Economics. [5] PwC. (2008). Academies Evaluation Fifth Annual Report. London. 28-30 [6] DCSF. (2010). Academies: Everything you need to know. London. Online at (http://publications.teachernet.gov.uk/eOrderingDownload/DCSF-00292-2010.pdf). 10-13. [7] Simpson, J. and Weiner, E. (2009). Oxford Dictionary of English: Second Edition Online at (http://www.socialstudiesforkids.com/articles/economics/wantsandneeds2.htm)
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 4 Job attitudes as a predictor of employee performance: Evidence from public sector of Pakistan.
Mehvish Ali Faculty of management sciences, Riphah International University Khansa hayat Faculty of management sciences, Riphah International University Nosheen Sarwat Faculty of management sciences, Riphah International University Javeria Ashfaq Qureshi Faculty of management sciences, Riphah International University
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Abstract This study is designed to find out the impact of job satisfaction and organizational commitment on employee performance with the mediating impact of organizational citizenship behavior. This study reviews that to what extent the OCB increases and decreases the organizational commitment and how this will effect on employee performance, and explores the relationship between the two variables job satisfaction and organizational commitment. The data has been collected through questionnaire from different public sector organizations in organizations in Rawalpindi and Islamabad. Our results show that there is a positive relation between the job satisfaction and organizational commitment with the employee performance. Key words: Job Satisfaction, Organizational commitment, Organizational Citizenship behavior, employee performance. 1. Introduction Job satisfaction is an important variable to consider when evaluating an organization's success .Employee attitude is very important for the success of the organization (Judge & Sari, 2004).Job satisfaction defined as the positive feeling about the job. The more satisfied people are those which are happier with their job. The concept of organizational citizenship behavior was firstly introduced by Bateman and Organ (1983). The definition of organizational citizenship behavior given by Organ is Individual behavior that is unrestricted, not directly or clearly recognized by the formal reward system, and that in the aggregate promotes the effective performance of the organization. To measure the organizational citizenship behavior there have been introduced many techniques by the experts one of these models is five factor models, the five dimensions are known as; altruism, conscientiousness, sportsmanship, courtesy, and civic virtue. Another model for the measurement of OCB is two factors model this model was introduced by Williams and Anderson (1991). Gilder (2003) defined OCB is positive behavior that adds to managerial efficacy. Employee performance is accomplishment of a given task measured against preset standards of accuracy completeness, cost and speed. There are many indicators of employee performance (1) employees with higher socioeconomic status, (2) employees using communication technology for internal communication in the workplace, (3) younger employees, (4) full-time and permanent employees, (5) employees in larger firms and (6) employees in foreign-owned firms. (Baur.T, 2004). The most significant and accepted definition of organizational commitment is provided by Meyer and Allen (1984). According to Mayer and Allen there are three aspects of organizational commitment; (1) affective commitment, (2) normative commitment, (3) continuant commitment. An employee's emotional attachment to, identification with, and involvement in the organization, it is called affective commitment.Continuance commitment is defined as commitment
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based on the costs that employees associate with leaving the organization and normative commitment as an employee's feelings of obligation to remain with the organization. Morrison (1994), found that affective commitment has a strong impact on OCB, employees who are committed with the organizations and their jobs and organizations they are more like to get involved in OCB (helping and voice). There is a considerable amount of research conducted on job satisfaction, organization commitment and employee performance in developed countries. Developing countries have got less attention on this issue. Moreover the OCB as a mediator have got very little attention so this model is significant to study and explore. There is some research on this issue but not enough to determine the actual factors. Job satisfaction is one of most important determinant to get more output. If employees are dissatisfied with the job then the employees cant give a better performance to the organization. Job satisfaction, organization commitment and employee performance actually depend on the OCB of the employees. If the employee exhibits the extra role behavior in the organization, they give more output to the organization. 2. Literature review 2.1 Job satisfaction Job commitment has a positive effect on job satisfaction when job commitment increases job satisfaction also increase as employees commitment with the job has a long term relationship with job satisfaction, provided evidence. There is more job satisfaction when employees are committed to their work. Teamwork also effects the job satisfaction. Valle, Witt (2001), the organization high level teamwork & low level teamwork, when the high level teamwork involve in the work the employees satisfied about their job because they give the importance to employees more the low level and its effect on the organization. The low level teamwork is not beneficial for the organization and the employees do not satisfied their job. The work performance of the employee and teamwork , the research make the decision about the performance of employee and the manager , they give the responsibility to manager inside the activities of all employee , if the manager satisfied then they keep for the organization position otherwise they reject the employee and manger (Shore, Martin, 1989). The job satisfaction in intelligent management teamwork which is concentrating to the activities of the organization and to do better for the productivity, the employees which need to satisfaction from the team worker which take the decision about their activities (Hosseinian, Yazdi, Zahraie, Ashtiani, 2008). Malaysian organization is also done research on it and they conclude that the manager better work for the organization , which is consider to increase employees satisfaction and reduce the employee turnover , the manager take the decision that how the customer control and to work better for the organization which impact on the employees satisfaction (Fatt, Khin, Heng, 2010). The attitude and job satisfaction of employee the researcher mention some questions which is most important for the organization when the employee have good attitude and good behavior in the organization then the employee work better and to make the position in the organization , which help them in his future and the employee always satisfy their job (Saari, Judge, 2004). The relationship of employee performance and job satisfaction which is given by management and researcher , the management give the facilities to employee due to which the employees show the ability and good performance because they all satisfy and happy from the management and organization (Judge, Bono, Thoresen, Patton, 2001). Job satisfaction is high in such organizations who give rewards and recognition to their employees. Pascoe, Ali, Warne (2002), the role of the employee and teamwork which make better to organization, the management make another policies for the organization in which the employees satisfy and to perform another role, the manager also perform another role which is follow by the management. The organization productivity and high performance team which in member of the organization, the personal skill which must be show to organization and productivity area and employees must be satisfied from the organization, the achievement is concern on the employees and the facilities which the organization must provide to all employees (Flores, Universidad, Mxico, 2008). Job insecurity negatively effects job satisfaction when employees are not in a state where the job security is ensured to them then it would have a negative impact on job satisfaction. Shahu, Gole
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(2008), the industrial and organization relationship b/w job satisfaction and job performance, the researcher provide the system for the employees and organization through which the employees perform their duty honesty and loyalty and the organization also satisfy about the employees performance. Stress is also lead towards the negative side. This article show the management effects on organization the researcher study that the organization current situation if the problem create by employees then researcher and management towards the organization through the discussion (Yahaya, Arshad, Ismail, Jaalam, Zakariya, 2009). Employees working in public sector organizations have a high level of job satisfaction as they are satisfying their needs and desires, as the environment is less compatible so employees do not go for turnover. The organization culture and leadership style in which the employees looking for the opportunity in the organization , if the employees cannot take responsibilities then they looking for another opportunity inside the organization with the help of leader but if the opportunity is not available then the employee withdraw from the organization (Lok, Crawford, 2003). When a person works together, there arise conflicts between them so we always keep in mind, that conflict should be eliminated in the organization. Conflict may be internal or external so we should eliminate it. The professional value and role of the organization in which the employees their well performance and to erase the conflict to show the satisfaction of the job, to get the knowledge in organization and facing challenges during the work in the organization (Lui, Ngo, Tsang, 2001). Ethic and job satisfaction through the people in which the ethically can satisfy their job. the conflict in most demerit for the people it should be erase but the unity of the people is must through which the people can get the knowledge and get the satisfaction (Kang,1987). This article shows relation of organization productivity and employees performance. The manager of the organization give responsibilities to employees which they achieve their goals and bring on the position .The employees must have knowledge and skills for their work (Samad, 2006). 2.2 Organizational commitment In all firms and their respective functional area wants their employees to be more committed to their organizations (Hunt, Chonko, and Wood 1985).Organizational commitment has been defined in different ways, but the most broadly used approach has been that of Porter, Steers, Mowday and Boulian (1974). They developed the Organizational Commitment Questionnaire (OCQ) to measure what they concluded was a one-dimensional constructing (Mowday, Steers and Porter, 1979). Along this there are number of ways in which organizational commitment can be defined and there is no consensus amongst the researchers on it (Gurses and Demiray, 2009). Early research focused on defining the concept of organizational commitment through two popular approaches, commitment related attitudes and commitment related behaviors (Mowday, Steers and Porter, 1979). According to Gurses and Demiray (2009) all the systems produce certain products to reach their goal. In educational systems the product is believed to produce positive behaviors of individuals. Both are directly related with individuals. Peoples are happy to work in public sector and they are highly committed to the organization. This is due to the past history of public service motivation. Furthure more public sector employees in the past have high levels of commitment to the organizations goals because it is spoke angirly that they are a different type of employee, with strong ethics as well as job security (Mowday,Steers and Porter, 1979). In terms of factors influencing organizational commitment among employees of public sectors during their early employment, the stage examined in our study, they have proposed three sets of antecedents: personal influences, non organizational factors, and organizational influences. Personal influences are factors that employees bring with them at entry and are represented by pre-employment characteristics such as age, education, job expectations, and circumstances of job choice (Johnston, Futrell and Parasuraman, 1990). Porter, Steers, Mowday and Boulian (1974), define organizational commitment as the strength of an individuals identification with and involvement in a particular organization. Organizational commitment characterize it by three psychological factors: desire to remain in an organization, willingness to exert considerable efforts on its behalf and belief in and acceptance of its goals and values hold (Karim and Noor, 2006). Organizational commitment has been studied in the public, private sector, and more recently internationally. Personal characteristics play an important role, nonetheless as determinants of the outcome variables. Different researchers have their own view that how an individual can highly comment to their organization. Same like this Yun, Takeuchi and
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Liu (2007) take a look that Individuals recognize that by improving their performance, they will come to be seen as competent and as assets to the organization, and in this way they can impress others, including their immediate managers and impression management motive perspective to include employee job performance behaviors that leads to satisfaction of an individual. If employees' commitments to specific constituencies contribute to global organizational commitment, they provide opportunities for managers to foster employees' global organizational commitment in addition to using such customary means as encouraging employees to internalize and identify with organizational goals and values (Hunt and Morgan, 1994). 2.3 Organizational citizenship behavior Organizational Citizenship Behavior OCB is a special behavior of individual inside the organization. Organizational citizenship behavior is not something that is important for every employee it is not a part of employees defined role it is an extra activity from employee, it is dependent upon the supervisor and employees relationship (Elizabeth Wolfe Morrison1994). Organizational citizenship behavior is not something that is must to perform from any one in organization because that is a extra activity from employees for their organizations. The employees of any organization or institution who are involve in organizational citizenship behaviors they are more respected and preferable in the organizations (Moorman, Blakely, & Niehoff 1988). It shows that when any person performs citizenship behavior inside the organization that those persons are very important for the organization because they are more productive for organizations than that of other employees. Organizational Citizenship Behavior is very important of educational institutions and in whole educational sector, because when the people who are attached with the educational institutions will do extra activities for development institutions and show their high level of commitment in educational activities than that may increase the achievements of institutions and value and importance of those people for institutions. The teachers and professors who are involved in organizational citizenship behaviors are awarded with more incentives from institution than that of other employees (Kenneth K. Eastman 1994). It is natural that organizations give preference to those employees who are more productive and committed with the organizational activities, so employees are able to increase their values in institutions due to their practice of organizational citizenship behaviors. Better understanding between employees and their managers is very important for organizational citizenship behaviors from employees and justices from managers that will increase internal relationships of institutions (Konovsky & Pugh 1994). For the development of educational activities that is important that teachers and principals have excellent understanding and show their agreed decisions that will perform for the betterment of internal relationship in institutions. The systematic justices inside the institutions are very important for the motivation of employees to do organizational citizenship behaviors, the support from institutions also increase it (Moorman, Blakely, & Niehoff 1988). When the institution provide solutions for the problems of teachers and also support them where they need institutional support than that can be helpful for developing the positive vision of staff about doing organizational citizenship behavioral. The support from the institutions to their employees is very important to motivate employees to conduct OCB activities. The demographical differences between the employees disturb their values in the organizations and that difference will stop the behavioral activities from employees side (Prithviraj Chattopadhyay 1999). Plans of institutions about pay rewards for better performance, which motivate employee for doing OCB (Deckop, Mangel, & Cirka 1999). The rewards plans from the organizations that they can give rewards to those employees who show better performances and commitment for organizations are helpful in motivation of employees towards doing OCB. The impression of school leaders also motivates their subordinates to perform organizational citizenship behavior that creates huge effects at the overall performance of institution (Mark c. bolins 1999). The impression of head of institution on employees is also very countable thing that can motivate or de-motivate staff for doing organizational citizenship behavioral but if he impresses staff positively than that is very value able for the development of institution in future. Organizational citizenship behavior contribute allot in management of different institutions but not enough in sales (admissions) area (Mackenzie, podsakoff & fetter 1993). Organizational citizenship behavioral contribute a huge share in the management
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issues and working but that is not that much productive in institutions admission complains because that is inside behavior of organization it effects very minor to external behavior. If educational institution take steps to increase satisfaction of teachers with their roles and jobs than that will motivate them to increase their activities of OCBS (Mackenzie, podsakoff & fetter 1993). It is must that educational institution solve all problems of their staff to motivate them for more and more contribution in educational activities of institution and that also increase the percentage of students educational achievements also. If satisfaction of employees is with their jobs than that increase their role in OCBs relevant activities, they convert staff vision towards OCB, it is important that they have right to interfere in job relevant issues (Cappelli & Rogovsky 1988). The organizational citizenship behavior of teacher in educational institutions is dependent upon the situation in which they are working (Moorman & Barkely 1995). The behavior of individual is also dependent upon the situation in which he is working currently for that organization or institution. The effects of the group working and organizational citizenship behavior increase the self esteem of employees in organizations (Dyne, Vandwalle, Kostova, latham & Cumming 2000). Group working activities in educational institutions increase the self esteem level of employees inside the institution. Organizational citizenship behavior affects the managerial activities of an institution and that also creates fluctuation in performance of institutions (Pasdakoff & Mackenzie 1994). Organizational citizenship behavior affects the managerial activities of any institution very positively than that of others, Organizational citizenship behavior create a fluctuation in overall performance of institution on continues bases. The relationship between inside organizational behavior and performance of the organization increase the performance effectively (Dunlop & Lee 2004). If the behavior inside the organization is main thing to increase or decrease the organizational performance of institutions staff, if the behavior is positive, than the final output also show positive results for institutions and the people related to them, so the behavior of the individual is highly dependent upon the working conditions of the institutions. OCB motivates people towards socialization and they have opportunity to learn from one and other (Bommer, Milos & Grover 2003). When the people in institutions creates organizational citizenship behavior than they get opportunity to learn and also provide opportunity to others for learning from their experience. Each and every institution needs to manage their employees well, if employees are engaged in OCBs activities than management is easy (Stamper & Masterson 2002). In every institution if the people are willing to do the organizational citizenship behavior than the management is able to control them in very easy way because their employees are highly motivated to do something for organization personally. This is very important that educational institutions make a proper plan to motivate people for doing Organizational citizenship behavior in future for the development of the institution and educational activities of students. The interest of a person in its role and tasks in organization defines the overall output of that individual (Diefendorff, Brown, Kamin & Lord 2002). If a person have interest in his role inside the organization than he is able to do things more accurately and in better manners, but if he have no attention in his or her job role and job description than his work is not up to that level which is expected from him. Psychological ownership related to commitment of employees with in organization and their satisfaction with their roles that motivates them for doing OCB (Dyne & Pierce 2004). So for development of any educational institution we are not able to exclude the value of Organizational citizenship behavior because that increases overall efficiency of staff and helps in educational and non educational achievements of institution and students. 2.4 Employee performance Employee high performance means that steadily pursue higher level of individual and organizational performance involving quality, productive, innovation rate and cycle time of performance (Bharadwaj, 2005).If employees appreciate that their organization cares about them and their happiness, treats them with consideration, and distributes its rewards accordingly, those employees are far more likely to develop constructive affective attachments to their employer (Eisenberger et al., 1987), this will increase the performance. Employer has to treat their workers as
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the most important internal resources and gratify them in order to attract and sustain higher employee satisfaction (Jin, 2007). Performance encouragement support the efforts and performance of employee in a field of finances (Gibbons, 1997). Therefore employers need to provide competent link between motivation systems and performance and reward their employees so that they will become more committed to organization (Vroom, 1964).Job satisfaction pay a vital role in the high performance because pleased employees at work are more supportive, obliging and compassionate to their peers and client (Jin, 2007).The relationship between satisfaction and performance may perform differently among different levels of employees (Petty et al., 1984). Extensive utilization of justice award by new financial firms enhances the employee performance and retain its key employees (particularly in critical technical positions) by providing superior incentives (Ittner, Lambert & Larcker , 2002). Researchers have shown that there is always a link between supervisor support and employee performance .When supervisors instigate structure, set goals, assist with problem solving, provide social and material support, and give feedback on work performance, their employee experienced lower ambiguity and uncertainty, and hence greater satisfaction with their job (Odriscoll & Beehr, 1994). 3. Hypothesis: H1: job satisfaction is positively related with employee performance. H2: organizational commitment is positively related with employee performance. H3: organizational commitment has a significant relationship with OCB H4: OCB has a mediating impact on the relationship of job satisfaction, organizational commitment and employee performance. 4. Theoretical framework
Job satisfaction Employee performance
OCB Organization al commitment
Figure 1. Theoretical framework of the study
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5. Results Table 1: Correlation analysis JS OC OCB 1 .266(**) 1 .537(**) .508(**) 1 .241(*) .523(**) .556(**) EP
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JS OC OCB EP
The correlation matrix shows that there is a significant relationship between job satisfaction, organizational commitment, and organizational citizenship behavior and employee performance. This shows that there is a strong and significant impact of job satisfaction and organizational commitment on the performance of an employee, with mediating impact of OCB. Table 2: Regression analysis Beta JS OC EP .241 .523 .556 t-value 2.542 6.286 6.849 sig .012 .000 .000 Adjusted R square .049 .251 .302
Regression analysis was used to test all hypotheses. The result shows that job satisfaction explained 30 per cent of the variance in employee performance and has significance relationship with organizational commitment. Organizational commitment also has significant relationship with employee performance; however job satisfaction does not have significant relationship with employee performance. These results show that employee performance is much more dependent on organizational commitment and increased job satisfaction. The public sector institutions can get an advantage of the full capacity and best performance of their employees by properly managing the employee performance and this can be done through increasing job satisfaction of the employees and also through achieving higher level of organizational commitment. Whereas as the insignificant relationship of job satisfaction with employee performance shows that job satisfaction is not the only predictor of employee performance, it needs further exploration, further more with the lower level of job satisfaction and higher level of organizational commitment the organizations cannot reach up to the mark level of performance. Table 3. Mediation analysis: Relationship Adjusted R square JS EP .28 JS OCB .049 OC EP .30 OC OCB--EP .15 JS---OCB--EP .20 F 42.63 6.46 46.90 20.63 26.48 .53 .24 .55 1.03 .66 t 6.52 2.54 6.84 4.52 5.28 Significant .000 .205 .000 .000 .001
There is a mediating impact of organizational citizenship behavior the relationship of job satisfaction, organizational commitment and employee performance. This shows that if there would be
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a higher level of job satisfaction and organizational commitment the employees of an organization will be exhibiting extra role behavior and it will lead to a higher level of employee performance. In order to achieve higher and improved level of employee performance the organizations need to focus on the job satisfaction and organizational commitment of the employees this will increase the job satisfaction of employees and also will increase their commitment and ultimately they will be showing extra role behavior which will lead to the higher level of employee performance. 6. Conclusion The Results of the study show that employee performance can be achieved through job satisfaction and organizational commitment, there is a mediating role of organizational citizenship behavior in the relationship of employee performance and job satisfaction and organizational commitment, the major antecedents of employee performance is organizational commitment. The job satisfaction is having a comparatively weaker impact on employee performance. The moderating impact of organizational citizenship behavior is stronger on the relationship of major job attitudes and employee performance. Similarly there is a positive relationship between job satisfaction and employee performance. The results show that if the employees/ workforce is satisfied and committed they will be exhibiting extra role behavior and this will lead to an improved performance. Over all, the results of the study show that there is a positive impact of organizational commitment and job satisfaction on employee performance and there is a mediating role of organizational citizenship behavior on the relationship of job satisfaction, organizational commitment and employee performance. Employee performance can be improved through achieving higher level of job satisfaction and organizational commitment. The satisfied and committed workforce is a source of achieving improved employee performance. For further research we propose the model which focuses on OCB and its outcomes. The job satisfaction is having a weaker impact on employee performance so it needs further research.
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References
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William H. Bommer, Edward W. Miles, Steven L. Grover, 2003. Does One Good Turn Deserve Another? Coworker Influences on Employee Citizenship, Journal of Organizational Behavior, Vol. 24, pp. 181-196 Yahaya, A., Noordin Y., Arshad, K., Ismail, J., Jaalam, S., Zakariya, Z. (2009). Occupational Stress and its Effects towards the Organization Management.
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Impact of Job Satisfaction and Organizational Commitment on Employee Performance, Evidence from Pakistan
Javeria Ashfaq Qureshi MS (HRM) Scholar Riphah International University, Islamabad, Pakistan Khansa Hayat MS (HRM) Scholar Riphah International University, Islamabad, Pakistan Mehwish Ali MS (HRM) Scholar Riphah International University, Islamabad, Pakistan Nosheen Sarwat MS (HRM) Scholar Riphah International University, Islamabad, Pakistan
Abstract
This study is designed to find out the impact of job satisfaction and organizational commitment on employee performance. This study reviews that what are the factors which increases and decreases the organizational commitment and how this will effect on employee performance, and explore the relationship between the two variables job satisfaction and organizational commitment. The data has been collected through questionnaire from different organizations in Rawalpindi. In this study we mentioned that what are the other factors which are related to the job satisfaction and due to this the employee performance increases .Our results shows that there is a positive relation between the job satisfaction and organizational commitment with the employee performance.
Keywords: Job Satisfaction and Organizational Commitment on Employee Performance INTRODUCTION
Job satisfaction defined as the positive feeling about the job. The more satisfied people are those which are happier with their job. There are many factors which influence the job satisfaction and these variables have impact on the job satisfaction pay, promotions , benefits ,coworkers, working conditions , supervisors, safety , organizational culture, growth opportunities, some people says that the pay is very important factor for job satisfaction but the growth opportunities are also very important factor for job satisfaction .rearward system in the organization is also very important factor for satisfaction the employee .the negative indicators of the low job satisfaction are sabotage, absenteeism and violence .Turnover is also
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the indicator of job satisfaction and organizational commitment .Job satisfaction is an important variable to consider when evaluating an organization's success .Employee attitude is very important for the success of the organization.(Judge & Sari, 2004). Found that there must be the proper understanding among the employee attitude and organization it is very important to understand that what are the factors which influence on employee attitude intrinsic factors and extrinsic factors. There is a considerable amount of research conducted on job satisfaction, organization commitment and employee performance in developed countries. Developing countries have got less attention on this issue. There is some research on this issue but not enough to determine the actual factors. Job satisfaction is one of most important determinant to get more output. If we dissatisfied with the job then we cant give a better performance to the organization. Job satisfaction, organization commitment and employee performance actually depend on the culture of the organization if the employee suit the culture of the organization, they give more output to the organization. Organizational commitment is simply defined as the of the feeling of responsibility that an employee has towards the mission of the organization. Organizational commitment is also define as the emotional attachment towards the organization that how employees committed to the organization. (Amernic & Aranya, 2010) found that professional commitment is the important and main predictor of the organizational commitment. There are many factors which effect on organizational commitment. Its common practice that if the employees are more committed with the organization than the organization can more efficiently achieve their goals so the organizational commitment has the positive impact on the organization. Many factors effects on the organizational commitment one of the very important factors which increase the organizational commitment that is job satisfaction if it increases the OC also increases. Organizational commitment is very important in the study of organizational behavior. Employee performance is accomplishment of a given task measured against preset standards of accuracy completeness, cost and speed. There are many indicators of employee performance (1) employees with higher socioeconomic status, (2) employees using communication technology for internal communication in the workplace, (3) younger employees, (4) full-time and permanent employees, (5) employees in larger firms and (6) employees in foreign-owned firms. (Baur.T, 2004) relates the flexible work force with the
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satisfaction across all the countries. Performance
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employee performance and he found that flexible work force systems have positive is the ability to perform effectively in your job requires that you have and understand a complete and up-to-date job description for your position, and that you understand the job performance requirements and standards that you are expected to meet. Bedeian, (1992) found that there are other factors which effects on job satisfaction and employee performance 1.personal factors (demographics) and situational (environmental) characteristics. He also says that tenure is differently related to various elements comprising satisfaction. Employees are the most valuable asset in any organization. A successful and highly productive business can be achieved by engaging them in improving their performance. . New evaluation system and much training is requires bay the supervisor for improving the performance of the employee.( Greger, Brayan , brayan, Taxas, 2009).There is many other factors which are reason for decrease and increase of employee performance. Haward (2005) found that there is a relationship between the leadership syle and the employee performance and emotional intelligence is important in the employee performance. Employees are more likely to enjoy their work and produce desired results when they know what is expected of them and have the tools and knowledge to perform the task. Job satisfaction is enhanced by pride in results that meet and exceed expectations. (Moser, Galais, 2007) found that with increasing the tenure the job opportunities are also increases so that the there is a moderating impact of job satisfaction on employee performance.
LITERATURE REVIEW Job Satisfaction
Job commitment has a positive effect on job satisfaction when job commitment increases job satisfaction also increase as employees commitment with the job has a long term relationship with job satisfaction, provided evidence. There is more job satisfaction when employees are committed to their work. Teamwork also effects the job satisfaction. Valle, Witt (2001), the organization high level teamwork & low level teamwork, when the high level teamwork involve in the work the employees satisfied about their job because they give the importance to employees more the low level and its effect on the organization. The low level teamwork is not beneficial for the organization and the employees do not satisfied their job. The research of teamwork which is effects on leadership and job satisfaction, the teamwork research about the organization activities and about employees which need more satisfaction in the
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organization, the work of employees must be in the proper way which is benefit for the organization position (Yun, Cox, Sims, Salam, 2007). The work performance of the employee and teamwork , the research make the decision about the performance of employee and the manager , they give the responsibility to manager inside the activities of all employee , if the manager satisfied then they keep for the organization position otherwise they reject the employee and manger (Shore, Martin, 1989).The job satisfaction in intelligent management teamwork which is concentrating to the activities of the organization and to do better for the productivity, the employees which need to satisfaction from the team worker which take the decision about their activities (Hosseinian, Yazdi, Zahraie, Ashtiani, 2008). Malaysian organization is also done research on it and they conclude that the manager better work for the organization , which is consider to increase employees satisfaction and reduce the employee turnover , the manager take the decision that how the customer control and to work better for the organization which impact on the employees satisfaction (Fatt, Khin, Heng, 2010). The attitude and job satisfaction of employee the researcher mention some questions which is most important for the organization when the employee have good attitude and good behavior in the organization then the employee work better and to make the position in the organization , which help them in his future and the employee always satisfy their job (Saari, Judge, 2004). The relationship of employee performance and job satisfaction which is given by management and researcher , the management give the facilities to employee due to which the employees show the ability and good performance because they all satisfy and happy from the management and organization (Judge, Bono, Thoresen, Patton, 2001). Job satisfaction is high in such organizations who give rewards and recognition to their employees. Pascoe, Ali, Warne (2002), the role of the employee and teamwork which make better to organization, the management make another policies for the organization in which the employees satisfy and to perform another role, the manager also perform another role which is follow by the management. The organization productivity and high performance team which in member of the organization, the personal skill which must be show to organization and productivity area and employees must be satisfied from the organization, the achievement is concern on the employees and the facilities which the organization must provide to all employees (Flores, Universidad, Mxico, 2008). Job insecurity negatively effects job satisfaction when employees are not in a state where the job security is ensured to them then it would have a negative impact on job satisfaction. Shahu, Gole (2008), the industrial and organization relationship b/w job satisfaction and job
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performance, the researcher provide the system for the employees and organization through which the employees perform their duty honesty and loyalty and the organization also satisfy about the employees performance. Stress is also lead towards the negative side. This article show the management effects on organization the researcher study that the organization current situation if the problem create by employees then researcher and management towards the organization through the discussion (Yahaya, Arshad, Ismail, Jaalam, Zakariya, 2009). Employees working in public sector organizations have a high level of job satisfaction as they are satisfying their needs and desires, as the environment is less compatible so employees do not go for turnover. The organization culture and leadership style in which the employees looking for the opportunity in the organization , if the employees cannot take responsibilities then they looking for another opportunity inside the organization with the help of leader but if the opportunity is not available then the employee withdraw from the organization (Lok, Crawford, 2003). When a person works together, there arise conflicts between them so we always keep in mind, that conflict should be eliminated in the organization. Conflict may be internal or external so we should eliminate it. The professional value and role of the organization in which the employees their well performance and to erase the conflict to show the satisfaction of the job, to get the knowledge in organization and facing challenges during the work in the organization (Lui, Ngo, Tsang, 2001). Ethic and job satisfaction through the people in which the ethically can satisfy their job. the conflict in most demerit for the people it should be erase but the unity of the people is must through which the people can get the knowledge and get the satisfaction (Kang,1987). This article shows relation of organization productivity and employees performance. The manager of the organization give responsibilities to employees which they achieve their goals and bring on the position .The employees must have knowledge and skills for their work (Samad, 2006). The education sectors of Pakistan is the people more struggle to get education and then more chances for the job which became future of the people, the education system is make better by people and get knowledge and to teach others in this case they all satisfy about their job and education (Ali, 1997). There is also negativity, but positively job satisfaction is more found in this questionnaire which give to employees so as the basis on that, it show positive result
ORGANIZATIONAL COMMITMENT
OC
largely depends upon the two factors that is intrinsic factors and extrinsic factors. Job
satisfaction is also one of the reasons of increasing the organizational commitment. Organizational commitment has a relationship with the job satisfaction.
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(Shore & Martin.1989). found that there is a relationship between the job satisfaction and employee performance but it may different with respect to the degree of professionalism and the job attitude is related to the task related out comes and organizational commitment is related to the organizational-related outcomes. Some other studies explores the other factors which effects on the job satisfaction and employee performance .perceived organizational support is very important factor to increase the organizational commitment. (Upadhyay, Kumar singh &Shilp singh,2010) found that the perceived organizational support as a meditation factor among the job satisfaction and the organizational commitment he found that if the employees perceived the organizational support than the employees are more committed with the organization. Job security is another important determinant of the organizational commitment it the employees perceived that their jobs are secure As a result employees are more committed with the organization.(Khatibi,Asadi & Hamidi,2009) found that there is a negative relationship between the stress and the organizational commitment. Stress in the organization decreases the organizational commitment. there is a direct and indirect impact of stress on the employee(Burg,2008) found there is a difference with the low and high stress on organizational commitment low stress more organizational commitment and high stress low organizational commitment. (Cohen,1993) discuss that the different employment stages with respect to the organizational commitment he explores the age and tenures relation with the organizational commitment in relation to age with OC the earliest employment stages are strongest but with respect to the tenure with OC latest employment stages are strongest. Job satisfaction, team empowerment, participative management is very important for organizational commitment. The participation of employee to job satisfaction is very important for the progress of the organization.(Bhatti & Quaishi,2007). Found that employee participation is very important because it has impact on the job satisfaction, employee commitment and employee productivity. Relationship between the employee and their supervisor is very important while measuring the organizational commitment some organizations are relationship oriented and some are task oriented so their employees commitment are different
H1: when organizational commitment increases the performance also increases. So there is a positive relation.
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EMPLOYEE PERFORMANCE
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Employee's performance means how well the employee performs compared to the tasks that he had been assigned. And performance is then evaluated. Employee performance depends on leader attitude as on researcher said. Employee performance enhanced when leader is free to deal with special issues that arise with workers. (Schmid, 2006). Appreciation, reward and chance for feedback facilitate employees to consider valued and satisfied. Sequentially employees who consider valued by the organization are more satisfied and more devoted and creative (Bauer, 2000). Employee performance also depend on that how they perceived the managers. And HR practices and managers both increased employee performance. (Kuvaas & Dysvik, 2010). Employee performance strongly depend on the leadership. Manger must acquire leadership skills to do well and meet up performance standard distinct by association. There is a strong positive connection between leadership and employee performance ( Abbas &Yaqoob, 2009).employees performance can increased By positive organizational behaviour.Employees are satisfied and committed to the work if the positive organizational behavior practiced its not only satisfied employees it also guide positive environment which create better organizations. ( Ramlall, 2008).employees performance is also linked with employee commitment without commitment performance is not meaningful.It is inadequate to just focal point on develop the job satisfaction of employees because if the employee commitment is low, then satisfaction is not interpret into performance (Zhang& Zheng, 2009).performance is also increased to give importance the employees opinions. employees performance and motivation is increased when their leader gives them chance to voice their view and communicate their suggestion, because of this employees learn important skills and experiences from each other and there commitment to work increased .(Huang, Iun, Liu & Gong, 2010). When employees like originality-related jobs, their level of original productivity is maximized (Tierney, Farmer, Barton ,Graen, 1999). .Communication is also a one element which indirectly affects the employee performance in an organization as communication is not the root of improving performance, but it is the base of other methods, like teamwork and employee mind-set, that are key direct basis that increase performance( Rodwell, Kienzle& Shadur,1998) .
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Theoretical framework
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JOB SATISFACTION
EMPLOYEES PERFORMANCE
ORGANIZATION COMMITMENT
Methodology Questionnaire
The questionnaire of independent variable Job satisfaction based on questionnaire used by Dr.Shahid Siddiquie August,(2006) & Mabid Ali Al-Jarhi (2001)organization commitment questionnaire based on the questionnaire used by the Hasan Raza June, (2005) & Sudin Haron (2005). The employees performance questionnaire was based on the questionnaries Erven .L.Bernad& Mr. Ghulam Shabbir & Munawar Iqbal (2001) and dependent variable employees performance is used to measures how many employee have the potential of the work and satisfied with job to give the better output of the organization. The reason was selecting this questionnaire is that it was used to study the impact of same variable as in the present study and was well tested on reliability and validity scales.
Participants
The participants included those employees of which have works in different sectors of the organization in Rawalpindi in Pakistan. A total 180 questionnaire was distributed how ever 150 were received back making response rate as 83% and a sufficient sample size was collected for analysis of results because of the limited research.
Procedure
Data was acquired through personally and administered questionnaire.
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Demographics frequency table:
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Demographics results are shown in demographics frequency table.

Correlation Matrix:
Correlation matrix was used to verify the existence of relationship between the independent variables i.e job satisfaction, organization commitment and dependent variable employees performance.
Findings Table 1: Demographics n= 150 Description Frequency Percentage
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The importance of this table is to show the differences of respondent to have a better understanding about their response and result for present study. Majority of our respondent are female and majority lies between the 35-45 years. Mostly are married but the unmarried are also good average in the research. Majority of respondent employed and they perform their duties effective and mostly belong to master and they have more then 18-25 years experience and no one lies in matric. Majority of the respondent are speak Urdu. The demographics are not used in the present study to find out the relationship between employees performance and job satisfaction and organization commitment. For dependent and independent variables, further have research and explain that in the table of correlation and regression.
Results Table 2 Correlation Analysis
Correlations
Employees Performance Employees Performance 1
Job satisfaction
Organization commitment
.265**
.303**
Job Satisfaction
.265**
1 .425**
Organization Commitment
.303**
.425**
**.Correlation is significant at the 0.01 level (2-tailed)
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The correlation matrix indicates that Job Performance is strongly correlated with the Employee performance..265**. Similarly the Job Satisfaction is also positively and significantly correlated with organization commitment. .303**.
Regression Analysis
Standardize d Coefficients Beta Job Satisfaction Employee performance .166 .233
Sig.
1.571 2.207
.120 .030
a Dependent Variable: job performance R square=.115, F=6.27, Significance .000. n=100 Regression analysis indicates that the value of R square .115 which indicates that it is strongly significant. The value F is 6.27 which are significant at 0
Discussion
Employee performance and Job satisfaction affects the performance of the organization. There is a considerable amount of research conducted on impact of job satisfaction and employees performance in developed countries. Job satisfaction and organization commitment are significantly effect on the employee performance. Public sector of Pakistan is doing work under the different sectors of the organization. This research is also conducted to find the way that lead towards the satisfaction of employee performance so there should also give incentives to their employees so that they give better result to the organization. The overall result emerging that the employees of different sectors of the organization are highly
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satisfied with their job because it works according to the environment which suits them. We acquire the result in our research paper that the dependent variable employee performance are positively and significantly correlated with the independent variables like job satisfaction and organization commitment so its means that these variables show the positively result employee performance for the employees as well as customers. In this research, we also mention those points which lead towards the negative side of employee performance. Today's workforce is experiencing job stress and job dissatisfaction in contagion magnitude. Workers at all levels feel anxious, unconfident, misunderstood and undervalued at their workplace. When workers suffer job stress they are only responsible for their fatigue and anger. Job dissatisfaction and job stress is due to the overloading of work or exhaustion of employees. It can be caused because of Discrimination in the workplace, separating or making distinctions among job applicants or employees, based on race, national origin, or gender. When there is job stress and dissatisfaction in the organization it involves the lower level employees and then managerial level. The main purpose of this paper is to select the values of organization which is depend on such as job satisfaction, organization commitment and employee performance. Some rules and regulation are made to achieve the target but some targets we make team, and there may be a chances of conflict which creates ambiguity among employees. There is an also negative impact in our questionnaire in the job satisfaction because many people have perception that if there is overload work, leads towards the job stress and employee can not perform his function better as well as duties so its also creates negatively impact in our research paper that we have discussed in the literature review. Instead of this negativity, positive results are more emerging than the negative impact of job satisfaction, organization commitment on employee performance. The research found that dependent variable depends on Employees performance and job satisfaction so organization commitment depends in these variables but to some extent there have a negative impact also found. Many people show less motivation in the organization because of job stress and different culture of the organization but the relationship employees performance and job satisfaction between is strong and significant. The ethical responsibility of organization is to increase the confidence of the employees through give incentives,
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for the development of economic growth. Employees performance have their own outcomes like
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reward, and bonus on the basis of performance appraisal. Effective performance is necessary
job satisfaction and organization
commitment many other variables which can be find out through further research but due to minimum time, we have discussed just these two independent variable job satisfaction and organization commitment There are limited researches available in our literature review on employees performance but when employees performance is highly positive significantly with the Job satisfaction, organization commitment is also positive influenced by towards Job performance. Employees performance are significantly related with the job satisfaction, if we employees do work in a motivated way, achieve goal on the behalf of the organization not for own personal interest; they can give the better output to the organization.
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Lui, S., S., Ngo, H., Y., Tsang, A., W., N. (2002). Interrole conflict as a predictor of job satisfaction and propensity to leave. Journal of Managerial Psychology, 16(6), 469-484. Kang, J., A. (1987). Ethical Conflict and Job Satisfaction among Public Relations Practitioners. Journal of Management Science, 5(8), 399-423.

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Impact of Strategic Leadership on Organizational Performance, in the Context of Job Satisfaction and Organizational Commitment, Evidence form Educational Institutions of Pakistan.
Nosheen Sarwat
MS (HRM) Scholar Riphah International University, Islamabad, Pakistan
Khansa Hayat
Javeria Ashfaq Qureshi

Mehwish Ali
MS (HRM) Scholar
Riphah International University, Islamabad, Pakistan
Abstract The purpose of this research is to find out the impact of strategic leadership specifically transactional and transformational leadership on organizational performance in context of major job attitudes which are job satisfaction and organizational commitment which lead to improved organizational performance. The theory which have been discussed in this paper is resource based view (RBV) and strategic leadership theory. Leadership of an organization is taken as a valuable, rare and inimitable resource for the organization. Data was collected through a questionnaire from 250 employees working in educational institutions in the vicinity of Rawalpindi and Islamabad. Results show that there is a direct relationship between leadership and organizational performance but there is no mediating impact of organizational commitment and job satisfaction on organizational performance in strategic leadership transformational leadership is positively related with organizational performance. Key words: Strategic Leadership, Transformational Leadership, Transactional Leadership, Organizational Commitment, Job Satisfaction, Educational Institutions. Introduction Leader gives clear view to their followers how to achieve goals and he encourages them to achieve goals. A delegate leader who is elected to represented the view of a group of a people and makes decision for them, modest or thumbs down guidance to followers. (lewin, LIippit, and white, 1939). The third type of leadership process is laissez faire, which is very passive and may more closely be related to a lack of leadership (Hood, 2003). Lease, (1998) found that job satisfaction can be observed as the degree of an employees sentimental orientation toward the work role in the organization. Business loses money when they have an unmotivated and unsatisfied work force. Leadership is the ability to influence people towards to achieve goals or achievement of vision. It is the duty of an individual leader to enhance people to achieve their goals or to achieve their vision. Leadership is a process of getting things from others people. Leadership style refers to how to achieve goals and how to decisions are made. Leadership is excellent as long as it works and is not against personal values and interests or departmental traditions (Kekle, 1999). Every organization wants to different leadership skills to beat other organization in the world of competition; therefore
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they search for the different types of leadership skills. Organization required different types of leadership skills (Barlow, Jordan, Hendrix, 2003). This study is an effort to highlight the relationship between strategic leadership and organizational performance with mediating impact of major job attitudes which are job satisfaction and organizational commitment in educational institutions of Pakistan. The purpose of the study is to find out the impact of strategic leadership (leadership styles) on organizational performance in the context of organizational commitment and job satisfaction. In this study we will try to investigate that to what extent transactional and transformational leadership styles affect employees job attitudes and organizational performance. Is strategic leadership a predictor of organizational performance. Which leadership style is more desirable in the organizations. Resource based view (RBV) is being used in this paper. According to Barney (1991) Firms internal resources should be Valuable any resource is beneficial for the organization if it is valuable otherwise there is no use of having that resource. Rare the resource should be rare because if there are many firms owning that resource then there is no use of that resource for the company. Inimitable if the resources are easy to copy then there is no use of that type of resources for the firm. Non-substitutable There must be no deliberately corresponding expensive possessions that are themselves neither rare nor inimitable. The researchers and scholars of RBV suggest it is necessary for the resources to meet some important and vital conditions, for example, Barney, (1991) or the Peteraf, (1993) suggest to give in a continual aggressive benefit. If the leader exhibits the transformational leadership style and he/she has valuable, unique and inimitable team leading and decision making and other skills then the leader would be a unique resource of the organization. A basic exclusive source f competitive advantage of an organization is its strategic leadership and their skills. Strategic leadership is a significant field in the field of strategic management research. (Finkelstein & Hambrick, 1996). The research on Strategic leadership has its center of attention on individual leaders (e.g., CEO or division general managers), clusters (e.g., top management teams) and others (e.g., board of directors). The research may give interesting results and some new ideas/findings to other people. Organizational performance and human resource practices when aligned together positively impact the strategy and performance of organization (Delery and Doty, 1996). There are difference between leadership and management. One can be a leader without being a manager (Gini, 1997). In different technical expertise there are different leadership is required (Gini, 1997). Leadership consists of a spiral upwards, self improvement, and self knowledge and seize and who creating opportunities so that a person can make things happen that would not otherwise have occur (Cronin, 1984). Leadership must be highly dependent for their achievement on the leadership performed by other leaders. Some leaders are outstanding at creating or inventing new structure (Cronin, 1984). Organizational commitment is defined by Van Dyne et al. (1995), as ones strong belief and acceptance for organizational goals and desire and intention to maintain membership with organization. Leadership style plays a vital role on organizations performance as Dzcelik; Langton & Aldrich (2008) found that organizations performance in form of increased gross revenue of the company is affected significantly by leadership practices. The collision of both transactional and transformational leadership has not been tested at a considerable scale. There is a lot of research conducted on job attitudes, leadership styles and organizational performance separately but it has got a little attention with reference to strategic leadership. In case of Pakistan the research on strategic management has got very little attention. Literature on impact of transactional and transformational leadership on major job attitudes and performance of the organization is not much.
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The benefit of this broad study is that it will be accommodating in raising such strategies which will be helpful in implementation of leadership styles for the organization this research will find the impact of leadership styles on organizational performance with mediating impact of job satisfaction and organizational commitment on educational sector of Pakistan. Literature review Transactional leadership Leadership style based on the following three points, Autocratic, participative and laissez faire. In autocratic leader make the decision and tell team members to what to do. In participative leadership, leader make the decision himself either asks to team members what to do. In laissez fair leader make their decisions himself he cant take idea to other members. Leader focuses on how to define the future to the followers and moves them towards it. Authoritarian leaders give a clear expectation for what needs to be done, when it to be done and who it should be done where as Participative leaders encourage to group members to participate (lewin, LIippit and white, 1939). Transactional and transformational leadership are both active processes of leadership. According to Macmillan Journals, (1995) goal setting is the leadership component that greatest epitomizes agentic qualities, while interaction facilitation best epitomize communal qualities. Participative leadership behavior is more associated to conflict over administrative issues (Schul, Pride, Little, 1983). Transformational and transactional leaders motivate their followers, by incorporate potentially important mediate variables into the overall leadership process (Jung and Avolio, 2000). Transformational leadership is positively correlated with both organizational citizenship behavior and performance; transactional leadership was negatively correlated with both of these criteria (Goodwin, Wofford, Whittington, 2001). For the organization grow transactional leadership behavior role is most important. Transactional leadership behaviors become more important as organizations grow (Vera and Crossan, 2004). Kuhnert and Lewis, (1987), find that too many researchers have limited efficient leadership to its impact on task performance. Leader should perform his tasks and be sincere with the tasks to achieve goals. Leaders who function at developmental stage to their followers are enhanced to encourage their supporters. Alternately, and he should lead their followers effectiveness (Kuhnert and Lewis, 1987). To make easy, educate, teach, guide, motivate, support, and sustain change in organizations over longer periods is the ability of an individual leader (Hennessey, Jr., 1998). It is the duty of an individual leader to guide, lead, and inspire to their followers. Many technical decisions made by good administrative leaders but he referred to policy decision to their political superiors (Wart, 2003). There are different contexts of leadership with varying missions, organizational structures, and so on. Leadership technology is much less articulated on the public sector side than the private sector side (Wart, 2003). Leadership behavior reflecting support and consideration tend to be much associated with conflict over administrative issues rather than with product service issues in Participative leadership (Schul, Pride, Little, 1983). Leader has the classic leader traits, e.g. self confidence, entrepreneurship, energy, aggressiveness, knowledge, etc. and uses his personality and charisma to influence other people. Leaders make roles for others and control their performance in through these roles by direct supervision (Shrivastava and Nachman, 1989). Leadership role is to take actions that satisfy other powerful people if he wishes to improve his role (Denis, Lamothe, Langley, 2001). Leadership is a person who motivates, enables, and supports to others and helps others to complete tasks (Spillane, Hallett, Diamond, 2003). Transformational leadership is appreciably associated to the transactional leadership and Transactional leadership is significantly and positively related to laissez faire leadership (Hood, 2003).
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Transformational leadership In transformational, leader brings about to change, he change old things in to new things. Visionary Leadership, in this step the leadership style focuses on how the leader defines the future for followers and how to moves them toward it and how to achieve goals and who to set goals. Movements that inspire others in the getting of long term, visionary goals are known as Transformational leadership (Sarros and Cooper, 2006). According to Kuhnert and Lewis, (1987) transformational leadership is the expression by the leader of end value and that value should be accepted by the followers. Transformational leadership influences each one (Pawar and Eastman, 1997). Transformational leadership was associated with increased responsibility receipt of mentoring functions and reduced job related stress (Sosik and Godshalk, 2000). Transformational leadership had both direct and indirect effects on followers performance. However, transactional leadership mainly had indirect effects on performance (Jung and Avolio, 2000). Transformational leadership is most important for the organization positive feed back and negative feed back. Transformational leadership will have a positive impact on positive feed back and negative feedback learning (Vera and Crossan, 2004). Transformational leadership enhanced to others at least one measure each of motivation, morality, and empowerment among the direct followers (Dvir, Eden, Avolio, Shamir, 2002). Transformational leadership theory explains the special effects of leadership on the immediate and long term processes and out comes (Dvir, Eden, Avolio, Shamir, 2002). There is a positive direct and indirect relationship between transformational leadership and effort, job satisfaction, and performance (Sparks and Schenk, 2001). In transformational leadership styles, transformation contributes to higher collective teacher efficacy and to teachers' commitment to the school mission, to the school as a professional community, and to involving the external community in location school directions (John A. Ross and Peter Gray, 2006).Transformational leadership method is likely to have a positive impact on teacher beliefs about their collective ability and on teacher commitment to organizational values (John A. Ross and Peter Gray, 2006).The transformational leadership method results in outcome that is essential for implement principles in an organization (Dawn S. Carlson and Pamela L. Perrewe, 1995).The personal responsibility is important to institutionalizing ethical behavior in the institute and can be seen through the transformational leadership process as employees are empowered and have control over their own actions (Dawn S. Carlson and Pamela L. Perrewe, 1995). Organizational commitment Organizational commitment is participation and classification of a person with an institute; this is the constructive societal association linking an individual and institute. Persons who contain far above the ground intensity of organizational commitment, they engage in extra role behavior as well. Organizational obligation is an aspect that controls extra role behavior. The most significant and accepted definition of organizational commitment is provided by Meyer and Allen (1984). According to Mayer and Allen there are three aspects of organizational commitment; (1) affective commitment, (2) normative commitment, (3) continuant commitment. An employee's emotional attachment to, identification with, and involvement in the organization, it is called affective commitment.Continuance commitment is defined as commitment based on the costs that employees associate with leaving the organization and normative commitment as an employee's feelings of obligation to remain with the organization. Another model which is proposed by Inverson and Buttibieg (1999), suggests that there are four dimensions of organizational commitment which are affective, normative and high personal sacrifice, low perceived alternatives. There are many techniques and
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models presented by different experts in this context however the model which will be used in this study is Mayer and Allen (1984). (America & Aranya, 2010) found that professional commitment is the important and main predictor of the organizational commitment. There are many factors which effect organizational commitment. It is common practice that if the employees are more committed with the organization than the organizations can more efficiently achieve their goals so the organizational commitment has the positive impact on the organizational performance. Empowerment have a strong impact organizational commitment, senior management have more organizational commitment as compared to other levels of management within an organization, to increase the commitment of an employee towards the organization higher level management should increase the psychological empowerment among the employees when the employees will be feeling empowered and they will have a clarified vision which will motivate them, they will be more committed with their work and work place. (Avolio, Zhu & Bhatia, 2004). Transformational leadership is positively related with organizational commitment, transactional leadership has a nominal impact on organizational commitment transformational leadership has a dominant and stronger relationship with organizational commitment (Lee, 2004). (Khatibi,Asadi & Hamidi,2009) found that there is a negative relationship between stress and organizational commitment. Stress in the organization decreases the organizational commitment. There is a direct and indirect impact of stress on the employee.(Bhatti & Quaishi,2007). Found that employee participation in decision making is very important because it has impact on the job satisfaction, employee commitment and employee productivity. Relationship between the employee and their supervisor is very important while measuring the organizational commitment some organizations are relationship oriented and some are task oriented so their employees commitment are different.
Job satisfaction
Haward, (2005) found that there is a relationship between the leadership style and job satisfaction, and emotional intelligence is important in the employee job satisfaction which leads to organizational performance. Job commitment has a positive effect on job satisfaction when job commitment increases job satisfaction also increases as employees commitment with the job has a long term relationship with job satisfaction, There is more job satisfaction when employees are committed to their work. Teamwork also effects the job satisfaction. Valle, Witt, (2001), the organization high level teamwork & low level teamwork also influences the job satisfaction of employees, when the high level teamwork is involved in the work the employees feel more satisfied about their job because in this case more and more importance and appreciation is given to employs which have a positive impact on employee job satisfaction and organizational performance. The low level teamwork is not beneficial for the organization and the employees are not satisfied with their jobs in this case. The research of teamwork shows that leadership and job satisfaction are related to each other transformational leadership is more important for more satisfied employees, the teamwork research about the organization activities and about employees which need more satisfaction in the organization, the work of employees must be in the proper way which is beneficial for the organization performance. (Yun, Cox, Sims, Salam, 2007). The attitude and job satisfaction of employee are very important for the satisfaction of employee the researcher mention some questions which is most important for the organization when the employee have good attitude and good behavior in the organization then the employee work better and to make the position in the organization, which help them in his future and the employee
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always satisfy their job (Saari, Judge, 2004). The relationship of employee performance and job satisfaction which is given by management and researcher , the management give the facilities to employee due to which the employees show the ability and good performance because they are satisfy and happy from the management and organization (Judge, Bono, Thoresen, Patton, 2001). Job satisfaction is high in such organizations who give rewards and recognition to their employees. Pascoe, Ali, Warne (2002), the role of the employee and teamwork which make better to organization, the management make another policies for the organization in which the employees satisfy and to perform another role, the manager also perform another role which is follow by the management. Organizational productivity and performance depends on the facilities which an organization provides to its employees. (Flores, Universidad, Mxico, 2008). Job insecurity have a negatively effects job satisfaction when employees are not in a state where the job security is ensured to them then it would have a negative impact on job satisfaction. Shahu, Gole (2008), the industrial and organization relationship b/w job satisfaction and job performance, the researcher provide the system for the employees and organization through which the employees perform their duty honesty and the organization are also satisfied about the employees performance. The researcher study that the organization current situation if the problem create by employees then researcher and management towards the organization through the discussion (Yahaya, Arshad, Ismail, Jaalam, Zakariya, 2009). Employees working in public sector organizations have a high level of job satisfaction as they are satisfying their needs and desires, as the environment is less compatible so employees do not go for turnover. When a person works with the employees/coworkers there arise conflicts between them so the managers and concerned department should always keep in mind, that conflict should be eliminated from the organization. Conflict may be internal or external. The professional values and role of the organization in which the employees work have a very important impact on job satisfaction, to get the knowledge in organization and facing challenges during the work in the organization (Lui, Ngo, Tsang, 2001). the conflict in most demerit for the people it should be erase but the unity of the people is must through which the people can get the knowledge and get the satisfaction (Kang,1987). This article shows relation of organization productivity and employees performance. The manager of the organization give responsibilities to employees which they achieve their goals and bring on the position .The employees must have knowledge and skills for their work (Samad, 2006). The education sectors of Pakistan is the people more struggle to get education and then more chances for the job which became future of the people, the education system is make better by people and get knowledge and to teach others in this case they all satisfy about their job and education (Ali, 1997). There is also negativity, but positively job satisfaction is more found in this questionnaire which give to employees so as the basis on that, it show positive result.
Organizational performance
In terms of dynamic and evolutionary the performance itself is clearly understood; most of the time the research on organizational performance explore a sharing of presentation levels at a given time. (Barnett, Greve, Park, 1994). Organizational performance results by aligning learning environment of the organization with its goals i.e. a good leadership style utilizes KM (knowledge management) technique in order to create a learning organization and aligns it to organizations strategic goals to perk up the performance of the organization (Anantatmula, 2007). Job satisfaction and organizational commitment are strongly linked to each other and are key factors in an organizations performance and success. (H. Westover, R. Westover & Alen Westover, 2010). Human resource practices have a straight collision on the presentation of the institute, if the human
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resource is managed according to the strategy of the institute and they are provided with the facilities such as: long-term commitment, employee stock options, team based problem solving practices and strong leadership, this will help organization to increase the performance (Takeuchi, 2003). Competition in the market is a driver of performance and it is constructed by strategy and structure of organization and additional peaceful choice pressure, the more are that strategies and structures allow organizations to survive in spite of their capability to gain knowledge of the market (Barnett, Greve, Park, 1994). Better potential between strategy content and process can increase organizational performance (Segev, 1987). There is a bond between information distortion e.g. communication barriers, organizational design, and task environment and they are related to the organizational performance (Carley and Lin, 1997). The elements of organizational culture also predict organizational performance (Marcoulides and Heck, 1993). Hopkins and Hopkins (1997) studied strategic planning systems and found that the banks having better financial performance, in case, are found to be contented by means of their strategic setting up system and they will charge their viewpoint concerning planning-performance associations and their strategic planning knowhow decidedly. Furthermore, they may be characterizing superior worth to setting up in influential the mechanism of strategic planning strength. Faster product development cycles are directly related to more accounting returns, sales growth, or overall performance of the organization (Ittner and Larcker, 1997). Strategies are more likely to be with traditional outline and bundles, and any fresh strategy may be predicted to have a weaker impact on performance (Buck, Filatotchev, Demina, Wright, 2003). Regulatory punctuations by altering change drive changes in organizational domain, leadership, and performance (Haveman, Russo, Meyer 2001). There is a systematic relationship between contracts, cooperation, and performance (Luo, 2002). Capar and Kotabe (2003) studied relationship between international diversification and organizational performance in German service firms and found a strong positive relationship among the two. International association increases the chances so as to their collective corresponding assets are also collective, united in the most important valuecreating actions of the coalition which will increase the performance of the organization (Sirmon and Lane, 2004). There is every sign that the relation between affect at work and job performance can be more comprehensive than was previously thought (Ct, 1999). There is an optimistic affiliation amongst ethical leadership and family management that results in employee performance (Wu, 2006). The turnover can show significant relationships with performance improvement, either directly or indirectly and shared organizational values strengthen this relationship (Watrous, Huffman, Pritchard, 2006). The firms whose performances are poor would have a preference to change to a deal to facilitate enhanced hysterics the surroundings, but its not common and it is not easy for the reason that the associated planned and structural transforms are extremely instant overwhelming and exclusive. (Caves and Porter, 1977). The immediate feedback generated by the implementation process can be sufficient for the help members generate new understanding for causes of organization performance (Pegels, Song, Yang, 2000). The decision speed is very important for the relation between organization structure, business environment and organizations performance (Baum and Wally, 2003). This paper shows that those firms who perceive of managers is the surroundings is much vigorous will be illustrious by superior quantity of creation modularity; this will be optimistically connected to planned suppleness, this influence the perfroamnce of firm positively. (Worren, Moore, Cardona, 2002). It is helpful for manufacturing firms to strap up the productive potential of their employees in order to achieve superior performance production workers (Youndt, Snell, Dean, Lepak, 1996). Organizational performance is also improved through implementation of TQM (total quality management) practices as Joiner (2007) found a positive relationship between organizational performance and TQM practices implementation; according to his findings coCOPY RIGHT 2011 Institute of Interdisciplinary Business Research
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worker support plays a moderating function in the affiliation between accomplishment of total quality management and the performance of an organization.A balanced relationship between learning organization and transfer of training improves performance and brings maximized gains for the organization and enables it to stay competitive in global market which is changing constantly (Weldy, 2009). H1: The transactional leadership style leads to increased job satisfaction and organizational commitment of employees. H2. Satisfied and committed employees lead to the improvement of organizational performance.
H3: The transformational leadership style leads to increased job satisfaction and organizational commitment of employees.
Theoretical framework
Organizational commitment
Strategic leadership
.Transactional .Transformational
Job satisfaction
Organizational performance
Research Design
The purpose of our research is hypothesis testing and hypothesis is developed through review of other research work on same topic. We are testing relationship between strategic leadership and organizational performance. The investigation type of our study is correlation as we are finding relationship between dependent variable organizational performance and independent variable strategic transactional and transformational leadership the extent of researcher interference is minimal and study setting is natural or non-contrived.
Methodology
The data which have been used in this study is collected through questionnaires; the questionnaires were distributed among the employees of educational institutions of Pakistan, The regression and correlation analysis of the data is conducted in order to find out the results of the study and the data of this study is analyzed on SPSS. The sample of our data contains 250 university teachers, including head of department and Dean.
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Characteristics of sample Attribute Frequency 123 Percentage 80.92%
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Male Gender Marital Status Female Married Unmarried Matriculate Intermediate Qualification Bachelors Masters MS/PHD 18-25 25-35 Age 35-45 Greater than 45 Urdu Punjabi Pushto Sindhi Balochi Others
29 103 49 0 0 4 96 100 91 40 14 7 71 63 10 3 0 5
19.08% 67.76% 32.24%
3.24% 96.6% 30.29% 59.87% 26.32% 9.21% 4.61% 46.71% 41.45% 6.58% 1.97% 0.00% 3.29%
Language
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Results Table 1. Correlation Analysis
Transformation al Leadership Transactional leadership Job satisfaction Organizationa l commitment
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Organizationa l performance
Transformation al leadership Transactional leadership Job satisfaction Org.commitmen t Organizational performance
1 .409** -.132 .195* .476**
.409** 1 .034 .025 .498**
-.132 .034 1 .762** -.052
.195* .025 .762** 1 -.009
.476** .498** -.052 -.009

1
Correlation analysis indicates that there is a strong and significant relationship between transactional leadership and transformational leadrteship (.409**). There is a strong and significant relationship between organizational performance and transformational leadership (.476**) .transactional leadership is significantly and strongly related with organizational performance which indicates that strategic leadership have a direct impact on organizational performance. Organizational commitment and job satisfaction are strongly related with each other as the value (.762**) shows, this indicates that job satisfaction effects the commitment of individual and vise versa. There is a strong and positive relationship between transformational leadership and organizational commitment which shows that there is a strong impact of transactional leadership on organizational commitment.
Table 2: Regression analysis transformational leadership Beta Transformational leadership Job satisfaction Organizational commitment Organizational performance t 11.568 Significant .026
-.132 -.195 .476
-1.503 .612 6.120
.135 .026 .000
N=250 Dependent variable= transformational leadership R square=.038 Adjusted R square=.031 F=5.069 Significance=.026
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Table 3: Regression analysis transactional leadership Beta Transactional leadership Job satisfaction Organizational commitment Organizational performance t 11.568 Significant .026
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.034 .025 .498
.384 .285 6.504
.702 .026 .776
N=250 Independent variable= Transactional leadership R square=.001 Adjusted R square=-.007 F=.148 Significance=.702
Table 4. Mediation analysis: transactional leadership Relationship Adjusted R square OC .28 .049 F t Significant
TrL TrL OP OC TL OP
42.63 6.46 46.90 20.63 5.49 40.3 30.5
.53 .24 .55 1.03 1.08 . 33 1.05
6.52 2.54 6.84 4.52 3.84 2.67 4.54
.209 .205 .000 .205 .225 .208 .204
OP OC
.30 .12 .035 .25 .30
TrL J.S j.S OP TrlJ.sOP
Table 5. Mediation analysis: transformational leadership. Relationship Adjusted R square .39 .27 .30 .23 .40 .35 F t Significant
TmL JS TmL Op JS OP TML JS OP Tml OC Tml---OC--OP
37.46 38.42 56.91 35.67 35.67 57.36
.50 .52 .55 1.095 .59 .53
6.03 6.28 6.84 5.54 5.27 4.98
.000 .000 .002 .010 .000 .030
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Discussion
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The purpose of this study was to find out the impact of strategic leadership on organizational performance in context of major job attitudes i.e. job satisfaction and organizational commitment. The findings of this study are very interesting and attention seeking. The hypothesis of this study are not fully supported by the results as we supposed that there is a mediating impact of organizational commitment and job satisfaction on organizational performance, the results show that there is a direct relationship of organizational performance with leadership styles but the mediating variables are not fulfilling the conditions of mediation which are proposed by Banal and Kenney (1986). The reason for such type of findings could be other contextual factors which lead to organizational commitment and job satisfaction. The other factors may have more strong impact on the satisfaction of university teachers as compared to leadership styles. The employees might be giving more importance to those factors than leadership that is why it does not creates strong results. Despite of good leadership there are many other factors that influence the job attitudes of employees. The direct relationship of both strategic variables show that it is not necessary that employees are satisfied and committed in the presence of valuable leadership, however if the leadership is valuable, rare and inimitable as RBV argues then it will lead to increased organizational performance. There could be other factors which may cause a decrease in organizational commitment and job satisfaction as Khatibi, Asadi & Hamidi, (2009) found that there is a negative relationship between stress and organizational commitment. Stress in the organization decreases the organizational commitment. There is a direct and indirect impact of stress on the employee. The peer support and relationship of supervisor with subordinates is also an important determinant of job satisfaction and organizational commitment. Bhatti & Quaishi, (2007) Found that employee participation in decision making is very important because it has impact on the job satisfaction, employee commitment and employee productivity. Relationship between the employee and their supervisor is very important while measuring the organizational commitment some organizations are relationship oriented and some are task oriented so their employees commitment are different. Organizational structure is very important for the success of strategy and commitment and satisfaction of employees. Organizational structure as well as external environmental factors, influence performance of the employees and determine their commitment. (Ozcan, Shukla, Tyler 1997).There is a strong relationship between working environment and job satisfaction if the working environment of employees is supportive and productive it will lead to organizational performance and job satisfaction. Work family conflict could be the major determinant of job satisfaction and organizational commitment, if the family and work life or employees is not balanced then strategic leadership will be use less what ever leadership style an organization carry out, if the employees are facing work life conflict then there will be decreased job satisfaction and organizational commitment. Transformational leadership have got a strong and significant relationship in accordance to our correlation analysis, which shows that desirable leadership style is transformational leadership style, it increases the performance of organization.
Future directions and limitations

Organizational commitment and job satisfaction do not have a significant impact on organizational performance and they are not affected by strategic leadership it means that there are some other factors which lead to increased organizational commitment and job satisfaction. To find out the actual determinants of organizational commitment and job
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satisfaction this model can be further studied by finding out the impact of human resource practices (HRP) and organizational culture on job satisfaction and organizational commitment. Compensation can also be tested as a determinant of job satisfaction and organizational commitment. To review the mediating impact on organizational performance culture and employee performance can be a worthwhile model to study. We have used subjective method to measure organizational performance; we have measured perceived organizational performance. In future new research can be conducted and organizational performance can be measured through financial analysis e.g. trend analysis, annual sales analysis ad other financial analysis can be applied to measure the organizational performance.
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Efficiency Decomposition in Data Envelopment Analysis: An application to Insurance companies in Iran

Kambiz Shahroudi (Corresponding Author) Assistant Professor, Department of Management, Islamic Azad University-Rasht, Iran Mohammad Taleghani Associate professor, Department of Management, Islamic Azad University-Rasht, Iran Goljahan Mohammadi M.Sc Student, Department of Management, Islamic Azad University-Rasht, Iran
Abstract Traditional DEA models treat the DMU as a black box. Inputs enter and outputs exit, with no consideration of the intervening steps. Consequently, it is difficult, if not impossible, to provide individual DMU managers with specific information regarding the sources of inefficiency within their DMUs. Traditional DEA models ignore the internal process of production systems and are not able to identify the cause of deficiency in efficiencies measuring. At this research traditional DEA model and two-stage DEA model were used to measure efficiency of Iranian private insurance companies during 2006-2007. The results indicated that the traditional DEA model is not suitable for such kind of network systems. In marketing perspective iran Moein Company was efficient during the study period. But this company is not efficient due to weakness in investment sub-process in year 2007. Key words: Data Envelopment Analysis, Insurance industry, Marketing sub-process, Investment sub-process, Network system. Introduction: Insurance companies extend the productivities and services activities with providing safety and confidence. Insurance industry also cause stability and reduce the anxiety due to indemnification. These companies accomplish the governmental social program as well as allocate the sources in a rational manner. Furthermore, these companies have positive effects on economics growth of the country. Therefore, the efficiency of the insurance companies is always under the question mark. Efficiency measurement in the insurance companies increases the quality of their activities and also assists them to identify and solve the problems (Kueng, 2000). Measuring the performance of a production system is an important task for purpose of control and planning. Data envelopment analysis (DEA) is a technique that widely applied to measure the relative efficiency of a set of production systems, or decision making units (DMUs) which apply the same inputs to produce the same outputs. This method identifies all of the DMUs with weak performance and also shows the sources of inefficiency (Fortuna, 2000). Traditional studies in DEA view systems as s whole, ignoring the performance of their component processes to calculate the relative efficiency of a set of the production systems. The first deficiencies are that the efficiency score may not properly represent the aggregate performance of the processes of a system. The second deficiencies are that the traditional DEA dose not show which process causes the low efficiency of an inefficient system. In order to identify the source of inefficiency, it is possible to calculate the efficiency of each process independently. However, the relationship between the efficiency of the system and those of the processes is not revealed (Kao, 2009). There are several studies show the deficiency of traditional DEA model such as: Chen & Zhu, 2004; Luo, 2003; Chen et al, 2006; Kao and Hwang, 2010; Kao, 2009. Traditional DEA is considered the DMUs activities as a black box and ignore the intermediate measures (Chen et al, 2006). Traditional DEA may give high score to the overall efficiency but in fact that the sub-processes are not efficient (Kao, 2009) There are many studies are dealt with network system that include internal processes. Seiford and Zhu (1999) divide a commercial banks production process into the stages of profitability and marketability. The input of the bank production process is employees, assets and shareholders equity, which are also the inputs of the first stage. The output of the bank production process is market value, total return on investments, and earning per share which are also the output of the second stage. Although there are two intermediate products, revenues and profits, which are the outputs of the first stage as well as the inputs of the second stage. Kao and Hwang (2008) measured the efficiency of non-life insurance companies with two-stage DEA model in Taiwan. They divided production process of non-life insurance companies to two sub-processes premium acquisition and profit generation. Two-stage DEA model partially improve these deficiencies. Recently DEA has been extended to examine the efficiency of two-stage processes, where all the outputs from the first stage are intermediate measure that makes up inputs to the second stage (Chen et al., 2010). Insurance industry provides services to
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VOL 3, NO 4 their clients to generate profit. There are several studies which used the DEA technique to measure the managerial performance of this industry (Fecher et al, 1993). The profit is not earned from insurance service alone. Insurance company use the insurance premium acquired through the systems of agencies, broker, solicitors, etc (Kao and Hwang, 2008). Zha and Liang (2010) considered production to describe the cooperation between different stages efficiency and banks overall assessment. Production process in the insurance industry is consisted with two sub-processes called marketing and investment. The output of the marketing sub-process is the input of the investment sub-process. The aim of this research is to measure the efficiency of private insurance companies via two-stage DEA model in Iran during 3 years. There are several studies dealt with the efficiency measurement of insurance companies in Iran, but they have used traditional DEA method that ignores the internal process of production systems. Therefore, this research is different from the previous studies which treat the whole production process and the two sub-processes as independent. Moreover, this paper takes the series relationship of the two sub-processes into account in measuring the efficiencies of the Iranian private insurance companies. Material and Methods: Data was collected from 14 private insurance companies in Iran from 2006 to 2007. Input and output was earned from financial sheet of the companies (Iranian Central Insurance, 2010). Marketing and investment sub-processes were considered (Figure 1). Marketing sub-process inputs includes operation expenditures ( 1 ), insurance expenditures ( 2 ). Marketing sub-process outputs includes direct written premiums ( 1 ) and reinsurance premiums ( 2 ) which inputs of the investments sub-process. Output of investments sub process consist underwriting profit ( 1 ) and investment profit ( 2 ). Operation costs and insurance costs in sub-process of marketing are covered by clients and the other insurance companies. Clients pay direct written premiums and reinsurance premiums paid by the other insurance companies. In subprocess of investment premiums are invested in a portfolio to earn profit.
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Direct written Operation expenses (
X1 )
Marketing subprocess
premiums ( Z1 ) Reinsurance premiums ( Z2 )
Investment subprocess
Underwriting profit ( Y1 ) Investment profit ( Y2 )
Insurance expenses ( X2)
Figure 1: Production system of the private insurance companies in Iran. Inputs of the system, which are also the input of the first stage (marketing), are as below: Operation expenses ( 1 ): Salaries of the employees and various types of costs incurred in daily operation such as personnel costs, administrative and public costs) Insurance expenses ( 2 ): expenses paid to agencies, brokers and solicitors, and expenses associated with marketing the service of insurance such as reinsurance premium, wage of damages and etc.) Intermediate products in the system, which are the outputs of the marketing sub-process as well as the inputs of the investment sub-process, are as below: Direct written premiums ( 1 ): Premiums received from insured clients. Reinsurance premiums (
2
): Premiums received from ceding companies.
Outputs of the system, which are also the outputs of investment stage, are as below:
Underwriting profit ( 1 ): Profit earned from the insurance business.
Investment profit ( 2 ): Profit earned from the investment portfolio includes banking deposit revenue, couponbond revenue, loan revenue and etc.
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VOL 3, NO 4 Insurance production of Iranian industry is based on two-stage network structure (Figure 1). Therefore the traditional DEA model is not a rational manner to measure the efficiencies of this industry. Kao and Hwang (2008) was used a two-stage DEA model to measure the efficiencies on non-life insurance companies in Taiwan. Therefore, at this research their model was used to measure the efficiencies of Iranian private insurance companies. First of all, the overall efficiency was measured. Then, the first stage efficiency was measured consider to the overall efficiency. The second stage efficiency was determined whereas the overall efficiency was divided to the first stage efficiency.. As mentioned before that the private insurance companies in Iran have the network system with series structure, hence these kinds of systems will be discussed. Network Systems: Systems with more than one process connected with each other called networks (Kao, 2009). Outputs of the first stage are as the inputs of the second stage that they called as intermediate data (Zha and Liang, 2010). There are two basic structures for the network systems, series and parallel, in the both systems efficiency and deficiency can be divided into efficiency and deficiency of internal process. In a series structure the whole internal processes are connected in a series form where as the outputs of the each process are as the inputs of the next process that they called as intermediate data. Intermediate data of the last process are the outputs of the system. The number of intermediate products can be different for each process. At this status, a DMU is efficient only if all its processes are efficient. The system efficiency will be low if there is a process which is very inefficient and will be high only when all processes have high efficiencies. In a parallel structure the whole internal processes are connected in a parallel form. At this status the sum of input for all processes is equal to the input of the system of this is the same for the output. If a process is efficient in the parallel system, it will be preferable to use this process alone for production. Since the underlying assumption of the CCR model is constant returns to scale, the system will be efficient if this efficient process consumes all of the inputs for production (Kao, 2009). To measure the efficiency of a network system a network DEA model is needed. Different from the traditional DEA model, the network DEA model does not have a standard form. It depends on the structure of the network in question. There are four procedures exist for two-stage systems: Standard DEA approach; efficiency decomposition approach; network-DEA approach and game-theoretic approach. Except for the standard DEA approach, all other approaches attempt to correct for the above-referenced conflict issue (Cook et al, 2010). At this research the procedure of efficiency decomposition and two-stage DEA model were used and these methods will be discussed. DEA models treat the DMU as a "black box" Inputs enter and outputs exit, with no consideration of the intervening stages. Consequently, it is difficult, if not impossible, to provide individual DMU managers with specific information regarding the sources of inefficiency within their DMUs (Lewis & Sexton, 2003). Two-stage DEA model: Denote ik , i=1,,m and rk ,r=1,,s as ith input and rth output, the traditional DEA model for measuring the efficiency of DMU k under the assumption of constant returns-to-scale is the CCR model:
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E k = max u r Yrk
r =1
s.t
s
v X
i =1 i m i =1
ik
= 1; j = 1,..., n r = 1,..., s (1)
u r Yrj vi X ij 0;
r =1
vi , u r ,
k is inefficient.
i = 1,... m ,
Ek is the relative efficiency of DMU k. If Ek =1 shows the DMU k is efficient and if Ek <1 indicate the DMU
Consider a two-stage network structure or processes as shown in Figure 2, for each of a set of n DMUs, we
pk ik , (i=1,2,, m) to the first stage, and q outputs , assume each DMUj (j=1,2,, n) has m inputs (p=1,,q) from that stage. These q outputs then become the inputs to the second stage and will be referred to as
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intermediate measures. The outputs from the second stage are rk , (r =1,2, , s). We denote the efficiency for the first stage as Ek and second stage as Ek , for each DMUj.
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Figure 2.Two-stage system of DMU k Seiford and Zhu(1999) use model(1) to measure the overall efficiency and the models 2,3 cited below to measure the efficiencies of first stage( Ek ), and second stage( Ek ). These models ignore interrelationship between internal processes and calculate the stages efficiencies independently.
1 E k = max w p Z pk p =1 q
1 2
s.t.
q
v X
i =1 i p =1
ik
= 1;
m
w p Z pk vi X ik 0;
i =1
j = 1,..., n
( 2)
vi , w p , i = 1,..., m, p = 1,..., q
vi is a weight given to input i , w p is a weight given to intermediate p, X i k is the data value i from DMU k
and
Z pk is the intermediate data value p from DMU k.
E k2 = max
q
u Y
r =1 r p
rk
s.t .
s
w
p =1 r =1
Z pk = 1;
q
u r Yrk w p Z pk 0;
p =1
j = 1,..., n
( 3)
w p , u r , p = 1,..., q , r = 1,..., s
w p is a weight given to intermediate p, u r is a weight given to output r, Z pk is the intermediate data value p
from DMU k and
Yrk is the data value output r from DMU k
Kao and Hwang(2008) introduced the models(2,3) which are the same as model(1). Therefore, the efficiencies of the whole process and two sub-processes are calculated independently. To link the two sub-processes with the overall process, a model must describe this series relationship between the overall process and two subprocesses. Model (4) was introduced by them according to this concept:
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E K = Max
m
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u Y
r =1 r m
rk
s .t . v i X ik = 1;
i =1
u r Y rj
r =1 q
v X
i =1 i m i =1 i
ij
0;
i j
j = 1,..., n j = 1,..., n j = 1,..., n (4)
p =1
w p Z pj
r rj
v X
q p
0;
u Y
r =1
w
p =1
Z pj 0 ;
v i , w p , u r , i = 1,..., m , p = 1,..., q , r = 1,..., s
vi is a weight given to input i , w p is a weight given to intermediate p, u r is a weight given to output r, X i j is

the data value i from DMU j and output r from DMU j. Overall efficiency and internal process efficiency are calculated after solving model 4 and determining the coefficients of u r , vi , w p .
* * *
Z pj is the intermediate data value p from DMU j and Yrj is the data value
Ek =
u r*Yrk v
i =1 r =1 m * i
1 EK =
w
p =1 m
* p
Z pk , E k2 = X ik
u Y w
p =1 r =1 q *
p
* r rk
X ik
v
i =1
* i
Z pk
The optimal coefficients solved from model 4 may not be unique; consequently, the decomposition of
1 1 Ek = Ek Ek2 would not be unique. This makes the comparison of either Ek or among E k2 all DMUs lack a
common basis. TO solve this problem we may find the set of coefficients which produces the largest Ek while maintaining the overall efficiency score at Ek calculated from Model (4). Therefore, model 5 was presented by Kao and Hwang (2008) as below:
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E
1 k
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= Max
m
ik
p =1
w pZ
pk
s .t . v i X
i=1
= 1
k
s q
r =1
u r Y rk E u r Y rj w pZ
pj
i=1
vi X
i j
ik
= 0 j = 1 ,..., n j = 1 ,..., n j = 1 ,..., n
(5 )
r =1
i=1
vi X
m
0,
i j
p =1
i=1
vi X
0, 0,
r =1
u r Y rj
p
p =1
w pZ
pj
u r ,vi, w
Case Study:
; r = 1 ,..., s ; i = 1 ,..., m ; p = 1 ,..., q
The sample sizes at this research were 14 private insurance companies in Iran (Table1). These companies includ Moalem, Parsian, Tosieh, Razi, Karafarin, Sina, Melat, Iran Moein, Omid, Hafez, Day, Saman, Novin and Pasargad. Data such as operation expenses( 1 ),insurance expenses( 2 ),direct written premiums( 1 ), reinsurance premiums( 2 ), investment profit( 1 ) and underwriting profit( 2 ) were collected during 2006-2007(Iranian Central Insurance, 2010). Two stage DEA techniques via LINGO 8 software were used in order to measure the efficiencies of the insurance companies. Results: Data such as input, intermediate and output from 14 Iranian private insurance companies have been shown in table 1 in year 2006. Table 1: Input ( X ), intermediate ( Z ) and output ( Y ) from 14 Iranian private insurance companies in year 2006 (Iranian Million Rial). Insurance companies Operation expenses ( 1 ) 15764 34758 9140 14249 64387 31479 26059 1199 2593 3888 39054 10698 7263 1291 Insurance expenses ( 2 ) 25393 1929459 19046 230353 458962 363161 575364 26967 12210 68797 149012 92207 45790 249 Direct written premiums ( 1 ) 47332 2007088 23747 292438 541405 431699 1065067 42386 11421 70526 174017 109573 82070 659 Reinsurance premiums ( 2 ) 3080 314655 2896 26083 50783 48621 35905 4173 7084 657 24029 3498 4103 248 Underwriting profit ( 1 ) 11596 194944 5900 23856 76929 46812 201025 12881 1020 3588 39240 21061 19102 109 Investment profit( 2 ) 10239 53909 11152 42579 25942 38292 207460 7929 2493 2452 28306 11720 2510 19405
Moalem Parsian Tosieh Razi Karafarin Sina Melat Iran Moein Omid Hafez Day Saman Novin Pasargad
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Overall efficiency and internal process efficiency of insurance companies were calculated using traditional DEA approach and models 1, 2 and 3 that presented in previous section. Although, the overall efficiency of the insurance companies was calculated using two-stage DEA model through model 4. Marketing sub-process efficiency was calculated based on model 5 (Tables 2, 3). Investment sub-process efficiency also was calculated with the following ratio:
2 EK =
EK 1 EK
Results of traditional DEA model indicate that the companies such as Iran Moein and Pasargad are efficient ( Ek =1) in year 2006 (Table 2). But pasargad insurance company is not efficient in marketing and investment process simultaneously. Result of two-stage DEA model shows that the Iran Moein company is efficient ( Ek =1) in year 2006. In marketing point of view the companies such as parsian, iran moein and omid are efficient ( Ek =1). In investment perspective all of the companies except iran moein and pasargad are deficient in year 2006.( Ek
2
1
1 ).
Table 2: Efficiency of Iranian private companies in year 2006. Traditional DEA model Insurance companies Moalem Parsian Tosieh Razi Karafarin Sina Melat Iran Moein Omid Hafez Day Saman Novin Pasargad Average Two-stage DEA model
Ek
(model 1) 0.04 0.30 0.41 0.22 0.27 0.21 0.69 1 0.15 0.05 0.45 0.41 0.52 1 0.40
1 Ek
Ek2
(model 3) 0.88 0.65 0.47 0.26 0.48 0.36 0.89 0.97 0.33 0.31 0.79 1 1 1 0.64
Ek
(model 4) 0.04 0.30 0.37 0.16 0.27 0.21 0.57 1 0.14 0.05 0.43 0.41 0.50 0.26 0.33
1 Ek
(model 2) 0.05 1 0.64 0.65 0.59 0.65 0.80 1 1 0.56 0.65 0.62 0.76 0.28 0.66
(model 5) 0.05 1 0.64 0.65 0.59 0.63 0.91 1 1 0.50 0.65 0.62 0.66 0.26 0.65
2 EK =
EK E1 K
0.80 0.30 0.57 0.24 0.45 0.33 0.62 1 0.14 0.1 0.66 0.66 0.75 1 0.54
The results of traditional DEA model in the left side of the table 3 shows that the companies such as Iran Moein and Pasargad are efficient ( Ek =1) in year 2007 (Table 3). Whereas, these two companies are just efficient in one marketing and investment sub-process. Therefore, there is doubt about the validity of traditional DEA model. There is a contradictory between the result of this model and two-stage DEA model. Result of two-stage DEA model shows that the Iran Moein company has the highest overall efficiency with score efficiency of 0.94( Ek =0.94). This means that this company is efficient in marketing and investment sub-process. In marketing point of view the companies such as Parsian, Melat, Iran Moein, Hafez and Novin are efficient( Ek =1),but all of the above mentioned companies are deficient in investment sub-process( Ek 1).
1 2
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Table 3: Efficiency of Iranian private companies in year 2007. Traditional DEA model Insurance companies Moalem Parsian Tosieh Razi Karafarin Sina Melat Iran Moein Omid Hafez Day Saman Novin Pasargad Average Two-stage DEA model
1 Ek
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Ek
(model 1) 0.21 0.65 0.75 0.71 0.28 0.37 0.81 1 0.18 0.22 0.32 0.54 0.82 1 0.56
Ek2
(model 3) 0.25 0.22 0.66 0.20 0.36 0.28 0.21 0.94 0.27 0.83 0.54 0.77 0.54 1 0.50
Ek
(model 4) 0.14 0.22 0.02 0.20 0.22 0.21 0.21 0.94 0.12 0.08 0.27 0.48 0.54 0.72 0.31
1 Ek
(model 2) 0.74 1 0.72 0.99 0.71 1 1 1 1 1 1 0.62 1 0.72 0.89
(model 5) 0.59 1 0.72 0.99 0.61 0.75 1 1 0.52 1 0.56 0.62 1 0.72 0.79
2 EK =
EK E1 K
0.23 0.22 0.02 0.20 0.36 0.28 0.21 0.94 0.23 0.08 0.48 0.77 0.54 1 0.39
The efficiency comparison of the insurance companies shows iran moein company is efficient in marketing process during 2006 and 2007. Therefore, the investment weakness is the main reason of overall deficiencies. Discussion: Traditional studies in DEA view systems as a whole, ignoring the performance of their internal processes in calculating the relative efficiency of a set of production systems. The deficiencies are, firstly, that the efficiency score may not properly represent the aggregate performance of the processes of a system. The objective of efficiency measurement is to detect the weak areas so that appropriate effort can be devoted to improve performance. An issue which is of greater concern to the inefficient DMUs is what factors that causes the inefficiency? To answer this question, much effort has been devoted to breaking down the overall efficiency into components so that the sources of inefficiency can be identified. One type of decomposition focuses on the structure of the DEA model. Traditional DEA models consider all DMU activities as a black box and ignore the intermediate products. Therefore, the two-stage DEA model was used in this research. Kao and Hwang (2008) measured the efficiency of non-life insurance companies with two-stage DEA model in Taiwan. They showed that there is a significant difference between marketing efficiency average and investment efficiency average. Although, they indicated that investment sub-process weakness is the main reason of insurance companies deficiencies. The result of this research is similar to study of Kao and Hwang (2008). A two-stage DEA model is used to measure the dual impacts of operating and business strategies for the Canadian life and health (L&H) insurance industry (Yang, 2006). His result indicated that the Canadian L&H insurance industry operated fairly efficiently during the period examined (the year 1998). The result also showed that operation and business performances have significantly mutual effects. Therefore, efficiency analysis should be considered simultaneously which is similar to the result of this study that emphasis this issue. A two-stage DEA model was used for efficiency evaluation of banks (Luo, 2003). He found that the real problem of bank inefficiency is due to marketability efficiency rather than profitability efficiency. However, there is a contradictory between his result and the result of this paper. Here we found that the investment weakness is the main reason of Iranian private insurance companies deficiencies in the study period.
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References
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Azar,A.,M,Momeny,2008. Statistics and Its Application in Management. SAMT publication,Tehran,Iran, pp:439. Chen, Y., J. Zhu and W.D.Cook, 2010. Deriving the DEA frontier for two-stage processes. European Journal of Operational Research,138-142. Chen,Y., J. Zhu, 2004. Measuring information technologys indirect impact of firm performance. Information Technology and Management 5: 9-22. Chen,Y., L. Liang and F. Yong, 2006. A DEA game model approach to supply chain efficiency. Annals of Operation Research ,145: 5-13. Cook,W.D., L, Liang and J. Zhu, 2010. Measuring performance of two stage network structures by DEA:A review and future perspective . Omega 38: 423-430. Fecher, F., D, Kessler and P, Pestieau, 1993. Productive performance of the French insurance industry. Journal of Productivity Analysis 4: 7793. Fortuna, T, 2000. A DEA Model for the Efficiency Evaluation Of No dominated Paths on a Road Network European. Journal of Operation Research, 549-558. Iranian Central Insurance, 2010. financial lists (http://www.centinsur.ir). Kao,C, 2009. Efficiency decomposition in network data envelopment analysis: A relational model Journal of Operational Research, 192: 949-962.
.European
Kao, C., S, Hwang, 2008. Efficiency decomposition in two- stage data envelopment analysis: An application to non-life insurance companies in Taiwan. European Journal of Operational Research, 185: 418-429. Kao, C., S, Hwang, 2010. Efficiency measurement for network systems: IT impact on firm performance . Decision Support Systems,48: 437-446. Kueng, P, 2000. Process Performance Measurement System. Total Quality Management,11(1). Luo, X, 2003. Evaluating the profitability and marketability efficiency of large banks: An application of data envelopment analysis . Journal of Business Research , 56: 627-635. Seiford,L., ,J, Zhu, 1999. Profitability and Marketability of the Top 55 U.S. Commercial Banks. Management Science, 45(9): 1270-1288. Sexton, T.R., H.F, Lewis, 2003. Two-stage DEA: An application to major league baseball. Journal of Productivity Analysis, 19:227249. Yang, Z, 2006 .A two-stage DEA model to evaluate the overall performance of Canadian life and health insurance companies. Journal of the Mathematical and Computer Modeling , 43: 910-919. Zha,Y., ,L, Liang, 2010. Two-stage cooperation model with input freely distributed among the stages. European Journal of Operational Research, 205:332 -338.
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Factors affecting on the social entrepreneurship in organization (Case study)

Noor-Mohammad Yaghoobi Islamic Azad University , Zahedan Branch , Zahedan , Iran Esmaiel Tolue Master of Public Administration, Iran. Omolbanin Azadikhah Islamic Azad University , Zahedan Branch , Zahedan , Iran Abstract Social entrepreneurship is one of the new fields that have been made in the field of entrepreneurship. In fact, the aim of social entrepreneur is to identify social problems and applying the principles of entrepreneurship through organize, create and manage a business risk in order to achieve social change. In this study were followed up to recognize influencing factors on the trend of social entrepreneurship among the participants in entrepreneurship training in technical and vocational organization of firouzabad city. The research method in this research was descriptive- survey and tools for data gathering was questionnaire. The studied statistical population were the trainees of technical and vocational organization of firouzabad and among those, were selected the statistical sample of 123 people. For data analysis and review of the hypothesis was used spearman correlation coefficient, kolomogorov-smirnov test and kruskal-wallis test. The results of this study indicate that the three first hypothesizes are confirmed and the fourth hypothesis are rejected. Ie, social skills of entrepreneur, confident of entrepreneur, social supporting of entrepreneurs affect to the trend of social entrepreneurship. Also factors like age, gender and levels of education no effect on the trend of social entrepreneurship. Keywords: Social Entrepreneurship, Technical and vocational organization, entrepreneur Introduction While we have become into the twenty-first century that developed countries and developing economies is alive again with cause life force. Nowadays participatory economics drawing on the creativity and innovation is using continuously strategies and methods of efficiency to take up entrepreneurship instead of traditional businesses. Glance at the status of the global economy leads us to believe that entrepreneurship development and entrepreneurial culture while combined with the culture, resources, abilities and preferences of local is the only way to improve the disease of today's economy and prevent the deterioration of tomorrow(Mahoshi, 2008: 2). The idea that different areas of entrepreneurship is the key factor of development in different countries has been emphasized by prominent researchers such as Schumpeter(1934), Stevenson and Jarrilo(1990)(Moghimi& Partner, 2008, 209). Among different field of entrepreneurship, social entrepreneurship is a relatively new. Unlike the economic entrepreneurship that will follow the creation of durable economic growth and is often in ralated to survival and growth of a business organization; social entrepreneurship pursue solve social problems besides the economic advantages(Alvord& others, 2001, 136). The truth is that, today, the community and organization can have accelerative motion in development way that with creation of the required fields, equip human resources to entrepreneurship knowledge and skills and then they use this valuable capability to manage
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and direct the other resources of the community and organizations in order to creation of value and the development(Salgoghi, 2009, 58). Technical and vocational training as entrepreneurial training plays an important role in creation of human capital through training of skilled workers needed in the labor market in different countries. These training in developing countries are not only responsible for training the workforce needed by different sectors of the economy of these countries but by creation of self-employment help to solve the problem of unemployment(Salimifar& Partner, 2005, 3). Also in Iran, One of the most important organizations that serves in the field of entrepreneurship is technical and vocational organization that through providing the necessary services and training plays an important role in the spread of entrepreneurship in society.
Expressing problem Although, the term of productivity and entrepreneurship used for several hundred years, but academic research in the field of productivity has started about the 40s and in field of entrepreneurship has started early 70th century in US. These researchs was done afterwards the changes in society and the social values and lead to changes in production, innovation and creation of millions self-employed business(Mahoshi, 2008: 2). On the other hand, the concept of social entrepreneurship is relatively new. In fact, social entrepreneurs established organizations of innovation and do risky procedures that the mission is social change and improve the target group rather than the pursuit of profit(Weerawardena&Mort,2006:24). Technical and vocational organizations as one of the centers of entrepreneurship in Iran is a long time that teach entrepreneurial skills with purpose of raising empowerment entrepreneurs. Now, according to the all told, the main question is "what factors can affect the trend of social entrepreneurship among trainees in entrepreneurship courses at the technical and vocational organization of Firouzabad city as one of the main centers of entrepreneurship in Iran?" The necessity and importance of research Undoubtedly, entrepreneurship has a direct impact on economic development and social of communities. What a society participate further in entrepreneurial activities, achieve rather to economic and social development. Modern society needs people who determined to achieve success and those who able to transform dream to reality and have the spirit of independence to explore new opportunities. If be considered the social and economic effects of entrepreneurship will be clear role of professionals and graduates in respond to different needs of community and community development (Melito, 2001, 23). Unlike business entrepreneurs, most of social entrepreneurs are supporting the efforts of each other. They are skilled in analysis, forecasting, communication, empathy, supporting and mediate and are able to organize and empower the wide range of different people(Sherrill, 2000: 25).Given that most social institutions are face with low productivity and inefficiency and many humanitarian activities have stayed away from government expectations and programs, It is essential that entrepreneurs pay more attention to social issues(Talebyan, 2002, 12). Considering the importance of social entrepreneurship in community development and this that the technical and vocational organization is one of the main centers of entrepreneurship in Iran, It is necessary to be a scientific research about factors affecting on social entrepreneurship and hereby lead to expansion of this emerging phenomenon in society. Theoretical background and literature research the concept of social entrepreneurship is relatively new initiative that is used entrepreneurial capacity for solving social problems(Alovard et.al, 2001, 136). This emerging phenomenon is derived from human interaction and states benefits of social institutions with a picture of
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discipline, innovation and social dependence(Talebyan, 2002, 15). The concept of social entrepreneurship means different things to different people and entrepreneurship. One group of reasearchers refers to social entrepreneurship as not-for-profit initiatives in search of alternative funding strategies, or management schemes to create social value. A second group of entrepreneurship understand it as the socially responsible practice of commercial businesses engaged in cross-sector partnerships. And a thirth group views social entrepreneurship as a means to alleviate social problems and catalyze social transformation(Mair & Marti, 2006, 37). Providing clarity Thompson(2002) identifies social entrepreneurship as possibly occurring in profit seeking business that have some commitment to doing good, in social enterprise set up for a social purpose but operating as businesses and in the voluntary or nonprofit sector.However, he concludes the "main word of the social entrepreneur is the voluntary[NFP] sector(Weerawardena&Mort,2006, 22). Social entrepreneurship may be expressed in vast array of economics, educational, research and welfare, social and spiritual activities engaged in by various organizations. Given the wide scope of activities, researchers have attempted to conceotualize the social entrepreneurship construct in a number of context, including public sector, community organizations, social action organizations and charities. However, the majority of literature on social entrepreneurship has evolved within the domain of non-for-profit organizations(the same, 22).
Features and elements of social entrepreneurship A number of authors emphasis on non-profit nature of the social entrepreneurship activities as a unique feature. However, social entrepreneurship can well be par with a profit activity. For this reason that is determined establishing of a activity by social needs, the amount of required resources, return of capital and ability of economic investment(Mair & Marti, 2006, 39). Other features social entrepreneurship including excessive thinking and seeing opportunities where others do not see; risk taking and encourage the judgments and reasoning; decoding problem; creation of practical prospect by ideas that will improve people's lives; rotating work hours(flexible) and willing to the aim of social(Talebyan, 2002, 35).
Social entrepreneurship is made up of six components. These elements include: 1 - Agents of change in the social sector: social entrepreneurs are development-oriented and reformer with a social mission. They made fundamental changes in the social sector with things to do. Their perspective is bold and emphasize to basic principles and problems 2 - Mission admission to create and sustain social value: for social entrepreneurs, social mission is fundamental, creation of wealth and response to the desires of their customers are part of their activities. However, these factor are a tool for achieving social goals 3 identify and encourage new opportunities: social entrepreneurs are oriented toward understanding the social needs. When they encountered an obstacle, do more activities. 4 - Using a continuous process of innovation, adaptation and learning: entrepreneurs are innovative and creative. They are pioneering to develop new models and works. 5 - Seriously and without fear act by available resources: They use the scarce resources efficiently and provide its limited resources through synergies with its partners and others. They are searching all the resources with the humanitarian nature for their business. 6 Provide an sense of accountability to the institutions and the resulting consequences: Since market discipline automatically clear the social risks of non-efficient, social entrepreneurs are taking steps to ensure that they are creating value. They ensure that accurately identify people's needs and values. They intend to serve their communities with things to do (the same, 35-36).
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Gucla&others(2002) presented the process of social entrepreneurship in the model consists of two stages. First, a social entrepreneur generate a promising idea. Second, the social entrepreneur attemps to develop that idea into an attractive opportunity.its natural to think of the generation step as an act of pure creativity and the development step as purly analytic and logical. However, both steps combine inspiration, insight and imagination with research, logic and analysis(Guclu&others, 2002,1-2).
Figure 1: The Opportunity Creation Process Change
Operating Environment
Social Needs
promising ideas
Social impact Theory
Social Assets
Opportunity
Operatin g Model
Resourse Strategy
Social Impact
Personal Experience
Bussiness Model
Step 1: Generating promising ideas
Step 2: Developing Promising Idea into Attractive Opportunities
Theoretical framework for research Variables related to the theoretical framework of this research formed through interview with teachers and the number of active entrepreneurs and these variables identified based on their opinions. The independent variables of the research are including social skills of entrepreneur, confident of entrepreneur, social Supporting of entrepreneurs and the dependent variable is the tendency to social entrepreneurship. The theoretical framework for research is Shown In figure 2. Figure 2: Theoretical framework for research Social skills of entrepreneur
tendency to social entrepreneurship
Confident of entrepreneur
Social Supporting of entrepreneurs

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Research objectives The main objective Understanding the influencing factors on the trend of social entrepreneurship among the participants at the entrepreneurship training in technical and vocational organization of Firouzabad city is considered as the main objectives of research. Secondary research objectives In order to achieve the main objective is considered the following secondary objectives: 1. Understanding the impact of social skills of entrepreneur on tendency to social entrepreneurship 2. Understanding the impact of confident of entrepreneur on tendency to social entrepreneurship 3. Understanding the impact of social supporting of entrepreneurs on tendency to social entrepreneurship 4. Understanding the impact of demographic factors (age, gender, education) of entrepreneurs on tendency to social entrepreneurship Research hypotheses Hypotheses have been introduced based on the research objectives. there are as follows: 1. between social skills of entrepreneur and tendency to social entrepreneurship is a significant relationship. 2. between confident of entrepreneur and tendency to social entrepreneurship is a significant relationship. 3. between social supporting of entrepreneurs and tendency to social entrepreneurship is a significant relationship. 4. between demographic factors(age, gender, education) and tendency to social entrepreneurship is a significant relationship. Methodology of research The research method in this research was descriptive- survey; because the research variables are described in the present and data gathering tool is questionnaire. To collect information about the background and theoretical basis of research used the library studies and to collect data to test hypotheses used the researcher made questionnaire with 14 questions that was prepared based on the likert spectrum. expert options were used to assess the validity of questionnaire. method of Krunbakh alpha coefficient was used to assess the reliability of questionnaire and the amount obtained for the first, second and third hypothesis respectively were 92%, 85% and 89% that is an acceptable level. For data analysis and review of the hypothesis was used spearman correlation coefficient, kolomogorov-smirnov test and kruskalwallis test and by Using the software spss. Statistical population and statistical sample Statistical population as a whole group of individuals, events or things that the researcher wants to engage in research about it(Sekaran, 2006, 294). Statistical population were 180 people and includes all the entrepreneurs engaged training in technical and vocational organization of firouzabad city in different fields. From this statistical population, for statistical sample, 123 persons with proportional random sampling method was selected and studied.
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Research findings In this research, men make up 64% of people studied statistical sample and women make up 36%. respondents in age range 20 -25 years had the highest frequency (57%) and 52% of respondents were have diploma degree. based on spearman correlation coefficient test, kolomogorov-smirnov test and kruskal-wallis test, research findings related to each of the research hypothesis are as follows: The contained information in table 2 show that in the three first hypothesis, significance level is less than / 05. Therefore, null hypothesis of these three hypotheses are rejected and alternative hypotheses are confirmed. Consequently, can be argued at the level of 95% is a significant relationship between social skills of entrepreneur, confident of entrepreneur, social supporting of entrepreneurs and tendency to social Entrepreneurship.
Table 1. The results of the spearman correlation coefficient test in the three first hypothesis
Number of hypotheses Null hypothesis Between social skills of entrepreneur and tendency to social entrepreneur ship Isnt a significant relationship. Between confident of entrepreneur and tendency to social entrepreneur ship Isnt a significant relationship. . Between social supporting of entrepreneur s and tendency to social entrepreneur ship Isnt a significant relationship Alternative hypotheses Between social skills of entrepreneur and tendency to social entrepreneur ship Is a significant relationship. Between confident of entrepreneur and tendency to social entrepreneur ship Is a significant relationship. . Between social supporting of entrepreneur s and tendency to social entrepreneur ship Is a significant relationship Correlation coefficient test Error level Significant level Conclusion of test
The first hypothesis
/387
/05
/016
Rejection of null hypothesis
The second hypothesis
/348
/05
/032
The third hypothesis
/445
/05
/005
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To investigate the fourth hypothesis(between demographic factors(age, gender, education) and tendency to social entrepreneurship is a significant relationship) and in related to impact of gender of entrepreneurs on tendency to social entrepreneurship was used kolomogorovsmirnov test and to investigate impact of age and education of entrepreneurs on tendency to social entrepreneurship was used kruskal-wallis test. the results is shown in table 2, 3 and 4. According to the table results, significance level of all three test is greater than the level of error. Therefore, between demographic factors(age, gender, education) and tendency to social entrepreneurship is not a significant relationship. Table 2. Results of two-dimensional Kolmogorov-Smirnov test about the relationship between gender and tendency to social entrepreneurship Social entrepreneurship .249 .036 -.249 1.269 .080
Absolute Most Extreme Positive Differences Negative Kolmogorov-Smirnov Z Asymp. Sig. (2-tailed)
Table 3. Results of kruskal-wallis test about the relationship between age and tendency to social entrepreneurship Social entrepreneurship 7.246 4 .123
Chi-Square df Asymp. Sig.
Table 4. Results of kruskal-wallis test about the relationship between education and tendency to social entrepreneurship social entrepreneurship 5.519 3 .138 Chi-Square Df Asymp. Sig.
Conclusion The results of investigations and analysis of data reveals that the three first hypothesis was confirmed and the fourth hypothesis was rejected. results of hypothesis has been investigated in the following: The first hypothesis: The results of statistical analysis indicated that between social skills of entrepreneur and tendency to social entrepreneurship is a significant relationship. Ie, any size social skills of entrepreneur including pleasure of working with others, lack of concern for face with others,
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oratory skills to others, pleasure of talking with others be higher tendency to social entrepreneurship is more. The second hypothesis: The results of statistical analysis indicated that between confident of entrepreneur and tendency to social entrepreneurship is a significant relationship. Ie, any size confident of entrepreneur including accepting responsibility for their work, do the right thing If others disagree, accepting criticism, express opinions without fear of others, self-confidence and imagination of self-respect be higher tendency to social entrepreneurship is more. The third hypothesis The results of statistical analysis indicated that between social supporting of entrepreneurs and tendency to social entrepreneurship is a significant relationship. Ie, any size social supporting of entrepreneurs(family support and government support) be higher tendency to social entrepreneurship is more. The fourth hypothesis The results of statistical analysis indicated that between demographic factors(age, gender, education) and tendency to social entrepreneurship is not a significant relationship. Ie, factors including age, education level and gender of entrepreneurs does not impact on tendency to social entrepreneurship. According to the results of research and to enhance the willingness of individuals to social entrepreneurship have been offered the following suggestions: 1.It is necessary to placed on the agenda of technical and vocational centers special training programs, including training to increase confidence and improve social skills to take shape in trainee other skills related to social entrepreneurship alongside of technical training . 2.It is necessary to support trainee family from entrepreneur in financial and spiritual dimensions and this will be when be institutionalized people tend to social entrepreneurship in society. Therefore. It is suggested to used cultural tools to promote a culture of entrepreneurship in society. 3.It is necessary to the government will contribute in development of social entrepreneurship in society, through direct and indirect support of entrepreneurs. 4.It is necessary to be done further research in relation to impact of other dimensions on tendency to social entrepreneurship.
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References Alvord, sarah H, Brown l david& letts Christine w(2001), Social Entrepreneurship, leadership that facilitates societal transformation an exploratory study, center for public leadership Guclu,j, Ayse&Dees, Gregory& Anderson Beth Battle(2002), center for the Advancement of social Entrepreneurship. Mahoshi, Afshin(2008), Impact of entrepreneurship in developing culture of productivity, Proceedings of International conference on RD, ministry of industries and mines. Tehran, Iran Mair, Jojanna& Marti, Ignasi(2006), Social Entrepreneurship research: A sourse of explanation, prediction and delight, journal of world business, n0 41, 36-41 Melito, Salazar(2001), ntroduction to Entrepreneurship, Translated by siamak nottagh, Publications.of national iranian productivity organization, tehran, iran. Moghimi, Mohammad & Pordariany, Ahmad(2008), Teaching of entrepreneurship in small and medium businesses: needs and solutions, Journal of Entrepreneurship Development, no. 1. Salimifar, mostafa & mortazavi, saeid(2005), Human capital and entrepreneurship(case study: khorasan state), Journal of Science and Development, no. 17. Salgoghi, Khosro(2009), Entrepreneurial culture, Cultural Entrepreneurship, The importance, necessity and place, Journal of Social Sciences, no. 23. Sekaran. Oma. (2006), Research method in management, Translated by saebi, mohammad and shirazi, mahmod, Iran, Tehran: Publishing supreme Institute of Education, Research of management and Planning, Fourth edition. Sherrill, . Johnson (2000), Literature Review on Social Entrepreneurship, Canadian Center for Social Entrepreneurship, p22-35 Talebyan, Ahmadreza(2002), Social entrepreneurship, Journal of Tadbir, no. 128. Weerawardena jay& Mort illian sulivan(2006) , " Investigating Social Entrepreneurship: A Multidimensional Model", Jornal of World Business.no. 41.21-35
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS The Effect of Modern Technology on Organizational Agility (An Empirical Study)
Noor-Mohammad Yaghoobi
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Islamic Azad University , Zahedan Branch , Zahedan , Iran

Omolbanin Azadikhah Islamic Azad University , Zahedan Branch , Zahedan , Iran
Abstract The changing never changes in the turbulent business world .so we should achieve agility to use competition opportunities .of course, it is important to be agile according to increasing available abilities to technology, rapid growth of technology and costumers expectations are increasing too. So this article studies role of modern technologies of organizational agility and review Iran. Saipa Yadak .co as an example .at the first ,it studies agility assessing by Goldman fuzzy method .then it uses T- one sample test statistic to value role Goldman of modern agile technologies .also the experts investigated on the basis of international expressions. the results show it is a very agile and competency ,flexibility and organizational quick theories have the highest insure and about %99. it means to use modern information and communication technologies of competency ,flexibility and quick to improve organizational agility effectively . Key words: Agility , Information technology(IT),Virtual organization, assessing agility ,Agility level , Fuzzy agility Index 1-Introduction Present organization face to some invironmetal features include fast development of technology ,raising the risks ,globalization and privately expectation so that agility will create competence successfully which is kept by famous innovation and quality. The organization and firms like other producers have to gain agility to compete in 21st century since modern organizations are strained increasingly to find new and active competitive ways in global dynamic market. Also we can suppose as following : increasing availability of technology ,intensive competition of the development of technology and customers expectations which it more important factor.( St, John &etal,2001 ) Agility is able to improve capability of organization to present its products and quality services .However it will be necessary and effective . 2-Concept of Agility For the first time Iacocca agency used agility to explain needed capability of modern production which was reported as the strategy of industrial special in 1991.(Nagel &Dove ,1991) agility word describes quickness and responsiveness when an organization meets internal and external there is no certain description for agility for it is new subject .how ever Agarwal , Shankar & Tiwari (2007)review different its definitions as an article.
Able to produce a lot of cheep and quality and present them in short time . ( Vokurka&Fliedner,1997) Its relationship between organization and market in fact its base of competition. ( katayama&bannett,1999) When an organization can accelerate the quantity and variety of products.( christopher,2000) Usage of business knowledge and virtual organization of opportunities.( Mason-jones,2000 ) Reply to costumer business turbulence and gain.necessary capabilities by thinking.( VanHook ,Harrison&Christopher,2001) Able to recognize demand ,fast reply ,inflexibility and same time operation.(Itken,Christopher &Towill,2002 Creative products and unstable demands shows agility providing.( Stratton &varburton,2003) 3-Necessary of agility and use the modern technologies all of business will face to changes so they should accept them not only its just for organization but also its important for individuals. the culture of business is not stable today since technology and innovation .there for people should intend in match with new technologies and techniques quickly .if they may not improve and substitute with others. However it is important to be agile for both of them and development of innovation and technologies depend on people and organization will predict its time before others.
To present value to customer, preparation to meet changes ,notice to importance of skills and make participation.( .Goldman,Nagel&Preiss,1995)
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VOL 3, NO 4 4- Organization agility tools organization tools and agility enablers which include organization , labour force, Structure of organization :it should be flexible so an organization can improve it by: Participation with other organization Improving flexibility via decentralization and make flexible structures. Distribution of reconstruction Individuals: ability and inflexibility of people have key role in agile organization which faces to permanent circumstances change. Information technology : a benefit of agile systems is having high informational capacity .in addition to exchanged information among cooperated organizations shows necessary of secure their key information systems ,relationship and inflexibility which secure information and IT developed more than other technologies and industries and its different types is used expand with new technology . Innovation and creativity :its more effective that organization provides the solution to customers than sales the production and it should end to accomplish ordering reality and achieve all certain costumers needs. 5-Agility capabilities capabilities as certain same abilities in an organization so that it can reply to changes. Responsiveness : its ability to recognize the changes and reply to improve them quickly. Competency : many abilities provides productivities of operation to receive the organization goals. in other hand its ability to effective achievement the organization ends and purposes. Flexibility : operation of different procedures and gain the goals by same sources and equipments. Quickness :its capability to execute an operation on the shortest time.(Macauly,1996) 6-Improve agility capabilities of organization The organization will consider to develop agile capabilities and usage as a competitive benefit in active and competitive business circumstance . If the organization doesnt define to be active and required before .it meets the problem to improve agility .Here ,agility is described as ultimate way to improve. While Vokurka &Fliedner (1998)present an improvement model of agility according to Ferdows&M (1990) this chart shows the organizations probably touch to fail. this sand hill model which is Ferdow&Dimirs expanded design suggests to firms and organizations to make agile particularly .(Vokurka &Fliedner,1998) 7-Approach and agile model of Goldman ,Nagel and Priess There is different models as Goldman ,dove ,Priess, sharifi, Zhang, Youssuf, Gunasekaran, Torang lin stated .but all of them refer to Goldman and etl. above model shows Sharifi&Zhang methodology (2001).to gain the agility on the basis of Goldman and etal design. Goldman and Nagel state the agility to use combination of new and modern productive technologies. Goldman and all (1995)present 4 principles of agility includes power costumers ,control the change ,cooperation and effect of personnel and information in a book which is called ,agile contestants and virtual organization. Customers over satisfaction
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Change and noinsurance
AGILITY
cooperation
Personnel and information

Figur1. Agility model (Goldman&Nagel,1995)
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8-Role of information technology in organization agility Information technology include all technologies to operate ,save ,transfer the information by electronic. it needs to use some equipment like computer ,relating equipments ,fax machines and every controllable electronic box.(Lucas&Henry,1994) Today, it need to use many information technologies to be effective and competitive balance on world economic. Most of job and business are not raluable without IT usage and suppose it as a possession which improve the change , competition and Innovation. Information system can create flexibility for both of great and small organizations to remove some limitations. the compatible. IT system makes a part of positive cooperation of personnel in costumers and providers nets. The personnel are importance to gather data , design and receive information systems and modern technology of organization .when there is a free and correct data base .the members can provide correct information to costumers. Some part of current business space is electronic relationship. While technology saves time of some business .however personnel skills effect on gain and distribute the Information , predict and content the problems and facilitate effective and important communications. Table1. Role of IT on agility Role of IT on agility Business difficulty To plane the patterns and new business orientation To improve business policy To decrease expenses In corporation and adhesion to decrease the time of responsive to make To make at least risk changing Necessary Sub structure of IT To relate the IT to business To insure the stability and effective flexibility To decrease the difficulty To use the properties ,stimuly now and future To improve business value
Necessary rapid changing
9-Role of IT to improve organization productivity One reason of organization development is IT and its progress .in other hand , new IT progress changes strategy organizations.(Sharma&Yetton,2001) The organization transfer much expense to operating IT specially computers from heavy machineries during 3 later decades .so they communicate by computers. also internet causes to communicate the information without geographical in other words, present of "information age" Develops modern business companies investing on IT rapidly .(Grovera&etal,1998) investing IT increased to annual 18.1 percent rate while investing on other permanent productive parts just was about 3.3 percent .(Yorukogla.1998) Krieble presents about %50of investing expense of great America companies to relate on IT.(Krieble,1998) there for its important to study how IT investment effects on organization productivity. Figure 2 ,shows the relation ship between usage of modern technologies and agility and includes all aspects of agility concept separately .on the other hand this paper reviews technology role of all agility aspects specially competency .
Usage of modern technology
flexibility
quick
competenc y
responsive ness
Decrease expense
Organization Agility
Figure 2. Research model COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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10- Hypotheses of Study
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Usage of modern information and communication technologies effect on organizational flexibility to improve agility positively . 2. Usage of modern information and communication technologies effect on organizational quickness to improve agility positively . 3. Usage of modern information and communication technologies effect on organizational competency to improve agility positively . 4. Usage of modern information and communication technologies effect on organizational responsively to improve agility positively . 5. Usage of modern information and communication technologies effect on organizational expense to improve agility positively . 11-Methodology The managers and experts of services after sale part of organization are choose as statistic group .while the top managers specialist receive primary questionnaires. Next all of organization experts who relate on technologies receive ultimate questionnaires. Cronbach alpha coefficient is used to assess the primary questionnaire and Cronbach alpha .0.9327 is used to value ultimate questionnaires which indicate high levels permanently. Table 2,criterion and numbers of same questions for primary assessing organizational agility . Table 2. Criterion and numbers of same questions for primary Questions serial Questions Criterion 5 -1 9- 6 14-10 19-15 5 4 5 5 Customers over satisfaction cooperation Change and no-insurance Personnel and information Row 1 2 3 4
1.
Table 3 ,criterions and their numbers are presented in ultimate questionnaires role of IT ,they include a questions with 7 choices and answers. their same number arent similar but it changes between 4-7. Table 3 .Criterions and their numbers in ultimate questionnaires Questions serial Questions Criterion flexibility 4 4 -1 Quickness 7 11-5 Competency 4 15-12 Responsiveness 4 19-16 Decrease expense 4 23-20 row 1 2 3 4 5
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12-Evaluations of agility , statistic test and analyze the result Table 4 presents Criterion agility index to assess agility index organization. Table 4. Criterion agility index to assess agility index organization Symbol Index AA11 Costumer communicational strategy AA12 Manager should involve result of costumers services AA13 Costumers opinions are important to design the products and services procedures. AA14 Evaluation results with costumers systematically AA15 Provide enough services at proper time AA21 AA22 AA23 AA24 AA31 AA32 AA33 AA34 AA35 AA41 AA42 AA43 AA44 AA45 An organization should decide consultatively Provide the purposes and benefits of procedures in team working costumer can meet managers Cooperation and communication organization Organization flexibility to restructure Prepare to create organizational changes Able to use new technologies to provide the services Reengineering and restrict in organization again Competency of personal to decide Educate the personal to communication with costumer effectively How they accept new technologies Inter important information in web site Provide electronic consultativing costumer Fast provide services &communication with other organizations Index AA1
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Main criterion Customers over satisfaction
Cooperation AA2
Control changes and un surety AA3
AA4
Individual information effects on IT
Linguistic expressions and equal MFS are used to study assessing expressions as several arguments to insure. Table 5. Linguistic variables and similar numbers Performing rank Weight importance Linguistic expression symbol Linguistic expression symbol fuzzy number fuzzy number worst W (0,0.05,0.15) very low VL (0,0.05,0.15) very poor VP (0.1,0.2,0.3) low L (0.1,0.2,0.3) poor P (0.2,0.35,0.5) fairly low FL (0.2,0.35,0.5) fair F (0.3,0.5,0.7) mediu m M (0.3,0.5,0.7) good G (0.5,0.65,0.8) fair high FH (0.5,0.65,0.8) very Good VG (0.7,0.8,0.9) high H (0.7,0.8,0.9) Excellent E (0.85,0.95,1.0) very high VH (0.85,0.95,1.0) Agility attributes are assessing to use linguistic expressions and they approximate to use fuzzy numbers. then linguistic expressions and weight rating are approximated with fuzzy numbers according to equal relation ship between them as are presented in next tables.
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Table 6. Fuzzy average rating and weight of criterion and sub criterion AAi AAij Fuzzy average rating Fuzzy average weights AA1 (0.660,0.7778,0.884) AA11 0.7200,0.8300,0.9200 0.8500,0.9500,1.0000 AA12 0.6500,0.7700,0.880 0.7100,0.8300,0.9200 AA13 0.5400,0.6800,0.8200 0.7600,0.8600,0.9400 AA14 0.7300,0.8300,0.9200 0.820 ,0.9200,0.9800 AA15 0.6500,0.7700,0.8800 0.8200,0.9200,0.9800 AA2 (0.5457,0.6830,0.8211) AA21 0.5400,0.6800,0.8200 AA22 0.5000,0.6500,0.8000 AA23 0.6600,0.770, 0.8800 AA24 0.4600,0.6200,0.7800 AA3 AA31 0.5400,0.6800,0.8200 AA32 0.4200,0.5900,0.7600 AA33 0.5400,0.6800, 0.820 AA34 0.6100,0.7400,0.8600 AA35 0.5300,0.6800,0.8200 AA4 AA41 0.6100,0.7400,0.860 AA42 0.6500,0.7700,0.880 AA43 0.6200,0.7400,0.860 AA44 0.6100,0.7400,0.860 AA45 0.6500,0.7700,0.880 0.6200,0.7400,0.8600 0.6600,0.7700,0.8800 0.7300,0.8300,0.9200 0.5800,0.7100,0.8400 (0.5313,0.6757,0.8167) 0.7000,0.8000,0.9000 0.6100,0.7400,0.8600 0.6100,0.7400,0.8600 0.7300,0.8300,0.9200 0.6500,0.7700,0.8800 (0.6278,0.7519,0.8680) 0.7500,0.8600,0.9400 0.7200,0.8300,0.9200 0.6900,0.8000,0.9000 0.7500,0.8600,0.9400 0.7200,0.8300,0.9200
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Table 7.Fuzzy variables and similar numbers to determine agility level(Lin etal ,2006,296) Symbol linguistic variables fuzzy number DA Definitively Agile (0.8,0.9,1.0) EA Extremely Agile (0.7,0.8,0.9) VA Very Agile (0.6,0.7,0.8) HA Highly Agile (0.5,0.6,0.7) A Agile (0.4,0.5,0.6) FR Fairly (0.3,0.4,0.5) SA Slightly Agile (0.2,0.3,0.4) LA Lowly Agile (0.1,0.2,0.3) S Slowly (0.0,0.1,0.2) Other fuzzy average rating and main weights AAi and sub criterion AAij are accounted similarly . Uniform fuzzy rating of main criterions are accounted and the results are shown: AA1 = 0.6605 AA2 = 0.5457 0.7778 0.6830 0.6757 0.7519 0.8847 0.8211 0.8167 0.8680
AA3 = 0.5313 AA4 = 0.6278
Fuzzy agility index (FAI) is accounted: FAI= 0.5958 0.7246 0.848
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Now the distance are formulated to use FAI members of A: d (FAI,DA)= 0.890 d (FAI,EA)= 0.1361 d (FAI,VA)= 0.0564 d (FAI,HA)= 0.2188 d (FAI,A)= 0.3906 d (FAI,FR)= 0.5632 d (FAI,SA)= 1.2688 d (FAI,LA)= 0.9092 d (FAI,S)= 1.0822 13-Fuzzy variables and similar numbers &FAI SO , Minimum d is lable linguistic as" very agile "for Iranian Saipa Yadak.Co. Although organization agile index is very close to "very agile" but is not close to "Extremely agile".
1 0.9 0.8 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1
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Figure 3. Fuzzy variables and similar numbers& FAI These rates show sub criterion to provide organization agility. 14.rating of sub criterions It is important to note MATLTB software which a researcher designs it is used for all accounts of fuzzy method . Table 8. Rating of sub criterions Rating 0.0651 0.1526 0.1526 0.0825 0.0768 0.187 0.1613 0.1429 0.1937 criterion AA11 AA12 AA13 AA14 AA15 AA21 AA22 AA23 AA24
0.1461 AA31 0.1685 AA32
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0.1685 AA33 0.1388 AA34 0.1685 AA35 0.1175 0.1175 0.1594 0.1175 0.1444 AA41 AA42 AA43 AA44 AA45
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The results show the lowest value for first part, costumer communicational strategy in organization, which relate to costumer over satisfaction . Table 9. results of assessing organizational agility rating criterion 0.0651 Costumer communicational strategy in organization 0.0768 Provide enough services at proper time 0.0825 Assessing performing results with costumers systematically The results of statistic one- sample test for 5 criterions are presented in under Table . Table 10.Result of one-sample Test Test Value = 4 Std. Deviation .91581 .98512 1.01554 1.01299 1.15919 Sig. (2tailed) .000 .000 .000 .000 .000 Index AA11 AA15 AA14
N 70 70 70 70 70
Mean 4.74286 4.74830 4.7035 4.5607 4.3714
Df 69 69 69 69 69
T 6.787 Flexibility 6.355 Quickness 5.796 Competency Responsivenes 4.631 s 2.681 Expense
Table 10 presents average of test equal to 4 (1-7 average).there for higher amounts of a criterion illustrate modern information and communications technologies effect on improve organizational agility effectively .when this account is more it will be more effective ,also of averages are more than test account ,4,and have the highest insurance ,more than 0.999.so ,zero theory(equal and less average with4) will be rejected which result in organizational competency, flexibility and speed are the highest .it means to use modern technologies effect on them to increase agility. . 15-Conclusions and suggestions first organizational agility is evaluated and role of new technology with different agile aspects specially competency also studied them. so Iran Saipa Yadak. co is analyzed as very agile .then one-sample test ,permanent and theories illustrates. Just Competency ,Quickness and flexibility to have the highest (average of insurance 0.999<) to compare 5 aspects. In other hand modern information and communications technologies to ward Competency ,Flexibility and quickness effect on increase agility intensively .the research is specially used for Saipa Yadak .co. How ever it needs to research about agility evaluation in different organizations to determine their week points to remove them to be agile critically .it suggests all organization managers to be agile specially for competency to use modern information and communication technologies not only they to competitive but also it is key and necessary strategy.
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References
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Agarwal, Ashish ; Shankar, Ravi; Tiwari, M.K. (2007). Modeling agility of supply chain, Management, Vol .36, P .443 -457. Christopher ,M , (2000),The agile supply chain, Industrial Market Manage ,Vol.29,No.1,PP.37-44. Ferdows ,K ,De Meyer ,A,(1990),Lasting improvements in manufacturing performance: in search of a new theory ,Journal of Operations Management,Vol.9No.2,pp.168-83. Goldman, S, Nagel ,R,(1995) ,Management ,Technology and Agility :The Emergence of New Era in Manufacturing ,International Journal of Technology Management ,8.35-18,(2/1). Grovera ,Varun and etal ,(1998),The influence of information technology diffusion and Business process change on perceived productivity ,The IS executive prespective Information and management .Vol.34. Katayama ,H, Bennett ,D,(1999),Agility ,Adaptability and leanness:A comparison of concepts and a study of practice ,journal of production Economics,60D61,43-51. Lin, hing-Torng &Chiu,Hero& Chu,Po-Young,(2006),Agility index in the supply chain,Int.J.production Economics,Vol.100,No.285-229. Lucas.C,Henry,Ir.,(1994),Information Technology for Management,5 Edition,New York:MC Graw Hill book Co. Macaulay.J,(1996),Management in the agile organization ,APQCquality press ,Milwaukee,WI. Nagel ,R.N,Dove .R,(1991),21th centry manufacturing Enterprise strategy :An Industry Led view ,Iccoca Institute ,Lehigh University ,Bethlehem . Sharifi, H; Zhang, Z. (1999). A methodology for achieving agility in manufacturing organization: Anintroduction, International Journal of Production Economics, Vol .62, P .7- 22.2. Sharma Rajeer, etton, hilip,(2001), the contingent effects of training Technical complexity and Task Interdepence on successful Information Systems Implementation,MIS Quarterly,Vol .31,pp 219-238. St,John CH,Cannon,A,pouder,R(2001),Change drivers in the new millennium ,an agenda for operations strategy research ,J oper Manage,19:143-60. Van Hook ,R,Harrision.A and Christophe ,M,(2001),Meauring agile capabilities in the supply chain ,International Journal of operations &production Management ,Vol. 21 No .1/2,2001,pp.126-147. Vokurka.r,Fliedner,G,(1998),The jouney toward agility ,Industrial Management Data Systems 98/4,pp.165-171. Yorukogla,Mehnnet,(1998),the Information Technology productivity paradox review of economic dynamics ,I, p 551-592 .
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Transforming Web usability data into web usability information Using Information Architecture concepts & tools
Kamran Khan Tatari (Principle Author/Corresponding) Sarhad University of Science and Information technology, 36 B, Chinar Road University Town, Peshawar, Khyber PukhtoonKhwa, Pakistan Salim ur-Rehman Sarhad University of Science and Information Technology, 36 B, Chinar Road University Town, Peshawar, Khyber PukhtoonKhwa, Pakistan Waheed ur-Rehman Sarhad University of Science and Information Technology, 36 B, Chinar Road University Town, Peshawar, Khyber PukhtoonKhwa, Pakistan
Abstract Usability plays a vital role in the acceptance of any website because poor usability leads to rejection of websites. This paper is a step to divert the attention of researchers from usability evaluation methods towards the transformation of web usability data into web usability information using the concepts and tools of information architecture. The paper provides a direct relation between web usability and information architecture. The paper establishes a theoretical frame work (Diamond) for transforming usability data into usability information through Information Architecture (IA), however the commercialization and validity of the given framework is still remain for future work because of limited resources in establishing usability labs. For the convenience of futuristic work, a theoretical guideline has been given as appendix for conducting experiment in order to check the validity & effectiveness of the proposed model (See Appendix). The paper concluded with some findings and future work Key Words: Usability, web usability, information architecture, Diamond frame work, SE, HCI
1. Introduction
The objective of any web site is to keep their users satisfied. This objective can be achieved by creating quality web sites. Usability is one of the quality attributes that can lead the web sites towards satisfactions and revenue generation. The usability of web sites can only be achieved if it is fully understandable by the practitioners as well as novice users. Usability data (assumed to be raw in the context of this paper) is useless if it is not converted to information. One of the ways of converting web usability data into web usability information according to the authors view is, by using the tools and concepts of information architecture (IA). This paper presents both qualitative and quantitative approaches. The paper starts with the qualitative part in which literature review is conducted on both usability and information architecture and tries to establish relationship between usability and information architecture. A model is proposed (section5) as a result of literature review. To validate and authenticate the effectiveness of the proposed model requires experiment in well equipped usability and information architecture labs which remains as future work, however for the convenience a theoretical frame work/guidelines for conducting experiment is given as an appendix. The paper is concluded with some conclusions & future work.
1.1 Background
The quality and acceptance of an interactive human computer system is highly dependant on the ergonomic design of user interface [1]. Usability is a quality attribute which is not easy to express [2, 3]. The term usability is derived from the word user friendly [4]. Every standard body has defined usability in their own perspective. According to ISO 9126-1 there are six principles of Quality characteristics these are, functionality, reliability, usability, efficiency, maintainability and security. The interaction of the system, either leads to user satisfaction or dissatisfaction, where satisfaction is related to the comfort that user experiences in using a certain product [2]. The more a product is usable more will be the degree of satisfaction. Web site usability and its accessibility are the core issues and problem [5].According to Beirekdar, [6]; an estimated 90% of websites provides poor and
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VOL 3, NO 4 inadequate usability. Due to lacking of universally accepted definition and meaning for the usability, there is no standard for transforming usability data into usability information that can be acceptable and understandable by SE (software engineers) & HCI (human computer interaction) communities. As J. Howarth et.al [9] also stresses on the immense need of research to be conducted on transforming usability data into usability information because usability data is of no use if not converted to usability information. The usability data, if converted to usability information will lead to a great revolution in usability of web application in particular and for the software application in general. Regarding quality of the web application, usability is the most important criteria of acceptance [7]. For the development of web application, user centered design approach is adopted by many teams [8], hence usability of the websites are normally designed keeping the users view about the websites interface design. That is why many websites are rejected by users due to poor usability. Though the term usability data is familiar in both SE and HCI communities but due to unexpressive meaning and contextual complexities it is hard for them to implement the usability data until and unless it is converted to usability information. There is a gradual shift of research from usability evaluation methods to the transformation of raw usability data into usability information, still there is a lot of gap exists in transforming usability data into usability information [9]. The usability data is scattered and exist in many forms that include notes, video, audio records and many other sources such as self reporting from remote users, usability testing data from usability labs and the data collected by usability experts through inspection and various techniques etc, so it becomes a pressing problem for usability practitioners to make meaning out of these data and recognized the usability problems [9]. Considering the importance of usability, a research is needed to divert the attention of researchers towards the transforming of usability data into usability information. In this paper author will argue that how IA (information architecture) [10] can be used or helpful in transforming usability data into usability information. The author has related the concepts of usability and information architecture that can help in transformation of web usability data into web usability information. The paper provides exploratory data that results into the formation of proposed model named as Diamond model by author, however its validation and effectiveness still remains as future work, and however a theoretical guideline has been given for conducting experiment as an appendix.
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1.2 Aims and Objectives

The aim of this paper is to identify the ways that how web usability can be transformed into web usability information in such a way that usability data become easy for novice practitioners for its understanding and implementation. The aim and objectives of this paper is achieved by conducting quantitative and qualitative part. In achieving this aim, following objectives are achieved. Highlights the importance of transforming web usability data into web usability information. Provide a step for usability to borrow and utilize the concept of information architecture. Provide an insight for the novice usability practitioners about usability data and usability information 1.3 Research Questions My research question in this paper includes 1.3.1 What role information architecture has to play in transforming web usability data into web usability information? (Section 3.1, 3.1.2) 1.3.2. What are the ways of transforming web usability data into web usability information? (Section4) 1.3.3 How effective the Diamond model would be in transforming usability data into information (future work) 1.4 Expected out comes 1.4.1 The paper provides a direct relationship between usability data and information architecture (Section 3, 4, 5) 1.4.2. Provide help to novice usability practitioners, how to implement and use usability data into web design interfaces (1, 5) 1.4.3. An understanding and importance of transforming web usability data into web usability information (3, 4, and 5). 1.4.4 Development of Diamond model for transforming web usability data into web usability information using IA tools and concepts (Section5). 1.5 Research Methodology This paper has adopted an exploratory and evaluatory approach in the context of its qualitative Research methodologies [11] that comprises of literature review which results in the authors own proposed model named Diamond Model for transforming web usability data into web usability information. However its quantitative
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VOL 3, NO 4 part the proposed model is left for its validation and effectiveness in transforming usability data into usability information as future work because of lacking resources in maintaining expensive usability labs and other time consuming ethnographic observations and data collection. 2 Usability Usability can simply be defined as Quality in Use [12]. The productivity of people and their comforts are directly related to the usability of software they use [13]. Usability is not a luxury but a basic ingredient in software systems [13]. During last few decades usability has gained much attention from researchers especially from Software engineers (SE) and Human Computer interactions (HCI) Communities [14], The concept of usability is not easy to express [2, 3] different researchers and standardized bodies have defined usability in different context (see table 1 for various standardized definitions of usability in section 2.1).
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2.1 Usability Definitions

Table1: Defining Usability in the context of three different Standards According to ISO/IEC 9126-1, 2000: The capability of the software product to be understood learned, used and attractive to the user, when used under specified conditions. According to ISO9241-11, 1998: The extent to which a product can be used by specified users to achieve specified goals with effectiveness, efficiency and satisfaction in a specified context of use According to IEEE Std.610, 12-1990 The ease with which a user can learn to operate, prepares inputs for, and interprets outputs of a system or component.
2.2 Usability Characteristics:

According to ISO 9126-1, there are four characteristics of usability as follow: Understandability Operability Learnability Attractiveness
These four characteristics are explained by ISO 9241-11 in [18] as

Usability Characteristics Understandability Operability Learnability Attractiveness Wixon [19] describes the characteristics of usability as: Effectiveness Efficiency Satisfaction Description Does the user comprehend how to use the system easily? Can the user learn to use the system easily? Can the user use the system without much effort? Does the interface look good?
Table2: Characteristics of Usability [19]

Characteristics of Usability a) Effectiveness b) Efficiency c) Satisfaction Description of Usability How well do the users achieve their goals using the system? What resources are consumed in order to achieve goals? How do the users feel about their use of the system?
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2.3 Usability Measure:
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Usability is complex due to its different contextual meaning, some researchers measures usability in terms of different views. According to N. Bevan et al [15] the usability can be measured in the following three different views as:
Usability Measure
Product oriented view
User Oriented View
User Performance view
Figure 1: Usability Measures and understanding
2.3.1 Product Oriented View:

In this view, usability is viewed in the context of product in order to understand and measure usability. To measure usability, product view considers the ergonomic attribute of the product [15]. Pieratti [16] argues that a usable product is one that: Easy to learn Efficient to use Easy to remember Enjoyable to use Visually pleasing Provide quick recovery from errors
2.3.2 User Oriented View:

Usability is mostly judged, measured and considered from the users point of view. Users have significant role in understanding and implementation of usability. According to this view the usability can be measured in terms of mental effort and attitude of the user [15]. According to P.W.Jordan [17] the user characteristics affects the usability, He [17] further argues that the experience characteristic of the user is relatively dynamic and enhances with the passage of time. These characteristics are as follows: Experience Domain Knowledge Cultural background Disability Age and Gender
2.3.3 Performance View:

Usability evaluators evaluate and understand the usability issues by considering the performance view of the users. In this, the performance of the users is observed in order to understand the complexities and difficulties in measuring and understanding of usability. According to [15], the performance view comprises of two issues ease of use or acceptability. That is, the user interacts with the product on the emphasis of its ease of use that how the product is easy in terms of its usage or acceptability- whether the product can be used as an real world object or not ?
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2.4 Web Usability
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Thomas Powell [20] formally describes, web usability that allow users to navigate and manipulate sites features to accomplish a particular task or goal. The usability of a web site is complex due to mix of text, links, graphic elements and formatting that affects the quality of website to a great extent [21]. Due to the emerging concept of globalization, where distances are measured with browsing and with click of mouse, web usability plays a significant role in interacting with end users via World Wide Web because most of the Information Technology services(ITes) are based on usable interfaces. The success of any website is vitally dependant on its usability. The more a website is usable the more it will generate revenue and visitors. According to [21], poor designed websites lead to lost of productivity and revenue. Moreover poor usable websites leads to frustrations for the users which results in cancellation of the sites by clicking the close option.
2.4.1 Characteristics of web usability:

The website is usable if it allows users to accomplish their tasks quickly, efficiently and easily [22]. Brinck et.al [22] further argues that the usable website should have the following characteristics: Functional Correctness Efficient to use Easy to learn Easy to remember Tolerant to Error Subjectively Pleasing
2.4.2 Web Usability Measure:

The usability evaluation is directly related to the behavior of user that interacts with the websites interface. Most of evaluators measures and evaluates website usability considering users preferences or experiences about the website. Banati et al. [23] proposed the following criteria to measure the websites usability, these are: Appearance of the Site Work Satisfaction Emotional Satisfaction State of Features Trustworthiness of the sites
2.4.3 Determinants of Usability

N.Bevan et al [15] have figure out the determinants of usability. They [15] argue that the ease of use in a particular context can be determine by attributes of the product and can be measured by the users performance and satisfaction. According to them [15], the product attributes contribute to usability in terms of properties of interface, structure, nature of functionality, system efficiency and reliability etc. they[15] stated that the measures of attitude and performance provides the criteria which determines whether the design attributes are successful in achieving the usability. The determinant of usability is shown by them [15] as shown in Figure 2.
3. Information Architecture (IA)

Information Architecture is defined by IAI (Information Architecture Institute) as The art and science of organizing and labeling websites, intranets, online communities and software to support usability [24]. Information is always a critical issue for any organization, due to its importance and applicability. Information is considered as an important capital for the organizations. Organization is striving to better utilize their information, in this context information architecture provides ground and serve as basis for information systems that make sense for their users. According to [24], organizations require Information Architecture when: Business needs to design or redesign the user interface or website Cost increases due to inaccessibility of information to customer and employees
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Product Attributes
Product attributes user aware of
Organization al context
Attitude, understanding and Mental Effort
Environmenta l context
Users Performance with
Task
Figure 2: Determinants of Usability [15].
4 Related work
According to G.McGoven [25], Quality of websites is driven by the design principles of information architecture rather than graphic design. He [25] further argues that web requires information architecture design than graphic design because words and information provides the building blocks to the majority of websites, not the images. The information architecture focuses on, how the web page will read while the graphics focuses on how the web looks. Considering the UCD(user centre design) [26], in which websites are designed keeping the users needs and interest, the user rejects the websites due to poor usability in not finding his/her intended information and due to frustrating contents(including graphics font size etc). The role of information architecture in the web context is linking the web contents with each other to make web design effective so that it can easily be read, found and viewed. Hence usability data should be architecturally presented to the stakeholders of websites that can easily be understood by them. Usability data that are scattered in various forms should be integrated architecturally so that the flow of usability data becomes visible, traceable and obvious to the practitioners as well as to novice users for its implementation and utilization
4.1 Usability in context of IA

The common theme that both usability and information architecture carry is the design for the user. Both usability and information architecture implements their design principles to facilitate the user in proceeding towards his/her goals. The DentsuFuse Inc Tokyo [27] stated that usability and information architecture go together because the established usability standards and practices are the everyday part of an information architect, as they involve in understanding of label taxonomy, create design schematic , and building the logical structure of web sites. Prof. Dr. K.Andrews at Austria University [28] mentioned in his lecture notes that the user experience with any product or interface is an umbrella term which is composed of Information Architecture, usability engineering, graphic design and interaction design. Lain Barker [29] considers usability as a broader term than information architecture and stated that information architecture is a sub set of usability. He [29] further argues that both usability and IA are closely related to each other. Considering the IA diagram [29] in Figure 3 below
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Context Users
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Content
Figure 3: IA Diagram [29]. The above IA diagram (Figure3) can be associated with web usability in the context of this paper, similar to the business context in which the business objectives, policies and constrains are considered same as the web usability that has its context which depends on the type of web sites for which the usability will be evaluated. For example while designing an interface its consideration revolved in three dimensions i.e. information oriented, business oriented or service oriented, while usability issues in this context will be varying accordingly. In second layer of IA in which the contents are considered while designing the IA for an organization i.e. information and functions are considered, the similar features are also considered while designing the web site, it considers how information will be available on the web sites, what functionality should be available on the web sites on the basis of priority etc. the third and the last feature which is supported strongly both by Information architect and usability practitioners, is the user, i.e. for whom the information are going to be design, who will be the users etc. usability has a special term for this, is the user centre design in which usability is evaluated keeping the users view points. Both usability and IA considers about their users while designing interfaces for the web applications i.e. how easily user can find their intended information and goals, as in the words of Wurman (the founder of IA) [29], organizing the patterns in data, making the complex clearer this is the theme of IA, also reflecting the objective of usability to make design as clearer and visible that it becomes understandable, learnable and memorable for the users. The information architecture manages the flow of information so it becomes easy for users to follow the flow of information that leads them towards their intended goals. If the contents of websites are not properly labeled and are not placed in a proper flow on the website, it will lead to poor usability and will create frustration for the users. Hence usability and information architecture are tightly inter linked with each other because in creating a web applications both IA (information architecture) and usability consider users, contents, and the context in which the websites is developed.
4.2 Transforming web usability data into web usability Information

The research is now shifting from usability evaluation methods to the transformation of usability data into usability information. Usability data is useless if it not understandable by the practitioners and novice users. Similar to the concept of data and information where data is applicable if it is converted to information because it is the information not the data that provides the complete meaning to the users. For example, consider a website in which different users are dealing with their profile photo on the websites some user will have problem in uploading the image, the other having problem in resizing or shaping the image but over all this means that there is problem in the usability of image, so all these issues collectively provides the information or idea about the problem in the usability of image. According to [9], the aim of every evaluation process is to transform raw usability data into information that is understandable for the practitioners and novice users. Howarth et.al [9] stated that in the analysis phase during evaluation of usability, the raw data is converted to usability information which is dependant on the expertise of usability experts to extract the usability problems from raw usability data. The current usability evaluation process [9] is shown in Figure4 in which usability problem data is identified at the stage of usability problem analysis.
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Interaction Design User Task Performance
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Data Collection
Raw usability Data
Problem Analysis
Usability Problem Description
Evaluation Reporting
Usability Evaluation Report Figure 4: Current Usability Evaluation Process [9]. To the best of our literature study, no research is conducted explicitly on transforming web usability data into web usability information except a journal [9] in which the authors discussed aboutStructured process of transforming usability data into usability information. In this journal the emphasis is given on usability problem data and the authors argued about the issue that the raw usability data that are generated by evaluation methods are not straightforward. The authors of the journal presented the concept of usability problem instance which according to them, serve as bridge between raw usability data and usability problems. They [9] have considered each usability problem as an instance, these usability problem instance are identified in usability data collection and this usability problem instance form the basis for structured usability evaluation process for translating usability data into usability information. However, discussing this journal [9] in detail is beyond the scope of this research paper.
5. Proposed Model of transforming web usability data into web usability information using IA concepts
After literature study we have proposed a model named Diamond model (see Figure5) that can be used for transforming web usability data into web usability information. The proposed model is using the concepts of usability and information architecture, at its first phase, it gathers the raw usability data (assumed to be raw data) from various resources that includes usability data collected through video/audio recordings, various inspections and testing methods, incident diaries/ notes, data that are collected through self reporting and ethnographical observations, provide input to the information architecture to be implemented. The concepts of IA is then applied on the raw usability data in which the data that are obtained from various mentioned resources are properly label and prioritized by users e.g. card sorting technique [28]. The tasks that are important and prioritized by the users are presented in the flow diagrams that the novice users and practitioners can easily know about the navigation path.
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Video/audio records Inspections/ testing methods Notes/incident diaries Self reporting, ethnographic observation
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Raw usability data
Collected raw usability data
Web Usability Data
Information Architecture Rules
Grouping usability data Using IA

Label taxonomy Flow of navigation using diagram Styles and formatting template for info element Create scenarios and story boards
Information grouping
Web Usability Information
Figure 5: Diamond frame work for transforming web usability data into web usability information The last rule of IA that are applied on usability data in which series of actions and user experiences are documented in scenarios, these actions are also presented visually as a story board or in graphical organization that provides understanding about the actions of the users while interacting with the system interface. The contents that have given more priority by users are visually presented (through story board) and synthetically described. When the above Information architecture rules are applied on usability data, it becomes clearer to novice as well as practitioners of web usability to understand the usability flow as information. Through this synchronize flow; usability data become more visible and understandable than before. Due to proper flow, sequence, scenarios, story boards, proper labeling (card sorting) the usability data can be converted to usability information in such a way that become meaningful for the practitioners and novice users to predict, understand and conceptualize the usability data. The proposed model is helpful for the researcher to gain insight in establishing a direct relationship between usability and information architecture
7. Conclusions
A lot of research is devoted on evaluation methods for usability that identifies usability problems for the practitioners and novice users, but due to perceptive and hardly expressive nature of usability, it is often ambiguous for practitioners especially for novice users to utilize usability data that are evaluated through usability evaluation methods. Usability is useless if it is not converted to some meaningful information that every practitioner and novice can understand. It is significant for practitioners to understand usability, as the rejection and acceptance of any website is dependant on usability of that website. The paper has contributed to in two dimensions, one effort is made in establishing relationship between usability and Information Architecture, the other major contribution of this paper is the establishment of theoretical frame work named as Diamond proposed model that not even shows the shows the relationship between web usability data and information COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 architecture but also provides frame work how to transforms usability data into usability information. Though the Diamond model has not been validated with respect to its effectiveness in transforming web usability data into web usability information as its quantitative part but a full theoretical guideline for conducting practical experiment is given as an appendix. The paper serves as a foundation for SE and HCI communities to switch their attentions from usability methods towards its transformation from usability data into usability information by using the concepts and tools of Information Architecture, the paper concluded with some future work that has to be considered by usability practitioners (see section 7.1)
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7.1 Future work

7.1.1 A standard frame work should be developed for web usability 7.1.2 A usability transformation model should be evaluated that transforms web usability data into web usability information. 7.1.3 The Diamond model should be validated in usability labs to check its effectiveness in transforming usability data into usability information 7.1.4 Specific Usability engineering tool should be developed that support the novice user in understanding web usability.
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Appendix 1
Guidelines for conducting experiment
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1 Experiment to validate the Diamond model Quasi experiment [11] can be perform to validate the effectiveness of Diamond proposed model. In this experiment groups should not randomly be selected but particular groups should be assign with particular task to conduct experiment 1.1 Objective of study The objective of this experiment is to evaluate the effectiveness of proposed model. The objective is also to find the validity of the model. 1.2 Hypothesis Null Hypothesis: In our experiment, less than 10 usability user group authenticates the effectiveness of proposed model. Similarly, less than 3 expert usability groups validate the proposed model (if usability users group<10 and usability expert groups<3, disagreed, model is not valid & effective) Alternative Hypothesis: The proposed model is effective in transforming web usability data into web usability information. In the experiment if equal and more than 10 user groups authenticates the effectiveness of proposed model. Similarly, equal or more than 3 expert users validate the proposed model (If usability users groups>10, and usability expert groups>3, model is efficient) 2 Method Experiment should be conducted in well equipped usability lab to validate the effectiveness of proposed model. The choice for experiment over survey is because of its quantitative nature and also because surveys are week in the area of validity and reliability; moreover it is hard to motivate people for survey questions [30]. The second reason for conducting experiment over survey is that surveys are having chances of biased opinion. Further the proposed model also demands for experiment than survey as it needs to be evaluated in some controlled environment. The purpose of experiment is to analyze the effectiveness of the proposed model and to find whether the model can be used for transformation web usability data into web usability information. 2.1 Demographics and Experiment Procedure the proposed model is comprised of two layers, one layer is concerned and associated with usability and the other layer is associated with information architecture, there for two groups are selected from both domain i.e. usability practitioners/novice and the information architect(mostly experts that has also experience of working with usability). Twenty people from usability domain in which 15 users were novice and 5 were usability experts. The average ages of all participants are between 25-40. The average qualifications of the users are master degree. The selections of the subjects (people involved) are done from HCI communities and from Information Architects. The 15 novice users of the usability group were assigned task to perform usability test using Think aloud protocol technique on a web interface which were identical for all of the 15 users. The 15 usability novice users were evaluating the usability problems in group of three so they were in 5 groups same interface was provided to all groups for evaluating usability problem (usability data in this context). The users were speaking loudly what so ever they were thinking about finding the usability problems of the assigned interface. The five usability experts were assigned task to observe and record the usability data. One usability expert was appointed on one group of novice usability evaluators (3 novice users per one usability expert). The usability experts are then collected and the observed data and the data that are commonly observed by all the usability experts are then hand over to group of IA. The 5 information architectures started to construct the information architecture for these raw usability data. By using label taxonomy, story boards and scenarios and the navigation path of the users using flow diagrams. After the constructions of information architecture, it is shown to the 15 novice users again for their assessment and comments that whether they found it easier than before as was assigned to them in the first task. The assessment is done only by novice users because it will show better effectiveness of the model at a novice level. 2.1.1 Variables of the Experiment 2.1.2 Dependant Variable: The effectiveness is the dependant variable of the experiment because the effectiveness of the model is dependant on all the participants, techniques and experience of users 2.1.3 Independent Variable The independent variables of the experiments include, number of users, instruments, evaluation technique (think aloud protocol). 2.1.4 Instruments of the Experiment The two different groups should use different instruments to perform their tasks. The usability group in which 15 users use computer systems to evaluate usability problems for the particular interface design. Five 5 usability experts for their observations and recording data will use video/audio recording, incident diaries pen and papers
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VOL 3, NO 4 The IA group for designing the architecture for the gathered usability data will use, papers, pen for designing label taxonomies, card sorting, data flow diagrams, Microsoft Visio and Smart draw tool to develop architecture for usability data. 3: Validity Evaluation This part is constructed according to the format suggested by C. Wohlin [31] as 3.1 Internal Validity In the experiment the purpose of the internal validity is to observe the relationship between treatments and outcomes. The internal threat that is associated with different users is minimized by keeping the experience factors constant. So the different user with different experience interacting with the system in usability group has no internal threat to the experiment, as same treatment is given to all the participants of usability group. Since two different groups are selected but treated separately with their respective domain so their behavior and domain knowledge has no threat to the other group respectively. 3.1.2 External Validity One external threat to this experiment is the environment that includes placement, surroundings and the users. The users are selected in a reasonable way that can represent the sample population which is up to level minimized. The other external threat to this experiment will be the place but this experiment should be conducted in usability lab that should be fully equipped with recording and observing materials so this threat is brought to minimized level. Same is the case for information architecture in which they were equipped with story boards, viso tools etc. 3.1.3 Conclusion Validity 3.1.3.1 Reliability Measure: this can be a threat to this experiment because experiment does not based on statistics; rather its based on the personal judgments of the novice users. 3.1.3.2 Reliability of the treatment implementation This is objectionable in the context of ideal measures, as in this experiment human interactions are involved. Humanly mistakes can be a threat in the reliability of the treatment implementation 3.1.3..3 Random irrelevance in experimental setting This is not a threat in this experiment because the experiment is conducted in information architecture and usability labs which are fully equipped with instruments that are needed in this experiment under controlled and monitored way. 3.1.3.4 Random heterogeneity of subjects The subjects are not selected randomly; both groups of usability and IA are identical in their own domain. No heterogeneity exist between the subjects that can effect the out comes of the experiment. The subjects are not that much homogenous that it can affect the external validity of the experiment, neither affects the judgments of the observant, the subject is from same domain. I.e. usability and IA, both groups perform their task separately so neither of the groups are threat to each other in performing their individual tasks. 4 Operations On this stage the actual experiment is performed. The treatments are applied on the subjects (people/demographics involved in the experiment). The operation is comprises of three phases that includes preparations, execution and data validations. 4.1 Preparations The preparation part should be performed in two steps. First to select the subject (population samples) and informed them about the due date of experiment. The second step is to arrange the materials and instruments to perform the experiment. The subjects are selected from two fields i.e. from web usability industry and from Information architecture domain who serves as an architect in any organizations. Those subjects should be selected who are willing to conduct this experiment such that they represent the population from both practitioners/novice including information architects. The selection of the subjects should be done from web industries and information architecture field. Special considerations should be given to subjects so that it can represent the sample populations and can efficiently validate the proposed model. To obtain the consent of the subject, instructions about experiments are given to the participants. Since the result is not sensitive to participants so there is no need for participant personal data, only information about the proposed model is given to the participants. The instruments should be determined according to requirement and design of experiments. 4.2 Experiment Execution The experiment should be executed in two groups in different occasions; first the usability group should evaluate the usability data which provided the usability data that serves as an input to the IA group. The usability group will s first collects the usability data in usability lab through different means that includes video/audio recording, incident diaries and through observations of the usability experts. When the web usability is gathered, it should then be given to information architects for applying IA tools and concepts to transform that data. Both groups should conduct experiment in a controlled environment under the supervision of experimenter.
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The experiment execution can be shown in Figure 6 as
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15 Users perform usability test using think aloud protocol technique Usability group
Raw usability data gathered
5 usability experts observe and record the usability problem
identified by the users
The constructed Information architecture is shown again to the 15 usability novice group to evaluate, whether usability is easier and clearer than before? If Yes model is efficient if No model is not efficient
Usability data given to IA group 5 Information Architect design IA for the raw usability data
IA Group
IA construction for Usability

Web usability Information
Figure 6: Experiment to validate the effectiveness of the proposed Model
4.3 Data Validation The web usability data that are collected by first group of usability are validated by 5 usability experts, for validation of the collected data, the 5 usability expert considered those data that are commonly found by 15 usability users and then the data should be transfer to the second group of IA for the transformation of usability data into usability information. The validation of data collected should then be judged by usability experts. 4.4 Data Analysis and Interpretations In this phase the results gathered from the operations phase of the experiments should be analyze and interpreted to draw valid conclusions. The interpretation should be done in three steps that include Descriptive statistics, data set reductions and hypothesis testing. In this experiment the data should be interpreted using hypothesis testing. In the hypothesis testing the model will be analyzed in terms of how much deviation occurs in data. In this experiment usability problem should first be evaluated by users, the same usability data that are evaluated by the users are shown again to the users after applying the IA concepts on it. If 10 usability users out of 15 and 3 usability experts users out of five agree upon that the usability data become much easier and clear than before the model will be accepted else alternate hypothesis will be accepted. Similarly if the number of usability users is less than 10 and number of usability experts are less than 3 then the model will not be effective in transforming web usability data into web usability information. 4.4.1 Hypothesis Testing The hypothesis test should be performed to choose between the alternatives that is null hypothesis and alternate hypothesis given in section 5.1.2. The hypothesis testing can be summarized in the table as
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Steps:
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Null hypothesis(H0): if usability users group<10 and usability expert groups<3, model is not valid Alternative Hypothesis(H1): If usability users groups>10, and usability expert groups>3, model is efficient Decide Level of Significance: 10 Critical area: to filtered the common usability data gathered from all the 15 usability users by the experts Accept or reject Null hypothesis: If usability users groups>10 and usability expert groups>3 null hypotheses is rejected else vise versa. Conclusions: Model rejects null hypothesis, proposed model is effective ( if applied experiment)
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References:
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[1] Gettzulch and S.Stowasser, Usability Evaluation of User Interfaces with the Computer aided Evaluation Tool PROKUS, Germany, 2000 [2] L.Gamberini et al, Web Usability Today: Theories, Approach and Methods Amsterdam, IOS Press, 2001, 2002, 2003 [3] M.Morris, A. Dillon, The importance of usability in the establishment of organizational Software standards for end user computing, International Journal of Human Computer Studies 45, 1996, pp. 243-258 [4] E.Folmer and J.Bosch, Architecting for Usability: A Survey, Journal of Systems and Software, Issue 70-1, January 2004, pp. 61-78. [5] Adaptive Technology Resource Center (University of Toronto) and Trace Center (University of Wisconsin), Canada & USA, available from internet http://www.snow.utoronto.ca April 2008 [6] A. Beirekdar et al., A Framework and a Language for Usability Automatic Evaluation of Web Sites by Static Analysis of HTML Source Code, In Proceedings of 4th International Conference on Computer-Aided Design of User Interfaces CADUI'2002, 2002 [7] M. Hitz, G. Leitner, R. Melcher, Web Engineering: the Discipline of Systematic Development of Web Applications, Hoboken, N.J: Wile cop, 2006. [8] J. Nielsen, The art of Navigating through Hypertext, Communications of the ACM 33, 3 (1990) 296-310 [9] J. Howarth, T. S. Andre and R. Hartson, A Structured Process for Transforming Usability Data into Usability Information, Journal of usability studies, November 2007, pp. 7-23. [10] H.McnayInformation Architecture - Visual Displays IEEE, 2003. [11] John W.Creswell, Research Design Qualitative, Quantitative and Mixed Method Approaches, SAGE Publications, 2003. [12] ISO/IEC 14598-1, Software Product Evaluation: General Overview, Intl Org. for Standardization, Geneva, 1999. [13] N. Juristo, H. Windl and L.Constantine, Introducing UsabilityIEEE, 2001 [14] A. Seffah and E. Metzker, The obstacles and myths of usability and software engineering, Communications of the ACM, Volume 47 Issue 12, ACM Press, Dec 2004. [15] N. Bevan et al What is Usability? Proceedings of the 4th International Conference on HCI, Stuttgart, September 1991. [16] D.Pieratti, Xerox company document, available from Internet, www.stcsig.org/usability/resources/toolkit/brochur4.doc, May 2008 [17] P.W.Jordan, An introduction to Usability, Taylor & Francis Ltd, 1998. [18] A. Abran, A. Khelifi, W. Suryn and A.Seffah, Usability Meanings and Interpretations in ISO Standards, Software Quality Journal 11(4), 2003 pp. 325-338 [19] D. Wixon and C. Wilson, The Usability Engineering Framework for Product Design and Evaluation, Handbook of Human-Computer Interaction, M.Helander (Ed.), Amsterdam, 1997, pp. 665 [20] T. Powell, Web Design: The Complete Reference, Osborne McGraw-Hill, Berkeley, Calif., 2000 [21] M.Y. Ivory and M. A. Hearst Improving Web Site Design, University of California, Berkeley, IEEE, April 2002. [22] T.Brinck, D.Gergle, and S.D. Wood, Usability for the Web: Designing Web Sites that Work, San Francisco: Morgan Kaufmann, 2002 [23] H. Banati, P.Bedi and P. Grover, Evaluating Web Usability from the Users Perspective Journal of Computer Science 2 (4), Science Publications, 2006 pp. 314-317 [24] WHAT IS INFORMATION ARCHITECTURE? 2007 Information Architecture Institute http://iainstitute.org/documents/learn/What_is_IA.pdf last visited April 2 2008. [25] G.McGovern Information architecture versus graphic design Dec17, 2001 http://www.gerrymcgovern.com/nt/2001/nt_2001_12_17_design.htm , last visited April 2008 [26] D.Norman, The Design of Everyday Thing, Basic Books, New York, 2002. [27] DentsuFuse Inc Tokyo Information Architecture and Usability Expertise, Confidential, 2001 [28] D.K.Andrews, Information Architecture and Web Usability 706.041 Information Architecture and Web Usability WS 2007/2008 3VU Graz University of Technology, Austria, Copyright 2007 Keith Andrews. [29] L.Barker, KM Colum, What is Information Architecture? Step Two Designs Pty Ltd May 2005. [30] D. Dillman, R. Tortora and D. Bowker, Principles for Constructing Web Surveys,Joint Meetings of the American Statistical Association, 1998 [31] C. Wohlin, P. Runeson, M. Hst, M. C.Ohlsson, B.Regnell, and A. Wessln, Experimentation in Software Engineering: An Introduction. Boston: Kluwer Academic, 2000.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Relationship between Personality Traits and Marital Adjustment of Teachers
Hummara Akram Department of Psychology, University of Sargodha, Sargodha, Pakistan Dr. Najma I. Malik(Corresponding Author) PhD, Lecturer (Psychology) Department of Psychology, University of Sargodha, Sargodha, Pakistan
Abstract
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The present study aimed at finding the relationship between personality traits and marital adjustment of couples involved in teaching profession. The sample was comprised of (N = 30) teaching married couples, selected from the different colleges and University of Sargodha. For assessment of personality traits the Urdu version (Chisthi, 2002) of Revised NEO Personality Inventory (Costa & McCrea, 1992) and for marital adjustment the Urdu translation (Naseer, 2000) of Dyadic Adjustment Scale (Spanier, 1976) were used. Results indicated the significant positive relationship between Extraversion, and Conscientiousness with marital adjustment; whereas relationship between personality trait Openness to experience and marital adjustment was positive but non significant. Gender difference on NEO PI-R were also found to be non significant except for the Conscientiousness facets where women score significantly higher as compared to men and one of its sub facet order was found to be profoundly determinant in making that significant difference. Keywords: Personality Traits, Marital Adjustment, Teaching Faculty 1. Introduction Marital harmony is very imperative social phenomena globally and marital happiness without any troublesome relationship at home is critical for those who dedicate themselves for educational paradigm whole heartedly. Teachers who glee their job have a considerable effect on students indiscernibly, which ultimately guide their students to a promising future with positive and optimistic attitude. Many variables effect the marital adjustment but the one key feature is ones own personality. Similarity in personality traits is related to spousal selection and marital adjustment in ones married life, whether a marriage will turnout to be happy and satisfied. Personality traits are also related to important life outcomes such as marital unhappiness and divorce and literature connotes the importance of personality traits of husband and wife as play important role in adjustment of ones marital life (Andrews & Withey, 1965; Campbell, Converse, & Rodgers, 1976; Hughes & Gove, 1981; Nemechek & Stephine, 1999). An emergent literature on the interpersonal correlates of marital adjustment (Bradbury & Fincham, 1988; Gottman, 1994; Karney & Bradbury, 1997) reflects the prevailing notion that personality characteristics significantly contribute to positive and negative outcomes in marital relationships (Boucherd, Lussier, & Sabourin, 1999; Kosek, 1996; Kurdek, 1993; Nemechek & Olson, 1999; Russell & Wells, 1994; Shackelford, Besser, & Gietz, 2008). For instance, Kosek (1996) studied the personality characteristics and marital adjustment of 107 couples using Big Five personality traits measure and found that score in all personality dimensions were significantly predictor of marital satisfaction specially scores on Extraversion, Openness, Agreeableness and Consciousness were correlated positively with marital satisfaction. It was evident that highest correlation on the factor of agreeable and neuroticism yielded an inverse correlation with marital adjustment and personality satisfaction, as both husband and wives who relate their spouse higher on neuroticism were less happy in their relationship. In 1999 Nemechek & Stephanie studied personality characteristics and marital adjustment of 59 couples and found that spousal similarity in Agreeableness was related to marital adjustment only for husbands. However, husband rated their marriages as batter adjusted when their wives were similar to themselves in the extent to, which they were cooperative and altruistic. Partners similarity in Neuroticism was related to marital adjustment for wives but not for husband. Openness to feelings was also related to marital adjustment only for wives not husbands. Chen and Tanaka (2007) suggested that the personality traits of a partner could predict an individual's marital adjustment. The link between marital adjustment and personality was investigated in 66 Japanese married couples. Structural equation modeling suggested that the husband's Neuroticism score was related to the wife's marital satisfaction, while the wife's Extraversion score was related to the COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 husband's marital satisfaction. Spouses marital satisfactions were correlated with each other. Lester (1989) found that increased Extraversion of either spouse is related to marital dissatisfaction, while the findings of others suggest that marital adjustment is correlated with husbands who are relatively introverted and wives who are relatively extraverted (Barry, 1970; Bentler & Newcomb, 1978; Aluja, Barrio & Garcia, 2007). 2. Research Design Main focus of this study was to find out the relationship between personality traits and marital adjustment of teachers. As the teaching profession demands enthusiasm and requires a great deal of mental commitment, which is dependent upon marital harmony (Akhter , Muniruddin & Sogra 2008; Shen, 2001) present study was designed to assess the relationship between similar personality traits of the teaching couples and their marital adjustment and to explore the difference between personality traits of husbands and wives. On the basis of these assumptions it was hypothesized that couples that would score high on the facets of Extraversion, Openness and Conscientiousness would also have high level of marital adjustment. It was also hypothesized that personality traits would be different among teaching couples gender wise. The research design was co-relational however; cross sectional comparison was carried out to see the gender differences through quantitative analysis (t-test). The sample of (N = 30) married couples was drawn from the University of Sargodha and Post Graduate Colleges of Sargodha city, Punjab, Pakistan. Purposefully only those couples were taken as sample who were teachers and had an educational degree of MA/MSc, M.Phil and Doctorate/Post doctorate (currently teaching in post graduate colleges and university). Mean age for husbands was 45.20 (SD = 5.6) and for wives was 40.2 (SD = 4.8). Length of current marriage ranged from 2 to 25 years (M = 15.2; SD = 7.5). 2.1. Research Instrument For the present study the culturally adapted and translated version of the Revised NEO Personality Inventory (Chisthi, 2002) was used based on the Five-Factor model (McCrea & John, 1992). It consists of 240 personality items and response format consists of five-point ratings. The NEO Pl-R was designed to provide a general description of normal personality relevant to clinical, counseling and educational situations. NEO PI-R items and materials were designed to be easily read and understood. The five domains (factors) measured by the NEO PI-R provide a general description of personality, while the facet scales allow more detailed analysis. These five factors include: Neuroticism (characterized by anxiousness, depression and insecurity), Extraversion (being sociable, assertive and talkative), Openness to experience (imaginative, curios and open-minded), Agreeableness (friendliness, good natured, cooperative and tolerant), and Conscientiousness (being dependable, careful, and hard-working). For the present study three factors Extraversion, Openness and Conscientiousness were used. Extraversion factor has 48 items from which 20 items have reversed scoring. Openness factor has 48 items and 23 items have reversed scoring. Conscientiousness factor also have 48 items form which 20 items have reverse scoring. All the subscales of Revised NEO Personality Inventory yielded a high magnitude of reliability (ranging from .75 - .88) and the overall reliability of NEO PI-R was found to be .89, which was quite high. Marital adjustment of teaching couples was measured through Urdu translated version of Dyadic Adjustment Scale (DAS) (Naseer, 2000). It is a self-report questionnaire to measure the marital distress consisted of 27 items. In translated item No. 9 was split into two parts i.e. and because it was administered to both spouses. Factors analysis of DAS has resulted in form components of adjustment: (a) Dyadic Satisfaction, (b) Dyadic Cohesion, (c) Dyadic Consensus and (d) Affectional expression. For present study the alpha reliability coefficient of DAS was .86. 2.2. Procedure of the study To collect the data of the present study a test booklet comprised of the two scales containing 144 items of the NEO Personality Inventory and 27 items of Dyadic Adjustment Scale were administered individually on a sample of 30 married couples working as teachers at University and Post graduate colleges. Along with the informed consent form and demographic data sheet, printed on the separate sheet containing information about age, sex, education, marital duration. The participants were ensured that the responses would be kept confidential. They were asked to respond all the items according to instructions. In the end the participant were thanked for their cooperation. 3. Results After the data collection, the next step was the interpretation of data. The data were analyzed on the scores of personality inventory and marital adjustment scale. After computing the reliability analysis the data of sample was analyzed to see the relationship between personality traits and marital adjustment of teachers.
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3.1. Table 1 Correlation between NEO PI-R Factor of Extraversion and Marital Adjustment of Couples (N = 30) Extraversion Marital Adjustment Facets Warmth Gregariousness Assertiveness Activity Excitement-Seeking Positive Emotion Extraversion Total **p = .01 r .25** .28** .31** .26** .23** .26** .24**
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Findings in table 1 revealed a highly significant positive relationship between extroversion and marital adjustment on all the facets and total of extroversion factor of NEO PI-R (.23 to .31, **p = .01). It means that personality similarity on extraversion is significantly correlated to marital adjustment which confirms our hypothesis of study. Scores of couples were also analyzed on the second factor of personality i.e., openness to experience in relation to their scores of DAS. 3.2. Table 2 Correlation between NEO PI-R Factor of Openness to experience and Marital Adjustment of Couples (N = 30) Openness to experience Marital Adjustment Facets Fantasy Aesthetics Feelings Actions Ideas Values Openness to experience Total p = n.s In table 2, result demonstrated the non-significant relationship between Openness to experience and marital adjustment of couples. Fantasy, Aesthetics, Feelings, Actions and Ideas were positively related but this relation was not that much strong to be significant at large. These finding were contrary with the hypothesis of present study i.e., the couples with high level of openness would also have high level of marital adjustment. Data of study was also analyzed to find out the relationship between marital adjustment of couples and their personality trait of Conscientiousness and results are as follows: 3.3. Table 3 Correlation between NEO PI-R Factor of Conscientiousness and Marital Adjustment of Couples (N = 30) Conscientiousness Facets Competence Order Dutifulness Achievement Self discipline Deliberation Conscientiousness Total **p = .01 COPY RIGHT 2011 Institute of Interdisciplinary Business Research Marital Adjustment r .23** .27** .46** .26** .29** .36** .28** r .01 .01 .18 .08 .33 .27 .09
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VOL 3, NO 4 Findings in table 3 also indicated highly positive significant relationship between the on all the facets and total of Conscientiousness factor of NEO PI-R (.23 to .46, **p = .01). These findings also confirmed hypothesis of present study i.e., level of Conscientiousness would also be high in couples with high level of marital adjustment. To test our hypothesis that personality traits would be different among teaching couples gender wise, t-test was computed in order to analyze the gender discrepancy. 3.4. Table 4 Mean scores, Standard Deviation and t- values of Husbands and Wives on the NEO PI-R subscale (N = 60) NEO PI-R FACTORS Husbands (n =30) M Extraversion Openness Conscientiousness df = 58 Table 4 demonstrated the mean scores, standard deviation and t- values of husbands and wives on the NEO PI-R. Result reveals that there is non significant difference between the score of husbands and wives on Extroversion and Openness to experience but the significant difference exist between husbands and wives on Conscientiousness (**p < .01), which partially confirms our hypothesis that significant differences lie between genders. 154.17 148.0 173.6 SD 22.3 14.5 17.7 M 155.8 148.1 183.07 Wives (n =30) SD 12.8 11.9 13.7 t -.36 -.029 -2.29 p .71 .97 .02**
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4. Discussion The present study aimed at investigating the relationship between personality traits and marital adjustment. The findings of the study revealed couples who were high on extroversion personality traits were more adjusted in their married life (see Table 1), which is also inline with the literature review as Kosek (1996) also states that both men and women who were positively related to the score of their spouse on extraversion shared a contented and sound marital relationship too. It also predict a clear notion that in Pakistan society where the gender and social roles are still not that much outrageously changed as in the western societies. So still according to the role expectation model men and women have cognitive pressure to perform according to demand of their spouses as their role expectation and role performance are related to their marital adjustment (Orden & Bradburn, 1969). They have to work in multiple roles i.e., women in Pakistan society and culture to work outside and inside the home at great level and also demand them to be responsible and dutiful for both job and homes where the men dont have that kind of bondage but their role demands elasticity at par for the multiple roles and obligation while being part of a joint family system. That is the major reason that both husbands and wives change their roles and tends to be more socially adjustment and compromising as they exchange their both jobs and family roles according to the cost, rewards and outcomes they will get for their marital adjustment in the shape of social security, social praise and positively valued consequences as described by the Role Equity model (Thaibout & Kelly, 1959; Swensen, 1973). Thus, in present scenario it is more evident that as the teaching profession demands to build communication pattern on one to one and one to group basis, where the teacher who is extrovert indulge him / her easily in social interactions with colleagues, students and parents; enjoys others company and build up personal relations very easily. This helps them in agreement and companionship with their spouse also as they are sexually active in terms of frequency (Wilson, 1978) and reflects positive emotions towards their mates (Piedmont, 1998), which leads to marital adjustment and contentment (Fitzpatric, 2001). Study found that the factor of NEO PI-R i.e., Openness to experience was non-significantly related with marital adjustment, which rejects our hypothesis (see Table 2). The result was consistent with the studies of Fitzpatrick (2001) and Ansari (2003) who also found that openness was the only personality trait that had insignificant relationship to marital satisfaction across both gender as a person with this characteristic is creative, liberal and demands variety and with these descriptors as boundaries in place it becomes more obvious that marital harmony will not be sustained. According to McCrea (1991) open individual are imaginative, intellectually curious, and attitudinally liberal and have independence of judgment. Therefore, high level of openness in women may cause interpersonal problems and marital COPY RIGHT 2011 Institute of Interdisciplinary Business Research 721
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VOL 3, NO 4 dissatisfaction in conservative society with the male dominance like Pakistan, where women live not only with husbands but also with in laws and their independence both financially and in other ways (independence of judgment, intellectual curiosity, and active imagination) may generate threaten feelings in men. It is also very much obvious that in eastern society like Pakistan it is a strong believe that the person not only get married to another person ; yet to another family of that particular person , which demands various sacrifices and tremendous efforts for the upcoming times ahead (Rack, 1982). So, the Openness working women find it difficult to abide by every view point of their husbands as well as their in laws and as a result they have lower level of marital adjustment (McCrea, 1991). Present study also aimed to know the relationship between conscientiousness and marital adjustment and the result (see Table 3) indicated a highly positive and significant relation ship between the two variable, which are consistent with the findings of Buss and Shackelford (1997) that the human with a high degree of conscientiousness due to his/ her need of goal achievement becomes more energetic and determined to maintain and sustain the relationship (Ford, 1992). Though similarity in this facet may become troublesome at times when two people living together, each insisting that a given task must be accomplish in a particular way, make for a great deal of conflict. By comparison, task completion may be eased when one partner is highly concerned with details, and the other is more laissez faire (Shiota & Levenson, 2007) but the women become the key indicator of potential infidelity and in order to attain the trust and confidence of husbands and in-laws the working women in Pakistan tends to restrict themselves carefully in the boundaries of culture and religion (Ansari, 2003). Exploration of gender differences was also part of present study and it was hypothesized that significant gender differences would be found in personality traits of couples. Result showed that one hypothesis was partially supported as one facet of NEO PI-R i.e., Conscientiousness was a significantly (**p < .01) differ between men and women of study (see Table 4). If we see this result in the connection with the result present in table 3 than it can be clearer that the sub facet of Conscientiousness i.e., dutifulness donates high positive value in comparison to other sub facets, and it becomes clear that according to Pakistani cultural demand women tends to be more competent in meeting the role demands, are more dutiful, maintain order of life, they are achievement oriented and try to complete the role expectation and social exchange needs of jobs and homes. They tend to be more self discipline and make deliberate activities to be more active person in making the marriage a successful. Role accumulation theory (Seiber, 1974) also states that as working women indulge in multiple roles at the same time that multiple roles buffer their inner self identity and boost their well being as the dampen and overweigh the stressors present in the environment. On the other hand, few early researches also highlight the gender similarities as Thorndike (1914) believed that psychological differences were too small, compared with within gender variation, to be imported same found by McCrae, Terracciano and Costa (2001) that gender differences are small relative to individual variation within gender. In general differences are replicated across cultures for both college-age and adult samples, and differences are broadly consistent with gender stereotypes: women reported themselves to be higher in Neuroticism, Agreeableness, Warmth, and Openness to Feelings, whereas men were higher in Assertiveness and Openness to Ideas. Alan (1994) also examined gender differences in personality and found that men were more assertive and had slightly higher self-esteem than women. However, women scored high in extraversion, anxiety, trust, and, especially, tender-mindedness in comparison to men. There were no noteworthy sex differences in social anxiety, impulsiveness, activity, ideas, locus of control, and orderliness. Gender differences in personality traits were generally constant across ages, years of data collection, educational levels, and nations. Thus the findings in the present study were that there was gender differences in personality traits was consistence with others researches. 4.1. Limitations, Implications and Suggestions The partially significant results in term of hypotheses may provide an evidence for culture difference in the magnitude of gender difference. Among certain reasons one possibility was that the sample size was very small and the results may depict different picture with large sample. However, the present study will be helpful for therapeutic work. In clinical setting assessing the personality traits of the clients can be very helpful to solve their adjustment problems. Clinicians can identify the styles that contribute to better or well adjusted marriages and they can develop strength in clients how they can be well adjusted. Results from this study may provide suggestions for teachers, education authorities and future researchers. It is also suggested that study should be replicate on large sample with couple having different profession and all the five factor of personality should be included in the study. It would be more informative if future studies should analyzed the associated variables of socioeconomic status, length of marriage, childlessness/ infertility and nuclear and joint family system couples too.
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References
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Akhter, I., Muniruddin, G., & Sogra, K. J., (2008). A trend analysis of faculty turnover at the private universities in Bangladesh: A business school perspective. Journal of Business Studies, 4(1), 1-5. Alan, F. (1994). Gender differences in personality: A meta-analysis. Psychological Bulletin, 116, 429456. Aluja, A., Barrio, V. D., & Garcia, L. E. (2007). Personality, social values and marital satisfaction as predictors of parenting styles. International Journal of Clinical and Health Psychology, 7(3), 725-737. Ansari, K. (2003). Personality traits and socio economic status of working women as predictor of marital adjustment in working women. Published PhD dissertation, Institute of Clinical Psychology, Karachi University, Pakistan. Barry, W. A. (1970). Marriage research and conflict: An integrative review. Psychological Bulletin, 73(1), 41-54. Bentler, P. M., & Newcomb, M. N. (1978). Longitudinal study of marital success and failure. Journal of Consulting and Clinical Psychology, 46, 1053-1070. Bradbury, T. N., & Fincham, F. D. (1988). Individual difference variables in close relationships: A contextual model of marriage as an integrative framework. Journal of Personality and Social Psychology, 54, 713-721. Buss, D. M & Shackelford, D. M. (1997). Susceptibility in infidelity in the first years of marriage. Journal of Research in Personality, 31. 193-221. Campbell, A., Converse, P., & Rogers, W. (1976). The quality of American life. New York: Russell Sage Foundation. Chen, Z., & Tanaka, N. (2007). The Role of Personalities in the Marital Adjustment of Japanese Couples. Social Behavior and Personality, 35, 561-572. Retrieved from http://www.atyponlink.com/SJP/doi/abs/10.2224/sbp.2007.35.4.561?cookieSet=1&journalCode= sbp Chisti, M. A. (2002). Translation and adaptation of revised Neo Personality Inventory. Unpublished M.Phil Dissertation, Quaid-i-Azam University, Islamabad, Pakistan. Costa, P. T. Jr., & McCrae, R. R. (1992). Normal personality assessment in clinical practice: The Neo Personality Inventory. Psychological Assessment, 4, 5-13. Fitzpatrick, N. Y. (2001). Marital Satisfaction and Personality. Graduate School of Psychology U.S.A. Ford, M. E. (1992). Motivating humans: Goals, emotions, and personal agency beliefs. Newbury Park, CA: Sage. Gottman, J. M. (1994). What predicts divorce? New Jersey: Lawrence Erlbaum Associates, Inc. Hughes, M. M., Gove, W. R. (1981). Living alone, social integration, and mental health. American Journal of Sociology, 87, 48 - 74. Karney, B. R., & Bradbury, T. N. (1997). Neuroticism, marital interaction and marital satisfaction. Journal of Personality and Psychology, 72, 1075-92. Kosek, R. B. (1996). The quest for a perfect spouse: Spousal mating and marital satisfaction. Psychological Report, 79, 731-735. Kurdek, L. (1993). Predictors of increase in marital distress in newly married couples: A 3- years prospective longitudinal study. Developmental Psychology, 27, 627-638. Lester, D., Haig, C., & Monello, R. (1989). Spouses personality and marital satisfaction. Personality and Individual Differences, 10, 253-254. McCrae, R., & Costa, R. (1991). The five factor model and its assessment in clinical setting. Journal of Personality and Social Psychology, 51, 167-169. Naseer, S. (2000). Marital adjustment and stress among traditional couples and dual-career couples. Unpublished M.Phil Dissertation, Quaid-i-Azam University, Islamabad, Pakistan. Nemechek, S., & Olson, R. (1999). Five Factor Personality Similarity and Marital Adjustment. (High Plains Mental Health Center. Goodland, KS, USA, Fort Hays State University) 27, 309-319. Orden, S. R., & Bradburn, N. B. (1969). Working wives and marriage happiness. American Journal of Sociology, 74, 392-407. Piedmont, R. L. (1998). The Revised NEO Personality Inventory: Clinical and research applications. New York: Plenum Press. Rack, P. (1982). Race, culture and mental disorder. New York: Tavistock Publications. Russell, R. J. H., & Wells, P. A. (1994). Predictors of happiness in married couples. Personality and Individual Differences, 18, 27-31. COPY RIGHT 2011 Institute of Interdisciplinary Business Research 723
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VOL 3, NO 4 Seiber, S. D. (1974). Toward a theory of role accumulation. American Sociological Review, 39, 567-578. Shackelford, T. K., Besser, A., & Goetz, A. T. (2008). Personality, marital satisfaction, and probability of marital infidelity. Individual Differences Research, 6, 13-25. Shen, A. C. (2001). The applicability of western marital satisfaction measure for couples in Taiwan based on ENRICH. Psychological Testing, 48(2), 131-151. Shiota, N. M., & Levenson, W. R. (2007). Birds of a feather dont always fly farthest: Similarity in Big Five personality predictor more negative marital satisfaction trajectories in long term marriages. Psychology and Aging, 22, 666-675. Swensen, C. (1973). Introduction to interpersonal relations. Florida: Furesman. Thibaut, J., & Kelly, H. (1959). The social psychology groups. New York: Wiley. Thorndike, E. L. (1914). Educational psychology (Vol. 3). New York: Teachers College, Columbia University. Wilson, E. O. (1978). On human nature. Cambridge, MA: Harvard University Press.
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STRATEGIC CONFLICT MANAGEMENT OF SECONDARY SCHOOL ADMINISTRATORS IN THE TABUK REGION, SAUDI ARABIA Yosef Mawdh S. Aljhani Faculty of Education, Department of Educational Management, Planning and Policy, University of Malaya. Jaber Hassan Faculty of Education, Department of Educational Management, Planning and Policy, University of Malaya. Ismail Hussein Amzat UCSI , University, Malaysia
Abstract
This research was carried out in the Tabuk region, Saudi Arabia on 41 school administrators from public secondary schools. The respondents were asked to identify and rank the areas from which conflicts are most likely to originate. It is found that the cause of conflict from parents comprised the largest figure in their responses, followed by the principal's character and both teachers and students behaviour. While these school administrators have identified the cause of their conflicts, they have also indicated that most of them would prefer to use avoidance when managing conflict, unless the situation becomes urgent and demanding. The majority of the respondents have also stated that they would use their position and power to settle conflicts, but if the situations are new and have no prior reference or experience to work from, they would change their approach by being collaborative and putting their teaches needs first before making their decisions in conflict resolution. Most school administrators in this region have shown good leadership skills and this can be shown from the improvement in existing communication methods, conveying their school mission and vision clearly and also increasing their involvement in both their teachers welfare and students academic achievement. Using Pearson's correlation, it is interesting to note that while the system and rules and curriculum level are least likely to be the causes of conflict, they have the highest influence on their behaviour in conflict management. On the other hand, it is found that leadership styles are affected greatly by the cause of conflict from society (r= .955, p< .01), followed by conflicts caused by students behaviour (r=.951, p< .01). Findings from this relationship study may suggests that strategic conflict management should include the management of both cause and effect, such as communicating clearly to the stakeholders outside of the school while improving the school administrators approach in dealing with conflicts arising from both society and student-related problems. Keywords: Strategic Conflict Management, Conflict Resolution, Leadership, Administrators, Secondary Schools.
1. Introduction
Conflicts are inevitable and incidentally form an integral part of life. People from all walks of life and all ages are faced with conflicts that can be constructive or destructive, depending on their methods of approach to suit the various circumstantial situations unexpectedly arising. When many people failed to manage an organization, the nature and the level of conflict within and between the organizations has to be viewed and analyzed in a constructive but effective system. Therefore, dealing
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professionally with a conflict must be treated as a priority and in a strategically, efficient, and harmoniously concordant method. Educational organizations usually have to face professional conflicts, whether due to owner disagreements, personnel issues, issues concerning vendor relationships, customer concerns or competitive situations, but there must positively be some effective ways to resolve them, preferably without arousing any doubt, ill feelings or misinterpretation to those concerned. According to Wilson (2002), individuals or organizations that are capable of handling strategic conflicts are most successful in their endeavours as long as their methods of approach are cordially and amicably accepted without recourse for further actions.
2. Background of Education in Saudi Arabia
Referring to the discussion presented by Bush (2006), one might think that school leaders in Saudi Arabia followed the more "formal" model as far as leadership is concerned. To explain further, the "formal" model is a generic term used to encompass a number of similar but not identical approaches. The term "formal" is used because these theories emphasize the official and structural elements of organizations. Formal models assume that organizations are hierarchical systems in which managers use the rational means to pursue the agreed targets. Heads of schools have the authority legitimized by their formal position within the organization and are responsible to the sponsoring agencies for the activities of their organization (Bush, 2003). Education is at the forefront of the priorities of the Saudi government. As the basis for the progress of the nation, the education sector has seen important developments since the founding of the first Ministry of Education in 1953. Thousands of elementary, middle and secondary schools have been established, as well as colleges and universities. According to UNESCO (2007), the gross enrolment rate for boys and girls in the primary education is 98.1%. For the secondary education, the total gross enrolment rate is 95.9%. In the secondary education, the gross enrolment total is 91.8% (UNESCO 2007). The management of all public and private schools in Saudi Arabia is under the jurisdiction of the Ministry of Education. However, the General Management of Educational Planning was established in 1419H or roughly 12 years ago (1998G). The main task of this body is to: a. Make educational plans to improve the educational work in the Ministry so as to achieve its educational expansion targets. b. Make long-term plans for improving the educational processes in the Ministry as well as short-term plans taking into account the following points: i. Studying educational policies and general targets. ii. Preparing educational planning projects and required work programmes in different stages. iii. Specifying the requirements on educational planning according to the current situation and future expectations. iv. Coordination and cooperation with other departments in making the plans objectively realizable. v. Following up as well as effective supervision on the implementation of the plans and monitoring them to guarantee the achievement of the educational planning targets of the Ministry. The education system in Saudi Arabia is primarily the responsibility of the Ministry of Education, the Ministry of Higher Education and the General Organization for Technical Education and Vocational Training. Other authorities, such as, the Ministry of Defence and Aviation; and the Presidency of the National Guard; the COPY RIGHT 2011 Institute of Interdisciplinary Business Research 726
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Ministry of the Interior provides their affiliates and children with educational facilities, such as, kindergarten, elementary, intermediate, secondary and adult education as well as keeping in step along the educational ladder, study plans and curricula, all these being exclusively formulated by the Ministry of Education. The highest authority that supervises the education in Saudi Arabia is the Supreme Committee for Educational Policy which was established in 1963. The Ministry of Education developed The Ministry of Education Ten-Year Plan for the period 1425 1435 (2004 2014) which set the following targets for that ten-year period: 1. The education of 4 to 6-year old children and the consideration of the kindergarten as an independent stage in terms of its buildings and syllabi from other education stages. 2. Accommodation of all age categories from 618 years old at various stages of education. 3. To deepen, invoke and invigorate the spirit of loyalty to and pride in the country through intellectual awareness based on recognizing the past and present issues of the country. 4. To prepare students academically and culturally at a local and international level to be able to achieve advanced posts internationally in the fields of mathematics and sciences for various age categories, taking into account the well established international testing standards. 5. To organize girls technical education. 6. To develop the educational system for students with special needs. 7. Development and growth of the Ministry personnel educational and administrative training. 8. Improvement of internal and external sufficiency for the educational system. 9. To develop syllabi based on the Islamic values leading to the development of male and female students cultured personality and to their integration into the society as well as to the achievement of scientific and thinking skills and commendable life characteristics resulting in self-education and lifelong learning. 10. To improve the quality of male and female teachers and to increase the citizens rate of participation in the education sector to achieve the full use of the Saudi knowledgeable and intelligent human resources. 11. To develop the educational structure and to update the school map of onward educational enhancement to meet the expected quantitative and qualitative changes in the next stage. 12. To develop the infrastructure of information and communication technology and its employment in education and learning. 13. To develop male and female adult educational literacy and to eradicate illiteracy. 14. The Ministrys comprehensive administrative development.
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16. To establish Education). integrated systems of accountability (Ministry
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15. Expansion of social participation in education to keep up with the global educational advancement. of
Although education has always been a priority in Saudi Arabia, with the coronation of King Abdullah, further education related projects have really begun to take off. One of the results of this is the King Abdullah Project for General Education Development. The King Abdullah Project for General Education Development is a SR 9 billion project to be implemented over the next six years to guarantee the availability of a highly skilled and motivated work force in the near future. A number of schools in Jeddah, Riyadh and Dammam have been selected for the implementation of this project. Crown Prince Sultan will head a ministerial committee to supervise the project which will start to create a high-tech classroom environment in Saudi Arabia over the next six years. More than 400,000 teachers will be trained to effectively teach in classes in the high-tech style. In addition, this project will emphasize on extracurricular activities for purposes of developing the intellectual, creative and communicative skills of students so that the country will have more well cultured, innovative, well motivated, conscientious and possessing the sense of belonging to the state as well as vigorously enthusiastic, more productive in their outputs and are ever so ready to face the daunting challenges of the near future without cringing back into the protective shell of cowardly pretence.
3. Problem Statement
In modern organizations, including educational organizations in Saudi Arabia, and in this research focusing on the Tabuk Region, conflict is a serious problem to tackle. In many cases, it wastes precious human resources that will be better directed to other activities, including the multi-aspect primary work of the organization. According to surveys, practising managers suggest that they spend more than 20% of their otherwise useful time dealing with conflict or its aftermath (Thomas, in press; Thomas & Schmidt, 1976). Nowadays, educational organizations are facing a lot of conflicts of various categories, especially, due to globalization and its influences that can create circumstantial situations of conflict. An organization that has humans as the member group, will, to varying extents, have conflict because of the inherent human factor. Human nature is such that people are always changing and this change creates conflict either in one way or another. As an educational leader, one must be prepared to face this ever present phenomenon in the workplace. Even though educational organizations are non-profit entities, they are not immune to conflict. This research aims to gain a better in-depth scrutiny of the strategy of conflict management that is being practised by educational leaders in their management in the Tabuk Region of Saudi Arabia. This paper is concerned with the impact of a strategic conflict management on the growth and success of the educational management in Tabuk Region by the principals of the secondary schools. In line with this holistic desire, problems recently occurring in educational management organizations were disclosed for the focus of the study. Moreover, this paper identifies and analyses several main causes of a conflict in the organization. Furthermore, this paper stresses on its importance, considers the implications, and makes appropriately practicable proposals on the subject of the study.
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4. Research Objectives
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i. ii. iii. iv. v.

5.
To define in its truest sense the strategic conflict management concept, and to discuss its definition, related theory, philosophy and methodology very closely associated with an impending conflict. To determine the strategic conflict management that is most practised by the principals of secondary schools in Tabuk Region. To define the theoretical and empirical correlations between the sample demography and the strategy that they practise and implement. To determine the differences of educational leaderships style with the practice of strategic conflict management. To define the factors that influences the actions of school administrators when choosing a strategic conflict management in their tasks. What is the most common repeatable strategic conflict management style practised by the principals of the secondary schools in Tabuk Region, Saudi Arabia? Is there any significant correlation between the secondary school principals/vice principals styles/behaviour and the strategic conflict management that they practise? Is there any difference or contrariety between the leadership style and the strategic conflict management that they practise?
Research Questions
i. ii. iii.
6.
Research Limitations
The researcher will focus only on the practice or the implementation of the strategic conflict management by the school administrators (principals or second assistant of/deputy principals) of secondary schools. Therefore, the research will only be conducted by surveys designed for all the 22 secondary schools with 41 respondents in Tabuk Region, Saudi Arabia. The research sampling is done among the schools that are fully supported by the government. The data from the outer region is considered not valid. All data were recorded according to the most recent and current research as conducted by the researchers by the date this research paper was written.
7. Literature 7.1 Conflicts in Educational Institutions
Webster's Dictionary (1983) defines a conflict as a sharp disagreement or opposition of interests or ideas. Reynolds and Kalish (2002), organizational consultants in mediation, collaboration and conflict resolution, note that managers spend at least 25% of their time on the resolution of labour disputes. This obviously affects the productivity of managers and partners or employees and can have a powerful impact on the organizational performance (Gatlin et al. 2009). According to De Bono, (1985), a conflict is something that is related to a clash of interests, values, actions, opinions or directions and desires as well.
7.2 Educational Management and Conflicts
In the educational setting, the conflicts may arise; the school managers and leaders need to evaluate a diversity of factors ahead before choosing what is considered as the best approach to the situation. An individual may select to compete, or dominate or trying to mandate the other side through physical or psychological means, or some may rather opt to accommodate, or give up, and be victorious on the other side. Similarly, some may prefer to withdraw by either engaging themselves with other nothings or isolating and abstaining from participating in resolving the conflict
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altogether. Besides, they may work together and attain a productive and commonly acceptable, or at least, amicable solution. With the new era of the government taking over the educational institutes in terms of financial supports, this involvement into micro-politics has lately changed with the increasing permeability of the school boundary (Hoyle, 1999, Bush, 2003). Besides, Hoyle (1986) did argue that, schools are particular prone to political activities because of their 'loosely-coupled' structure. This kind of involvement has led to serious conflicts in schools and higher institutions. In addition, nowadays, the organization has been personally influenced and compromised with the involvement of uncalled for political intrusion, especially, in schools. With this regard, leadership becomes a matter of political skills where you can literally see the head-teachers playing the awkward role of strategic performers by adopting particular styles of the self in order to dominate the organization (Ball, 1987). Ball argued that, this is the problem of micro-politics in education which has rejected 'top-down' and directly and manipulatively determined the interest, approach and concerns of teachers as well as the current problems of change facing the schools.
8. Research and Findings on Conflicts and Educational Management
The occurrence of conflicts in schools around the world and awareness of such conflicts by members of the staff cannot be longer ignored nor tolerated. A research conducted by Olu and Abosede (2003) on conflict management in the Osun state secondary schools in Nigeria shows that, a considerable number of the staff show a positive awareness towards conflict while undisputable numbers of staff are negative attitudes towards conflict. This is a proof that a reasonable percentage of workers are aware of the occurrence of conflicts in their schools. Moreover, a research carried out by Okon (2005) Embugus (2006) stated that in school districts where principals and teachers agree on a common course of action for conflict management, disputes are better managed. In relation to this, the research of Vautheven and Hee (2004), Ikoya (2006) also supported that when principals and board members and teachers are satisfied with the school conflict management policy, the teachers are subconsciously motivated and get actively involved in the school discipline
8.1 Causes of Conflicts
Known as the "eight causes of conflict", Bell (2002) originally proposed six grounds for conflict in the workplace: i) The needs to conflict, ii) The conflict styles, iii) The perceptions of conflict, iv) The conflicting objectives, v) The conflicting pressures, and vi) The conflicting roles, while Hart (2000) also describes two unpredictable causes of conflict: i) Different personal values and ii) Different political values.
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Gatlin, Wysocki, and Kepner, (2009) proposed the following points made with reference to educational organizations: a) b) c) d) e) f) g) h) Cause 1: Conflicting Needs Cause 2: Conflicting Styles Cause 3: Conflicting Perceptions Cause 4: Conflicting Goals Cause 5: Conflicting Pressures Cause 6: Conflicting Roles Cause 7: Different Personal Values Cause 8: Unpredictable Policies
8.2 Who is involved in a Conflict
In a school environment, organizational conflicts occur in the area of interpersonal conflicts. Three categories of conflict may arise; i) interpersonal conflicts among teachers, ii) interpersonal conflicts between the principals and the teachers and iii) interpersonal conflicts between the teachers and the students. However, in order to sample the data, the first and second categories of conflicts will be focused on the study. It is a fact that considerable time and energy are often used by managers or school administrators to deal with interpersonal conflicts among the actors of the school. Interpersonal conflict management is an essential component of a school leadership in schools.
8.3 Managing Conflicts in School
In the literature, numerous types of conflicts are mentioned and are divided into intra-personal, intra-group, interpersonal, intergroup, etc. According to DeCenzo (1997), conflicts of the organization can come in different ways, such as: the horizontal conflict, the vertical conflict and the role confusion/conflict. From the literature, the sources of conflict can be categorized into three types which are: i) Competition for scarce resources, ii) autonomous units, objectives and iii) divergence as a result of differences of opinion. Ivancevich (1996) stated that four factors are known to contribute or lead to conflict: j) Interdependence of work, ii) differences in objectives, iii) differences in perceptions, and iv) the increasing demand for specialists. Besides, Pondy (1969) has identified five stages of the conflict which are: i) Latent conflict, ii) perceived conflict, iii) felt conflict, iv) manifest conflict and v) post conflict (cited in Olu & Obesede, 2003).
In this particular research of Olu and Obesede, (2003), the inter-personal conflicts ranked the highest among the several types of conflicts that were identified in schools selected for their study and stated that, there should be a remedy to solve the problem. Additionally, studies have found strong relationships between the conflict management and the development. Studies conducted at a contemporary time by Blau (1986), Henkin (2000), Naquin and Tyne (2003), Arubayi (2006) have confirmed significant relationships between the organizational conflict and the system
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effectiveness. Thus, if conflict is resolved, organization progresses (Peter & Samuel, 2009).
9. Conflict Theory
In conflict, we may sometime receive some gains and benefits, and before receiving that, according to Otomar and Pual (2002), we have to, first of all, identify the causes of the conflict behaviour for us to explain why a particular conflict exists in the first place. In this situation, a conflict behaviour can occur for six main reasons: The parties may sense goals incompatibility among themselves, i) They may have perceived themselves of attaining high unity and ii) solidarity, They may be united for conflict, iii) Mobilizing their conflict resources, iv) Having the sense of hostility towards their opponents and v) They may be equipped with enough materials as it was shown in vi) figure 1.
Incompatible Solidarity Organization Mobilization Hostility Resource

Figure 1: A theory of Conflict Behaviour
9. The Framework for Conflict Resolution in schools 9.1 Conflict Management Model
Conflict Behavior
Using the Conflict Management Model in accordance with the Thomas-Kilmann instrument and behaviour, it can be expressed in terms of the co-operation and the assertiveness, and how that approach works.
Figure 2: Conflict Management Model
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For the model, according to Lyndsay (2006), avoidance is helpful if there is no serious need to resolve differences now or in the foreseeable future. In addition, it may not be helpful for a long term conflict management strategy if the workplace is too widened and not enough to avoid someone totally. These actions can be portrayed by delegating controversial decisions, or accepting fault decisions that will eventually dwindle into not to hurt other people's feelings. As mentioned, this approach is considered as an ineffective and nave approach to take because in many situations it is considered as the weakest decision to make. In relation to accommodative style, an accommodation permits the other person's needs to be attained, usually at the expense of the initiator. This is a helpful conflict management strategy if the issue can be ignored or put aside, or if the relationship is powerful or situational. It is about giving ways for other people in a way which may preserve or even build an amicable relationship. This style prioritizes people's needs and put them as a top agenda. The initiator always gives in to others; and it is not assertive but cooperative. Referring to a compromise, it is about collaboration and is somewhere between a competition and an accommodation where it gives up some ground to gain other ground somewhere else in which case the concept of you win some and you lose some is the guiding principle, while competition is the positive side of accommodation, that is, assuring that our own needs are attained, no matter at what cost. This win-lose approach is useful if there is an important deadline to meet, or if the relationship with the other party is not important. Regarding collaborative approach to conflict resolution, it argues on the possibility of solutions that all sides find acceptable. Collaboration is about identifying a common, shared, or joint goal and developing a process to achieve it. It is a process in which both parties exchange information openly, define their common problems, and create tenable options to solve these problems.
10. Research and Findings on the Conflict Resolution in Schools across the Global Scenario.
A conflict as well as a violence in school affects the physical and the social activity of a teacher and can even cause an irrevocable psychological trauma to a group of teachers and staff within the school environment. An accidental or unintended circumstantial situation or an unexpected aftermath of an eventful incidence may give rise to an eruptive and an unmanageable violence which can cause classroom disruptions, discipline problems (conflict between teachers and pupils), abuse between pupils (bullying), vandalism and physical damage, physical violence (aggression, extortion), and sexual harassment (Aznar, 2007). Studies conducted by the Organisation of Ibero-American States for Latin America (OEI, 2007), state that 22.9% of students say they have been verbally abused by their peers, 15.6% say they have been robbed, and even more alarmingly, 9.6% report having been physically assaulted. Also a research done by (OEI, 2007), shows that more than half of Latin American students have suffered some form of a direct aggression and incidentally abuse has also been occasioned on the teaching staff which has shown a serious concern. Nearly 20% of teachers have experienced some form of violence and 2.3% say they have been a target of aggression, although there are many teachers who also occasionally resort to intimidation and other abusive action in order to exert their power and authority (Cabezas, 2008).
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These studies are sending serious signals to educational administrations or managers to be skilful in solving conflicts in schools by applying different strategies to remove the abstracts. Studies by Lynch (2000), Amaize (2007) and (Onoyume (2007a) indicate that when a conflict remains unsolved, the academic eventual progress is at stake or may even be retarded. Globally, many approaches were used in different schools towards a conflict and its solution. It seemed "avoidance" techniques used to be effective in dealing with the conflict. A research carried out by Peter and Samuel (2009) testified the effectiveness of avoidance techniques for the time being where members of the board of education and school proprietors agreed on the application of the avoidance technique but principals and teachers are less keen on the application of that approach as it indirectly implies a weak administrative stance which tends to induce and eventually invokes further manipulated conflict. In terms of conflict management styles, Follett recommended three main ways to handle a conflict: i) domination, ii) compromise and, iii) integration. Furthermore, she later discovered other styles in her study that the educational management could use in dealing with a conflict in schools, such as, avoidance and suppression (Saduman, 2010).
11. Dimensions of Conflict
Rummel (1976) notes that the conflicts are multidimensional as they appear in different forms. One can see a conflict in terms of its analytical purposes and practical problems. The first concerns a conflict taken as a social phenomenon, especially, in schools. From this view, one can work towards the understanding of a social conflict and its empirical manifestations. In fact, conflicts appear in many disguised forms and are interwoven with multiple causes, provision and power. The aspect of its manifestation depends on the confrontation between the realities of the individual perspective and that of the acceptable norm. Conflicts resolution is known to be a balance of vectors or power, or the ability to produce effects. It is a clash of powers and the result may not necessarily be the achievement of an overall equilibrium or stability. Fundamentally, a conflict is synonymously correlative to power. To understand the powers is to understand the unravelling of the powers involved behind it, according to Rummel (1976). Conflict situations should be either resolved or used beneficially. Conflicts can have positive or negative effects on the organization, depending upon the environment created by the manager who manages and regulates or rather creates the conflict situation. According to Filley (1975), one of the positively demoralizing effects of conflicts is the dissemination of more serious conflicts. Games can be used to moderate the attitudes of people, providing a competitive situation which can release the tension of the competing parties and produce some entertainment value. In organizations where members participate in decision making, conflicts are usually mild but sharp as some of the moderate members belligerent and aggressive behaviour is in minor disagreement which mitigates the risk of an unmanageable physical violence. Further destructive effects of conflict can cause the impending impediments in producing a good job, the reduction of productivity, the obstructions in decision making, and the formation of competing affiliations within the organization itself. Thus, the overall result of these negative effects is the reduction of the employee commitment to organizational objectives and organizational efficiency (Kirchoff & Adams, 1982).
12. Methodology 12.1 Research Subject
In this study, 41 respondents have been selected from 22 public secondary schools in Tabuk region, Saudi Arabia. These respondents consist of either principals or
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vice principals. The data from the outer region is considered not valid. All data are recorded according to the most recent and current research methods as conducted by researchers at the time this research paper was written.
13. Research Instrument
Each respondent is given a questionnaire that consists of 3 parts. Part 1 consists of a background information; part 2 consists of the school administrators' mode of approach and leadership skills in conflict management, while part 3 consists of the causes of conflicts that may have happened in their schools.
14. Place of Research
The research is conducted among the selected public secondary schools that are situated in Tabuk region, Saudi Arabia.
15. Research Procedure
The total of 41 school administrators who volunteered to answer the questionnaire were initially guided through every question until completion. When there was confusion in understanding the questions, the researcher made an effort to explain the meaning and provide some examples that would help the respondents to provide a deeper and more elaborate answer to the list of questions. It was made clear to the respondents that the data provided to the questionnaire was to be completed by the end of the session. It is important to note that while these school administrators were completing their assigned questionnaires, a short time was allocated at the end of the session for the researcher to gather other information that was useful to substantiate the data. This extra information is vital as it provides relevant examples for the researcher to further understand the practices and challenges of these school administrators during performance of their individual task as administrators and managers of their respective schools.
16. Research Analysis
The data derived from the questionnaires were analysed quantitatively using the Statistical Package for Social Sciences software (SPSS) through which these data were arranged, coded and analysed. Both the descriptive and the inferential statistics were used to derive results that would help to explain the information needed to elaborate and illustrate findings pertaining to the objectives of this study. Based on the methodology prescribed for this research, the data are analysed and presented in the next chapter.
17. Findings 17.1 School Manager's Background Information
Almost half of the total of 41 respondents in the survey consist of principals (48.8%) while the other 51.2% are vice principals of the school. Almost all of them have a bachelors degree (40 respondents) while only one respondent has a masters degree as his highest educational attainment. When the number of years in service was investigated, it was apparent that most of the respondents (78%) had served in the school managerial positions for less than 10 years, while the other 22% had served between 11-19 years. Listed below in Table 4.1 is the summary of the school managers interviewed in Tabuk region, Saudi Arabia.
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Table 1: Background of school administrators interviewed in the Tabuk region Demographic N Percentage 1. Position held Principal 20 48.8% Vice principal 21 52.2% 2. Educational level PhD 0 0 Masters 1 2.4% Bachelors Degree 40 97.6% 3. Number of years Less than 10 years 32 78% 11-19 years 9 22% Above 20 years 0 0% Table 2: Behavioural Responses towards Conflicts in School 1. Keep opinions to themselves if not answerable to others Totally disagree 3 (7.3%) Disagree 11 (26.8%) Agree 26 (63.4%) Totally agree 1 (2.4%) 2. Rather avoid a conflict than to be involved in one Totally disagree 3 (7.3%) Disagree 6 (14.6%) Agree 30 (73.2%) Totally agree 2 (4.9%) 3. Differences in opinions are not important and threatening when faced with conflict Totally disagree 0 (0%) Disagree 1 (2.4%) Agree 25 (61%) Totally agree 15 (36.6%) 4. Open to listen to other people's opinion, but would eventually decide how to deal with conflicts at work Totally disagrees 1 (2.4%) Disagree 1 (2.4%) Agree 24 (58.5%) Totally agree 15 (36.6%) 5. Have the final say in any conflict resolution Totally disagree 0 (0%) Disagree 6 (14.6%) Agree 23 (56.1%) Totally agree 12 (29.3%) 6. Make most decisions based on teacher's needs Totally disagree 0 (0%) Disagree 3 (7.3%) Agree 25 (61.0%) Totally agree 13 (31.7%) 7. Make changes based on priority Totally disagree 1 (2.4%) Disagree 0 (0%)
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Agree 24 (58.5%) Totally agree 16 (39.0 %) 8. Willing to accommodate with recent situations pertaining to conflicts Totally disagree 1 (2.4%) Disagree 0 (0%) Agree 18 (43.9%) Totally agree 22 (53.7%) 9. Find their way to compromise through a conflict. Totally disagree 0 (0%) Disagree 2 (4.9%) Agree 20 (48.8%) Totally agree 19 (46.3%) 10 Find a point of balance when faced with a conflict at work Totally disagree 1 (2.4%) Disagree 0 (0%) Agree 21 (51.2%) Totally agree 19 (46.3%) 11. Willing to listen to other people's ideas Totally disagree 1 (2.4%) Disagree 0 (0%) Agree 17 (41.5%) Totally agree 23 (56.1%) 12. Agree to cooperate with teachers in resolving conflicts. Totally disagree 1 (2.4%) Disagree 0 (0%) Agree 14 (34.1%) Totally agree 26 (63.4%) 13. Do not like endangering others when making decisions Totally disagree 0 (0%) Disagree 0 (0%) Agree 19 (46.3%) Totally agree 22 (53.7%)
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As seen in Table 2 above, 63.4 % of respondents agree that they would rather keep their opinions to themselves if they are not answerable to others. This is followed by a second majority of 26.8% who disagreed with that statement. Furthermore, 73.2% of respondents agree that they would rather avoid a conflict than be involved in one. Only 14.6% of the respondents mentioned otherwise. The majority of 61% of the respondents agree that differences in opinions are not important and threatening when faced with conflict, while 36.6% totally agree with the statement. Most respondents would totally agree (36.7%) and agree (58.5%) that they are open to listening to other people's opinions, but would eventually decide how to deal with the conflicts at work. Slightly more than half of them (58.5%) agree that they have the final say in any conflict resolution simply because they are put in charge to manage the school, while 36.6% of respondents are totally in agreement with the statement. Meanwhile, 61% of the respondents agree while 31.7% of the respondents totally agree to the fact that they make most decisions based on the teachers needs. However, when they are faced with conflicts, they are willing to make changes based on priority. Half of the respondents (58.5%) are supportive of the idea, while 39.0% totally agree with it. Most school principals are willing to accommodate recent
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situations pertaining to conflicts as 48.8% of the respondents agree while 46.3% of the respondents totally agree with this. The majority of principals would agree (48.8%), while 46.3% would totally agree to find a way to compromise over a conflict. The majority of the respondents would also agree (51.2%) and totally agree (46.3%) when it comes to finding a point of balance when faced with a conflict at work. The majority of the respondents also indicated that they are willing to listen to other people's ideas or share their ideas when conflicts are hard to solve. This can be seen by 41.5% of respondents who agree while 56.1% of the respondents who totally agree with this point. When teachers give good ideas, a majority of 63.4% of the respondents picked totally agree and 34.1% of the respondents picked agree to cooperate with teachers in resolving conflicts. On the other hand, 46.3% of the respondents do not like endangering others when making decisions but they prefer to cooperate and agree with the decision of the majority when solving conflicts. Surprisingly, a majority of 53.7% of respondents are supportive of the idea as they strongly agree with the approach.
18. School Leadership Styles
Table 4.3 below summarizes the leadership styles of the school administrators in Tabuk region, Saudi Arabia. As seen from the data, a majority of 68.3% of the respondents agree and totally agree (26.8%) with the fact that they have established the school vision and goals to be achieved in their respective schools. A majority of the respondents also noted that they have ensured a good and clear communication process in their schools with a majority of 65.9% and 31.7% who answered agree and strongly agree, respectively with the question. Most of them had also specified job descriptions carefully in their schools as can be seen by75.6% who agreed and 19.5% who totally agreed with the idea. Meanwhile, 53.7% agreed while 46.3% strongly agreed with the idea that they form specialized committees to improve and develop the education process in their schools. Furthermore, 56.1% of the respondents agree while 43.9% of them strongly agree with the idea of having a good understanding of the circumstances and conditions of the students at their schools. Not only that, 58.5 % agree while 41.5% totally agree to the fact that they also have a good understanding of the circumstances and conditions of the teachers at their schools. A majority of the respondents agree (58.5%) and 35.6% of them totally agree to seeking the cooperation of the local community in developing the school work and solving problems in the schools. While it may be viewed that this was a difficult case, however, 61.0% of the respondents agreed while 36.6% of them totally agreed that they had managed to change the cultural climate of the school. However, slightly more than half of them disagreed with the fact that they had encouraged their teachers to further their studies. This can be seen in the 56.1% of the respondents who answered disagree to the idea while the other 41.5% of them answered agree to the idea. Nevertheless, most of the respondents are positive in encouraging teachers to read more specialized books on modern methodology. This is shown in the 78.0% of the respondents who agreed followed by 17.1% of them who answered strongly agree. It emerged that 73.2% of the respondents agreed while 24.4% of them strongly agreed that they had followed up the teaching processes in the classes. On the other hand, 75.6% agreed and 24.4% totally agreed that they had disseminated information on professional ethics and commendable behavioural conduct. Most of them were also positive on emphasizing excellent job performance among their teachers and staff. This can be interpreted from the 68.3% of the respondents who answered agree and the 31.7% of them who answered totally agree with this approach. COPY RIGHT 2011 Institute of Interdisciplinary Business Research 738
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Besides, it emerged from the responses that 56.1% of the respondents were knowledgeable on education policies in the kingdom, followed by a majority of 56.1% of them who were in total agreement with the statement. Moreover, a majority of 56.1% of the respondents mentioned that they totally agreed with the practice of caring for their students final results, followed by 46.3% who mentioned that they agreed. A majority of 53.7% agree, followed by 46.3% who mentioned they totally agreed when saying that they did follow up on the teachers teaching plans. Finally, 58.5% of the respondents agreed, followed by 39% who totally agreed to having evaluated the school plan at the end of the year.
19. Causes of Conflicts
As seen from Table 4.4 below, the sources of conflict are ranked from 1 to 10 according to the respondents points of view. They were asked to rank 1 if the cause of conflict was most likely to happen, followed by 2, 3 and so forth. From column 1, it is found that the causes of conflict from parents made up the most substantial figure in their responses (9 respondents), followed by the principal's character (7 respondents) and both the teachers' and the students' behaviour (both recording 5 respondents). Looking at column 5, where the cause of conflict is least likely to happen, most respondents had picked the economic situation (15 respondents), followed by conflicts caused by the system and rules (10 respondents) and the curriculum level (8 respondents).The analysis of these findings can help to identify clearly the causes and the sources of conflicts in the school so that a concerted effort on conflict management can be strategically made with the proper allocation of time, resources and energy. This will be presented in the following chapter. Table 4.4: Causes of conflicts in schools Frequency of choice (1= Most likely to cause conflict. 10 =Least likely to cause Causes of conflicts conflict) Tota 1 2 3 4 5 6 7 8 9 10 l Management style 1 2 2 1 25 3 6 1 41 Principals characters 7 1 10 1 6 8 8 41 Teachers behaviour 5 3 13 6 1 2 4 1 4 2 41 The Parents 9 3 5 3 3 3 7 2 6 41 The Society 4 9 5 7 2 1 7 2 3 1 41 Students' behaviour 5 1 5 12 3 6 2 7 41 4 9 6 2 1 6 4 5 4 Less/Insufficient 41 activities Curriculum level 3 4 2 3 10 1 5 5 8 41 Systems and rules 2 4 1 1 8 3 11 1 10 41 Economic Situation 1 5 5 14 1 15 41 Total 41 41 41 41 41 41 41 41 41 41 20. Relationship Study between School Leadership Styles and Causes of Conflicts When the causes of conflict are analysed against the leadership styles of the school administrators, there are positive correlations shown in all the independent variables. In other words, each cause of conflict shows some influence on the relationship with the types of leadership practised by the school administrators as shown in Table 4.5.
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As seen from Table 4.5, the cause of conflict from society has the highest/greatest influence (r= .955, p< .01) on the relationship with the leadership styles shown by school administrators, followed by conflicts caused by students behaviour (r=.951, p< .01). The data found from the correlative study may perhaps provide some insights into how to deal with the leadership styles and where those causes of conflicts may arise from and these will be discussed in the following chapter. Table 4.5: Correlation between causes of conflicts and style of leadership among the school administrators of the Tabuk region, Saudi Arabia
Variables Pearsons Correlation, r
Dependent Variable : School Leadership Styles Independent Variable: Cause of conflicts a) Cause of conflicts from management b) Cause of conflict from principal's character c) Cause of conflict from teacher's behaviour d) Cause of conflict from parents e) Cause of conflict from society f) Cause of conflict from student's behaviour g) Cause of conflict from less /insufficient activities i) Cause of conflict from curriculum level j) Cause of conflict from system and rules k) Cause of conflict from economic situation
.790** .923** .947** .931** .955** .951** 929** .933** .851** .767**
** Correlation is significant at 0.01 levels (2-tailed)

21. Relationship between Causes of Conflicts and the Behavioural responses towards Conflicts
Positive correlation is again shown between the causes of conflicts and the behavioural response of school administrators in Tabuk region, Saudi Arabia. It is shown that the cause of conflict from the systems and rules (r=0.926**, p<0.01) itself influences strongly the behavioural response to conflicts, followed by conflicts caused by the curriculum level (r=0.923, p<0.01). This may perhaps give some indication that the school administrators may have to be guided towards a proper behavioural response when the causes of conflicts are identified and understood before a strategic conflict management can be formulated for/by the school leadership. Further discussions from this data analysis will be elaborated in the following chapter
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Pearsons Correlation, r Dependent variable : Behavioural response to conflicts Independent Variable: a) Cause of conflicts from management b) Cause of conflict from principal's character c) Cause of conflict from teacher's behaviour d) Cause of conflict from parents e) Cause of conflict from society f) Cause of conflict from student's behaviour g) Cause of conflict from less/insufficient activities i) Cause of conflict from curriculum level j) Cause of conflict from system and rules k) Cause of conflict from economic situation
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Table 4.6: Pearsons correlation between causes of conflicts with the behavioural responses towards conflicts
825** .888** .857** .910** .897** .906** .922** .923** .926** .888**
** Correlation is significant at 0.01 levels (2-tailed)

22. Interpretation of the Data and Summary
This study is conducted to analyse a strategic conflict management among school administrators in Tabuk region, Saudi Arabia. Forty-one respondents answered the questionnaires and they were asked in terms of how they would approach a conflict in their schools, including their leadership style while identifying which causes of conflict were most prevalent while performing their task as principals or vice principals in their schools. The data were analysed using the descriptive and the inferential statistics. This research discusses the findings and includes insights, suggestions and precautions that need to be understood and taken by the school administrators in their efforts to manage a conflict strategically. It concludes by making a summary of the research and some suggestions for future researches in Tabuk region. The data collected had identified that most school administrators chose to avoid a conflict if they could, while only a minority of the school administrators mentioned otherwise. Perhaps more work could be done towards exposing them to the topic of a strategic conflict management and, thus, helping them to understand the benefits it can bring for their professional development and to their organization. Moreover, school administrators are flexible enough to make changes when confronted with a conflict, considering the priority and seriousness of the problems. This indicates that while school administrators find themselves in charge of every matter related to the schools, their experience, instinct and discernment always provide them with a sense of direction to solve the issues at hand. However, when faced with new challenges and situations of conflict, most of them would prefer to compromise on
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the conflict or find a point of balance in the conflict through negotiations and collaboration. As mentioned earlier, while these school administrators have the final say in a conflict area, they may not behave the same when faced with new challenging conflicts which are perceived to be hard to resolve. In such a case, they are willing to listen to the good ideas of their teachers and cooperate with them towards resolving a conflict in the schools. When calculating the risk or cost of resolving the conflict, most school administrators will ensure that they do not unwittingly endanger other teachers by the decisions they make. Furthermore, the majority of the school administrators have established the school vision and goals to be achieved in their respective schools. This is perhaps one the important indicators of good school management. The school vision is important as it shows where the school administrators should be heading for in their own time frame towards success. The task of planning and evaluating the school performance on a yearly basis is considered as a good practice by the majority of the respondents as mentioned in the questionnaires. While doing so, they have also indicated maintaining a clear communication process to all levels of people in the schools, especially to their management team, teachers and students. A clear communication two-way flow is important as it is an integral part/element that decides whether a message is well received, correctly interpreted, appropriately understood and concisely put into action, rather than being misinformed and misconstrued with the eventual creation of unnecessary tension and conflict along the chain of communication. To complement the communication process, these school administrators have defined and outlined the job descriptions carefully in their schools. The only task which is left is to select and train the right candidates to perform the task they want, be it in a school management, teaching or learning team. Again, having the right system of job specialization does not guarantee that conflicts will not exist. More challenges must be expected in terms of organizational conflict as the school endeavours to form individuals who will make up teams to achieve goals, learn from each others mistakes and strategically manage situations that they will encounter from the chaotic and unpredictable environment of the school. By having a good understanding of the situations, circumstances and conditions of the school, especially on the part of both the teachers and the students, school administrators are able to address the emotional and job satisfaction needs of their staff. The role of school administrators is important to boost the morale of the people working under their leadership. Not only that, a motivated employee will get things done easily, progressively, effectively, efficiently and responsibly. These virtues are vital for every other organization which wants to put itself in a position to be successful. When their people are motivated and passionate about their work, organizational conflict is welcomed as a challenge to bring out the best in the people within the organization. If this example can be shown in the relationship between the school administrators and their teachers, students and staff, it is clear that the primary barrier to strategic conflict management has been broken to allow for the better and more constructive management of the issue. To change the culture and didactic climate of a school is a daunting task, more so, especially, if the school has been established for a long time. However, it is surprising to note that the majority of the school administrators in Tabuk region have managed to change the cultural climate and introduce new educational activities into
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their own schools. These cultural climate changes may come in the areas of new educational policy adoption, motivating teachers to change methods of looking at subject matters differently, implementation of action plans, forming new teams to achieve new tasks, or eliminating old ideas and influence from people who want to see and to actuate new ideas conservatively but which are considered to be ineffective in this modern age. In other words, these school administrators who agree to the transformation of the cultural climate actually risk their power and position because they see that a change is necessary to survive and emerge successful whilst at the same time advancing their professional development. Surprisingly, even though the school administrators are supportive of their own professional development, an astounding discovery is made that the majority of the respondents mentioned that they actually do not encourage their teachers to further their studies. Perhaps, more research should be conducted to find out the reason for this reverse phenomenon. Nevertheless, most of the respondents are positive about encouraging their teachers to improve themselves through getting and learning modern technology through books. In terms of leadership, the majority of school administrators have shown good leadership practices when it comes to following up on the teaching process inside the class. This is particularly important because the school is supposed to be focusing on its role of educating and changing itself into a learning organization. The level of involvement in their teachers and students' learning is considered a proactive approach on the part of these school administrators. Indirectly, the more they are involved, the more they are able to manage organizational conflict as they have established a good sense of belonging, reconcilably amicable rapport and work habits among their people. Further probing from the questionnaire reveals that the majority of these school administrators have disseminated information on professional ethics or good behavioural etiquette and commendable conduct. This proactive approach educates their people and prepares them for what they should do when they are confronted with a conflict within the organization that they are working in. As a result, most of them emphasize excellent job performance among their teachers and staff to boost their morale and establish positive attitudes and positive working behaviour. Studies have found that these school administrators actually possess at least some form of knowledge about the educational policies in the Kingdom of Saudi Arabia. The knowledge of educational policies and practices is vital because it determines the power and responsibilities of these school administrators to fulfil the national education agenda. The seeds of caring include the action of these school administrators to become involved in the academic achievement of their students. Most often, these school administrators emphasize academic achievement by following up and counselling their teachers, especially, in their teaching plans and the outcome of their students' final exam results.
23. Implication & Suggestion
On conflict causes, parents and teachers have similar interests and responsibilities to create a working relationship that fosters and inculcates students learning in a conducive atmosphere. The cultural and social context for parent-teacher relationships suggests some general strategies for minimizing the creation of misunderstandings and disagreements between the parents and the teachers through elimination of overlooked communication gaps, and discussion of some associated general principles for the parents and the teachers in dealing with misunderstandings or disagreements as they arise.
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Conversely, there are parents who may be reluctant to express their concerns because of cultural and social beliefs related to the personality of the teacher, such as, being authoritative which, in all probabilities, may be due to their long experience and memories of their own school years. Some parents may have a reserved point of view that that if they voice their concerns to the school and teachers, they fear that this will cause their child to be stereotyped or put at a disadvantage in the school. On the teachers side, most principals found that their new teachers may be equally anxious and apprehensive in their encounters with the parents. This can be traced to the fact that teachers receive very little training in how to foster the parent-teacher relationship, and with the growing interest of parents in their child in the school, these teachers may worry being subservient to the parents, even when the request may be unreasonable. These are some of the examples of causes of conflict from parents which emerged from the study through further probing and out of the questionnaire conversation. Cause of Conflict from the Principal's own weakness The school administrators mentioned that most of their conflicts came from their own weaknesses in conveying information correctly. While most of them have taken drastic steps to improve their communication skills, nevertheless, conflicts do occur because information has not gone through the proper channels, or has been misconstrued, thus, interpreted and understood wrongly. The task of communicating their intentions and actions has always been a struggle for these school administrators due to differences in views, perspectives, values and cultures. This situation is more prevalent in the early years of acting as school administrators, as reported by most of them. However, they have improved their management policies by increasing their involvement with both the teachers and the students' learning and academic achievement. Additionally, most of them have channelled their efforts into collaborating with the people, while keeping the stakeholders outside the school well informed about the school decisions and policies. Some school administrators have improved their management skills by using a variety of strategies to share information, such as, working with other staff to develop clear visions and working to ensure those visions are well communicated school-wide to all parties. Some of them have concentrated on their professional development to unite the people within their organizations by defining mission and goals for the school. To do this, they have increased their channels and methods of communication so that a wider range of people can be reached, thus, improving their evaluation techniques to gather data that can be used for curricular and instructional improvements. With further probing, it is also evident that some school administrators in Tabuk region have made some comparisons with other schools in the region with similar student populations and culture so that they can evaluate their actions and skills comparatively. Most respondents have indicated that the causes of conflict due to the economic situation are least likely to affect the schools; therefore, it is not surprising that they are also listed as having the least influence on causing a conflict. Perhaps public schools are somewhat protected from the pressures of economic downturns, and as schools are a regulated system, they tend to be operating automatically and are funded freely by the Kingdom of Saudi Arabia year after year. The school systems in Saudi Arabia have a long history and have gone through multiple challenges and corrections in the past, and have somewhat perfected their ways of getting things done. Because of this nature and
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culture of schools, it is profoundly important to note that the earlier data have shown that most school administrators have been somewhat able to transform their schools in the cultural aspects through the introduction and implementation of plans. Due to the success of transforming school culture through their leadership, this factor is likely to determine and explain why conflicts are less likely to occur in the systems and rules. The curriculum factor is another aspect which is less likely to be a cause of conflict. As explained earlier, public schools in Saudi Arabia have undergone a regime of curriculum development and policy implementation in the past, and all schools are expected to adhere to the education policies of the Kingdom. This is perhaps in itself an explanation of why conflicts do not happen easily in these areas. In short, the curriculum factor itself is not a major cause of conflict; rather it is the implementation of the curriculum and instructional leadership which are the main concern. School leadership styles and the causes of Conflicts It was found that all causes of conflict in the list provided have a positive influence on the relationship with the leadership styles of the school administrators. Their approaches to solving societal inflicted conflicts may vary from one principal to another, the respondents elaborated that their approach of leadership skills in strategic conflict management is very much dependent on how society understands their intentions and actions while performing the school management. They have indicated in the earlier findings that they are willing to change their approach based on the priority and mostly refer to their teachers' needs first. It is, therefore, important to note that these school administrators will not easily concede to the request of societal pressures on their schools at the expense of their staff. To face such conflicts, the school administrators will choose to establish proper communication skills and approaches when dealing with the demands of society, to educate rather than to compete, and to collaborate with the teachers with an open mind pertaining to the pressing issues from the public. Society cannot be manipulated to conform to the educational reforms, and if conflicts do occur from them, the proper solution will be to educate the society or to refer to a higher educational authority as mentioned verbally by the school administrators. Students behaviour was found to have a relationship with the school administrators' leadership. The school administrators have indicated that they encounter reports from their teachers mostly on the students' behavioural misdemeanour and disorders. Such disorders are portrayed as exhibiting aggressiveness towards other teachers, bullying, threatening and intimidating, physically abusing others, vandalism of school property, selfishness and being deceitful to teachers. Depending on the severity of the behavioural disorders, the school administrators will have to resort to instil fear into their students while acting as enforcers to maintain discipline and have to be authoritarian when dealing with teacher-student conflicts. To counter the causes of conflicts resulting from students' behaviour, most school administrators have also defined and restructured their roles to be more effective. Through further probing, some respondents indicated that they have spent considerable amounts of time empowering, training, informing and rewarding their staff through their positive contributions. Some have perceived themselves to be developing decision making teams that have involved the stakeholders of the school and providing them with the opportunities for conversations on the school-specific issues. They have also improved on their roles as motivators and in creating a supportive environment to communicate trust, encourage reasonable risk-taking, and provide leadership to manage a change. They have notably asked for more tangible resources from the government to
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fund the school in terms of money, equipment and learning materials for staff and assisting in the school improvement process. From the analysis of the data, it is indicative/apparent that the school administrators have understood the variety of roles they have to play. They have somehow evolved from practising instructional leadership to a broader role of collaborating in decision making through a team of teachers, while interacting with a wider range of individuals, including communities and other stakeholders. Relationship between the Causes of Conflict and the Behavioural Responses to Conflict The behaviour of school administrators towards conflict managements is strongly influenced by the systems and rules set in the school, followed by conflicts caused by curriculum. The strong influence from both factors above towards behaviour is found to be positively related, thus, meaning that if a behaviour is strongly influenced by the type of conflicts, it makes sense to focus both on managing the cause and the effect. Managing the cause will mean to evaluate, formulate and implement better systems, rules and curriculum that will yield and sustain positive results. On the other hand, managing the effect will mean to concentrate on actions that will strategically manage the behaviour; be it in collaboration, cooperation or through a better school leadership style.
24. Discussion
The present study determines the strategic conflict management that is most practised by the principals of secondary schools in Tabuk Region, together with the correlation between the sample demography and the strategy that they practise and implement; educational leadership styles and factors that influence the actions of the school administrators. In the present study, the school administrators were open-mindedly prepared to share and communicate with others as to what and how they feel on an issue, even if the issue did not concern them but only their superiors. This shows the sense of selflessness and ability to voice out their opinions. This finding has shown some similarities with a research carried out by Okon (2005) Embugus (2006) which stated that, when principals and teachers agreed on a common course of action for conflict management, disputes are better managed and amicably settled. Besides, another research by Vautheven and Hee (2004), Ikoya (2006) also supported the present finding reporting that, when principals, and board members and teacher are satisfied with the school conflict management policy, the teachers are readily motivated and get actively involved with the school discipline. The present study shows that the "avoidance" methods or technique has been used by the administrators in the schools in Tabuk. This present finding on the avoidance technique used in the schools in Tabuk has supported the finding of Lyndsay (2006), which reported that avoidance is helpful if there is no serious need to resolve differences now or in the future. Besides, a research conducted by Samuel (2009) shows the effectiveness of using avoidance technique in the school. This finding has greatly supported the present finding on how the school administrators make use of the avoidance techniques to handle and mitigate conflicts in their schools. In addition to the usage of the avoidance technique which had been used in the schools in Tabuk indicated that, the administrators and staff were quite aware of the conflict management techniques and did have the ability or skills to strategise plans to solve them. In this sense, this present finding has supported the finding of Olu and
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Abosede (2003) on the conflict management in the Osun State secondary schools in Nigeria where the staff show a positive awareness towards a conflict. However, in terms of the leadership styles in managing conflicts and organization, it was found in the present study that all causes of conflict in the list provided have a positive influence on the relationship with the leadership styles of the school administrators. This present study has somehow supported a study by Blau (1986), Henkin (2000), Naquin and Tyne (2003), Arubayi (2006) confirming the existence of significant relationships between the organizational conflict and the system effectiveness. Thus, if a conflict is resolved, the organization progresses (Peter & Samuel, 2009).
25. Recommendation
Due to the culture and the ways that individuals in a society are brought up in Tabuk region, Saudi Arabia, perhaps the school administrators should be led to a more open and diverse cultural exposures of being more collaborative and at the same time thriving while working in a competitive environment. As schools become globalized and open to the endless introduction of new approaches and technologies in education, school administrators must learn to expand their viewpoints to see conflicts as being part of their education towards professional growth and organizational development. A learning organization which does not grow out of conflicts in its daily management affairs eventually becomes incompetent and is left behind in the stream of modernization. Moreover, the school administrators should keep an open mind to share and communicate to others what and how they feel about an issue, even the issues which do not concern them or need them to be in the position to be answerable to their superiors. The selfless and brave approach of voicing their opinions to others should be viewed as a positive character development. The school has to deal with the students' behaviour in terms of conduct disorders and failure to comply with the school rules. School administrators can be prepared by adjusting their leadership skills strategically to manage their students and the communication process with the society. More collaboration should be carried out to increase and improve on the collaboration among school administrators within and among schools in this region. This can be done by encouraging meetings to discuss related events across schools and within the region. To improve efficiency and effectiveness, they can use their time during staff meetings to discuss issues pertaining to the school management so that an open communication can promote self- reflection at the same time. Further studies should be conducted to identify ways in which economic situations can have a direct effect on the school so that counter measures can be taken if such situations and threats do arise. Because schools are not easily changed in terms of their systems and rules, they are also indicated to be less likely to cause conflicts. Indeed, school administrators should be trained to handle situations that arise from a parent-teacher or parent-principal conflict. They can be trained in differentiating parents who have different perspectives on education and how they can communicate and collaborate in their efforts towards the upbringing of these students. Most of the time, the parents will like to be their children's strongest advocates against the teachers and the school, especially, when the 747
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parents are not in favour of the policies implemented by the school for their children. In order to sustain a competitive development on the psychological and emotional growth of the students, school administrators play an important part to ensure that teaching must come together with progress and that progress will not happen if there is no awareness of what is happening during and after the lesson. A clear communication flow is important as it is an integral part/element that decides whether a message is heard, interpreted correctly, understood and put into action, rather than being misinformed, misconstrued and eventually creating unnecessary tension and conflict along the chain of communication. In order to cope with the younger generations of teachers and student learners, school administrators will have to abandon their old ways of thinking which place seniority and the centralization of power and position, but rather become involved in a more collaborative approach towards management; regardless of age and what roles their subordinates play in their organization.
26. Conclusion
This chapter has presented some profound findings on the behavioural and leadership aspects of a strategic conflict management among secondary school administrators in Tabuk region, Saudi Arabia. While the causes of a conflict have been identified and ranked from most likely to least likely to happen, school administrators can actually be prepared and trained to better manage both the people and the conflict. It is important to note that a strategic conflict management should be concerned with managing both the cause and the effect of the matter. If a school administrator is not prepared to confront a conflict, common reactions would include avoidance, transferring the matter to others, preventing or minimizing the conflict from blowing out of proportion. School administrators are faced with two different thoughts; one is that a conflict may be either constructive or destructive to the individuals and organizations, such as, schools. A school administrator should be concerned with the strategic conflict management that is geared towards settling conflicts constructively. The challenge to identify which type of conflicts are worth pursuing, and preparing the organization to understand conflicts are some of the fundamental approaches to a strategic conflict management. It is hoped that this frontier study will be able to provide a better perspective and understanding on what school administrators are experiencing in their daily task of school management.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 4 Analysis of the factors affecting of Internet banking: Case study of customers of Mellat Bank in Isfahan city
Ali Sanayei University of Isfahan, Iran Faculty of Administrative Science & Economics, Department of Management Ali Shaemi University of Isfahan, Iran Faculty of Administrative Science & Economics, Department of Management Moslem Salajegheh (Corresponding Author) University of Isfahan, Iran Faculty of Administrative Science & Economics, Department of Management
Abstract The growth in the use of the Internet as a distribution channel of products and services offered by various businesses has been phenomenal. One such application is Internet banking services. As more and more financial institutions are finding ways to utilize Internet technologies to launch Internet banking services, an important issue is to understand what factors will impact the decisions of customers in adopting the service. The aim of this study is to analysis the factors affecting the acceptance of Internet banking at Mellat bank branches in Isfahan city. For this purpose we have used the modified model of technology acceptance model (TAM). The research is based on data that obtained through a survey study. It is noteworthy that the analysis of collected data was done by Amos software. The findings show that, acceptance of Internet banking mainly affected by trust, perceived ease of use, perceived usefulness, and attitude and tend to use. Keyword: Internet banking, Trust in Internet banking, Perceived ease of use, Perceived usefulness. Introduction: In recent years, developments in information technology and the subsequent evolution of internet banking have fundamentally changed the ways in which banks implement their business and consumers conduct their everyday banking activities (Eriksson et al., 2008; Sayar and Wolfe, 2007). Internet banking allows customers to conduct a wide range of banking transactions electronically via the banks web site anytime and anywhere, faster, and with lower fees compared to using traditional, real-world bank branches(Sonja and Rita, 2008). Online banking and other electronic payment systems are new and the development and diffusion of these technologies by financial institutions is expected to result in a more efficient banking system. This technology offers institutions alternative or non-traditional delivery channels through which banking products and services can be delivered to consumers more conveniently and economically without diminishing the existing service levels. Internet banking (IB) is such a delivery channel that deserves special attention from financial institutions, policy-makers, researchers, and academicians owing to its enormous potential from the viewpoint of banks, businesses, and retail consumers ( Akinci et al., 2004). As Sarel and Marmorstein (2003) point out, despite heavy investment by banks in developing online capabilities, many online consumers are inactive or use online banking sporadically, focusing mainly on verification tasks and avoiding more complex transactions. As moving consumers to the online channel has a clear cost savings goal, succeeding in this objective becomes very important for bank services providers, as meaningful savings are only possible with a significant migration of consumers to online banking. Understanding the key drivers that may be slowing adoption has become a relevant topic for the banking sector (Aldas et al., 2009). Beside, although online banking is common in many developed countries, for many developing countries online banking is still very much at its infancy. This is especially true for countries, such as Iran, which are still building up their IT infrastructure. One of the Iranians government economic plans is to shift its focuses from agricultural production to the service industry. As banking is an important part of the service industry, it is important for the banks to operate efficiently through the use of online banking. Although COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 online banking is still unfamiliar to many Iranian users and is still at an early stage of development, but with an internet population of 24 million users, there is a huge market potential for banks to explore (National Internet development center of Iran, 2010). However, for any technologies to be successfully introduced and used, the users have to accept and adopt the technology. Although online banking adoption studies have been conducted in many developed countries, studies for a developing and fast growing country such as Iran remain very few. Therefore this study attempts to investigate the factors that can influence users acceptance of online banking in Iran. 2. Background and hypotheses Organizations invest in information systems for many reasons, for example cutting costs, producing more without increasing costs, improving the quality of services or products (Lederer et al., 1998). It has been noted that users attitudes towards and acceptance of a new information system have a critical impact on successful information system adoption (Davis, 1989; Venkatesh and Davis, 1996). If users are not willing to accept the information system, it will not bring full benefits to the organization (Davis, 1993; Davis and Venkatesh, 1996). A system that satisfies users needs reinforces satisfaction with the system and is a perceptual or subjective measure of system success. Similarly, usage of a system can be an indicator of information system success and computer acceptance in some cases. Whether the system is regarded as good or bad depends on how the user feels about the system. Especially if the users do not rely on the system and its information their behavior toward the system could be negative. Success is not necessarily dependent of the technical quality of the system (Ives et al., 1983). Beside, many organizations today have responded to the competitive business environment by implementing e-business as part of their business strategies. With the growth of the internet, it is inevitable for banks to move towards providing online banking for their customers. Although the current branch based retail banking remains the most common method for conducting banking transactions, internet technologies has changed the way personal financial services are designed and delivered to customers (Wang et al., 2003). Shih and Fang (2004) describe internet banking as a new type of information system that uses the innovative resources of the internet and WWW (World Wide Web) to enable customers to effect financial activities in virtual space. For example, it allows customers to perform a wide range of banking transactions electronically via the banks web site (Tan and Teo, 2000). There is a growing body of academic research being focused on examining the determinants of computer technology acceptance and the utilization among users (Davis, 1989; Davis et al., 1989). Beside, several studies, whether with/without casual model is done in context of Internet banking in all of the world. A summary of studies has shown in table1. Among the different models that have been proposed, the technology acceptance model (TAM) (Davis, 1989; Davis et al., 1989) adapted from the theory of reasoned action (TRA) (Ajzen and Fishbein, 1980; Fishbein and Ajzen, 1975), appears to be the most widely accepted among information systems researchers. The reason for its popularity is perhaps because of its parsimony and the wealth of recent empirical support for it (Agarwal and Prasad, 1999). According to the TAM, system use (actual behavior) is determined by perceived usefulness (PU) and perceived ease of use (PEOU) relating to the attitude toward use that relates to intention and finally to behavior. According to the TAM these two beliefs are of primary significance for computer acceptance. PU refers to the prospective users subjective likelihood that the use of a certain application will increase his or her performance. PEOU is defined as the degree to which the prospective user expects the potential system to be free of effort (Davis et al., 1989). Although information systems researchers have investigated and replicated the TAM, and agreed that it is valid in predicting the individuals acceptance of various corporate IT (Adams et al., 1992), the TAMs fundamental constructs do not fully reflect the specific influences of technological and usage-context factors that may alter the users acceptance (Moon and Kim, 2001). As Davis (1989) noted, future technology acceptance research needs to address how other variables affect usefulness, ease of use, and user acceptance. However, factors affecting the acceptance of a new IT are likely to vary with the technology, target users, and context (Moon and Kim, 2001). Recent research has indicated that trust has a striking influence on user willingness to engage in online exchanges of money and personal sensitive information (Friedman et al., 2000). Therefore, perceived ease of use and perceived usefulness may not fully reflect the users intention to adopt Internet banking, necessitating a search for additional factors that better predict the acceptance of Internet banking. Therefore, in our study, we use modified model of TAM, we add trust to TAM, and research model is shown in figure 1. The primary objective of this research is to extend the TAM in the context of Internet banking. Perceived usefulness is defined as "the degree to which a person believes that using a particular system would enhance his or her job performance"(Davis, 1989). Perceived ease of use, refers to "the degree to which a person believes that using a particular system would be free of effort "(Davis, 1989). Trust: the perceived credibility and benevolence of a target of trust (Doney and Cannon, 1997). The first dimension COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 of trust, perceived credibility, is the extent to which one partner believes that the other partner has the required expertise to perform the job effectively and reliably (Ganesan, 1994). The second dimension of trust, benevolence, is the extent to which one partner is genuinely interested in the other partners welfare, and has intentions and motives beneficial to the other party when new conditions arise, conditions for which a commitment was not made( Wang et al., 2003). Attitude: is defined as positive or negative sense about the desired behavior. While some theorists argue that beliefs influence behavior only via their indirect influence on attitudes (e.g., Fishbein and Ajzen, 1975), others view beliefs and attitudes as codeterminants of behavioral intentions (e.g., Triandis, 1977), and still others view attitudes as antecedents of beliefs (e.g., Weiner, 1986). Counter to Fishbein and Ajzen's (1975) position, both Davis (1986) and Davis, et al. (1989) found that attitudes do not fully mediate the effect of perceived usefulness and perceived ease of use on behavior. Based on the above mentioned model the following hypotheses are developed: H1. Customers perceived usefulness has an effect on their trust to using Internet banking. H2. Customers trust has an effect on their attitude to using Internet banking. H3. Customers trust has an effect on their willingness to using Internet banking. H4. Customers perceived ease of use has an effect on their using of Internet banking. H5. Customers perceived usefulness has an effect on their attitude to using Internet banking. H6. Customers perceived ease of use has an effect on their attitude to using Internet banking. H7. Customers perceived usefulness has an effect on their willingness to using Internet banking. H8. Customers attitude has an effect on their willingness to using Internet banking. H9. Customers willingness to use has an effect on their actual use of using Internet banking. 3. Research Methodology This research can be categorized as descriptive survey research. The statistical population of this research was the customers of Mellat bank in Isfahan city that use Internet banking. The sample size estimated to be 247 based on Cochran formula. The data gathering instrument was a self administered questionnaire which consists of two sections. The first part designed to test the hypotheses which had been formed basis on modified model of technology acceptance model (TAM), and the second part records the respondents' demographic data. The first part contains 25 items in total that questions from 1 to 4 are related to customers trust according to the research model. Questions 5 to 9 measure the Customers perceived usefulness according to the research model. Questions 10 to 14 are related to Customers perceived ease of use variable .Questions from 15 to 18 measures the fourth variable, Customers attitude. Questions from 19 to 22 measure the Customers willingness to use according to the research model. And eventually questions from 23 to 25 measure the actual use of using Internet banking according to the research model. All the items were measured using five-point Likert scale items with anchor points 1 = strongly disagree and 5 = strongly agree. Seven common model-fit measures were used to assess the models overall goodness of fit: the ratio of x2 to degrees-of-freedom (df), Chi-Sqare(CMIN), goodness-of-fit index (GFI), Error of Approximation (RMSEA), adjusted goodness-of-fit index (AGFI. Finally, to determine the extent of the effects of variables, regression analysis has been used. To test the reliability of data gathering instrument, a preliminary study has been conducted with a sample of 30. The results of the primary sample show that Cronbach alpha () index is 0.89, which indicate a good reliability. 4. Data Analysis and Findings Table 2 shows demographic data. As it is shown, most of the respondents were male with 25 to 35 years of age. Their level of education falls mostly on categories of bachelor degree and amount of income falls mostly on category of 600 to $ 900 a month and most of them are self-employed or government employees. In this research we used Structural Equation Model (SEM) for testing hypothesis. For analyzing data we used the two steps Structural Equation model that proposed by Anderson & Gerbing(1988). For analyzing relation between constructs, in step one, we used Confirmatory factor analysis (CFA), and in other step Path Analysis have used. For determine that to what extent, indexes are acceptable for measuring patterns, first we must analyzing all of the measuring patterns separately. For this base, first, seven measuring patterns related to variables are tested separately. General indexes of measuring patterns (CFA) have shown in table 3. COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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Giving that for all of measuring patterns p> 0.05, could result that the ratio of measuring patterns.
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Goodness-of-fit index (GFI) for all measuring patterns is above 0.97(GFI> 0.97), showed that data are fit to patterns. RMR for all measuring patterns is below 0.05 (RMR<0.05), showed that minimum error in patterns and acceptable fitness of them. Comparative fit index (CFI) for all measuring patterns except actual use is above 0.96 can be concluded that data clearly support measuring patterns. RMSEA index for measuring patterns is below 0.05 (RMSEA< 0.05), showed that data are fit to patterns. And eventually, given the above contents can be concluded that measuring patterns have a good fitness and in the other words, general indexes confirmed that data clearly support measuring patterns. After review and confirm the patterns measured in Step one, we used Path analysis for testing hypothesis. Table 4 show general indexes that presented in path analysis. Giving that for mentioned pattern p> 0.05, could result that the ratio of pattern. (chi-square) is fit for that
Goodness-of-fit (GFI) for pattern is 0.98(GFI=0.98), showed that there is not little difference between reproduced and observed variance and co-variance, and it represented the good fitness of pattern. RMR for mentioned pattern is 0.019(RMR=0.019), that is little and showed little error in pattern and good fitness of it. Comparative fit index (CFI) for mentioned pattern is 0.98(CFI=0.98) and showed that the fitness of pattern is good. RMSEA for pattern is 0.043(RMSEA=0.043), this index too, showed that the fitness of pattern is good. Given the above contents can concluded that general indexes showed a good fitness in pattern by data, or on the other words, could say gathering data, are supported the pattern truly. Structural equation pattern with regression coefficient have showed in figure 2. After review and confirmation pattern, for meaningful test of hypothesis we have used Critical Value (CV) index and P. Critical value is the ratio that resulted of dividing the Regression Weight Estimation on Standard Error. According to meaningful level of 0.05, critical value must above 1.96. Below this value, the related parameter in pattern is not considered important (chau, 1997). And values below 0.05 for P value have showed meaningful difference in accounted value for regression weights with value of 0 in meaningful level of 0.95. Hypothesis with regression coefficient and partial index values related to each of hypothesis have showed in table 5. Hypothesis analysis H1. Customers perceived usefulness has an effect on their trust to using Internet banking. Standard regression coefficient for this hypothesis is 0.27, that given the p<0.05 for this hypothesis can concluded that this hypothesis is accepted with degree of confidence 0.95, and on the other words with degree of confidence=0.95 can say Customers perceived usefulness has an effect on their trust to using Internet banking. H2. Customers trust has an effect on their attitude to using Internet banking. Regression coefficient for this hypothesis is 0.21, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers trust has an effect on their attitude to using Internet banking. H3. Customers trust has an effect on their willingness to using Internet banking. Regression coefficient for this hypothesis is 0.12, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers trust has an effect on their willingness to using Internet banking. H4. Customers perceived ease of use has an effect on their using of Internet banking. Regression coefficient for this hypothesis is 0.41, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers perceived ease of use has an effect on their using of Internet banking. H5. Customers perceived usefulness has an effect on their attitude to using Internet banking.
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VOL 3, NO 4 Regression coefficient for this hypothesis is 0.22, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers perceived usefulness has an effect on their attitude to using Internet banking. H6. Customers perceived ease of use has an effect on their attitude to using Internet banking. Regression coefficient for this hypothesis is 0.25, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers perceived ease of use has an effect on their attitude to using Internet banking. H7. Customers perceived usefulness has an effect on their willingness to using Internet banking. Regression coefficient for this hypothesis is 0.42, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers perceived usefulness has an effect on their willingness to using Internet banking. H8. Customers attitude has an effect on their willingness to using Internet banking. Regression coefficient for this hypothesis is 0.17, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers attitude has an effect on their willingness to using Internet banking. H9. Customers willingness to use has an effect on their actual use of using Internet banking. Regression coefficient for this hypothesis is 0.43, showed that this hypothesis is acceptable, and for this hypothesis p<0.05, so, with degree of confidence=0.95 can say Customers willingness to use has an effect on their actual use of using Internet banking. 5. Conclusion The hypotheses are tested in a structural equations model, as shown in Figure 2. The models key statistics are good since the GFI is 0.98, the CFI is 0.98, the RMSEA is 0.043 and the AGFI is 0.94. We can thus safely conclude that the model is valid and can continue to analyze the outcome of the hypothesized causal effects. The Trust is positively affected by perceived usefulness, which supports H1.Trust has a positive effect on both Attitude and willingness to use, confirming H2 and H3. As such, other hypothesis also confirmed. The findings of this study point to the perceived usefulness of internet banking as the primary reason that Mellat bank customers in Isfahan city use the internet for banking. These findings are supported by Daviss (1989) findings that perceived usefulness has a stronger influence on usage than does ease of use. Daviss study shows that users are driven to adopt a technology primarily because of the functions it provides them, and secondarily because of the easiness of benefiting from those functions. Customers are often willing to overlook some difficulties of usage if the service provides critically needed functions: no amount of ease of use can compensate for a system that does not perform a useful function (Davis, 1989). From the banks point of view it is necessary to know the relationship between perceived usefulness and ease of use, because their influence on the actual usage is different. It may seem tempting to concentrate efforts on making the user interface easier and more appealing, but even in the pre-adoption stage the real content is what matters most. There are also factors, linked to internet bank, that affect usage, like overall trust in the bank. As the result showed, perceived usefulness effect on both attitude and willingness to use. So Customers familiarity with advantage and the method of use Internet banking could help to their perception of Internet banking and produce positive attitude to it and so resulted in Customers willingness to use Internet banking. Therefore, the possibility of this familiarity must be provided for customer by bank.
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References
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Adams, D.A., Nelson, R.R. and Todd, P.A. (1992), Perceived usefulness, ease of use, and usage of information technology: a replication, MIS Quarterly, June, pp. 227-47. Agarwal, R. and Prasad, J. (1999), Are individual differences germane to the acceptance of new information technologies?, Decision Sciences, Vol. 30 No. 2, pp. 361-91. Ajzen, I. and Fishbein, M. (1980), Understanding Attitudes and Predicting Social Behavior, Prentice-Hall, Englewood Cliffs, NJ. Akinci S, Aksoy S, Atilgan E.( 2004),Adoption of Internet banking among sophisticated consumer segments in an advanced developing country. Int J Bank Mark;22(2/3):21232. Aldas-Manzano, J., Lassala-Navarre, C., Ruiz-Mafe, C. and Sanz-Blas, S. (2009), The role of consumer innovativeness and perceived risk in online banking usage, International Journal of Bank Marketing, Vol. 27 No. 1, pp. 53-75. Anderson, J. C. and Gerbing, D. W. (1988). Structural Equation Modeling in Practice: A Review and Recommended Two-Step Approach. Psychological Bulletin.Vol. 103, No.3, pp.411423. Chau, p. (1997). Reexamining a model for evaluating information center success using a structural equation modeling approach. Decision Sciences. Vol. 28, No. 2, pp. 309-334. Davis, F.D. (1989), perceived usefulness, perceived ease of use, and user acceptance of information technology, MIS Quarterly, September, pp. 319-40. Davis, F.D. (1993), User acceptance of information technology: system characteristics, user perceptions and behavioral impacts, International Journal of Man-Machine Studies, Vol. 38, pp. 475-87. Davis, F.D. and Venkatesh, V. (1996), A critical assessment of potential measurement biases in the technology acceptance model: three experiments, International Journal of Human-Computer Studies, Vol. 45, pp. 19-45. Davis, F.D., Bagozzi, R.P. and Warshaw, P.R. (1989).User acceptance of computer technology: a comparison of two theoretical models. Management Science, Vol. 35 No. 8, pp. 982-1003. Davis, F.D. ( 1986).A Technology Acceptance Model for EmpiricallyT esting New End-User Information Systems: Theory and Results. Doctoral dissertation, MIT Sloan School of Management,Cambridge, MA. Doney, P.M. and Cannon, J.P. (1997). An examination of the nature of trust in buyer-seller relationships. Journal of Marketing, Vol. 61 No. 2, pp. 35-51. Eriksson, K., Kerem, K. and Nilsson, D. (2008). The adoption of commercial innovations in the former Central and Eastern European markets. The case of internet banking in Estonia. International Journal of Bank Marketing, Vol. 26 No. 3, pp. 154-69. Erikson, K., Kerem, K., Nilsson, D. (2005). Customer acceptance of internet banking in Estonia. International Journal of Bank Marketing. Vol.23 ,No.2,pp. 200-216. Fishbein, M. and Ajzen, I. (1975), Belief, Attitude, Intention, and Behavior: An Introduction to Theory and Research, Addison-Wesley, Reading, MA. Friedman, B., Kahn, P.H. Jr and Howe, D.C. (2000). Trust online. Communications of the ACM, Vol. 43 No. 12, pp. 34-40. Ganesan, S. (1994). Determinants of long-term orientation in buyer-seller relationships. Journal of Marketing. Vol. 58 No. 2, pp. 1-19. Ives, B., Olson, M.H. and Baroudi, J.J. (1983). The measurement of user information satisfaction. Communications of ACM, Vol. 26 No. 10, pp. 785-93. Jaruwachirathanakul, B., Fink, D. (2005). Internet banking adoption strategies for a developing country: the case of Thailand, Internet Research, Vol. 15 Iss:3 ,pp.295-311. Lederer, A.L., Maupin, D.J., Sena, M.P. and Zhuang, Y. (1998). The role of ease of use, usefulness and attitude in the prediction of World Wide Web usage. Proceedings of the 1998 Association for Computing Machinery Special Interest Group on Computer Personnel Research Conference, pp. 195-204. Lee, M. (2009). Factors influencing the adoption of internet banking:An integration of TAM and TPB with perceived risk and perceived benefit ,Electronic Commerce Research and Applications 8(2009) 130-141. Moon, J.-W. and Kim, Y.G. (2001).Extending the TAM for a World-Wide-Web context. Management, Vol. 38, pp. 217-30. National Internet development center of Iran, (2010). Sarel, D. and Marmorstein, H. (2003). Marketing online banking services: the voice of the customer. Journal of Financial Services Marketing, Vol. 8 No. 2, pp. 106-18. Sayar, C. and Wolfe, S. (2007). Internet banking market performance: Turkey versus the UK. International Journal of Bank Marketing, Vol. 25 No. 3, pp. 122-41. Information &
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Shih, Y. and Fang, K. (2004). The use of a decomposed theory of planned behavior to study internet banking in Taiwan. Internet Research, Vol. 14 No. 3, pp. 213-23. Sonja Grabner-Kruter, Rita Faullant, (2008) Consumer acceptance of internet banking: the influence of internet trust, International Journal of Bank Marketing, Vol. 26 Iss: 7, pp.483 504. Suh, B., Han, I. (2002). Effect of trust on customer acceptance of Internet banking. Electronic Commerce Research and Applications 1, 247-263. Tan, M. and Teo, T.S.H. (2000). Factors influencing the adoption of internet banking. Journal of the Association for Information Systems, Vol. 1 No. 1, pp. 1-42. Triandis, H.C. (1977).Interpersonal Behavior, Brooks/ Cole, Monterey, CA. Venkatesh, V. and Davis, F.D. (1996).A model of the antecedents of perceived ease of use: development and test. Decision Sciences, Vol. 27 No. 3, pp. 451-81. Wang, Y., Wang, Y., Lin, H., Tang, T. (2003).Determinants of user acceptance of internet banking : an empirical study. International Journal of Service.Ind.Manage, Vol.14,No.5,pp.501-519. Wang, Y.S., Wang, Y.M., Lin, H.H. and Tang, T.I. (2003). Determinants of user acceptance of internet banking: an empirical study. International Journal of Service Industry Management, Vol. 14 No. 5, pp. 501-19. Weiner,B . ( 1986). Attribution Emotion and Action in Handbook of Motivation and Cognition ,R .M. Sorrentino and E.T. Higgins (eds.), Guilford, New York, NYpp. 281-312. Yiu, C., Grant, K., Edgar, D.,(2007).Factors affecting the adoption of Internet Banking in Hong Kong. Implications for the banking sector. International Journal of Information Management, 27, 336-351. Yuttapong, C., Sirion, C., Howard, C.,(2009). An Investigation of the Factors Impacting Customers Willingness to Adopt Internet Banking in Thailand. ASBBS Annual Conference:las vegas ,February 2009.
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Annexure
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Trust
Perceived Usefulness
Attitude
Willingness to use
Actual use
Perceived ease of use
Figure 1-Modified model of TAM (Davis, 1986
Table 1 : Summary of past studies

Studies Suh Han 2002 Title Effect of trust on customer acceptance of internet banking Model TAM technology acceptance model Factors Trust Perceived profitability Ease of use Attitude Intended use Wang lin Wang tang 2003 Determinants of user acceptance of internet banking TAM technology acceptance model Perceived credibility Perceived profitability Ease of use Self Efficacy in computer intention Eriksson Kerem Nilsson 2005 Jaruwachirathanakul Fink 2005 Internet banking adoption strategies for a developing country: the case of Thailand TPB Analytical model Customer acceptance of internet banking in Estonia TAM technology acceptance model Trust Perceived profitability Ease of use Use Web characterized Perceived usefulness Risk & privacy Personal preference External environment culture
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Yiu Grant Edgar 2007 Ming lee 2009 Factors influencing the adoption of internet banking: an integration of TAM & TPB with perceived risk and perceived benefit TAM technology acceptance model & TPB Analytical model Factors affecting the adoption of internet banking in Hong Kong TAM technology acceptance model & Diffusion of innovation theory
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Perceived usefulness Usefulness of Perceived usage Personal inovation Perceived risk Perceived usefulness Usefulness of Perceived usage Attitude Time risk Financial risk Performance risk Security risk Social risk Perceived advantage Subjective norms Perceived behavioral control
Yuttapong Sirion Howard 2009
An investigation of the factors impacting customers willingness to adopt internet banking in Thailand
TAM technology acceptance model & TPB Analytical model
Perceived usefulness Perceived usage Testability Complexity Comparative advantage Compatibility

Characteristics Description Gender Age Female Male Less than 25 years 26 to 35 years 36 to 45 years 46 to 55 years more than 56 years Education Diploma and less Advanced diploma Bachelor Master Degree PhD and above Income Below 300 dollars 301 to 600 dollars 601 to 900 dollars 901 to 1200 dollars More than 1200 dollars Frequency 96 151 42 88 77 26 14 24 31 109 69 14 39 81 87 28 12 Percent 38.9 61.1 17 35.6 31.2 10.5 5.7 9.7 12.6 44.1 27.9 5.7 15.8 32.8 35.2 11.3 4.9
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Table 3. General indexes of measuring patterns (CFA)
Willingness to use Perceived ease of use Perceived usefulness Actual use index attitude
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trust
CMIN P GFI RMR CFI RMSE A AGFI
0/000 0/997 1 0/000 1 0/000 1
0/152 0/196 1 0/004 1 0/000 0/997
2/138 0/343 0/997 0/016 1 0/017 0/974
8/84 0/116 0/987 0/022 0/969 0/042 0/96
1/719 0/190 0/997 0/009 0/998 0/048 0/965
5/517 0/504 0/978 0/036 0/914 0/046 0/905
Table 4. General indexes of fitness of Path Analysis
Index CMIN P GFI RMR CFI RMSEA AGFI
Value
9/648 0/086 0/988 0/019 0/989 0/043 0/948
Figure 2. Structural equation pattern with regression coefficient
Z2
Trust
.12
.27
.21
Z1
Perceived usefulness
.22
Attitude
17
Willingness to use
43
Actual use
.41 .25
Z3
Z4
Z5
Perceived Ease of use
.42
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Table 5. Hypothesis with regression coefficient
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Hypothesis H1 H2 H3 H4 H5 H6 H7 H8 H9
Regression Coefficient 0/27 0/21 0/12 0/41 0/22 0/25 0/42 0/17 0/43
Critical value 47/78 92/86 54/36 99/753 71/011 108/289 107/530 65/695 34/038
P 0/000 0/000 0/000 0/000 0/000 0/000 0/000 0/000 0/000
Result Accept Accept Accept Accept Accept Accept Accept Accept Accept
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS VOL 3, NO 4 An Empirical Study on Employee Retention Strategies in a Biscuit Manufacturing Company in India
S. R. Kavitha Assistant Professor, Depatment of Management Studies Saranathan College of Engineering, Tiruchirappalli, Tamilnadu, South India S. R. Geetha Depatment of Management Studies Final year Student, Bharathidasan University, Tiruchirappalli, Tamilnadu, South India, V.Arunachalam Manager, Indian Overseas Bank, Madurapuri, Tamilnadu, South India, Abstract This paper aims at developing insight on how employee retention is relevant in present business context. Retention is more important than hiring. There is no dearth of opportunities for talented person. There are many organizations which are looking for such employees. This study reveals that, treating employees with respect and dignity is critical to retaining good workers, especially in a better job market. A managements failure to demonstrate respect to employees is the main reason for them to leave their jobs, and hence recognition of employees achievements, encouraging innovation, handling their complaints fairly rewarding them for jobs well done is some of the ways for employers to show workers respect and retain them. The researcher carried out the study with the objectives of finding out various factors influencing the employee towards retention in a biscuit manufacturing company in India. Primary data was collected by the researcher with the help of structured questionnaire. Random sampling method(lottery method) was absorbed by the researcher and the sample size was 102 middle level employees of that company has been taken for the study. To test the reliability of the data collected, the researcher used cronbachs Alpha test and the value is 0.930 which shows that the data has satisfactory reliability and validity. Using Statistical Package for Social Science (SPSS) some of the relevant tests were carried out like factor analysis and multiple regression. Based on these analysis some of the relevant findings were derived, that will be useful, relevant and significant to the present Indian scenario. Keywords: Employee retention, strategies, career development Introduction With the labour market at its tightest in recent memory, the talk of the town seems to be attracting top talent to a company. But what a company does to retain that talent, and the talent it already employs, is arguably more important than attraction. In recent times, employees retention has become one of the leading challenges for organization. Given today's weak company loyalty, employees are increasingly "jumping ship" for better job opportunities elsewhere. The issue isn't simply losing a key member of your team; there is also the hassle-and cost-of replacement. It is obvious that employees retention is one of the most pressing issues that Human Resource Professionals face today. Organizations have come to realize the critical strategic implications of losing their best people. Employees turnover is assuming crisis proportions for many employers who struggle to retain people in the tightest labour markets in recent memory. "Employee retention is the conscious and deliberate effort to retain quality individuals on the company payroll. Stated otherwise, it is the proactive methods utilized by successful
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organizations to stop the drain of company profits caused by excessive employee turnover". Among the many reasons organization care about retention, retention are the direct and indirect costs linked to the loss of talented employees. In a number of studies human resources managers have estimated the cost of turnover to vary between 50% and 500% of the departing employees annual salary, depending on job level, industry and geography potentially one of the largest costs of turnover, and perhaps the most over looked, is the lost future potential of the brightest and best who often are the ones to leave. Another, more insidious costs of turnover involves the sharing of a companys method, technology and clients with competitors who may have hired the employees away. As a companys success becomes increasingly dependent on the knowledge skills, abilities, and relationships of its employees. The financial impact of losing talented employees will continue to rise. Literature Review The literature clearly indicated that there are six keys to retaining personnel. They are recruiting, communications, training, job satisfaction, pay, and benefits. The effort to retain the best personnel begins with recruiting. Attracting and retaining the best People are not two different things, but is the same thing. Both require creating and maintaining a positive reputation, internally as well as externally. Employers must be honest with the recruit about the beliefs, expectations, organizational culture, demands, and opportunities within the organization. By representing the organization realistically, a department will attract those who will be content working within the culture (Marx, 1995). Denton (1992, p.47) follows this up by stating that, the better the match between recruits and the organization the more likely you are to retain them. Lynn (1997) believes that you must take time during the hiring process to make wise decisions. The employer must be candid about the working conditions, responsibilities, opportunities and other details to reduce the chances of making hiring mistakes. Taylor and Cosenza (1997) strengthen this thought by noting that it is imperative that companies give prospective employees a true picture of the organization, if they hope to match the personality type with the climate and culture of the organization. Carney (1998) believes that the key to employee retention is quit e simple: communicate, communicate, and communicate. Communication with the employees must begin early on in the relationship. He believes that the imprinting period of a new employee is probably less than two weeks. Employers must engage the employee early on by sharing how important the job they do is. Lynn (1997) follows this up by stating that early on an atmosphere of fairness and openness must be created by clearly laying out company policies. Taylor and Consenza (1997) indicate that it is important to communicate the values of the organization to its employees in order to increase their level of consent, participation, and motivation. Lynn (1997) echoes this thought by pointing out that the vision of the organization must be shared with the employee as well as the importance the employees play in helping fulfil it. Lack of communication may result gaps between managements perceptions of quality employment and the employees desired and perceived quality of employment (Taylor & Consenza, 1997). There must be a common purpose and trust among employees. People want to feel as if they are a vital piece of something larger (Carney, 1998). As Denton (1992) points out, managers must make sure employees know what they should do and why it is important. Lynn (1997) notes that communications must be a two way street to be effective. Employers must listen to what employees have to say. An atmosphere must be created in which employees feel comfortable making suggestions and trying our new ideas.. As was noted earlier it is important that the employee feel like a valued member of the organization. Training helps underscore this message. Training personnel is a way to
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show you respect them and want them to grow. The department is making an investment in the employee by offering training (Marx, 1995). Good training can de- emphasizes salaries and benefits, in part by building a positive work environment and by giving employees advancement opportunities (Lynn, 1997). Lynn goes on to say that training helps strengthen employee loyalty. Training can help revitalize personnel. For an increasing number of people, the chance to learn new skills is a significant personal goal for both the career opportunities education can provide and for the chance to do something a little different (Mendonsa, 1998).Training emphasizes to the employee that they are valued and respected. This in turn to increased loyalty and retention. While an organization must be competitive in terms of compensation and benefits, it is the relationship with the supervisor that is often a crucial factor in determining whether a person stays orgoes (Mendonsa, 1998). Employees want more interaction with management, more self-satisfaction on the job, more responsibility and more control over decisions affecting them. They want their work to make a difference and want to be part of something that matters (Taylor, 1997).Departments should encourage innovation by soliciting the advice and input of their staff members, followed by responses to ideas, complaints or questions (Taylor, 1997). It is difficult to keep people on the job if they have no say in how to do it (Spragins, 1992).People need to be recognized for their accomplishments in the workplace. In most organizations the feeling of underrecognition is the most pervasive feeling in the workplace (Mendonsa, 1998). Provide a great deal of personal and team recognition (Carney, 1998). Recognize achievements with memos, mentions in staff meetings or articles in the newspapers (Lynn, 1997) To retain employees, departments must offer career advancement opportunities. Departments failing to offer employees career opportunities, room for advancement and enhancement of skills and knowledge may find it difficult to retain qualified employees (Taylor, 1997). Marx (1995) concludes this by pointing out that promoting from within is one of the proven methods of employee retention. Promoting from within shows that there is truly room for advancement and growth within the department. Employee involvement, recognition, importance of work, and career advancement opportunities are all important, when dealing with employee retention. In general people think that money and benefits or lack thereof, are the main reasons people leave their jobs, but this is not the case. While compensation and benefits may be a key factor in the final decision-making process, a money shortage is usually not what causes people to look in the first place (Mendonsa, 1998).Money may be the reason they give when they resign, but its like white noise. They are conscious of it for a while but if they are bored on the job, money alone is not going to keep them there(Branch, 1998).Although traditional benefits such as vacation and health are still important, todays workers are also looking for more non-traditional benefits. Benefits such as flexible work ours, availability of child-care tuition assistance programs and discounts on services now top the list of desired benefits (Denton, 1992).The literature clearly indicates while still factors, money and benefits are not as important as job satisfaction in terms of employee retention The research conducted on the link between dissatisfaction with pay and voluntary turnover appears to be inconclusive. Mobley et al (1979) concluded that results from studies on the role of pay in turnover were mixed but that often there was no relationship between pay and turnover. Other studies found no significant relationship. On the other hand Campion (1991) cited in Tang suggests that the most important reason for voluntary turnover is higher wages/career opportunity. Martin (2003) investigates the determinants of labour turnover using establishment-level survey data for the UK. Martin indicated that there is an inverse relationship between relative wages and turnover (ie establishments with higher relative pay had lower turnover).
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Griffeth et al (2000) noted pay and pay-related variables have a modest effect on turnover. Their analysis also included studies that examined the relationship between pay, a persons performance and turnover. They concluded that when high performers are insufficiently rewarded, they leave.
Methodology Objectives 1. To know the effectiveness of employee retention program in a biscuit manufacturing company in India 2. To examine the various factors that influence the employees towards retention. Hypotheses 1) There is relationship among the factors that influences the employee towards retention.
2) Exit interview and encouragement to higher education can predict the retention of employees. The present study aims at developing insight on how employee retention is relevant in present business context. Due to various reasons the companies name was not disclosed in the study. Primary data was collected by the researcher with the help of structured questionnaire. Random sampling method (lottery method) was absorbed by the researcher and the sample size was 102 middle level employees of that company constitute the sample size for the study. To test the reliability of the data collected, the researcher used cronbachs Alpha test and the value is 0.930 which shows that the data has satisfactory reliability and validity. Using Statistical Package for Social Science (SPSS) some of the relevant tests were carried out like factor analysis and multiple regression. Table 1: Reliability Statistics
Cronbach's Alpha .930 N of Items 28
The Cronbach's alpha values were calculated to assess the internal consistency of the Questionnaire. Reliability refers to the confidence we can place on the measuring instrument to give us the same numeric value when the measuring instrument is repeated on the same object. For the Employee retention questionnaire, the Cronbach's alpha value of .930 indicated adequate reliability. FACTOR ANALYSIS Hypothesis: There exist relationships among the factors that influence the employee retention. Table 2 : KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .617 Bartlett's Test of Sphericity Approx. Chi-Square Df Sig. 1535.574 378 .000
KMO measure of sampling adequacy is an index to examine the appropriateness of factor analysis. High values 0.5 and 1.0 indicate factor analysis is appropriate. Values below 0.5 imply that factor analysis may not be appropriate. From the above table it is
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seen that KaiserMeyerOlkin measure of sampling adequacy index is 0.617 and hence the factor analysis is appropriate for the given data set. Bartletts Test of Sphericity is used to uncorrelated. It is based on chi-square transformation of the determinant of correlation matrix. A large value hypothesis in turn this would indicate that factor analysis is appropriate. Bartletts test of Sphericity Chi-square statistics is 1535.574, that shows the 28 statements are correlated and hence as inferred in KMO, factor analysis is appropriate for the given data set. Table 3: Total Variance Explained
Component Total 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10.480 2.454 1.788 1.597 1.469 1.327 1.137 1.043 .881 .783 .688 .613 .578 .479 .470 .418 .344 .289 .242 .240 .179 .158 .118 .080 .060 .044 .022 .020 Initial Eigenvalues % of Cumulative % Variance 37.428 8.765 6.385 5.704 5.248 4.740 4.060 3.727 3.148 2.798 2.457 2.188 2.065 1.709 1.678 1.492 1.227 1.032 .865 .857 .639 .564 .421 .287 .213 .159 .077 .070 37.428 46.193 52.578 58.282 63.529 68.269 72.329 76.056 79.204 82.002 84.459 86.647 88.712 90.421 92.099 93.591 94.818 95.849 96.714 97.571 98.210 98.774 99.195 99.482 99.694 99.853 99.930 100.000 Extraction Sums of Squared Loadings % of Cumulati Total Variance ve % 10.480 2.454 1.788 1.597 1.469 1.327 1.137 1.043 37.428 8.765 6.385 5.704 5.248 4.740 4.060 3.727 37.428 46.193 52.578 58.282 63.529 68.269 72.329 76.056 Rotation Sums of Squared Loadings % of Cumulative Total Variance % 3.724 3.625 2.894 2.712 2.705 2.205 1.810 1.621 13.300 12.945 10.337 9.684 9.662 7.874 6.464 5.789 13.300 26.245 36.582 46.266 55.928 63.802 70.266 76.056
Extraction Method: Principal Component Analysis.
Eigen value represents the total variance explained by each factor. Percentage of the total variance attributed to each factor. One of the popular methods used in Exploratory Factor Analysis is Principal Component Analysis, Where the total variance in the data is
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considered to determine the minimum number of factors that will account for maximum variance of data.
Table 4: Rotated Component Matrix (a)
Component 1 Opportunities to learn and dev Potential talents identified Encouragement to higher education Share knowledge through training Responsibilities in career Competitive compensation pattern Fringe benefits par with market Select potential and cultural fit candidates Superior quality leadership Superiors stand up for critical situation Superiors providing coaching Helps to strike balance Corporate social responsibilities Appreciation of good work Realists exit interview Merit based recruitment Open and transparent Administration Organisational values are practiced Part of growing organisation Fair and equitable treatment Looking for talents and encourage them Strong corporate governance and citizenship Secured job Adequate materials, computer, etc.. Safe work environment Opinion and feedback is valid Cross functional team Job enrichment .828 .794 .550 .626 .690 .727 .529 .558 .599 .602 .583 .717 .625 .755 .848 .562 .835 .598 .863 .534 .622 .824 .541 .752 .546 .600 2 3 4 5 .757 6 7 8
Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. A Rotation converged in 21 iterations.
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Rotation Method: Varimax with Kaiser Normalization: Interpretation of factors is facilitated by identifying the statements that have large loadings in the same factor. The factor can be interpreted in terms of the statement that loads high on it. The factors of a study on employee retention programs comprises of 28 individual statements. Out of 28 factors, 8 individual factors contribute more towards employee retention programs 1. Company helps to strike balance professional, personal, financial and social life. In the organization exit interviews are realistic and unbiased. 2. Superiors are standing up for the team when they are facing with critical situation. 3. Employees involving cross functional activities to get variety of exposures. 4. Employees getting early responsibilities in career. 5. Job enrichment. 6. Getting opportunities to learn and progress. 7. Appreciated for their good work done. 8. Fringe benefits like mediclaim, loan, bonus, gifts, paid holiday, picnics, etc. 9. Job is secured in my company 10. Getting opportunities to learn and progress. 11. Each and every employees involving part of growing organization. Regression Anaysis Hypothesis Exit interview and encouragement to higher education can predict the retention of employees. Table 5: Model Summary
Model 1 R .921(a) R Square .848 Adjusted R Square .745 Std. Error of the Estimate .24203
a Predictors: (Constant), job enrichment, select potential and cultural fit candidates, share knowledge through training, superiors stand up for critical situation, organisational values are practiced, competitive compensation pattern, realists exit interview, opportunities to learn and dev, encouragement to higher education, part of growing organisation, adequate materials,computer,etc.., fringe benefits par with market, corporate social responsibilities, cross functional team, superior quality leadership, open and transpent admini, superiors providing coaching, safe work environment, merit based recruitment, opinion and feedback is valid, secured job, potential talents identified, responsibilities in career, fair and equitable treatment, strong corporate governance and citizenship, looking for talents and encourage them, appreciation of good work, helps to strike balance
In the above model summary table shows R-Square for this model is 0.848 this means that 84 percentage of the variation in overall retention programs of employees (dependent variable) can be explained from the 28 independent variables. The table also shows the adjusted R-square for the model as .481. Any time another independent variable is added to a multiple regression model, the R-square will increase (even if only slightly). Consequently, it becomes difficult to determine which models do the best job of explaining variation in the same dependent variable. The adjusted R-square does just what its name implies. It adjusts the R-square by the number of predictor variables in the model. This adjustment allows the easy
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comparison of the explanatory power of models with different numbers of predictors variable. It also helps us to decide how many variables to include in our regression model. Table 6: ANOVA (b)
Model 1 Sum of Squares Regression Residual Total 13.441 2.402 15.843 df 28 41 69 Mean Square .480 .059 F 8.195 Sig. .000(a)
a Predictors: (Constant), job enrichment, select potential and cultural fit candidates, share knowledge through training, superiors stand up for critical situation, organisational values are practiced, competitive compensation pattern, realists exit interview, opportunities to learn and dev, encouragement to higher education, part of growing organisation, adequate materials,computer,etc.., fringe benefits par with market, corporate social responsibilities, cross functional team, superior quality leadership, open and transpent admini, superiors providing coaching, safe work environment, merit based recruitment, opinion and feedback is valid, secured job, potential talents identified, responsibilities in career, fair and equitable treatment, strong corporate governance and citizenship, looking for talents and encourage them, appreciation of good work, helps to strike balance b Dependent Variable: employee satisfaction
The ANOVA table, as displayed in the above table 38 shows the F ratio for the regression model that indicates the statistical significance of the overall regression model. The larger the F ratio there will be more variance in the dependent variable that is associated with the independent variable. The F ratio =8.195. The statistical significance is .000- the sig. So reject the null hypothesis. There is relationship between independent and dependent variables
Table 7: Coefficients (a)
Model 1 (Constant) Opportunities to learn and dev Potential talents identified Encouragement to higher education Share knowledge through training Responsibilities in career Competitive compensation pattern Fringe benefits par with market Select potential and cultural fit candidates Superior quality leadership Superiors stand up for critical situation Superiors providing coaching Helps to strike balance Unstandardized Coefficients B .546 -.155 .004 .228 .226 -.034 .057 .023 -.035 .114 -.061 .111 -.001 Std. Error .570 .141 .136 .115 .136 .099 .051 .100 .102 .107 .105 .110 .129 Standardized Coefficients Beta .958 -.162 .005 .294 .275 -.054 .109 .028 -.043 .121 -.076 .135 -.002 -1.098 .026 1.991 1.664 -.340 1.114 .227 -.339 1.062 -.583 1.004 -.009 .344 .279 .979 .053 .104 .736 .272 .822 .736 .295 .563 .321 .993 t Sig.
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Corporate social responsibilities Appreciation of good work Realists exit interview Merit based recruitment Open and transparent admini Organisational values are practiced Part of growing organisation Fair and equitable treatment Looking for talents and encourage them Strong corporate governance and citizenship Secured job Adequate materials,computer,etc.. Safe work environment Opinion and feedback is valid Cross functional team Job enrichment .106 -.036 .185 .080 -.085 .024 .086 .046 .233 -.138 .019 -.082 -.228 .101 .121 .075 .213 .105 .132 .136 .104 .133 .095 .177 .144 .117 .118 .105 .143 .084 .102 .162 -.039 .344 .084 -.122 .031 .093 .075 .268 -.176 .027 -.133 -.306 .135 .209 .036 1.418 -.169 1.766 .601 -.629 .227 .645 .477 1.319 -.956 .165 -.696 -2.173 .703 1.439 .223
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.164 .866 .085 .551 .533 .822 .522 .636 .194 .345 .870 .490 .036 .486 .158 .825
.023 A Dependent Variable:overall employee retention
To determine if one or more of the independent variables are significant predictors of overall satisfaction of employee retention programs, we examine the information provided in the coefficient table. The standardized coefficient beta column reveals that opportunities to learn and development has a beta coefficient (-162), which is not significant (.279). potential talents identified has a beta coefficient( .005), which is not significant (.979). Encouragement to higher education has a beta coefficient (.294), which is not significant (.053).share knowledge through training has a beta coefficient (.275), which is not significant (.104). Responsibilities in career has beta significant (054), which is not significant (.736). Competitive compensation pattern has beta coefficient (.109), which is not significant (.272). Fringe benefits par with market has a beta coefficient (028), which is not significant (.822). select potential and cultural fit candidate has a beta coefficient (.-043), which is not a significant (.736). superior quality leadership has a beta coefficient (-121), which is not significant (295). Superiors stand up for critical situation has a beta coefficient (-076), which is not significant (.563). superiors providing coaching have a beta coefficient (.135), which is not significant (.321). Helps to strike balance has a beta coefficient (-002), which is not significant (.993). A corporate social responsibility has a beta coefficient (.162), which is not significant (.169). Appreciation of good work has a beta coefficient (-.039), which is not significant (.866). Realists exit interview has a beta coefficient (.344), which is not significant (.085). Merit based recruitment has a beta coefficient (.084), which is no significant (.551). Open and transparent administration has beta coefficient (-122), which is no significant (.533). organisational values are practiced has beta coefficient (.031), which is not significant (.822). Part of growing organisation has beta coefficient (-.093), which is not significant (.522). Fair and equitable treatment has beta coefficient (.075), which is not significant (.636). Looking for talents and encourage them has beta coefficient (.268), which is no significant (.194). strong corporate governance and citizenship has beta coefficient (-176), which is not significant (.345).
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secured job (.027), which is not significant (.870). adequate materials,computer,etc.. has beta coefficient (-133), which is not significant (.490). Safe work environment has beta coefficient (.306), which is not significant (.036). Opinion and feedback is valid has beta coefficient (.135), which is no significant (.486). Cross functional team has beta coefficient (.209), which is not significant (.158). Job enrichment (.036), which is not significant (.825). In the table shows that encouragement to higher education, share knowledge through training, realists exit interview, looking for talents and encourage them, cross functional team these are highly predictor variables in the employee retention programs.
CONCLUSION In the present scenario, identification of employee retention has become a crucial element. In this study, it found that most of the employees are satisfied with the organization. It is inferred that the predictor variables of overall employee retention programs is encouraged for higher education, opportunities to share knowledge with various methods, looking for talents and encourage them, and Cross functional team are highly influenced by the employees. Certain factors like compensation pattern, responsibility in career personal care is not appreciated when compared with other factors. So the management can strategically design towards the employee needs with regarding to retention programs.
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References
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Allen, D.G., & Griffeth, R.W. (2001). Test of a mediated performance-turnover relationship highlighting the moderating roles of visibility and reward contingency. Journal of Applied Psychology, 86, 1011-1021. Carney, Karen (1998, November). How businesses can reduce high employee turnover.Inc,47. Baltes, B.B., Briggs, T.E., Huff, J.W., Wright, J.A., & Neuman, G.A. (1999) Flexible and compressed workweek schedules: A meta-analysis of their effects on workrelated criteria. Journal of Applied Psychology, 84, 496-513. Collins, C.J. (2007). The interactive effects of recruitment practices and product job seekers employer knowledge and application behaviors. Journal of AppliedPsychology, 92, 180-190 Denton, D. Keith (1992).Recruitment, retention, and employeerelations.West Westport,CT: Quorum Griffeth, R.W., & Hom, P.W. (1995). The employee turnover process. Research in Personnel Human Resource Management, 13, 245-293. Griffeth, R.W., & Hom, P.W. (2001). Retaining valued employees. Thousand Oaks, CA: Sage. Marx, Mary (1995, December). Keeping your best employees. Journal of PropertyManagement,26- 29. Mendonsa, Robert (1998, January). Keeping who you want to keep: Retaining the bestpeople.Supervision, 10- 12 Spragins, Ellen E. (1992, November). How to retain key employees.Inc., 36 Steers, R. (1977). Antecedents and outcomes of organizational commitment. Administrative Science Quarterly, 22, 46-56. Taylor, Susan L. & Cosenza, Robert M. (1997, December). Internal marketing can reduce employee turnover.Supervision,3- 5
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Impact of Technology Transfer on Research and Development Activities in Developing Countries During The Period 1999-2008.
Khadijeh Nasrolahi
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Assistant Professor, Department of Economics, Faculty of Economics, University of Isfahan, Isfahan, Iran Batul Rafaat Assistant Professor, Department of Economics, Faculty of Economics, University of Isfahan, Isfahan, Iran Behrooz Kakaei (Corresponding Author) MA in Economics , Department of Economics, Isfahan University, Hezar-jarib Ave, Isfahan Mahyar Shabaninejad Masouleh MA in economic development and planning, University of Isfahan, Isfahan, Iran Abstract Innovation has been converted into one of the most important properties for companies in all countries in the framework of economy globalization and internationalization of R&D activity. Objective of this survey is to analyze main determinants of R&D activities in developing countries. Impacts of channels of foreign technology transfer on R&D investment in developing countries are explicitly studied. Panel data estimation method is used for estimation. Primary findings show that foreign direct investment (FDI) is a strong determinant in all models for R&D intensity. Technology importation has negative correlation sign but is not significant statistically in none of the models. Impact of interest rate on R&D investment is negative and statistically significant and impact of exports is positive and significant. Also findings illustrate that developing countries in Latin America, the Middle East and Central Asia have lower R&D than developing countries of east and south of Asia. Moreover, positive impact of FDI in other developing countries has been lower than east and south Asian countries. Keywords: R&D, Foreign Direct Investment (FDI), Technology Importation, Developing Countries. 1. Introduction Investment in R&D has been recognized as the principal growth motor by endogenous growth models that claim institutional and economic factors explain technological advancement speed. Growth models like models of Mankiw et al (1992) and Romer (1994) have shown that human capital and its accumulation by education and knowledge creation are principal resources of long-term growth. Most contemporary definitions about economic growth and technology advancement consider a prominent role for investment in R&D that could be seen in researches of Griliches (1980), Mansfield (1988), Cohen and Levinthal (1989), Feller (1990), Jovanovic and Nyarko (1995), Adams and Griliches (1996), Stephan (1996), Madden et al (2001), Fraumeni and Okubo (2002) and Maloney and Rodriguez (2007). About the newly industrialized countries technology has been recognized as the main organizer of creating considerable growth (Nelson and Pack, 1999). Also developing countries are trying to promulgate technology advancement by international technology transfer (Basant, 1997). Recently, many countries have confirmed foreign direct investment (FDI) as the main channel of technology transfer. Basis of such thinking is that FDI brings superior technology with itself that hasn't previously been available in the host country. Also FDI can have a positive spillovers impact on economy of the host country through competitive and exhibitive effects, mobility of the work force and supply chain (Muran, 1998). However, FDI may have negative impact on economy of the host country especially on its technological activities (Moinul Islam, 2009: 2). Buying of technology from foreign countries or technology importation is another channel of technology transfer that could be effective on R&D. Importation of capital goods may stimulate innovative activities in the importing company in order to adapt such goods with local conditions (complementary effect) (Pavitt, 1984). On the other side, the fact that the new technology could be supplied easily from outside may neutralize any need to develop internal technology and thus it decreases internal innovative attempts (this is called substitution effect) (Pillai, 1979).
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VOL 3, NO 4 Having access to favorable techniques of technology dissemination due to their potential impacts on internal technology development is an important issue in view of developing countries that would be too questionable. Do such input flows increase internal motivations for innovation? Or do these channels of technology transfer decrease motivation of companies by eliminating the need for domestic production of technology? Is the total size of technology transfer important? Or the method by which technology is imported is important too? We analyze the mutual relation between FDI and technology importation with R&D in order to respond to above questions. Also impact of other variables like exports as a criterion for freedom of trade and interest rate on R&D expenditures in the selected developing countries are studied following the existing literature and studies. Thus this survey is organized as the following: theoretical frameworks for the impact of the above variables on R&D expenditures are mentioned in the next section. Accomplished studies will be reviewed in section 3. Variables, model and sample are introduced in section 4. Experimental results and analysis are stated in section 5 and at last conclusion and recommendations are represented in the last section. 2. Theoretical Background Consensus about methods of technology transfer among the countries is that important mechanisms for technology transfer are international trade and FDI, especially trading in capital goods and intermediatory productions with high technology and FDI flows. It is argued in international technology transfer hypothesis that advantages of foreign R&D activities could be transferred through trading and FDI and affect investment decisions in internal R&D. In the following, theoretical literature about each channel and other determinants of R&D activities will be studied briefly. 2.1 Foreign direct investment and R&D Proposed arguments in theoretical literature show that inflows of FDI increases R&D in the host economy. Technology of multinational enterprise (MNE) might not be suitable for local conditions, since intensity of factors and the existing raw materials in a host developing country are not similar to what exists in the developed countries that are origins of FDI. Hence, some research and development must be performed to adjust such technologies due to local conditions (Katrak 1985, Cassiman and Veugelers 2003, Tomiura 2003). Also, FDI may increase number of companies in an industry especially in industries with high setting up cost and severe obstacles and through this it will decrease compression and increase competition in that industry (Veugelers and Van den Houte, 1990). It is necessary for internal companies to invest in R&D in order to improve the quality of their productive products and reduce costs so that to be able to compete with foreign companies. Moreover, perhaps some internal companies perform R&D activities to increase their attraction capacity for complete enjoyment of FDI spillovers effects (Kathuria, 2001; 2002). Also entrance of foreign MNEs may have a positive impact on production of the current internal firms through spillovers (Caves, 1996). However, there are arguments in theoretical literature too which show that input flow of FDI decreases R&D activities in the host economy. FDI may lead to increase compression in the host country (Aitken and Harrison, 1999). Foreign companies have specific competitive properties and because of this may provide prominent market situations for themselves. Number of active companies in an industry might be reduced after entrance of multi-national companies into the host country if more efficient companies are just remained and less efficient internal companies are forced to get out of the market. Also it is argued that foreign subsidiary companies have access to technology of their original company and perhaps the only remaining way for internal companies in developing countries to compete with foreign companies is to obtain similar technologies. This technology could be obtained either through investment in internal R&D or by buying such technologies from foreign companies. Given to the financial and capacity limitations, R&D is most likely not considered because it is an activity that brings uncertainty, risk and delay in results with itself (Lall 1992, Katrak 1985). Thus, companies might select the option of buying these technologies from foreign countries. Following the argument of the first group we consider that FDI inflows has positive spillover impacts on R&D activities. 2.2 Technology importation and R&D In a free trade political regime firms can import technology from foreign countries. Technology importation could be in the form of capital goods (modern technology) or in the form of disembodied technology. It could increase motivation of the company for investment in internal R&D. A theory states that a substitution relation exists between these two; this theory indicates that companies in developing countries resort to import technology from foreign countries because they have limited research possibilities to develop internal technological capacities. In other words, availability and using of foreign COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 technology decreases R&D activities of the receiver company and replaces those activities; as a result technology importation reduces investment in R&D (Pillai 1979, Evenson and Westphal 1995). In addition, more importation of technology may create "dependence culture" and through this reduces internal attempts (Katrak 1990). On the other side, the opposite viewpoint of this theory imagines them as complement of each other (Cohen and Levinthal 1989, Bell and Pavitt 1997). It is argued that attraction of importing technology needs some technological capabilities in that part of the company that such capability could be achieved in the form of internal investment in R&D, since most technologies contain a specified element of implicit knowledge (Cohen and Levinthal 1989). Moreover, importing machineries and equipments might need adaptations and changes in order to be adapted with local conditions, consumed raw material and the applied model that necessitates such investment in internal R&D (Bell and Pavitt 1997). If technology belongs to a country that is at a higher situation in technology ladder, the need for comparative R&D will be increased. Given that OECD countries constitute the basic section of technology importation of the developing countries, these countries most likely need to perform R&D. In this survey we follow argument of the first group and assume that technology importation decreases internal technological attempts in developing countries. 2.3 Exports and R&D Competition in international markets most probably needs products with advanced quality in terms of technology that obliges export-oriented companies to invest in R&D. Theory of industrial organization says that export orientation by a company is possible if that company has some advantages and R&D is among the important channels of accumulating such advantages. Therefore, those companies that are at the service of international markets -by export or having production bases in foreign countries- must perform R&D activities. Also export is leaded to enjoyment of companies from economy of scale and as a result increased investment rate of return in R&D (Zimmerman, 1987). Moreover, most probably more extrovert companies have more information about technological changes outside of the country than introvert companies (Evenson and Joseph, 1997). Finally, exporting companies need adaptation of productions and processes for foreign markets in coordination with their demand nature, interests and tastes, production standards and having access to raw materials and etc. Hence, following these arguments in this survey it is expected to observe a positive relation between exports and R&D efforts. 2.4 Interest rate and R&D Models that study the relation between real interest rate and portion of allocated resources to research, i.e. R&D-based growth models predict a negative relation between these two. In Romer's endogenous technological change model (1990) when interest rate is considered as an exogenous parameter, an increase in real interest rate reduces portion of the allocated work force to research and economic growth rate. Since research is a time consuming process, increasing of real interest rate enhances opportunity costs of resources allocated to research rather than allocating them to a market activity or more immediate return. In other words, increasing of real interest rate decreases current value of future profits that could create a new invention as a result of research and development. Besides, since supplied properties by families are used as an input in capital production in the model, higher interest rate increases borrowing cost for producers of capital equipments and thus decreases the profit they can achieve in each period of commercial application of their technological invention. Both of these effects tend to omit incentives for individuals to allocate resources to research. Also Moinul Islam (2009) has shown in his theoretical study that the demand slope for R&D expenses with regard to interest rate is negative. He has shown that this negative relation exists both in competitive credit market and monopolistic credit market. Then in order to confirm his theoretical findings through an experimental research that has done about 72 countries concludes that negative relation between interest rate and R&D intensity exists in both states of interest rate being exogenous (competitive credit market) and interest rate being endogenous (monopolistic credit market). Therefore, our expectation is that the relation between these two is negative. 3. Previous Empirical Studies A number of studies that have examined the relation between R&D and two primary tools of achieving foreign technology, i.e. FDI and technology importation are summarized as below: Wang (2010), has studied main determinants of investment in R&D at national level for 26 OECD countries. Results of EBA estimation of this study have shown that both standards of technology input flow, i.e. FDI inflow and technology importation have had negative correlation sign and statistically significant. It means that investment in R&D related to foreign countries is indeed a substitution for COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 internal R&D efforts. Finally, the expected and current income growth rate hasn't been significant in describing changes of investment severity in R&D. Qi and Li (2008) have studied the impact of spillovers channels of foreign direct investment on knowledge creation in large and medium internal industrial companies in China in their research entitled FDI spillovers impacts on knowledge creation in China. They used panel data for 28 industries during the period 2001-2005 in this research. Estimation results of their econometric models reveal that FDI plays a positive and significant role in knowledge creation in China during the intended period in all estimation models. Exhibitive effects and work force mobility are spillovers channels in the same period that create favorable results but competitive effect has an unfavorable impact on knowledge creation. However, impact of these three spillovers channels on knowledge creation is weak in China; hence knowledge creation of internal companies depends largely on inputs of the work force and the applied capital in R&D units. Results of their study indicate that China government must improve human capital and technology level in order to establish conditions to help internal companies that could attract and gain knowledge from FDI. Alvi et al (2007) have studied in their article whether supporting intellectual property rights and technology transfer facilitate R&D activities in a sample of developed and emerging countries or not. They used a semi parametric model in their study to estimate the related parameters by means of data across the country for 21 countries that 6 of them were emerging countries for the period 1997-1981. Results of their study demonstrate that FDI has positive effects just for countries that are severely depended upon FDI (3 percent of gross domestic product or more) and R&D has often been growing by increasing of income. Their estimation reveals the issue in terms of technology transfer that only countries which have significant FDI benefit from technology transfer channel and experimental profits in their R&D. This shows importance of economic opennes in facilitation of R&D. In the relation between importation and R&D they have shown that industrial import helps R&D, this issue is a reason to support openness policy of economy. Chen (2007) analyzed the relation between FDI and regional innovative capacity (RIC) and showed that spillovers impact of FDI is not significant to the degree that has been imagined. Impact of FDI on RIC was weak and thus entrance of FDI had a small impact on increasing of internal innovation ability. Moreover, inflows of FDI may have an exogenous impact on innovation and internal R&D activity. Li (2006) created a set of panel data for 16 OECD countries from the year 1981 to 2000 to study importance of FDI spillovers on innovative activities. Using estimation models that reflect recent development in econometrics of dynamic data panel, he argued that international spillovers were strong and significant by FDI inflows. Parameswaran (2004) has studied the impact of trading on investment in R&D of Indian companies in his study entitled "international trade and investment in R&D". It has been stated in this study that international trade could be effective on R&D activities of companies through several channels that include importing competition, exportation and technology importation. Data at firm level has been used in this study to estimate the model that covers manufacturing industries of India during the period 19941995 to 1999-2000 for 3675 industrial companies. Results related to analysis of his model show that exportation has originally a positive impact on investment in R&D and confirm this argument that it encourages strategy of export development, innovation and technology advancement. Technology importation has positive effect just in sections that have low level technological and engineering capacities. This result is in harmony with the view that companies which have a low level of technological and engineering capabilities need to perform internal R&D activities in order to attract the imported technology. Results related to impact of importing competition show that this impact depends on the structure of internal market. Pamucko (2003) has analyzed determinants of innovation decisions in the industrial sector of Turkey by emphasizing the impact of freedom of trade in his article entitled "commercial releasing and innovative decisions of companies". Binominal probit model has been used in this study to evaluate impact of various determinants on the probability that a company performs innovative activity. Results of this study about the impact of variables related to freedom of trade are in this form: competition in internal markets that is resulted from importation doesn't show any impact on innovation decisions of companies. Also estimations of simultaneous probit model show that competition in the international market doesn't increase probability of innovation. In contrast, results show that innovative companies want to enter into such markets. Results about transformations of international technology are not much obvious in this study: technology importation in the form of capital goods is leaded to increase innovation but the COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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VOL 3, NO 4 imported technology in the form of technology licenses and FDI has no positive relation with innovation decisions. van Pottelsberghe de la Potterie and Lichtenberg (2001) have studied about 13 member OECD countries by panel data from the year 1971 to 1990 that whether inflows of FDI has been effective on international dissemination of knowledge or not. Results of estimation of their OLS showed that significant knowledge spillovers don't occur through inflows of FDI. According to their study, hidden external knowledge saving in internal FDI has no significant impact on R&D. As it has been observed, experimental evidences about the relation between technology importation and FDI with R&D activities have been uncertain and are different from one case to another case. Some consider the relation between these two channels of technology transfer and internal technological efforts as substitution type, some have reached to the complementary relation between them. Thus we try in this survey to see how these relations about developing countries are and the impact of these two channels of technology transfer is similar or different. Impact of other variables like export and interest rate will be studied too. 4. Sample, variables and model 4.1 Sample The studying sample in this survey includes all developing countries that their data has been available during the period 1999-2008. Therefore, sample and period are selected according to data availability. Also we have collected our intended data from the World Bank website that could be downloaded from this addresshttp://data.worldbank.org/indicator. 4.2 Variable Definition 4.2.1 General Variables Aghion and Howitt suggest that R&D intensity is the proper empirical measure for the R&D input of the innovation function in the context of their endogenous growth model. So, a common indicator used to measure R&D investments across countries is represented by GERD: Gross Domestic Expenditures on Research and Development as a percentage of Gross Domestic Product (GDP). Therefore, R&Dit is the expenditure for Research and Development as a percent of GNP for ith country in tth year. These expenditures include current and capital expenditures (including overhead) on creative, systematic activity intended to increase the stock of knowledge and on the use of this knowledge to devise new applications. This includes fundamental and applied research and experimental development work leading to new devices, products or processes. Foreign Direct Investment (FDIit) is the net inflows of investment to acquire a lasting management interest (10 percent or more voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital. FDIit is expressed as a percent of GDP for ith country in tth year. Technology import (techimpit) is manufactures imports, Manufactures comprise the commodities in SITC sections 5 (chemicals), 6 (basic manufactures), 7 (machinery and transport equipment), and 8 (miscellaneous manufactured goods), excluding division 68 (nonferrous metals). Rate of Interest is the real annual rate of interest which is calculated as the deposit rate less the rate of inflation measured by the GDP deflator. Exports of goods and services represent the value of all goods and other market services provided to the world. Included is the value of merchandise, freight, insurance, travel, and other non-factor services (World Bank, 2007). This is expressed as a percent of GDP and is used as a proxy for Economic Openness. 4.2.2 Dummy variables Regional dummies are used. The countries are divided into 5 categories. Latin American Countries, East Europe, East Asia and South Asia, Middle East and Central Asia, and Sub-Saharan Africa. The following five dummy variables are introduced: LA, EE, EAS, MEC and SS. LA takes a value of 1 if the country is from Latin America, and 0 otherwise. EAS takes a value of 1 if the country is from East Asia or South Asia and 0 otherwise. EE takes a value of 1 if the country is from Eastern Europe, and 0 otherwise. MEC takes a value of 1 if the country is from Middle East or Central Asia, and 0 otherwise. COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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SS takes a value of 1 if the country is from Sub-Saharan Africa, and 0 otherwise.
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LAFDI, EASFDI, EEFDI, MECFDI and SSFDI are interaction terms between LA and FDI, EAS and FDI, EE and FDI, MEC and FDI, and SS and FDI, respectively. 4.3 The model In this study, various versions of the following relationship are estimated, (1) In which: : is intensity of research and development expenditures in country i in year t : is inflow of foreign direct investment into country i in year t in the form of a percentage of GDP : is technology importation by country i in year t in the form of a percentage of GDP : is real interest rate in country i in year t : is degree of economic openness of the country i in year t in the form of a percentage of GDP, and, : is random error 5. Empirical results and analysis In this study, Panel data estimation method is used for estimation. First the basic model (i.e., without any dummy variables) is estimated. Then the regional dummies are included with the basic model. Later, we drop the intercept dummies, however include the interaction terms. Finally, we include both regional dummies and the interaction terms with the basic model. 5.1 Estimation of the basic model The basic model that has been introduced in equation (1) is estimated in this section. F limer test is used to select estimation through pooling data or panel data method. Thus, first the model is estimated with fixed effects method. After estimation in the form of fixed effects, statistic F limer has been equal to 82.19 and its probability is 0.000 (that is lower than 0.05). Result of this test show that null hypothesis about the point that data is in pooling form couldn't be confirmed. Therefore, panel data method is used to estimate this model. In the next step it must be determined that which estimation method (fixed effects or random effects) is more compatible in panel data environment. Therefore, Hausman test is applied to select fixed effects or random effects method. As it is shown in table 5-1, statistic of Hausman test is equal to 6.41 and its probability is 0.1703 (that is higher than 0.05), as a result Hausman statistic has determined that random effects method is superior in panel data environment. In the next phase BreuschPagan test is performed to study variance difference and its result reveals that there is variance difference and random effects method is used to eliminate such difference. Estimation results of the basic model with random effects method has been shown in table 5-1. As it is observed coefficient sign of FDI is positive and statistically significant. Coefficient sign of technology importation is negative and insignificant. Interest rate has negative coefficient and is statistically significant. Exportation too has a positive and significant impact on R&D intensity. Amount of coefficients of FDI and export are equal to 0.0036 and 0.0015 respectively and this shows one unit increase in FDI and export variables is leaded to changes equal to 0.0036 and 0.0015 unit in R&D intensity. Also amount of interest rate coefficient is 0.0011 which shows one unit increase of real interest rate is leaded to 0.0011 unit decrease in the proportion of R&D expenditures to GDP. Determination coefficient R2 is low (0.008) that shows low describing power of regression model. However, regression is generally significant when is shown with significant statistic F. 5.2 Estimation of basic model along with dummy-regional variables In this section four dummy variables including LA, EE, MEC and SS are inserted in the model. ESA is used as the group of basic countries. Random effects method is used in this state to estimate the model. Results of this estimation are illustrated in table 5-2. Results about main variables are as previous state. Coefficient of FDI variable is positive and significant at each statistical level. Coefficient sign of technology importation is negative but is not significant. Coefficient sign of interest rate variable is negative and significant and export coefficient is positive and significant. All dummy variables have negative coefficient sign but coefficient is insignificant just about EE which justifies inserting of them in the model. This shows that developing countries located in Latin America, the Middle East and Central COPY RIGHT 2011 Institute of Interdisciplinary Business Research 778
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VOL 3, NO 4 Asia have lower independent R&D than countries of east and south Asia. Of course this coefficient is significant at 10% level for countries of Latin America. Total goodness of the model is modified in this state (R2 = 0.23). 5.3 Estimation of basic model along with interaction terms Another studying model is the same primary model by inserting of mutual effects variables. Table 5-3 shows estimation results of this model. As it is observed, FDI has still positive and significant coefficient sign and technology importation has negative and insignificant coefficient. Negative coefficient of interest rate and positive coefficient of export are significant too at 10% level. Coefficient sign of all interacting terms are negative and significant. This shows that positive impact of FDI on R&D is decreased in all developing countries located in Latin America, Eastern Europe, the Middle East, Central Asia and Sub-Saharan Africa to the proportion of countries of east and south Asia and even this impact could be negative about African countries. 5.4 Estimation of basic model along with both dummy variables and interaction terms Both dummy and interaction variables are inserted in the model in this section. Here random effects estimation method is used in panel data environment. Table 5-4 demonstrates results obtained from estimation of the total model. Results are like the previous state. FDI has positive and significant coefficient and technology importation has negative coefficient and is not statistically significant. Negative coefficient of interest rate and positive coefficient of export are significant at confidence level of 90%. All dummy variables except EE have negative coefficient but none of them have become significant. Coefficient of all interaction terms is negative and significant. This reveals that positive impact of FDI on research and development expenditures in countries located at LA, EE, MEC and SS regions is decreased than countries located in ESA. Even this impact becomes negative about countries located at Sub-Saharan Africa. 6. Conclusion In spite of increasing rate of globalization and global economy based on knowledge it appears that technological capacity in the recent theoretical and experimental literature has a considerable impact on capability of international competition and various aspects of growth. Therefore, national and regional governments play a significant role in national innovation systems of such economies and increasing advancement of R&D activity of national companies. Recent attempts in growth theories have emphasized the played role by R&D from a Schumpeter viewpoint. Profiteering innovative activities of companies in this viewpoint are the main source of long term economic growth. Therefore, it has been tried in this survey to identify determinants of R&D activity by emphasizing channels of technology transfer, i.e. FDI and technology importation in developing countries given to the importance of R&D activities in national innovation system and economic growth. Estimation results of econometric models of this survey by means of data for 40 developing countries show that proportion of input flow of foreign direct investment (FDI) to gross domestic product (GDP) is a significant determinant in all models for R&D expenditures intensity. Technology importation was not a significant determinant for R&D expenditures in none of the states. Interest rate has a negative and significant relation with R&D expenditures in developing countries. Export as a standard to show economic openness has a positive and significant impact on R&D too. Also results of this survey show that developing countries in Latin America, Eastern Europe, the Middle East, Central Asia and Sub-Saharan Africa have lower independent R&D than developing countries of east and south Asia. Moreover, positive impact of FDI in developing countries of Latin America, the Middle East, Central Asia and Sub-Saharan Africa is reduced; Even this impact becomes negative about countries located at Sub-Saharan Africa.
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References
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Adams, J.D., & Griliches, Z. (1996). Research productivity in a system of universities. NBER Working Papers Series, 5833. Aitken, B. J., & Harrison, A. E. (1999). Do Domestic Firms Benefit from Foreign Investment? Evidence from Venezuela. American Economic Review, 89, 605-618. Alvi, E., Mukherjee, D., & Eid, A. (2007). Do Patent Protection and Technology Transfer Facilitate R&D in Developed and Emerging Countries? A Semiparametric Study. International Atlantic Economic Society, 35, 217231. Basant, R. (1997). Technology strategies of large enterprises in Indian industry: some explorations. World Development, 25 (10), 1683-1700. Bell M., & Pavitt, K. (1997). Technological accumulation and industrial growth: contrasts between developed and developing countries. In: Archibugi, D., Michie, J. (Eds.), Technology, Globalisation and Economic Performance. Cambridge Univ. Press, 83137. Cassiman, B. & Veugelers, R. (2003). In search of complementarily in the innovation strategy: internal R&D and external knowledge acquisition. CEPR Discussion Paper, No. 3284, http://www.cepr.org/pubs/dps/DP3284.asp, accessed in April 2004. Chen, Y. (2007). Impact of foreign direct investment on regional innovation capability: a case of China. Journal of Data Science, 5, 577-96. Cohen, W.M. & Levinthal, D.A. (1989). Innovation and learning: the two faces of R&D. The Economic Journal, 99, 569596. Evenson, R.E. & Westphal, L. E. (1995). Technological Change and Technology Strategy. In: Jere Behrman and T.N. Srinivasan (ed.) Handbook of Development Economics Volume- 3A, Elsevier, Amsterdam. Evenson, R.E., & Joseph, K.J. (1997). Foreign technology licensing in Indian industry: an econometric analysis of the choice of patterns, terms of contract and the effects on licensees performance. Working paper NO. 273. Feller, I. (1990). Universities as engines of R&D-based economic growth: they think they can. Research Policy, 19, 335348. Fraumeni, B.M., & Okubo, S. (2002). R&D in the national income and product accounts: a first look at its effect on GDP. Bureau of Economic Analysis Working Papers, 2002-1. Griliches, Z. (1980). R&D and productivity slowdown. American Economic Review, 70, 343348. Jovanovic, B., & Nyarko, Y. (1995). Research and productivity. NBER Working Papers Series, No. 5321. Kathuria, V. (2000). Productivity spillovers from technology transfer to Indian manufacturing firms. Journal of International Development, 12(2), 343-69. Kathuria, V. (2001). Foreign Firms, Technology Transfer and Knowledge Spillovers to Indian Manufacturing Firms- a Stochastic Frontier Analysis. Applied Economics, 33(5), 625-642. Kathuria, V. (2002). Iiberalisation, FDI and Productivity Spillovers an Analysis of Indian Manufacturing Firms. Oxford Economic Paper, 54, 688-718. Katrak, H. (1985). Imported technology, enterprise size and R&D in a newly industrializing country: The Indian experience. Oxford Bulletin of Economics and Statistics, 38, 213-229. Katrak, H. (1990). Imports of technology and the technological effort of Indian enterprises. World Development, 18(3), 371-381. Lall, S. (1989). Learning to Industrialize: The acquisition of technological capabilities by India, London: Macmillan. Lee, G. (2006). The effectiveness of international knowledge spillover channels. European Economic Review, 50, 2075-88. Madden, G., Savage, S.J., & Bloxham, P. (2001). Asian and OECD international R&D spillover. Applied Economics Letters, 8, 431435. Maloney, W., & Rodriguez-Clare, A. (2007). Innovation shortfalls. The World BankWorking Papers, NO. 4283. COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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Annexure Table 5-1: Results of Estimation of the basic model Independent variable Constant FDI THIMP RAT EXPORT Estimation of coefficients 0.348 0.0036 -0.00069 -0.0011 0.0015 Standard deviation 0.5478 0.0014 0.0010 0.0005 0.0007 Statistic z 6.37 2.50 -0.67 -1.98 2.23 Prob 0.000 0.012 0.504 0.047 0.026 Probaibility:0.74
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H0: pooling data H0: difference in coefficients not systematic H0: Var(u) = 0
F(Limer) statistic:278.21 hausman: chi2(4 ) = 6.41 Breusch and Pagan: chi2(1) = 2870.46 R-Squared: 0.008
Prob>chi2 = 0.1703 Prob > chi2 = 0.0000
Table 5-2: Results of estimation of basic model along with dummy-regional variables Independent variable Constant FDI THIMP RAT EXPORT LA EE MEC SS Estimation of coefficients .5794 0.0037 -0.0010 0.0011 0.0014 -0.2437 -0.0823 -0.3570 -0.3792 Standard deviation 0.1151 0.0014 0.0010 0.0005 0.0007 0.1283 0.1338 0.1318 0.1612 R-Squared: 0.23 Table 5-3: Results of estimation of basic model along with interaction terms Independent variable Constant FDI THIMP RAT EXPORT LAFDI EEFDI MECFDI SSFDI Estimation of coefficients 0.3346 0.0591 -0.0003 -0.0010 0.0012 -0.0539 -0.0493 -0.0574 -0.0640 Standard deviation 0.5382 0.0125 0.0010 0.0005 0.0007 0.1300 0.1301 0.1264 0.1367 R-Squared: 0.11 Statistic z 6.22 4.72 -0.34 -1.75 1.75 -4.15 -3.79 -4.54 -4.68 Prob 0.000 0.000 0.737 0.080 0.080 0.000 0.000 0.000 0.000 Statistic z 5.03 2.62 -0.97 -1.95 2.06 -1.90 -0.62 -2.71 -2.35 Prob 0.000 0.009 0.332 0.052 0.039 0.058 0.539 0.007 0.019
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VOL 3, NO 4 5-4: Results of Estimation of basic model along with both dummy variables and interaction terms Independent variable Constant FDI THIMP RAT EXPORT LA EE MEC SS LAFDI EEFDI MECFDI SSFDI Estimation of coefficients 0.4355 0.0561 -0.0006 -0.0010 0.0012 -0.1083 0.0347 -0.1969 -0.2098 -0.0506 -0.0477 -0.0540 -0.0599 Standard deviation 0.1250 0.0130 0.0010 0.0005 0.0007 0.1405 0.1468 0.1461 0.1747 0.1355 0.1357 0.1314 0.1418 R-Squared: 0.22 Statistic z 3.48 4.31 -0.64 -1.72 1.76 -0.77 0.24 -1.35 -1.20 -3.74 -3.52 -4.11 -4.22 Prob 0.000 0.000 0.525 0.085 0.079 0.441 0.813 0.178 0.230 0.000 0.000 0.000 0.000
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Competency Assessment A Gap Analysis

N.Anitha B.TECH, MBA, (PHD) Associate Professor Saranathan College of Engineering, Trichy 620 012 Dr.Thenmozhi M.COM MBA, MPHIL, PHD Associate professor, Department of management studies, University of Madras, Chennai -600005 Abstract
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Competencies are a combination of several factors like motives, traits, self-concepts, attitudes or values, skills and abilities all of which can differentiate superior performers from average performers. Since competencies take a composite view of an employees ability to perform, they go beyond mere job knowledge. This becomes particularly useful when the definition of jobs itself changes under external competitive pressures. Todays industries place challenging demands on individuals, who are confronted with complexity in many parts of their activities. Defining such competencies can improve assessments of how well prepared young employees and adults are for industries challenges, as well as identify overarching goals for efficient operations and lifelong learning. The set of competencies provides management and staff with a common understanding of the skills and behaviour that are important to the organization. Therefore, it plays a key role in decisions for selection and recruitment of new employees, succession planning, career development, job rotation and transfer, project specific team development, performance measurement and training needs assessment. This research study to assess the gap between the expected and existing competencies of executives in automobile sector and to recommend measures to espouse to fill the gap.
Key Words: Competency, Ability to perform, Assessment, Recruitment, Career planning, Performance measurement, Training need assessment
1. INTRODUCTION
Today, more and more companies are interested in intangible assets and human capital as a way to gain competitive advantage. Competency gap analysis can help in supporting companys competitiveness by increasing the companys value through contributing to its intangible assets. However, in designing effective training and development programmes and activities, the first step in the instructional design process is the most crucial process in which it has to be properly and correctly conducted. Indeed, improperly and incorrect training needs assessments can lead to disastrous effects. The figure 1 shows the gap analysis assessment. Ought to be properly done indicates what someone is expected to do. Is doing/can do is the way in which someone is doing some job now. If the way in which I am filing or budgeting is not on the level that it is supposed to be, then a gap is formed. The gap is the difference between what I am doing now, while working, and what is expected of me, that is, the way in which a good employee ought to be working.
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Fig-1 Competency Gap Assessment How The Job Ought To Be Properly Done THE GAP How The Employee Is Doing Or Can Do The Job Now
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Competency Gap Assessment is the process of separating the job tasks into those for which training is needed and those for it is not and then developing an Individual Training Plan for accomplishing the needed training. This does not merely mean selecting those knowledge, skills or abilities, which are critical to the job performance, but also means determining what the capabilities of the current job incumbents are. Competency Gap Assessment determines the purpose and learning objectives of tailor made training in organizations. It forms the basis of focused design and evaluation of training sessions. Competency Gap Assessment approaches must be carefully articulated. An integrated approach combining these methods annul out any weakness would be ideal but can be expensive and time consuming. The purpose of needs assessment is to identify performance requirements or needs within a department/organization in order to channelize resources into areas of greatest need those that closely relate to fulfilling the organizational mission, improving productivity, and providing quality services.
2. PROBLEM IDENTIFIED
Training is associated with the performance of people in their job and performance gaps imply that there is a shortfall somewhere in their knowledge and/or skills to undertake certain roles or tasks. Training Needs Assessment is a vital part of the training design process which endeavors to reduce the gap by finding out what needs to be learnt. Determining the gap between what an employees must be able to do and what he or she can or is currently doing. A training needs assessment therefore identifies the gap between what the job expects an employee to do, on the one hand, and what the employee is actually doing, on the other. A training needs analysis discovers whether there is a discrepancy or conflict between what an employee ought to be doing and that which he or she can do. In a knowledge-based economy, the performance of business organizations depends on ensuring that all categories of employees possess current and up-to-date knowledge and skill. Therefore, the new knowledge and information-based economic system implies a strategic role for the training function. Now, businesses must analyze their training needs in greater depth and train a larger number of employees with different backgrounds in terms of knowledge and experience, and they have to do so more rapidly than in the past, while attempting to reduce training costs to remain competitive in a complex and changing environment.
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3. REVIEW OF LITERATURE
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Vickerstaff (1992) in his study on the training needs of small firms found that the organizations showed specificity in terms of their environment, strategy, structure, technology and culture, and differ markedly from large enterprises with regard to their training and development needs. Reid and Barrington (1994) argued that methods of identification of training needs depended on the focus of investigation, and have proposed referencing to strategic planning documents relating to marketing, production, and staffing; analyzing minutes of management meetings, and analyzing operational and personal records. Madsen and Larsen (1998) argued that organizations would rather much preferred methods such as performance appraisals, informal feedback from line managers and individual employees rather than their training needs for superior performance. Naikar and Sanderson (1999) in their study on work domain analysis for training system acquisition identified specific types of functional requirements for training equipment as they related to different levels of functional capabilities identified in the means-end hierarchy of the work domain. Kerr and McDougall (1999) in their work on small business of developing people found that most companies did not analyze all the training needs at different levels, but rather emphasized on individual employees needs. Turning to the methods used in accomplishing the identification of needs within organization. Wilson (1999) suggested the conventional and simpler methods such as interviews, questionnaires, observations, and focus groups to gather information for HRD needs analysis. Leigh, et. al., (2000) in their study on alternative models of needs assessment: selecting the right one for your organization stressed the importance of assessing and analyzing needs because this stage builds the foundation by identifying the kinds of HRD intervention needed for an effective effort. 4.RESEARCH METHODOLOGY
4.1 Hypotheses
1. There is no significant difference between desired levels of competencies among the employees. 2. There is no significant difference between existing levels of competencies among the employees. 3. There is no significant gap between competency desired and current state of competencies.
4.2 Sampling Design
Among the different manufacturing sector in Chennai, the automobile manufacturing sector of Chennai has been purposively selected for the present study based on similar manufacturing processes conveniently. The sample size is 300 executives.
4.3 Tools for Data Collection
The structured interview schedule is developed based on prior research studies, experts opinion.
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4.4 Statistical Techniques Weighted Mean Score
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The desired and existing core competencies of automobile manufacturing sectors are analyzed by calculating weighted mean and the formula is presented below as: Weighted Average = x / f Where x= Score of attributes = Frequency
T-Test
In order to study difference (gap) between desired and existing core competencies of executives of automobile manufacturing sector, t-test has been applied and the formula is:
5.DATA ANALYSIS Table-1 Weighted Mean for Desired Core Competencies of Employees S.No Core Competencies Weighted Mean I Technical 1 Ability to implement the advanced techniques or specialized methods efficiently and effectively 4.66 2 Capacity to quickly understand the technicalities and adoptiveness 4.29 3 Subject matter specialization in your functional area 4.56 4 Scope for learning and technical know-how 4.61 5 Knowledge of superior and competitive technical skills and technological advancements 4.27 II Behavrioural 1 Ability to work under pressurized situations 4.57 2 Ability to adjust and adopt to changing work environments 4.31 3 Ability to deal with risk factors 4.65 4 Ability to cope up with stressed circumstances 4.56 5 Ability to complete designated tasks 4.30 III Leadership and Command Skills 1 Ability to influence the followers to achieve the organizational tasks and goals 4.63 2 Ability to confidence building 4.35 3 Ability to make conducive environment for efficiency 4.63 4 Ability to motivate others for successful completion of work 4.65 5 Ability to build up a team spirit 4.20 IV Intellectual 1 Ability to proactive 4.66 2 Ability to diagonize the issues and forecast the outcomes with precision 4.23
Status
VH H VH VH H VH H VH VH H VH H VH VH H VH H 787
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3 4 5 V 1 2 3 Informative and updated Out of box thinking with practical implications Innovative and humanity Communication Ability to speak with confidence and fluency Ability to write with clarity and concise Ability to understand the communication quickly and clearly 4 Ability to transmit the information without ambiguity and loss 5 Ability to practice the modern communication practices VI Inter Personal 1 Ability to maintain the personal harmony with others 2 Ability to understand others feelings and emotions 3 Ability to encourage others in performing the tasks 4 Ability to motivate and creating interest in others 5 Ability to create team and personal interactions S.No Core Competencies
VII 1 2 3 4 5 VIII 1 Problem Solving and Decision Making Ability to identify the causes for the problems Ability to analyze the situations and problems Ability to take appropriate corrective measures Ability to bear the responsibility Ability to the action orientation and transparency in problem solving Responsiveness and Result Orientation Ability to prioritize the organizational goals than personal objectives Ability to accept the responsiveness Ability to efficient allocation and resource utilization Ability to achieve the target and results Ability of time conscious Teamwork Confidence in co-workers in the organization Resources are freely shard throughout the organization Employees in the organization work well together Organization communicates well with others Employees make a valuable contribution to the organization Commitment
Willingtoworkhardtogetthejobdone Willingtoputinextraeffortwhennecessary Loyaltomyorganization Mymoraleisgood Iamproudtoworkintheorganization
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4.64 4.61 4.20 4.59 4.28 4.65 4.57 4.30 4.59 4.31 4.69 4.65 4.26 Weighted Mean 4.20 4.75 4.56 4.21 4.68 4.60 4.28 4.55 4.61 4.28 4.61 4.30 4.67 4.61 4.29 4.63 4.32 4.62 4.68 4.26 4.22 4.29
VH VH H VH H VH VH H VH H VH VH H Status H VH VH H VH VH H VH VH H VH H VH VH H VH H VH VH H H H 788
2 3 4 5 IX 1 2 3 4 5
X 1 2
3 4 5 XI 1 2
Consumer Oriented Ability to understand the customers specific needs Ability to know the customers preference
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Ability to value the customers 4.66 VH Ability to maintain the best customer relationship 4.22 H Ability to understand and fulfill the customers expectations 4.22 H XII Social Skills and Ethics 1 Ability to enhance the status in the organization 4.28 H 2 Ability to adopt to different unforeseen situations 4.19 H 3 Ability to deal the issues with human touch 4.60 VH 4 Ability to follow ethical principles in both personal and business life 4.66 VH 5 Ability to easily socialize with employees and involvement in common social issues 4.16 H Source: Primary & Computed Data Note: VH=Very High if Weighted Mean is 5.00 H=High if Weighted Mean is 4.00 From the above table, it is clear that among desired technical competencies, the competencies of ability to implement the advanced techniques or specialized methods efficiently and effectively, subject matter specialization in your functional area and scope for learning and technical know-how are very high while the competencies of capacity to quickly understand the technicalities and adoptiveness and knowledge of superior and competitive technical skills and technological advancements are high as perceived by the executives of automobile manufacturing sector. The desired behavioural competencies of ability to work under pressurized situations, ability to deal with risk factors and ability to cope up with stressed circumstances are very high and ability to adjust and adopt to changing work environments and ability to complete designated tasks are high as perceived by employees. The desired leadership and command skills competencies of ability to influence the followers to achieve the organizational tasks and goals, ability to make conducive environment for efficiency and ability to motivate others for successful completion of work are very high while ability to confidence building and ability to build up a team spirit are high as perceived by executives. Among desired intellectual competencies, ability to proactive, informative and updated and out of box thinking with practical implications are very high and ability to diagonize the issues and forecast the outcomes with precision and innovative and humanity are high as perceived by them. The desired communication competencies of ability to speak with confidence and fluency, ability to understand the communication quickly and clearly and ability to transmit the information without ambiguity and loss are very high while the competencies of ability to write with clarity and concise and ability to practice the modern communication practices are high as perceived by executives. Among desired inter personal competencies, ability to maintain the personal harmony with others , ability to encourage others in performing the tasks and Ability to motivate and creating interest in others are very high and the rest of competencies of ability to understand others feelings and emotions and ability to create team and personal interactions are high as perceived by them.
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The desired problem solving and decision making competencies of ability to analyze the situations and problems, ability to take appropriate corrective measures and ability to the action orientation and transparency in problem solving are very high while the competencies of ability to identify the causes for the problems and ability to bear the responsibility are high as perceived the executives. The responsiveness and result orientation competencies desired of ability to prioritize the organizational goals than personal objectives, ability to efficient allocation and resource utilization and ability to achieve the target and results are very high while the competencies of Ability to accept the responsiveness and ability of time conscious are high as perceived by them. Among the desired competencies of team work, confidence in co-workers in the organization, employees in the organization work well together and organization communicates well with others are very high while the competencies of resources are freely shard throughout the organization and employees make a valuable contribution to the organization are high as perceived by the executives. The desired commitment competencies of willing to work hard to get the job done, loyal to my organization and my morale is good are very high and the rest of competencies of willing to put in extra effort when necessary and i am proud to work in the organization are high as perceived by them. Among the desired consumer oriented competencies, ability to value the customers is very high and the rest of competencies of ability to understand the customers specific needs, ability to know the customers preference, ability to maintain the best customer relationship and ability to understand and fulfill the customers expectations are high as perceived by them. The desired competencies of social skills and ethics of ability to deal the issues with human touch and ability to follow ethical principles in both personal and business life are very high while the rest of ability to enhance the status in the organization, ability to adopt to different unforeseen situations and ability to easily socialize with employees and involvement in common social issues are high as perceived by executives. Gap between Desired and Existing Core Competencies In order to study the gap between desired and existing core competencies of executives of automobile manufacturing sector, t-test has been applied and the results are presented in Table 2.
S.No Table- 2 Difference between Desired and Existing Core Competencies Core Competencies t-Value Sig
1 2 3 4 5 6 7 8 9 10 11 12
Technical Behavrioural Leadership and Command Skills Intellectual Communication Inter Personal Problem Solving and Decision Making Responsiveness and Result Orientation Teamwork Commitment Consumer Oriented Social Skills and Ethics
24.265 26.948 27.523 23.048 23.322 26.202 21.411 23.346 26.340 26.289 24.563 22.057
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Source: Primary & Computed Data

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The results show that the t- values are statistically significant at five per cent level of significance indicating that there is a significant difference between desired and existing core competencies of executives of automobile manufacturing sector.
A comparison of desired and existing competencies is shown in figure 4.2.3.3. This seems to indicate that the desired competencies are not being met by employees existing competencies.
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6. FINDINGS
The difference between the existing and desired technical competency is 1.47, the difference between the existing and desired behavioral competency is 1.26 ,the difference between the existing and desired leadership and commanding skill competency is 1.45, The difference between the existing and desired intellectual competency is 1.4, The difference between the existing and desired communication competency is 1.42 ,The difference between the existing and desired interpersonal competency is 1.49, The difference between the existing and desired problem solving and decision making competency is 1.35 ,The difference between the existing and desired responsiveness and result orientation competency is 1.4, The difference between the existing and desired team work competency is 1.87, The difference
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between the existing and desired commitment competency is 1.22, The difference between the existing and desired consumer oriented competency is 1.13, The difference between the existing and desired social skill and ethics competency is 1.22
7. RECOMMENDATIONS
In order to obtain effective performance at executive position level, the automobile manufacturing sector needs to have job incumbents well equipped with core competencies. The present research recommends that the automobile manufacturing sector incorporates the core competencies for best job performance of executives into its future competency-based human resource management plan.
8.CONCLUSION:
The weighted mean scores for desired competencies are suggesting that the desired competencies are high while the existing competencies are neutral as perceived by the employees. The difference in rating between desired and existing competencies indicate that all the competencies are very low except team work is low as perceived by the employees.
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References
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Vickerstaff, S. (1992), THE TRAINING NEEDS OF SMALL FIRMS. Human Resource Management Journal, 2: 115 Reid and Barrington (1994), TRAINING NEEDS ASSESSMENT AND ANALYSIS A Case Study Journal, 37: 351-360 Madsen and Larsen (1998), TRAINING NEEDS ASSESSMENT AND ANALYSIS A Case Study Journal, 37: 351-360 Naikar and Sanderson (1999), USE OF COGNITIVE WORK ANALYSIS ACROSS THE SYSTEM LIFE CYCLE Journal 43 Kerr and McDougall (1999), DELINEATING AND CHARTING SYSTEMATICAPPROACH OF HRD PROCESS Journal 19: 421-429 Wilson (1999), TRAINING NEEDS ANALYSIS Journal 62: 491-495 Leigh, et. al., (2000), HRD interventions Journal 6:160-206 THE
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Interrelationship between Customer Based Brand Equity Constructs: Empirical Evidence from Hotel Industry of Pakistan
Prof. Dr. Muhammad Ehsan Malik Dean, Faculty of Economics and Management Sciences/Director, Institute of Business Administration (IBA)/Director General, Gujranwala Campus, University of the Punjab (Pakistan) BasharatNaeem Lecturer, IBA Lahore, University of the Punjab& PhD Scholar, COMSATS Institute of Information Technology (CIIT), Islamabad Campus (Pakistan) Abstract
Brand equity of tangible goods has been extensively studied over the years but its real nature for service brands remains a big puzzle to be solved, as the current knowledge about it is based only on theoretical or anecdotal evidence (Krishnan & Hartline, 2001). In service sector, particularly the hotel industry, brands are instrumental in ensuring high business performance which is evident by the extensive use of branding strategies to develop brand equity. So in this study, researchers have aimed at ascertaining the relationship between hotel brand equity dimensions including perceived quality, brand awareness, brand loyalty and brand image. Regression results of about 200 responses from the customers of 8 four and five star hotels in Pakistan revealed that consumers perceived service quality has a moderate positive impact on brand image, brand loyalty and brand awareness. Consumers brand loyalty contributed to the promotion of brand image whereas brand awareness led to improved brand loyalty. Research and practical implications are presented.
Keywords: Customer Based Brand Equity, Brand Awareness, Brand Loyalty, Brand Image, Hotel, Pakistan Introduction Branding is considered as the cornerstone of services marketing in the 21st century (Berry, 2000). Researchers claim that it is the most significant aspect for the services rather than tangible goods because of its inherent characteristics like inseparability, perishability, heterogeneity and tangibility (Kapferer, 2004). When customers purchase services, there are only few cues which facilitate the decision making process (Javalgi et al., 2006) and a well recognized brand plays its critical role as purveyor, risk reducer and makes the decision making process simpler (Kayaman and Arasli, 2007; Davis, 2007) which in-return provides customer satisfaction, brand loyalty and their trust (Berry, 2000). Generally, brand is considered as a powerful tool for differentiation and getting competitive advantage through different marketing strategies (Tasci et al., 2007; Pappu et al., 2005).
Brand equity and its emergence in marketing have raised its importance in marketing strategies among managers and researchers (Keller, 2003) and have different concepts (Yoo &Donthu, 2001). In existing literature, there is a significant difference between the brand equity concept and its measurement related issues (Keller and Lehmann, 2006; Bailey and Ball, 2006). As regards hotel based brand equity Bailey and Ball (2006)
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define it as the value that consumers and hotel property owners associate with a hotel brand, and the impacts of these associations on their behavior. Whereas Prasad and Dev (2000) define it as customers perceptions and attitudes either positive or negative which are influenced or formed while booking of hotel represent the brand equity. They also advanced the index of brand equity for hotels as per the consumers evaluation through brand awareness and brand performance indicators. Findings of empirical investigations in the hotel industry revealed that high brand equity results in greater preferences (Cobb-Walgren et al., 1995). Although, brand equity is considered as the overall usefulness that consumers rank a brand against the competitors (Vazquez et al., 2002). To understand about brand equity, research community differentiates it on the basis of three perspectives; (1) financial perspective which investigates the financial strength of the brand as compared with the unbranded products which are accrued to the company (Farquhar, 1989), (2) customer perspective which explores the brand equity by capturing customers mindset and (3) the combination of financial and customers perspectives. This study took brand equity as customers perspective as proposed by influential researchers (Keller, 1993, 2003 & Aaker, 1991, 1996). Numerous researchers (e.g. Kayaman & Arasli, 2007) claim that positive and favorable perception and attitudes of the consumers towards the hotels lead to increased brand equity. Customer based brand equity (CBBE) has got paramount importance over the past few years in brand management literature. ONeill and Mattila (2004) found that hotel brands that ensure provision of high satisfaction level to their guests are high revenue generators and achieve high growth rates as compared with hotels that provide low level satisfaction. Similarly Kim and Kim (2005) concluded that four- dimensional customer based brand equity has a significant positive impact on organization performance of chain restaurants and luxury hotels. In spite of these research investigations, the literature in hotel industry related to customer based brand equity is still sparse, calling for empirical investigations to confirm or disconfirm the predictions of the theories on the topic (Kim et al. 2008; Kayaman & Arasli, 2007).So, the main purpose of this research endeavor was to contribute in CBBE literature by showing how the sub-constructs of CBBE interrelate with each other in the hotel industry of Pakistan. Literature Review Brand equity defined by Aaker (1991) as the set of assets (and liabilities) linked to a brands name and symbol that adds the value provided by a product or service to a firm and/or that firms customers. He classifies brand equity in four sub-categories such as brand loyalty, perceived quality, brand association and brand awareness. Another researcher Berry (2000) presents brand equity model particularly for the organizations operating in service industries. It was based on six vital components named brand awareness, external brand communications, brand meaning, customer experience, companys presented brand and brand equity. However Keller (1993), disregarding behavioral aspects, defines brand equity as the differential effect of brand knowledge on consumer response to the marketing of the brand. In CBBE framework, perceived quality is considered as the primary facet (Dyson et al., 1996). Zeithaml (1988) suggests that service quality is the consumers judgment about the overall excellence or superiority of a service. The service providers can differentiate the brands through perceived quality and provide a reason to the customer for purchasing a specific brand because of its superior quality. Brand loyalty is recognized as brand equitys dimension, outcome of brand equity, and strategic assets for the companies (Gil et al., 2007; Morgan, 2000).Aaker (1991) defines brand loyalty as the basis of brand equity that is created by many factors, chief among them being
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the use experience. Brand loyalty generates high profits for the organization (Keller & Lehmann, 2006) as retention of customers is cheaper than recruiting new customers (Hallberg, 1995).Significant relationship was found between service quality and loyalty in the research of Bolton and Drew (1991). Later on numerous empirical investigators observed positive relationship of service quality perception with customers brand loyalty and repurchase intentions (e.g. Cretu & Brodie, 2007; Jones et al. 2002; Michell et al., 2001). Hence the following research hypothesis can be framed:
Hypothesis 1: Perceived service quality will result into development of hotel brand loyalty.
Brand image is considered as the most influential aspect of brand equity and extensively used in CBBE framework (Agarwal & Rao, 1996; Aaker, 1996; Feldwick, 1996; Srivastava & Shocker, 1991). According to Keller (1993, 2003) brand image refers to perceptions about a brand as reflected by the brand associations held in consumer memory. The perception of brand image is taken as the social approval by the customers (Tsai, 2005). Researchers endorsed brand image and service quality relationship (e.g. Aydin & Ozer, 2005) whereas Kim and Kim (2005) observed that brand image and service quality perceptions share too many features. Hence it could be expected that:
Hypothesis 2: Perceived service quality will have positive impact on hotel brand Image.
Brand awareness is considered as necessity to build strong CBBE (Denizci-Guillet and Tasci, 2010). Aaker (1991) defines brand awareness as customers ability to recognize or recall a brand as a member of certain product category. Keller (1993) categorizes brand awareness into two parts i.e. brand recall and brand recognition. Consumers brand awareness will probably be high provided they have high level quality perceptions about the brand. Therefore the expected relationship between perceived quality and brand awareness is summarized as follows: Hypothesis 3: Perceived quality has a significant positive impact on hotel brand Awareness. Brand loyalty is either a behavior or attitude and is considered as CBBEs determining factor and strategic asset for the organizations (Gil et al., 2007; Odin et al. 2001; Yoo et al., 2000).Brand loyalty is considered as one of the foremost objective of brand equity and it stems from the greater confidence that consumers place in a brand than they do in its competitors. This confidence translates into consumers loyalty and their willingness to pay a premium price for the brand Lassar et al. (1995). Aaker (1991) described brand loyalty as as the attachment a customer has to a brand. When the customers are aware with the product then there will be the possibility of re-purchasing the brands through which the loyalty begins (Aaker, 1991). Therefore, the following research hypothesis could be framed:
Hypothesis 4: the greater the consumers brand awareness, the higher will be their brand loyalty.
Andreassen and Lindestad (1998) urge customer loyalty as extrinsic information cue for both existing and potential buyers and may or may not influence brand image. To build customer loyalty, the first step is to build strong brand image in customers mind. Based on the understanding we can expect that:
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Hypothesis 5: Consumers brand loyalty will result into improved brand image.
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Research Methods
Data was collected from customers of four and five star hotel of Pakistan. Survey questionnaire was administered to the customers of 8 four and five star hotels during March June, 2010 and 200 questionnaires were found to be statistically useable. The instrument contained four dimensions of CBBE named perceived quality, brand awareness, brand image and brand loyalty. Kim and Kim (2005) scales were used for measuring brand loyalty (6-items), brand awareness (3-items), and brand image (14items). Perceived service quality was measured by 22-items scale developed by Parasuraman et al., (1988). The 5-point Likert scale was employed to measure all sub constructs of CBBE where1 = strongly disagree and 5 = strongly agree. Stepwise regression analysis was employed to test the research hypotheses.
Analysis and Interpretation

Table 1, reflects the descriptive information (mean, standard deviation) and reliability co-efficient of study constructs.
Table 1 Descriptive Statistics (N=200) Mean Std. Deviation Brand Loyalty Perceived Quality Brand Image Brand Awareness 3.90 3.92 4.10 3.28 0.38 0.39 0.33 0.61 () 0.48 0.89 0.76 0.38
Results of regression analysis (table 02) depict that perceive service quality contributes40 percent (Adjusted R2= 0.40) variance in brand loyalty. Standardized regression estimate indicates significant positive impact ( = 0.64, t = 10.68, p<0.001) of perceived quality on brand loyalty which is consistent with the first hypothesis.
Table 2: Regression (Brand Loyalty) Perceived Quality Adjusted R2 Fstatistic Beta value () t-value
* Significant at 0.001 level: One-tailed
0.40 114.06* 0.64* 10.68
Table 03 indicates42 percent variance (Adjusted R2= 0.40) is accounted for by perceived quality in brand image. Beta coefficient ( = 0.65, t = 10.50, p<0.001) reflects strong positive impact of perceive quality on brand image which supports hypothesis 2.
Table 3: Regression (Brand Image) Perceived Quality Adjusted R2 Fstatistic Beta value () t-value
0.42 110.15* 0.65* 10.50
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Table 4 indicates the regression analysis for perceived quality with brand awareness. Perceived quality explains only 16 percent variance (Adjusted R2= 0.40) in the model and significant F statistics shows the appropriateness of predictive strength of the model. Standardized regression estimate indicates significant positive impact ( = 0.41, t = 5.80, p<0.001) of perceived quality on brand awareness which is consistent with proposed hypothesis.
Table 4: Regression (Brand Awareness) Perceived Quality Adjusted R2 Fstatistic Beta value () t-value
0.16 33.58* 0.41* 5.80
Results of regression analysis (table 05) demonstrate that when brand loyalty was regressed on brand awareness only13percent (Adjusted R2 = 0.13) variance was explained by the brand awareness. Standardized regression estimate ( = 0. 36, t = 5.26, p<0.001) indicates moderate positive impact of brand awareness on brand loyalty which is in line with the expectation.
Table 05: Regression (Brand Loyalty) Brand Awareness Adjusted R2 Fstatistic Beta value () t-value
0.13 27.67* 0.36* 5.26
Table 6 depicts that brand loyalty explains 18 percent variance (Adjusted R2) in brand image. Standardized regression estimate indicates significant positive impact (= 0.43, t = 5.99, p<0.001) of brand loyalty on brand image which is consistent with the hypothesis 5.
Table 06: Regression (Brand Image) Brand Loyalty Adjusted R2 Fstatistic Beta value () t-value
0.18 35.85* 0.43* 5.99
Conclusion
The prime goal this research investigation was to ascertain interrelationship between constructs of customer based brand equity in the hotel industry of Pakistan. Based on the study findings, it can be concluded that consumers perceived service quality had moderate positive impact on brand image, brand loyalty and brand awareness. Consumers brand loyalty positively influenced brand image whereas their brand
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awareness led to their improved brand loyalty. These results are in line with the findings of previous researches (e.g. Bailey & Ball, 2006); Kim & Kim, 2005). In the hotel industry, management faces the challenge of how to transform intangibles to tangibles. It is advisable for them to devise some innovative strategies to improve their consumers perceived quality of their hotel brand such as offering elegant atmosphere, developing employee competence and ensuring the provision of innovative but reliable services at reasonable prices to fostering consumers brand image, brand awareness and brand loyalty. Since brand loyalty is considered as a strategic asset to sustaining competitive advantage for service providers coextensive and creative communication by the hotel management such as, media advertising, hotel appearance, name, and logo may improve brand recognition and brand recall which consequently aids in fostering the brand loyalty. Loyalty programs should be launched aiming at fostering consumers attitudinal commitment, repeat behavior and advocacy marketing that may result into building unique position of the hotel brand in consumers mind. This research endeavor has some limitations. Interrelationships among four dimensions of customer based brand equity have been examined, so other constructs should also be modeled in future research. Only four and five star hotels operating in Pakistan is the context of the study, so future researchers should take other hotel categories and chain restaurants to facilitate comparison of interrelationship of CBBE dimensions between hotel categories and restaurants. The study design of this research is cross-sectional. Antecedents and consequences of CBBE should be incorporated in future studies. As regards practical implications, CBBE is a valuable instrument for the hotel management to evaluate themselves according to customers needs.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS References
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De Chernatoy, L. and Segal-Horn, S. (2001), The criteria for successful services brands, European Journal of Marketing, November. Denizci-Guillet, B., Tasci, A.D.A., 2010.An exploratory study of multicultural views on the Disney-McDonalds alliance. Journal of Travel & Tourism Marketing 27, 8295 Dyson, P., Farr, A. and Hollis, N.S. (1996), Understanding, measuring, and using brand equity, Journal of Advertising Research, Vol. 36 No. 6, pp. 9-21. Farquhar, P. (1989), Managing brand equity, Marketing Research, September, pp. 2433. Feldwick, P. (1996), What is brand equity anyway, and how do you measure it? Journal of the Market Research Society, Vol. 38, April, pp. 85-104. Forgacs, G. (2003), Brand asset equilibrium in hotel management, International Journal of Contemporary Hospitality Management, Vol. 15 No. 6, pp. 340-2. Forgacs, G. (2006), Brand asset and a balancing act in the hotel industry, Hospitality Industry Trends, Vol. 5, August. Gil, R.B., Andres, E.F. and Salinas, E.M. (2007), Family as a source of consumerbased brand equity, Journal of Product & Brand Management, Vol. 16 No. 3, pp. 188-99. Grover, R. and Srinivasan, V. (1992), Evaluating the multiple effects of retail promotions on brand loyal and brand switching segments, Journal of Marketing Research, Vol. 29,pp. 76-89. Hallberg, G. (1995), All Consumers Are Not Created Equal, John Wiley & Sons, New York, NY. Javalgi, R.G., Martin, C.L. and Young, R.B. (2006), Marketing research, market orientation and customer relationship management: a framework and implications for service providers, Journal of Services Marketing, Vol. 20 No. 1, pp. 12-23. Jiang, W.Z., Dev, C.S. and Rao, V.R. (2002), Brand extension and customer loyalty: evidence from the lodging industry, Cornell Hotel and Restaurant Administration Quarterly, Vol. 43 No. 4, pp. 5-16. Jones, M.A., Beatty, S.E. and Mothersbaugh, D.V. (2002), Why customers stay: measuring the underlining dimensions of services switching costs and managing their differential strategic outcomes, Journal of Business Research, Vol. 55, pp. 441-50. Judd, C.M., Smith, E.R. and Kidder, L.H. (1991), Research Methods in Social Relations, 6th ed.,Holt, Rinehart and Winston Inc., Fort Worth, TX. Kapferer, J.N. (2004), The New Strategic Brand Management, Kogan Page, London. Kayaman, R., & Arasli, H. (2007). Customer based brand equity: Evidence from the hotelindustry. Managing Service Quality, 17(1), 92-109. Keller, K. L. (2003). Strategic brand management: Building, measuring, and managing brand equity. Upper Saddle River, NJ: Prentice-Hall. Keller, K.L. (1993), Conceptualizing, measuring and managing customer-based brand equity, Journal of Marketing, Vol. 57, pp. 1-22. Keller, K.L. (1998), Strategic Brand Management: Building, Measuring, and Managing Brand Equity, Prentice-Hall, New York, NY, pp. 45-56. Keller, K.L. (2000), The brand report card, Harvard Business Review, Vol. 1, pp. 147-57,January-February. Keller, K.L. and Lehmann, D.R. (2006), Brands and branding: research findings and future priorities, Marketing Science, Vol. 25 No. 6, pp. 740-59.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Miles and Snow Strategy Typology: A Critical Commentary
Prof. Dr. Muhammad Ehsan Malik Dean, Faculty of Economics and Management Sciences/Director, Institute of Business Administration (IBA)/Director General, Gujranwala Campus, University of the Punjab (Pakistan)
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Basharat Naeem Lecturer, IBA-Lahore, University of the Punjab & PhD Scholar, COMSATS Institute of Information Technology (CIIT), Islamabad Campus (Pakistan) ABSTRACT
Superior business performance is instrumental to achieve sustainable competitive advantage requiring organizations to develop valuable and difficult to replicate dynamic capabilities to support their business strategy. In the realm of strategic management over last three decades, Miles and Snow strategy typology received wide spread general acceptance yet mixed empirical findings about whether or not prospectors, analyzers and defenders register significantly different business performance. Thus, this paper enriches our understanding by presenting critical overview on Miles and Snows strategy typology. Practical implications for business strategists are presented.
Keywords: Strategy, Miles and Snow Typology, Performance Strategy Overview
The notion of strategy was first coined in 1960 in business and management domain. According to Chandler (1962, p.13) strategy is determination of the basic long-term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals. Later on Ansoff (1965) conceptualized strategy as decision rules and guidelines framed by an organization to ensuring its orderly and profitable growth. However, Johnson and Scholes (2002, p.39-61) reflect on design view of the strategy and recognize it something beyond the explicit formal planning. At the corporate level, strategy addresses the important question of in what businesses organization should be in and how to deploy valuable resources among them. Whereas at the business level, how to compete in a given industry is considered to be the critical question for business strategists (Hofer et al., 1978). So business strategy is primarily concerned with how advantage over competitors can be achieved; what new opportunities can be identified or created in markets; which products or services should be developed in which markets; and the
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the organization (Johnson , 2002, p.11). Strategy Typologies in Realm of Strategic Management
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extent to which these meet customer needs in such a way as to achieve the objectives of
Several environmental factors such as intensified competition, sluggish economic growth, technological advancements and deregulation provided impetus for strategic management (Day & Wensley, 1983; Jain, 1985). Typologies in strategic management are common and widely used to describe feasible business strategies in an industry. Famous examples of typologies in the realm of strategic management relate to strategy contexts (Mintzberg, 1979) views on strategy (Hamel & Prahalad, 1994), strategic decision making types (Ansoff & McDonnell, 1990) or strategic behavior patterns (Miles & Snow, 1987). Among the most influential typologies in strategic management are probably those of Abell (1980), Porter (1980) and Miles and Snows (1978). This paper aims at developing critical overview of these typologies with particular emphasis on Miles and Snows typology. All three actually propose multiple ways to organizations for addressing their entrepreneurial, operational and administrative problems to ensure effective execution of their marketing strategies. Porter documents extensive evidence (1979, 1980, 1981, 1985) on the topic and argues that managing competitive environment is "the essence of strategy formulation" (1979). He asserts that organization can follow three generic competitive strategies namely cost leadership strategy, focus strategy and differentiation strategy. His strategies classification scheme attracted criticism on the grounds that it is described in relatively general terms, and seems to be limited explaining the competitive market behavior of larger firms (Smith et al., 1989). Whereas Abell (1980) proposes that strategies classification scheme comprises of differentiated, focus strategy and undifferentiated. His typology has been challenged for its inability to differentiate among strategy less stuck-in-the-middle venture and the ventures that used cost leadership strategies (Chrisman et al., 1988).
Miles and Snow Typology
Miles and Snow theoretical framework (1978) has been undergone extensive empirical investigation (e.g. Ruekert & Walker, 1987; DeSarbo et. al., 2005; DeSarbo et. al., 2006) to improve understanding on business strategic orientations within a given industry for the last more than 32 years. This framework was developed in a field investigation of industries including food processing, college textbook publishing,
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health care and electronics. The typology considers an organization as comprehensive and integrated system having dynamic fit with the environment. It was postulated that organizations competing in a particular industry demonstrate behavioral patterns which are representative of four basic strategic types such as prospectors, analyzers, defenders and reactors (Miles & Snow, 1978). Walker and Ruekert (1987) further classified defender type organizations into Differentiated Defenders and Low Cost Defenders considering how they address their entrepreneurial problems. Let us have a brief overview of businesses following these five strategic orientations.
Prospectors:
Prospectors follow the strategy of leading change in their industry. They are oriented externally and compete by find out the latent customer needs, quickly transformation ability in changing environment and by launching new products to satisfy their customer base while taking in to the consideration of other marketing mix (Slater et al., 2010). Innovation is their main focus and proactive orientation (Narver et al., 2004) towards innovators and early adopters (Slater et al., 2007) lead them to deploy significant resources in market research, creative marketing strategies and other marketing related issues. Product innovations result from either R & D driven innovations (inside-out processes) or development of customer-orientated intelligence development (outsidein processes). They are result oriented (Miles & Snow, 1978) having formally structured product development programs (Cooper, 2008). They develop closer ties with the value chain partners in order to respond to early signals of environmental changes and emerging opportunities (Walker et al., 2003). After the development of the strategy, prospector organizations put greater focus on one important class of balanced scorecard perspectives: Innovation and Growth perspective.
Analyzers:
They face double challenge of competing not only with prospectors for early adopter market segments but also fierce fighting with other analyzers as well as Defenders in mass market segments (Slater et al. 2007). So they possess qualities of both prospectors and defenders and their growth is the outcome of their product and market development endeavors (Miles & Snow, 1978). Although they are not first movers in developing new products yet keep on updating them from competitors actions and reactions (Dyer & Song, 1997) thus follow second-but-better strategy (Robinson et al., 1992). Their targeted market segment is early majority (Slater, 2007) and they have their presence in both stable and turbulent environments (McDaniel & Kolari, 1987) but they are
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opportunists. To be successful, analyzers try to improve their focus not only on innovation and growth but also on internal business perspectives of business scorecard.
Low Cost Defenders:
Organizations having low cost defender orientations are mechanistic and use integration devices and formal procedures to improve coordination (Miles & Snow, 1978; Vorhies & Morgan, 2003). They may act as price warriors by pursuing aggressive strategy reliant on price competition (Porter 1980). Being competitor oriented, they usually benchmark cost and price structures of their competitors. They are in best position to mitigate customer risks by exploiting full advantage of experience effects of both analyzers and prospectors. They try to achieve economies of scale by effective penetration in mass market segments such as early and late majority.
Differentiated Defenders:
Differentiated Defenders may sustain their profitability provided they keep on differentiating themselves from their competitors by providing them products and services of superior quality (Walker & Ruekert, 1987). They pursue the strategy of intacting their competitive position in mass market segments such as early and late majority (Walker & Ruekert, 1987) by focusing on customer oriented behaviors.
Reactors:
Miles and Snow (1978) argue that reactors adapt to their environment only when environmental pressures force them to do so. They lack congruence of its strategy with the external environment and organizational structure, culture and processes. Such organizations do not have forward looking and high performance strategy. They do not bother either to sustaining their competitive position in well acquired product/market domain, or to take risks to exploit feasible opportunities in the external environment (Snow & Hrebiniak, 1980; Croteau, 1999; Garrigo s-Simon et al., 2005).
Concluding Remarks
Superior business performance is instrumental to achieve sustainable competitive advantage (Day, 1994) that requires an organization to develop valuable and difficult to replicate dynamic capabilities to support its business strategy. Innovative strategy could be the only choice for new entrant in an industry to succeed despite facing great resource disadvantages as confirmed by Hamel (1998).
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Prospectors, as change leaders in their industry, focus on new-to-the-world product developments and their R&D is the powerful driver of such radical innovations as empirically endorsed by marketing researches (e.g. Walker & Ruekert, 1987). In line with the recommendations of Mintzberg et al. (1998) prospectors must set mission and vision statements deliberately but pursue flexibility strategy in finalizing the detailed content of the strategy. So prospectors may use an emergent approach while crafting their business strategies supported by highly adaptive organization. Analyzers follow the blend of prospectors and defenders behaviors and operate in relatively stable and changing product-market domain. It is recommended to analyzers, as urged by Conant et al. (1990), to have rigorous process to evaluate numerous attractive opportunities to take quicker actions once prospectors reflect the viability of new product or market to ensuring second-but-better strategy. Low cost defenders may enjoy superior business performance by realizing experience effects of competitors and economies of scale. To build success story, differentiated defenders are urged to lay great emphasis on selective group of customers qualified for paying premium prices for products and services of premium quality. Reactors do not reap the potential benefits because of absence of systematic and constant reactions to the entrepreneurial problems hence not pursuing high performance strategy. Although Miles and Snow theoretical framework received general acceptance yet empirical investigations observed mixed findings about whether or not prospectors, analyzers and defenders register significantly different business performance (Segev, 1987; Conant et al. 1990; Zahra & Pearce, 1990; Parnell, 2000; DeSarbo et al., 2005). This typology predicts that organizations can realize superior performance provided they not only develop alliances with external business environment effectively in consistent fashion but also implement appropriate functional strategies with the right mix of cultural values.
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A Review of Educational Values of the Modern Muslim Thinker: Dr. Allama Muhammad Iqbal (R.A)
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Ijaz Ahmad Tatlah PhD Scholar University of Management and Technology Lahore, Pakistan Zulfiqar Ali PhD Scholar University of education Lahore, Pakistan Naila Nisar PhD Scholar University of education Lahore, Pakistan Abstract This research is encompassed on the review of the available literature regarding the
thoughts of the modern Muslim thinker Dr.Allam MuhammadIqbal the national poet of Pakistan. His thoughts and view point about life, reality, education, humanism, God, ultimate reality, eternal things, and death has been addressed. An answer of the questions has been assembled here according to his point of view, like what is life? , What is reality? , What is man, God, death? What is nature? What is eternal reality?
Key words; Reality, Death, Life, Nature.
Introduction
Iqbal was a poet, a philosopher, a lawyer, a political leader and above all an educationist. He had a very strong knowledge of both the oriental as well as the western thoughts of education. He started his early education from a Maktab and had the precious opportunity to study in the Cambridge and Munich University. He had a very sound understanding about the various shades of the concepts of education. He contributed a lot as a teacher, as an educational thinker and reformer. He expressed his view about the educational philosophy on various occasions through his poetic work, articles and speeches. Moreover, he wrote certain letters to different people and discussed the educational phenomenon in detail. Iqbals philosophy of education carries the vital significance being the combination of both modern and ancient thoughts. Iqbal rendered his valuable thoughts and services as a poet, philosopher, educator and educational thinker/reformer. He even contributed toward educational reforms in Afghanistan on the special request of King Nadir Shah. He tends to favor the modern scientific education in order to keep pace with the modern world. He believes that we being vicegerent to Almighty Allah are bound to take part in the conquest of the universe.
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This paper explores his concept of reality, universe, man, and values in education.
IQBALS CONCEPT OF REALITY
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While studying the concept of reality, we see an infinite series of disagreement among the thinkers. Some of the thinkers describe it as modifying object while according to others it is a permanent state. Some divide it into material and spirit. According to them, universe is the combination of water, air and fire. Sometimes, dimensions of body and spirit are lightened and keeping in view the subjective beliefs, this universe is considered to be the combination of self-perceptions. Thus, in the concept of reality, universe, man and values have personifying pierced into the knowledge & art while Islams concept of reality, that ALLAH is the absolute reality, the universe and all its mechanism is His creation, man has been standing as the vicegerent and his main objective is the will of GOD (ALLAH ALMIGHTY), disappears. In the circumstances, a thinker like Allama Iqbal appears and converts the darkness into light through the Islamic thinking and insight, negating the western thoughts. He anticipates every dimension of the concept of reality in the light of Quran and Sunnah, replying the narrow-view of western thinkers with logic (Ahmad, 1991). Allama Muhammad Iqbal, perhaps the first modern Muslim philosopher to focus on the reality, knowledge and values in any comprehensive manner, he writes: With the reawakening of Islam, therefore, it is necessary to examine, in an independent spirit, what Europe has thought and how far the conclusions reached by her can help us in the revision and if necessary, reconstruction, of theological thought in Islam. The modern philosopher Muhammad Iqbal sees no contradiction between faith and reason. He is considered the poet-philosopher of twentieth century Islam and his work has been a key impetus in the revival of Islamic thought. He studied in Britain and Germany. This expatriation offered him unique cultural and theoretical insights into both Islamic and Western philosophical traditions. He thinks that thought and intuition both arise from the same source; thought and intuition are not in opposition to each other, but rather are complementary. Reason aims at achieving knowledge of the physical world and existence; the institution of religious experience aims at transcending this world and achieving knowledge of the ultimate. Iqbal then thinks that it is necessary for Muslims to engage themselves in the study and science of philosophy in order to redefine an Islamic culture now confronted with a more
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philosophy.
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advanced western civilization. For Iqbal religion is not something isolated from
He advocates an integration of the two, at times suggesting that the psychology has not reached an advanced enough level to be able to incorporate spiritual experience as part of a scientific theory of knowledge. Iqbal thinks that, given adequate methods, the ultimate reality is within human grasp. He writes that: the truth is that the religious and scientific processes, though involving different methods, are identical in their final aim both aim at reaching the most real. In fact, religion is far more anxious to reach the ultimately real than science. One of the major objections to proofs from religious experience has been that religious experience is incommunicable, not transferable from one person to another and as such has any value as evidence. That is, person A may see the truth of a proposition whereas person B may not, and there is no way for person A to demonstrate the person B how he come to believe a certain thing. Iqbal does not think that this is a problem. Rather, precisely this problem is the foundation of his worldview. He had an organic view about the universe as a whole and people as we encounter them. In our everyday life we see other individuals as mere functions, and only deal with them in so far as their conceptual relation to us is concerned. We do not pursue them any further for any sense of an ultimate reality. Thus when seeking the divine, we can not and do not rely upon others. The clue to ultimate reality must be contained with it may be that what we call the external world is only an intellectual construction, and that there are other levels of human experience capable of being systematized by other orders of space and time in which concept and analysis do not play the same role as they do in the case of our normal experience. Iqbal, in concert with his organic world view, also explores possibilities of reconciliation between reason and religious experience, to him the principals of Islamic epistemology are laid out in the Quran. Three avenues or modes of knowledge are defined; 1. Certainty by Sense perception that is empirically derived knowledge. 2. Cognitive Certainty or knowledge by pure reason. 3. Absolute experienced certainty or knowledge by intuition (The Dialogue).
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Religion and Rationale
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Iqbals rationale of religion is essentially a philosophy of the relation of man to the ultimate Reality or God. It is a dynamic view of man's yearning for the Ultimate Reality. In line with his theory of knowledge, which is an organic whole of perception, reason and intuition, religious life is also divided into three periods; faith, thought and discovery. These are the phases or levels of the religious life of individuals or society. Man's aim being the realization of his ego as an integral part of the Ultimate Reality which is possible only by achieving a free personality. The three phases of religious life are delineated in the following manner: The first phase of religious life appears as a form of discipline which a person accepts un-conditionally. This is a period of dogmatic assertion and uncritical acceptance. Reflection on the nature of religion does not enter into this period. It is, in this period an 'unconditional command' without any rational understanding of the ultimate meaning and purpose of the command. The last phase is of rationale understanding of religion, its principals, laws and sources this is about the development of metaphysics of the religion. Finally metaphysics is replaced by psychology, when some urge to have a direct contact with reality is developed. This is a level strengthening personality through religion. The laws of religion become internalized in the depths of consciousness. Religion, in his view, needs to be supplanted by rational interpretation. The mystic's claim of the special and non-expressible nature of the religious experience leads to stagnation and skepticism. Iqbals philosophy aims at the realization of man's personality the perfection of his ego. This aim can be achieved by obtaining a full view of reality, which is for him spiritual in nature. This spiritual nature of reality cannot be grasped by the intellectual or conceptual method of knowledge, because the conceptual and the intellectual deals with bifurcated parts of reality and not reality as a whole. The spiritual and dynamic totality of reality can be realized by an ultra-intellectual religious experience or intuition. This process of religious experience starts with self affirmation and not self negation as the medieval mystic would have it. The aim of
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both science and religion is to reach an objective knowledge of reality. Iqbal is however, dissatisfied with the existing attitudes of both, which lack objectivity (The Religion).
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Concept of Ultimate Reality / God
Allama Iqbal was deeply aware of the ultimate reality and was the firm believer of Oneness of GOD (ALLAH ALMIGHTY). Rightly considering ALLAH Almighty the ultimate beauty, he finds His glimpses in His various creations and he spots that beauty in the nature. Then, he ahead a bit from the concept of Oneness of GOD (ALMIGHTY ALLAH) and in his concept beauty is regarded as an eminence while ALLAH Almighty becomes an institution. Constant struggle, commitment, will and actions become the base of his thought of eminence. He regards the self-understanding and then reaching ALLAH Almighty as the success. Negating the mechanical concept of existence of GOD (Allah Almighty) in his philosophical method, he presents the concept of existence of GOD (Allah Almighty) as an eternal and ultimate reality. He has also elaborated this concept of existence of ALLAH through the verses of Surah Noor, Ahmad (1991). In Iqbals view the basic Attribute of God is individuality; the other attributes are Creativeness, Knowledge, Omnipotence and Eternity. He conceives of God as the perfect 'Individual', while the rest of the egos including human ego are striving towards individual it which reaches relative perfection in human beings. God is the perfect individual, who in the words of the Quran Say: 1. 2. 3. 4. He is Allah (SWT) the One! Allah(SWT), the eternally be sought of all, He begotteth not nor was begotten, And there is none comparable to Him."
Allah`s (SWT) other attributes such as Creativeness, knowledge; Omnipotence and Eternity are inter related and closely linked to His individuality. Iqbals views seem to be based on two basic and important ideas: That God's attributes should not be conceived the analogy of our own imperfect qualities, All the attributes form an organic whole in the Person of God, and 817
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are mutually interdependent.
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Iqbal thinks that the difficulty about grasping the Ultimate Reality as an ego is due to our reliance on logical principles, which leads us to the presence of a non ego as a necessity for an ego's existence. Iqbal upheld both God's omnipotence and human freewill. "No doubt, the emergence of egos endowed with the power of spontaneous and hence unforeseeable action is, in a sense, a limitation on the freedom of the all inclusive Ego. But this limitation is not externally imposed. It is born out of His own creative freedom whereby He has chosen finite egos to be participators of His life, power, and freedom. (Islamic philosophy A-Z, 109).
CONCEPT OF UNIVERSE
Allama Iqbal explains his concept of universe in the light of Quranic verses. In his opinion, the concept of universe is the spiritual and eternal concept of metaphysic. ALLAH Almighty is the creator, the controller and the nurturer of this universe. Then he created the earth and the seven skies and this creation definitely is purposeful. Existence of man in this universe is of great importance as he is the vicegerent. This universe is a reality which will one day be packed up. ALLAH Almighty Himself temps man to understand the hidden mysteries of universe and the different phases of human life. Is life separate from matter or its within the matter or is moving within the natural mechanism, all this is within the ALLAH Almightys verdict of KUN FAYAKUN. (Ahmad,1991). Behold! In the creation of the heavens and the earth, and the alternation of night and day, there are indeed sign for men of understanding. Men who celebrate the praises of God, standing, sitting, and lying down on their sides, and contemplate the (wonders of) creation in the heavens and the earth, (with the thought): Our Lord! Not for Naught hast though created all this! Glory to thee! Give us salvation from the penalty of the fire. Surah Al-Imran (Verses 190 to 191)
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CONCEPT OF MAN
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In fact self philosophy is the central point of Iqbals teachings. Iqbals selfness means self-identity or insightfulness. Man should seek the self recognition and search for his personality and its values and with the help of that wisdom could discern the individuality and values of ALLAH Almighty. Iqbal has presented this conceit synonym to the nature. If the power of awareness and conscience develops in a man and with this self-wisdom he foresees and observes the nature, in Iqbal`s opinion all life is individual and the individuality is the actual fact while the rest of the universe is sacred. Conceit and its existence is the enlightened reality (G.N.Ahmad, 1991). Behold! The Lord said to the angles: I will create a vicegerent on earth. They said, Will you place therein one who will make mischief therein and shed blood? While we do celebrate the praises and glorify the holy name? He said; I know what you know not. Surah Al-Baqarah (Verse No.30) We did indeed offer the trust to the heavens and the earth and the mountains; but they refused to understand it, being afraid thereof: but man undertook it; he was indeed unjust and foolish. Surah Al-Ahzab (Verse No.72)
CONCEPT OF VALUES
While studying different topics of educational philosophy it can be observed that core issue is its values. Augment and plunge of societies as well as survival of nations are based on its values. Success of vicegerent of this universe to Allah (SWT) also depends upon values. Change in teaching and training, difference of desired and regrettable are also the different aspects this concept. Some one consider it corporeal and others unwavering. Philosophers see values at different angles but fact is that they are tested at the same rate of dual theory of life i.e. spiritual and physical for the expansion of their teachings. Iqbal condemns the European culture that is inherited him due to his Islamic background. In fact he denies the western culture due to its unspiritual mindset of values and following of the material values only (G.N.Ahmad, 1991). Verily he most honoured of you in the sight of God is (he who is) the most righteous of you. Surah Al-Hujrat (Verse No.13)
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Soul and the Body
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Even the best accomplishment in the sphere of knowledge does not make human beings really human unless knowledge is buttressed by education in moral values. Iqbal criticizes this apparent progress which is alone but dissipates darkness. In Iqbals view Europe is the Devils workshop, because Europe, by promoting materialistic ideologies, perpetrating loot and carnage in the name of culture and education has contributed a lot in depriving humanity of the moral ground on which it stood. Iqbal saw clearly that the western materialistic and luxurious society was not conducive to the emergence of the scholars who had a comprehensive all embracing world view in expounding different systems and principles. The ultimate outcome seems to be that human society would fall a victim to the ruthlessness of modern scientific devices.
CONCEPT OF KNOWLEDGE
The focal point of Iqbals concept of knowledge is revealed knowledge that is the holy Quran. To him the superior, reliable and faultless source of knowledge is only this one. He is of the opinion that all types of modern scientific knowledge and thoughts of twentieth century have been segregated from Islam. For him knowledge of the universe as well as biological knowledge is the major subject of the holy Quran. By the western methodology of logical perception he has proved that only empirical knowledge is not absolute one but there exists metaphysical knowledge which can not be experienced through senses and rationale. Iqbal regrets the authenticity of intuitive knowledge because the perception of Sufis might be biased or his explanation may contradict to the teachings of the holy Quran. He is convinced of the rationale or logic method according to the holy Quran. For him the modern scientific knowledge is the misplaced wisdom of the Muslims and its retrieval is mandatory now. Hub of his concept of knowledge is conceit and selfimportance and intuition, rational and logic are the gates to achieve it. Pleasure and benevolence of ALLAH (SWT) can be achieved through this process. (G.N.Ahmad, 1991). Then guard yourselves against a day when one soul shall not avail another, nor shall compensation be accepted from her nor shall intercession profit her nor shall anyone be help (from outside)Surah Al-Baqarah (Verse NO.123)
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References
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1. Burni, S. M. H. (1987). Iqbal, Poet-Patriot India . 2. Ejteba Asadi, Institute for Promotion of Islamic Culture) IPIC. 3. G.N.Ahmad. (1991). Educational concepts of Allama Iqbal, department of business education, institute of education and research, university of the Punjab. 4. Islamic Philosophy A-Z, 109. 5. Iqbal: Philosophical Inspiration. . 6. Malik, H. (1971). A standard introduction; Iqbal, Poet-Philosopher of Pakistan 7. Schimmel, A., & Wing, G. s. (1989). A standard analysis of the relevance of Iqbal's ideas about education. 8. Syaiydain, K. G. (1996). Iqbal's educational Philosophy. Lahore: Ashraf Printing Press. 9. The Dialogue Quarterly Research Journal. Volume 3, No. 2 (ISSN #: 18196470) 10. Vahid, S. A. (1959). A thorough analysis of Iqbal's religious symbolism Iqbal: His Art and Thought 11. Religion, (www.hec.gov.pk/Chapters/431 -11).
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Linkage between Leadership and Reading : A Theoretical Review
Ijaz Ahmad Tatlah Department of Education, University of Management and Technology Lahore , Pakistan . Professor Dr.Uzma Quraishi Head of Department of Education, LCW-University, Lahore , Pakistan Shabir Ahmad PhD Scholar University of education Lahore, Pakistan Abstract
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This paper deals with reading and effective leadership. It highlights the fact that every reader is a potential leader. Effective leadership is therefore hinged on acquiring essential reading skills. The paper concludes by recommending ways individuals can enhance their reading skills and leadership skills are enhanced accordingly. Keywords: Leadership, Reading, Literacy, Skills.
Introduction
Reading is a complex activity that involves both perception and thought. It consists of two related processes word recognition and comprehension. Word recognition refers to the process of perceiving how written symbols correspond to ones spoken language. Comprehension is the process of making sense of words, sentences and connected text. Readers typically make use of background knowledge, vocabulary, grammatical knowledge, experience with text and other strategies to help them understand written text. Much of what is already known about reading is based on studies conducted in English and other alphabetic languages. Learning to read is an important educational goal for children and adults. The ability to read opens up new worlds and opportunities. The context of leadership is also important for instance, children and adults are both leaders in their respective domains; they learn to read, either in their language or a foreign language as is the common occurrence in Nigeria. As this occurs, they are exposed to the culture of the second language. And because texts are written with a specific audience in mind, cultural knowledge is present in texts and it is assumed that the reader is familiar with such knowledge. Therefore, the readers learn the cultural, educational, leadership styles of other people/cultures, and so borrow some useful traits to be used here. Thus, to be great, whether as a scholar or a leader, one has to internalize the practice of reading because it is only in reading that we stay informed, educated and dynamic. Reading Many think of reading as a skill that is taught once and for all in school. Reading involves perception and cognition. According to Deaman and Alber (2005), reading is that special process that involves all other developmental processes that lead to reading mastery. Yusuf (2009) defines reading as the interactive, multilevel, orthographic, phonological, lexical, syntactic, and semantic as well as discourse activities engaged by a person. She stressed that a readers purpose in approaching a
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text is of vital importance. Reading becomes far more than the ability to pronounce words on a page. It involves the recognition and interpretation of symbols. It also involves using both the information provided in the text by the author as well as the resources outside the text. Some other linguists believe that reading is a matter of maturation rather than a process developed through systematic instruction and practice. To others, reading is accurate pronunciation which emphasizes phonic instruction etc, while Smith (1973) views reading as a key to a wealth of experience that links people in ways that are unlimited. Reading provides experiences through which the individual expands academic and intellectual horizons, identified, extends and deals with personal interests and attitudes that affect the task of reading as a whole. Oyetunde (2009) defines reading as a process of, and an aid to information processing, and it fosters the understanding and comprehension of written text. The Encyclopedia Britannica, Vol 23 defines reading in the following ways. Reading may refer to: A cognitive process of decoding symbols to derive meaning from text (as in reading a book or reading music). The act or medium of obtaining useful pieces of information Interpretation: a mental representation of the meaning or significance of something. A process in which written information is received by the retina, processed by the primary visual cortex, and interpreted (2010). Most people think of reading as a simple, passive process that involves reading of words in a linear fashion and internalizing their meaning one at a time. But reading is actually a very complex process that requires a great deal of active participation on the part of the reader. To further get a better sense of the complexity of reading, some experts in the field have these to say about the reading process: Roy (2000) says that the message is not something given in advance, or given at all, but something created by interaction between writers and readers as participants in a particular communicative situation. Reading is asking questions of printed text, and reading with comprehension becomes a matter of getting your questions answered. (Frank, 1997). Reading is a psycholinguistic guessing game. It involves an interaction between thought and language. Efficient reading does not result from precise perception and identification of all elements, but from skill in selecting the fervent and most productive cues necessary to produce guesses which are right (Kenneth Goodman 1996). For many years, readers have driven literacy programmes world over with this perception. First, learning to read means learning to pronounce words and second, learning to identify words to get their meanings. On the other hand, learning to read could also mean learning to bring meaning to a text in order to get meaning from it (Cunningham, 1996). The benefits of reading If people develop a habit of reading, they will become more confident and self assured in abilities to comprehend and understand all information types. Reading exercises the mind. The mind begins to flex and bend mentally. It stays loose and limber so one can flow easier through the course of the day. The regular routine ensures that the reading muscles stay in good shape as well as the mind, just as physical exercise does.
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Reading enhances ones ability to focus. When the mind is trained and challenged, it begins to pay attention more thoroughly. Also, when people develop the habit of reading, they are building a foundation that will allow them accomplish many goals and ambitions for their lives. Reading is the basic foundation on which academic skills are built. In children, the right time to inculcate good habits and values in them is in their childhood. Reading enhances the childs ability to comprehend various concepts with immense ease. Reading avails one the rare opportunities of getting literacy information through text (Widdowson, 1979). It provides experience through which the individual expands his/her academic/intellectual horizons, (Yusuf , 2010) It distinguishes fact from fiction etc. As we read, our knowledge will be broadened to a greater level that could tickle our fantasy for reading every time, and by so doing, all the written information that is needed for us to excel as a leader will be made manifest. In addition to the fact that reading ensures being informed, there is the much acclaimed belief that readers are leaders. A leader who does not love reading, will be more unfortunate for being one. The foremost requirement here is that parents themselves (especially the literate parents) understand the importance of reading at home in order to be able to inculcate the reading habit in their children while the illiterate parents seek the assistance of lesson teachers and tutorials.
Leadership Good leaders are made not born. It is often said that one that has the desire and will power, can become an effective leader. Good leaders develop through a never ending process of self study education, training and experience (Jago, 1982). This statement will serve as a guide into the definition of leadership. The international leadership Journal (2007) defines leadership as the process of social influence in which a person can enlist the aid and support of others in the accomplishment of a common task. Northhouse (2007) views leadership as a process by which a person influences others to accomplish an objective and directs the organization in a way that makes it more cohesive and coherent (p.3). it is a process whereby an individual influences a group of individuals to achieve a common goal. Leaders carry out this process by applying their leadership knowledge and skills. Children Leadership World (CLW, 2010) defines leadership as enabling a group to engage together in the process of developing, sharing and into vision, and then living it out. Leadership entails exerting; motivating, inspiring and helping others realize their potentials. Collins English Dictionary (1998) defines leadership as the ability to lead, while Drucker (2008) sums up the definition of leadership as someone who has followers Leadership can also be seen as the ability to inspire, motivate, direct and lead a group of people to achieve a common goal and this requires influence, intelligence, diligence, continuing education and consistent reading. Leadership Qualities Honesty is being truthful and sincere in interaction and work with people. People want to follow an honest leader. When we start a leadership position, we need to assume that people will think we are a little dishonest. In order to be seen as an honest individual, we will have to go out of our way to display honesty. People will assume we are honest because we have never been caught on the wrong side. One of
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the most frequent places where leaders miss an opportunity to display honesty is in handling mistakes. Much of a leaders job is to try new things and refine the ideas that do not work and unless this is done, we cannot be honest. Insight-Vision There is power in vision. A leader of vision is one who has the ability to think and plan for the future with great imagination and intelligence. When people do not consider their leaders as forward-looking they (the followers) may think the leader is incapable. When a leader does not have a vision for the future, it is usually because such a leader spends much time on today, without the thought of tomorrow. Leaders should set aside time for planning, strategizing and thinking about the future. Competence simply means the ability to do something very well when measured against standards. A Leader must not necessary be the foremost expert on every area of the entire organization but there is need to be able to demonstrate competency. Inspiration A true leader is one who inspires his/her followers. Everybody wants to be inspired. In fact, there is a class of people who will follow an inspiring leader even when the leader has no other qualities. One technique to develop an ability to inspire is telling stories, and reading. Stories can be examples from the leaders clients, customers, students or staff. Stories help a leader to illustrate vividly what he/she is trying to communicate, through reading. A leader needs to read lots of material (past, present, future) to keep himself abreast of procedures to inspire/motivate his/her followers which is one of the goals of reading: that is, to ensure that people are informed and educated. Intelligence Intelligence can be difficult to develop. Developing it is a lifestyle of choice. To develop intelligence, one needs to commit oneself to continual reading learning through textbooks. With modern advances in distance education which has taken another dimension, one can take all the necessary lessons required from ones bedroom and this can only be made realistic if one internalizes the fact that reading ignites and stimulates the intellect. From the foregoing discussion one can say that by consciously making effort to exhibit the above leadership traits, people are more likely to submit themselves to you as followers. By exhibiting these qualities on regular basis, one can grow in influence. A good reader must have love for reading. It is only through reading that one can decipher meaning from text/print, in order to acquire knowledge. Knowledge they say, is power. Reading and leadership; effective leadership drives toward a common goal which is to achieve success. Reading is a prerequisite to measure a persons success while leadership is an act of exerting authority to accomplish a task. All of the two concepts are reinforced by someone to another. The role of reading in developing effective leadership qualities The challenges of effective leadership are enormous. Burman an Evans (2008) said that these challenges may result in temporary questioning of ability and stability for leadership, throwing up all manner of doubts and insecurity. In developing effective leadership, Burman and Evans (2008) looked at it from a literal angle. First, they defined leadership development as any activity that enhances the quality of leadership within an individual or organization. These activities ranged from programmes offered at schools, High-Ropes courses offered at Universities to executive recruits. Harrison (2009) added what may be termed as the great inclusion in history-Reading. He said that although leadership development has focused on
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developing the leadership abilities and attitudes of individuals, the world should know that people are not all born with the ability to lead, and as such different personal discipline, characteristics, etc. can help or hinder a persons leadership abilities and effectiveness. Chief among these is reading: the ability to read and understand. Reading formalizes and brings to fruition programmes for developing leadership competences. Everyone can develop ones leadership effectiveness. Achieving such developments or success takes focus, practice and persistence more akin to learning a musical instrument and/or reading a book. The overall success of leadership development efforts has been linked to three variables: Individual learner characteristics. The quality and nature of the leadership development programme. Genuine support for behavioral change from the superior leader. Personal learner characteristics that are associated with successful leadership development include ; Leader motivation to learn; A high achievement drive ; Personal traits such as openness to experience, an internal focus of control, and self-monitoring Leadership motivation springs from the idea that reading is the key to achieving leadership success. All the qualities of an efficient leader such as efficiency, uprightness, motivation/inspiration, honesty, etc do not stroll around on the street. They are imbedded in print, and to understand and carry them to the letter, the leader will have to search out and read them. Hence, reading should come first in all priorities set by a good leader. The world is gone global. With recent studies in technologies, one is able to see the other end of the world, the culture and economic policies through materials on the internet books, etc. Reading thus becomes a virtue at our disposal which should not be neglected. For leadership jurisdiction remains devoid of innovation and advancement without reading. Literacy Literacy development is the utmost goal of education. According to Copper (1997) Literacy focuses on the development of the individual, who may become a leader, the personal attributes desired in a leader, desired ways of behaving, of thinking, etc. Literacy development includes interpersonal relationship, the ability to decipher meaning to text; the ability to read and write, and the only way a society may develop is for its citizens to become literates. The task of obtaining literacy is giant one and it includes. The ability to use written language actively and positively. This avails one the privilege of being able to read, write, and use numeracy, to handle information, to express ideas and opinions to make decisions and solve problems. It is argued that literacy includes the cultural, political and historical contexts of the community in which communication takes place. Taking account of the fact that a large part of the benefits of literacy is obtained from having access to a literate person in the household. Many analysts consider literacy rates as a crucial measure to enhance a regions human capital. This claim is made on the ground that literate people can be trained less expensively than illiterate people can. Generally, literates have a higher socio-economic status and enjoy better health and employment prospects. Literacy increases job opportunities and access to higher education. Literacy has also been used as a way to sort populations and control on who has access to power. Educators struggle to find ways to engage students in literacy development and content exploration. Through this process, students provide an opportunity for parents and community members to see and assess their children performing culturally responsive literacy while conducting themselves in a professional manner.
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Conclusion & Recommendation Leadership is important, but it does not just happen. You can improve your leadership skills through reading (study and practice). Just as there are books such as the Bible or Quran which one expects worshippers to be familiar with, there are also books and articles that aspiring leaders should read and study, as well. Since reading is a prerequisite to measuring a persons success, every leader should cultivate a habit of reading in order to keep leading aright. A reading leader is a winning leader anytime, any day and anywhere. The following are some recommendations that can enhance effective leadership through reading. Leaders should know how and when to apply what they read to their practice of leadership. Just reading about leadership will not make anyone a leader except an individual wants to be one. Such individuals need to actually practice the ideas that are suggested in readable materials and incorporate them into how to lead or their leadership styles. It can sometimes be overwhelming, because there are lots of leadership ideas to try out. Leaders should always remember that becoming a great leader is a life-long journey, which demands time and energy. It is one step (toward greatness) at a time (Carol, 2009). Leaders should read an article with an eye for one idea that would strengthen their leadership skills. Leaders should always think of how they would practice ideas discovered and then try them out. After each practice, leaders should reflect on what they will do differently next time. Practice again and again until reading becomes a habit, and success can be celebrated.
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References Allington, R.L; Cunning and Ham, P.M. (1996). Schools that work: where all children read and write. New York: HarperCollins College Publishers Allington, R.L. & Cunning and Ham, P.M. (1998). International Reading Association for the Education of Young Children. Maryland State Department of Education, n. d; Snow, Burns and Griffin. Carol (2009) Readings about leadership. New York: Hamper and Row Collins English Dictionary (1998). New York; Houper Collins Publication. Christian Leadership World (2010). Effective Leadership Traits Amazons.com Cooper, J.D. (1997). Literacy: Helping children construct meaning (3rd ed.) Boston: Houghton Mifflin. Children Leadership World (2010): Journal of International Leadership forum: Buston; Massachusets: Houghton Mifflin. Dearman and Alber (2005) Leadership & Education: Two Inseparable concepts. London: McSpencer. Frank, S. (1997). Reading without Nonsense. IRA Journal Vol. 27.p.769. Goodman, K. (1996). Journal of the Reading Specialist. Portsmouth, NH:Heinemann:pp38-41 International Leadership Journal (2001). eBay.com Jago (1982) Leadership in Africa, In Journal of Leadership and Peace. Vol.2. Jos: LECAPS Northhouse, G.P. (2007). Leadership Theory and Practice. Amazons.co.za Oyetunde, T. (2009). Beginning Reading Scheme: Empowering Teachers to help Pupils become good leaders. Jos: LECAPS publishers. Peter, D. (2008). Leadership Essential: Forward to the Drucker Foundation.ask.com Roy, H. (2000) Rethinking: Writings on Reading. The free online Encyclopedia. Smith, F. (1973). Comprehension and Learning. A conceptual framework for teachers. New York: holt, Rhinehart and Winston. Werner, E.; Michael, C. J.; Steve, Z & Karl, L. G. (2010). Introductory Reading for being a Leader, and the Effective Exercise of Leadership: An ontological Model (May 6, 2010). Online: The free Wikipedia. The International Leadership Encyclopedia (2007). Online: The free encyclopedia; http//leadership traits.org The Leadership Encyclopedia (2010) Vol. III. Pearson Educational co. London, United Kingdom. The leadership Development Guide: Australian Leadership Development and Row. Cristive, C; Cynthia, G; Lori, H; Ru h, S. (2000). What is reading: an excerpt from what is reading. The Quarterly Spotlight on Reading for literacy. Vol. 22 No. 3. E-voice.com. Yusuf H.O. (2009) strategies for Improving the teaching of Reading Comprehension in Primary School. Journal of Education Research and Development: vol. 4 (3) p.3-8. Zaria: ABU Press. Yusuf, H.O (2010). Teaching Reading Comprehension in Primary Schools: a comparative Study of language development and vocabulary methods. Published Ph.D Dissertation; Mauritius: VDM Publishing House Ltd.
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Relationship between Demographic Characteristics and Burnout among Public Sector University Teachers of Lahore
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Dr. Nayyar Raza Zaidi Professor, Lahore School of Economics Dr. Rana Abdul Wajid Professor & Director, Lahore School of Economics Farheen Batul Zaidi Lecturer. University of the Punjab
Abstract The present study is an attempt to survey the burnout level of Public Sector University Teachers of Lahore and determine the likely factors that are associated with this phenomenon. The subjects of the study were 399 teachers, 237 male and 161 female, selected randomly from all public sector universities of Lahore. A demographic questionnaire was used to collect data regarding the individual characteristics (e.g., gender, age, marital status, education level, monthly income, and work experience). The Maslach Burnout Inventory-General Survey (MBI-GS) (Schaufeli, Leiter, Maslach, & Jackson, 1996) was employed to collect the data regarding the three dimensions of burnout namely, emotional exhaustion; cynicism; and reduced professional efficacy. Descriptive and univariate statistics, including means, standard deviations, t-test, one-way ANOVA were used in the analysis. The multiple regression analysis of each of the burnout components by teachers demographic characteristics was also carried out. Female, married, and teachers having work experience of less than 16 years were found to be experiencing more Cynicism than other teachers. Emotional exhaustion was found to be significantly lower among teacher drawing higher salaries. Professional inefficacy was found to be significantly higher among married and teachers drawing lower salaries. Multiple regression analysis reveals that demographic variables have little influence on all the components of burnout. Key words: Demographic Characteristics, Burnout, Emotional Exhaustion, Cynicism, Depersonalization, Professional Efficacy, MBI-GS, ANOVA, Multiple Regression Introduction In todays modern world, many people suffer from work-related mental problems. For example, a recent survey of the European Commission showed that after back pain (33%), stress (23%) and fatigue (23%) ranked at places 2 and 3, respectively, of the most frequently faced work related health problems (Paoli, 2001). An individuals job and working environment create mental tension and stress. Common symptoms of mental disorders are anxiety, depression, and reduced selfesteem whereas physical disorders may include headache, stomachache and future risk of frequent sickness (Yip & Rowlinson, 2007). Prolonged exposure to these symptoms can produce several negative effects such as reduction in productivity, decrease in performance, low levels of customer service, absenteeism, turnover and many more social problems (Colff & Rothmann, 2009). The nature of burnout Originally, burnout was considered to be a type of stress that comes from the persistent effort for success (Freudenberger, 1974). This stress response most commonly displayed by individuals who have intense contact and involvement with
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others during the course of their normal workday. It may come when an individual try to accomplish too much of something, i.e., unrealistic deadlines, too many meetings, projects or high expectations. Stress is not bad in itself but we all have our limitations and once these limits have reached, we find ourselves on the brink of burnout. Thus, job burnout is a psychological syndrome that involves a prolonged response to stressors in the workplace. Later on Freudenberger ( 1975) defined it as a state of physical and emotional exhaustion that develops from work conditions and leaves the individual feeling worn out and exhausted and experiencing feelings of failure. However, the most widely accepted definition of burnout was used in the Maslach Burnout Inventory (MBI), i.e.Burnout is a syndrome of emotional exhaustion, depersonalization, and reduced personal accomplishment that can occur among individuals who do people work of some kind (Maslach & Jackson, 1986, p. 1). A commonly accepted and widely known model holds that burnout is characterized by three interrelated dimensions. The first and a key component of burnout syndrome is an increased feeling of emotional exhaustion. At this stage the individual feels that ones emotional resources are used up and he/she is mentally drained, empty, or worn out. As ones emotional resources are depleted with a feelings of frustration and tension, he/she is unable to give his/her hundred percent. The second symptom, depersonalization or dehumanization, is marked by the treatment of clients as objects rather than people. Workers may develop a negative, cynical attitudes and feelings towards their work, clients or organization. The third aspect of burnout, diminished personal accomplishment, is tendency to evaluate oneself negatively (Jackson, Turner, & Brief, 1987)). Several studies have confirmed these three phases of burnout (Yip & Rowlinson , 2007; Leiter & Maslach, 2004; Cordes & Dougherty, 1993; Leiter, 1991; Koeske & Koeske, 1989)). Traditionally burn out was seen as occurring solely within the helping profession such as education and nursing because Maslach ( 1982)) considered burnout as a helper syndrome that results from emotionally demanding relationships with the clients. Such relationships are inherently difficult because human services professionals deal with troubled people who suffer and are in need. Therefore these professionals are likely to feel emotionally exhausted, to treat their clients as objects and sometimes even doubt their professional competence when dealing with their clients. However, since the introduction of MBI-GS, the three dimensions of burnout can be measured independently from the professional context (Maslach and Jackson, 1986). Psychometrically, MBI-GS worked equally well in a sample of software engineers and university teachers (Taris, Schreurs and Schaufeli study (as cited in (Schaufeli W. , 2003). Burnout among teachers For the past 30 years, burnout among teachers has been important concerns for researchers all over the world because apart from affecting the mental, emotional and social health of teachers it also decreases the quality of teaching and work performance, which may adversely affect students academic achievement (Blandford study ( as cited inTsigilis, Zournatzi, & Koustelios, Special Issue June 2011). Many studies in literature reveal that burnout is more common among teachers and more relevant to the teaching profession than any other professional area as teachers experience a great deal of stress and burnout practically on a daily basis (Antoniou, Polychroni, & Vlachakis, 2006; Jackson & Rothmann, 2005; Griva & Joekes, 2003).
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Teaching is considered to be a very stressful profession (Borg & Riding, 1991; Friedman, 2000; and Young & Yue, 2007)). The stress levels of teachers are reported to be higher than average stress level of individuals working in other client-related professions ( Travers and Coopers study ( as cited in Mukundan & Ahour, 2011). The warning symptoms of the burned out teachers may be lack of interest in teaching, communicating and conveying the lesson of the day to the students (Mukundan and Ahour, 2011). In a literature review, Kyriacou, 1989 (as cited in (Demirel et. al. p.33, 2005), found that major sources of stress for teachers are; poor pupil motivation in school performance, undisciplined behaviour of pupils, poor career opportunities; low income and shortage of teaching equipment, poor facilities and large classes; time pressures and short deadlines; low societal recognition of profession; conflicts with colleagues and supervisors; rapid changes in curricular demands and adaptation of scholastic programs to changes in a rapidly changing society. All of these factors are valid in the working conditions of Pakistani teachers. Thus, it should be expected that Pakistani teachers suffer from burnout more than the teachers in the westerndeveloped countries. However, no research relevant to teachers burnout in Pakistan exists in the literature on burnout. Socio-Demographic Factors The main purpose of this research is to explore the relationship between sociodemographic characteristics (age, gender, marital status, Educational level, monthly income, and work experience) (Ahola et al. 2005) and three components of job burnout. Many researches show that age is most consistently related to burnout (Byrne, 1999; Evers, Tomic, & Brouwers, 2005). Research also found that younger teachers scored significantly higher on emotional exhaustion than older teachers (Anderson & Iwanicki, 1984; Maslach, Jackson, & Leiter, 1996)). MBI manual shows decline of burnout levels with growing age or working experience for all three dimensions (Maslach et. al, 1996). However, inconsistent results have also been found in different studies regarding relationship between age and burnout levels among public school teachers in USA (Schawab, Jackson, & Schuler, 1986; Maslach & Jackson, 1981). The relationship of burnout with gender is not so clear-cut. Some studies show burnout occurs more often among females than among males (Maslach & Jackson, 1981; Maslach et al., 1996; Byrne,1999; Lau, Yuen, & Chan, 2005; Timms, Graham, & Caltabiano, 2006)) while the opposite is found as well (Anderson & Iwanicki, 1984; Bauer, et al., 2007) Marital status was significantly related to one burnout factor that is emotional exhaustion. People who were single or divorced scored higher than married as studied by Maslach et al., 1981. Differences by level of education were found for each of the MBI subscales. More education was associated with higher scores on emotional exhaustion while reverse pattern was seen in the depersonalization factor where higher education lowered depersonalization. Graduated individual scored higher on personal accomplishments.
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Research Questions
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This study will seek to answer the following question: What demographic characteristics (age, sex, marital status, education level, monthly income, and work experience) best predict level of burnout in Public Sector University Teachers of Lahore? Research Hypotheses The literature overwhelmingly supports the conceptualization of burnout as a threecomponent construct. Emotional exhaustion, cynicism (also known in burnout literature as depersonalization), and feelings of professional inefficacy (also known in burnout literature as lack of personal accomplishment) have been repeatedly demonstrated to be the three dimensions of burnout, and studies of burnout consistently consider the phenomenon by measuring the three variables. Null hypotheses formulated for this study are as follows: Hypothesis: 1 No significant gender difference in all three components of burnout Hypothesis: 2 No significant age difference in all three components of burnout Hypothesis: 3 No significant marital status difference in all three components of burnout Hypothesis: 4 No significant difference in all three components of burnout with respect to education level s Hypothesis: 5 No significant difference in all three components of burnout with respect to monthly income Hypothesis: 6 No significant difference in all three components of burnout with respect to work experience Hypothesis: 7 There is no significant relationship between burnout and linear combination of demographic characteristics (gender, age, marital status, education level, monthly income, and work experience) of teachers Methods Study Design The design for this research included questionnaires. The questionnaires were selfadministered by the respondents. Measures Emotional exhaustion occurs in an individual when that individual feels completely drained and loses control of his or her emotions (Maslach & Jackson, 1981). In teaching profession it happens when the teacher feels tired and fatigued. As a result he/she is unable to give his/her best to the students. Emotional exhaustion has physical, emotional, intellectual, and social elements. In this study, the emotional exhaustion subscale of the MBI-GS will measure exhaustion. Cynicism is defined as contemptuous distrust of human nature and motives. In this study, cynicism refers to the indifferent attitude of a teacher as they depersonalize their work. Teachers show negative attitudes toward their students and sometimes even physically distance
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themselves from them. In burnout literature, the term cynicism is used interchangeably with depersonalization. In this study, emotional cynicism subscale of the MBI-GS will measure depersonalization. Professional inefficacy refers to the worker's feelings that he or she is failing and/or having few feelings about his or her accomplishments and/or competence. Teachers at this stage feel that they are no longer helpful to the students in their learning and growth. In burnout literature, professional inefficacy is used interchangeably with the term lack of personal accomplishment. In this study, inefficacy will be measured by the professional efficacy subscale of the MBI-GS. Gender is divided into male and female. Marital status is divided into two: married and non-married including widowed, divorced or single.
Subjects Three hundred and ninety nine questionnaires were returned from teachers. The teachers were randomly selected from all public sector universities of Lahore. Of the total respondents, 237 (59 %) were male and 161 (41 %) were female. Instruments Two questionnaires were distributed among the subjects. One was aimed to get the demographic information, including the teachers gender, age, and marital status; education level, monthly income, and teaching experience. The other questionnaire was the Maslach Burnout Inventory-General Survey (MBI- GS) (Schaufeli, Leiter, Maslach, & Jackson, 1996). It is a 7- point Likert scale ranging from 0-6 (where 0 = never and 6 =daily). It includes 16 items that asked the respondents how often they experience feelings that relate to burnout. These items are related to the three dimensions of burnout (i.e., Exhaustion (EX) = 5 items; Cynicism (CY) = 5 items; and Professional Efficacy (PE) = 6 items). The Exhaustion subscale assesses the feelings of being emotionally exhausted or overextended (e.g., I feel emotionally drained from my work). The Cynicism subscale evaluates the feelings of impersonal response toward people (e.g., I have become less interested in my work since I started this job). The Professional Efficacy subscale measures the feelings of successful achievement (e.g., I can effectively solve the problems that arise in my work). High scores on EX and CY and low scores on PE are indicative of burnout (i.e. all PE-items are reversibly scored). Data Analysis The collected data were entered into the SPSS 15 for further analysis. The demographic variables were the independent variables and the three burnout levels (i.e., EX, CY, and PE) were the dependent variables of the study. Based on Maslach et al. (1996), higher scores in EX and CY represent higher degrees of experienced burnout. In contrast, because PE subscale assesses the successful achievement of the respondents with people (in this study, the teachers in relation with their students), lower scores in PE demonstrate higher degrees of experienced burnout. Descriptive and univariate statistics, including means, standard deviations, t-test, one-way ANOVA were used in the analysis. The results are presented in TABLE 1 for each question and the significant findings are discussed below:
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Table 1: ANOVA of MBI subscales by the demographic variables of Public Sector University Teachers of Lahore
Variables n Gender Male Female Age 24 30 31 40 Over 40 Marital Status Married Unmarried Education Levels MSc MPhil PhD Monthly Income <50K 50K 100K 100K 150K 150K 200K Over 200K Work Experience 4 5 16 17 Emotional exhaustion M SD F 5.36 5.01 5.44 5.29 4.77 5.15 5.34 6.45 5.22 4.50 5.21 5.53 4.44 4.52 2.98 5.38 5.04 3.51 1.65 1.07 M 13.82 14.99 14.22 14.63 13.78 14.67 13.85 14.08 14.27 14.51 13.76 14.55 15.11 15.12 12.85 14.41 14.36 4.50 Cynicism SD F 4.64 4.01 4.29 4.35 4.49 4.37 4.46 4.36 4.43 4.48 3.87 4.94 4.16 4.77 3.54 4.42 4.22 2.12 4.81** 1.182 Professional Efficacy M SD F 17.63 17.45 16.89 17.77 17.94 18.16 16.79 17.14 17.35 18.26 16.57 18.12 19.04 18.32 15.07 17.40 17.62 23.33 5.65 4.20 4.40 5.36 5.33 5.37 4.65 4.97 5.17 5.00 4.45 5.77 4.43 5.28 3.24 4.81 5.24 12.22 0.13 1.344
237 12.12 161 11.44 110 12.03 202 12.05 84 11.11 222 11.91 174 11.77 51 13.22 240 11.63 106 11.73 150 155 52 25 14 11.15 12.76 12.17 11.96 7.85
0.076 1.978
3.33* 0.185
7.36** 1.374
4.083***
1.712
4.04***
199 11.93 196 11.66 3 18.33
2.462*
5.2***
2.027
Notes: n = Number of subjects, M = Mean, SD = Standard Deviation, F = F-value, *, Results 1. Hypothesis 1 was partially rejected. There was a significant difference in mean score of male and female teachers with respect to Cynicism component of the burnout. The F value of 4.817 was significant at 0.05 level. However, there was no significant difference in mean score of male and female teachers with respect to Emotional Exhaustion and Professional Efficacy. 2. Hypothesis 2 was not rejected. The F value of 1.07, 1.18 and 1.34 indicated that there was no significant difference with respect to age for any component of burnout. 3. Hypothesis 3 was also partially rejected. There was a significant difference in mean score of married and unmarried teachers with respect to Cynicism and Professional Efficacy components of the burnout. However, there was no significant difference in mean score of married and unmarried teachers with respect to Emotional Exhaustion. The F value of 3.33 for Cynicism at 0.10 and 7.36 for professional Efficacy at 0.05 level was significant. 4. Hypothesis 4 was not rejected. The F value of 1.978, 0.185 and 1.374 indicated that there was no significant difference between education levels for any component of burnout.
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5. Hypothesis 5 was partially rejected. There was a significant difference in mean score of teachers having different monthly incomes with respect to Emotional Exhaustion and Professional Efficacy components of the burnout. However, there was no significant difference in mean score of teachers having different monthly income with respect to Cynicism. The F value of 4.083 for Emotional Exhaustion and 4.04 for professional Efficacy was significant at 0.01level. 6. Hypothesis 6 was partially rejected. There was a significant difference in mean score of teachers having different lengths of experience with respect to Emotional Exhaustion and Cynicism components of the burnout. However, there was no significant difference in mean score of teachers having different lengths work experience with respect to Professional Efficacy. The F value of 2.462 for Emotional Exhaustion at 0.10 level and 5.2 for Cynicism at 0.01 levels were found to be significant. 7. Table 2 shows the results of the multiple regression analysis of each of the burnout components by teachers demographic characteristics. The F value indicates that demographic variables do not have significant effect on emotional exhaustion and Professional Efficacy. For Cynicism, sex, age, marital status, length of work experience and income were found to be significant predictors. Lower values of coefficients of indicate that the demographic variables have little determinations, influence on the components of burnout Table 2 Beta coefficients of the demographic variables to Emotional exhaustion, Cynicism and Professional Efficacy Demographic Emotional Cynicism Professional variables exhaustion Efficacy Sex -1.026* 1.093** -0.027 Age -1.409* -1.356** -0.469 Marital Status -1.045 -2.144*** -1.679 Education -0.535 0.472 0.238 Work Experience 0.720 -0.986* -0.405 0.219 Income 0.243 0.520* 0.022 0.06 0.021 F 1.473 4.126*** 1.354 Notes: F = F-value, * Discussion Last thirty years research findings of the relationship between teachers demographic characteristics and various components of burnout given in table 3 reveal that there was no consistent pattern in the results. This factor motivated us to look further into the burnout phenomenon in public sector universities of Lahore. Therefore, the present study was designed to examine whether public sector university teacher experience different levels of burnout in relation to various demographic factors.
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Table 3: Summary of Relationship between Demographic Variables and the Burnout Components
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Sources: 1: Cordes C. L., & Dougherty T. W. (1993). A Review and an integration of Research on Job burnout. Academy of Management Review, P. 634. 2. Lau, P. S. Y., Yuen, M. T, and Chan, R. M. C. (2005). Do Demographic Characteristics Make a Difference to Burnout Among Hong Kong Secondary School Teachers. Social Indicators Research, P. 495
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Table 3 (Continued)
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Sources: 1: Cordes C. L., & Dougherty T. W. (1993). A Review and an integration of Research on Job burnout. Academy of Management Review, P. 634. 2. Lau, P. S. Y., Yuen, M. T, and Chan, R. M. C. (2005). Do Demographic Characteristics Make a Difference to Burnout Among Hong Kong Secondary School Teachers. Social Indicators Research, P. 495.
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Table 3 (Continued) Summary of Relationship between Demographic Variables and the Burnout Components
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Gender Previous studies on gender differences provided inconsistent findings except for the depersonalization/Cynicism burnout syndrome. Our findings also support this but the difference is that in many western studies, depersonalization/Cynicism appeared to be higher for male teachers than female teachers (Anderson and Iwanicki, 1984; Byrne, 1999; Cordes and Dougherty, 1993; Maslach et al., 1996) whereas our findings suggest that female teachers experience higher level of cynicism than male teachers. This may be due to the fact that Pakistani society is very conservative. In the past, majority of women were not allowed to get higher education and thus not eligible to work in universities. Therefore, their representation in the public sector universities was very small. Only recently, due to the advancement of technology and communication, this trend has changed and now they are getting higher education along with men. They now constitute around 25% of the total faculty of the public sector universities of Lahore (Punjab, Telephone Directory, 2010-2011).
Almost all the administrative positions are held by male faculty members. They do not fully understand the needs and requirement of the female faculty members and also have not yet accepted them as equal partners in the institution. They do not communicate female teachers what is expected of them. Female faculty members do not have separate faculty staff rooms where they can spend their free time. The married faculty members who have small children are not provided day care center for their children in the university premises. Moreover, their family, especially the husband, does not recognize the fact that they are now working women and treat them as house-hold women. Due to this reason, female faculty members suffer from role conflict and role ambiguity. Role conflict occurs when an employee perceives a discrepancy between expectations conveyed by different sources, while role ambiguity occurs when an employee is uncertain about expectation. Hence, they feel alienated and thus become cynical.
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Age & Education Level In the literature, age has been found to be very significant variable with respect to emotional exhaustion component of burnout (Byrne, 1999). Younger teachers have found to be experiencing more emotional exhaustion than older teachers (Anderson & Iwanicki, 1984; Maslach and Jackson; and Lau et al., 2005). For Cynicism/Depersonalization, Maslach and Jackson( 1981) found significant lower depersonalization score for their older respondents. Higher Personal accomplishment scores were found to be among the older respondents than younger ones (Maslach et al. 1996). In the present study, no significant difference was found for different age groups and education levels on any component of burnout. This may be due to the fact that in Pakistan, when a person is inducted in the public sector, he/ she will remain there till such time when he/she decides to quit or retire. There is no proper system of check and balance to assess the performance of employees. Although in theory, there are measures such Annual Confidential report (ACR), probation period and peer review system, but practically no attention is given to the adverse remarks. Hence, there is no pressure on faculty to perform. Marital Status Most of the previous studies on marital status provided consistent results that unmarried/single/childless teachers experience more emotional exhaustion and depersonalization than married teachers (Gold, 1985; Maslach & Jackson, 1985; De Heus & Dickstra, 1999; Lau et al., 2005; and Mukundan & Ahour, 2011 as shown in TABLE 3 of this article). But in the present study we found that there is a significant difference in mean score of married and unmarried teachers with respect to Cynicism and Professional Efficacy components of the burnout. Married teachers experience more Cynicism and Professional Inefficacy than unmarried teachers. This may probably be due to cultural difference between the West and the East. Here, according to the eastern tradition, married people are more committed to the marriage and family. They experience difficulty in maintaining a balance between the job and the family, resulting in more role conflict and work over load than the teachers in the western societies. This leads to greater cynicism and less commitment with the profession/job. Monthly Income Teachers drawing salaries between Rs.50,000 to Rs150,000 experience greater emotional exhaustion than other teachers. This is quite logical and understandable because most of these teachers are married, having small school going children, and are in the middle of their career. They have to meet the growing financial needs of their family which is not possible within this range of monthly income due to high inflation rate of about 18% in Pakistan. Work Experience Most of the previous studies found no relation between experience and any burnout components (Gaines & Jermier, 1983; Gold, 1985; Schwab & Iwanicki, 1982 b; Zabel & Zabel, 1982; Russel et al., 1987 as shown in TABLE 3 of this article). But, Anderson & Iwanicki, 1984 found that more experienced workers experience higher emotional exhaustion and depersonalization. However, Lau et al., (2005) reported that less experienced workers experience more emotional exhaustion,
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depersonalization, and personal accomplishment. The results of the present study support the findings of Lau et al., (2005) with respect to work experience.
Conclusions/Recommendations This study found that female, married, and teachers having work experience of less than 16 years were experiencing more cynicism/depersonalization that other teachers. Another finding of the study was that teachers drawing salaries between Rs.50,000 to Rs150,000 experience greater emotional exhaustion than other teachers. Therefore, special attention should be given to address the problems faced by these teachers. Some suggestions are given as under: 1. Special lectures should be arranged for head of the departments/institutes/colleges highlighting the needs and requirements of female teachers to bring harmony and better relationship in public sector universities of Pakistan. 2. Day care centers for the small children of the female teachers to be set up at each faculty level. 3. Special seminars and lectures should be arranged for the married teachers explaining how to keep the balance between the institution and the family. 4. Special allowance/honorarium should to be given to the teachers drawing salaries between Rs.50,000 to Rs150,000 to help them overcome emotional exhaustion.
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References
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Ahola, K., Honkonen, T., Isometsa, E., Kalimo, R., Nykyri, E., Koskinen, S., et al. (2005). Burnout in the general population-Results from the Finnish Health 2000 Study. Published online. Anderson, M. B., & Iwanicki, E. F. (1984). Teacher motivation and its relationship to burnout. Administration Quarterly , 20, 94-132. Antoniou, A., Polychroni, F., & Vlachakis, A. N. (2006). Gender and age differences in occupational stress and professional burnout between primary and high school teachers in Greece. Journal of Managerial Psychology , 21 (7), 682-690. Bauer, J., Unterbrink, T., Hack, A., pfeifer, R., Buhl-Griesshaber, V., Muller, V., et al. (2007). Burnout and effort-reward-imbalance in a sample of 949 German teachers. International Archives of Occupational and Environmental Health , 80 (5), 433-441. Borg, M. G., & Riding, R. J. (1991). Occupational stress and satisfaction in teaching. British Educational Reseach Journal , 17 (3), 263-281. Byrne, B. M. (1999). The nomological network of teacher burnout: a literature review and emprically validated model. In R. Vanderberghe, & A. M. (eds.), Understanding and Preventing Teachers Burnout (pp. 15-37). Cambridge: Cambridge University Press. Colff, J. J., & Rothmann, S. (2009). Occupational Stress, Sense of Coherence, Coping, Burnout and Work Engagement of Registered Nurses in Sout Africa. SA Journal of Industrial Psychology , 35 (1), 1-10. Cordes, C. L., & Dougherty, T. W. (1993). A Review and an Integration of Research on Job Burnout. The Academy of Management Review , 18 (4), 621-656. Demirel, Y., Guler, N., Toktamis, A., Ozdemir, D., & Sezer, R. E. (2005). Burnout among high school teachers in Turkey. Middle East Journal of Family Medicine , 3 (3), 33-36. Evers, W., Tomic, W., & Brouwers, A. (2005). Constructive thinking and burnout among secondary school teachers. Social Psychology of Education , 8, 425-439. Freudenberger, H. (1974). Staff Burnout. Journal of Social Issues , 30, 159-165. Freudenberger, H. (1975). The staff burnout syndrome in alternative institutions. Psychotherapy Theory Research Practice , 12, 72-83. Friedman, I. A. (2000). Burnout in Teachers: Shattered dreams of impeccable professional performance. Session: Psychology in Practice , 56 (5), 595-606. Griva, K., & Joekes, K. (2003). UK teachers under stress: Can we predict wellness on the basis of characteristics of the teaching job? Psychology and Health , 18 (4), 457-471. Jackson, L., & Rothmann, S. (2005). An adapted model of burnout for educators in South Africa. South African Journal of Education , 25, 100-108.
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Jackson, S. E., Turner, J. A., & Brief, A. P. (1987). Correlates of burnout among public service lawyers. Journal of Occupational Behavior , 8, 339-349. Koeske, G. F., & Koeske, R. D. (1989). Construct validity of the Maslach Burnout Inventory: A critical review and reconceptualization. Journal of Applied Behavioral Science , 25 (2), 131-132. Lau, P. S., Yuen, M. T., & Chan, M. C. (2005). Do demographic characteristics make a difference among Hong Kong secondary school teachers? Social Indicators Research , 71 (1/3), 491-516. Leiter, M. P. (1991). Coping patterns as predictors of burnout: The function of control and escapist coping patterns. Journal of Organizational Behavior , 12, 123-144. Leiter, M. P., & Maslach, C. (2004). Areas of Worklife: A Structured Approach to Organizational Predictors of Job Burnout. Research in Occupational Stress and Well Being , 3, 91-134. Maslach, C. (1982). Burnout: A social psychological analysis. . In J. W. (Ed.), The burnout syndrome (pp. 30-53). London: Park Ridge, II: London House. Maslach, C., & Jackson, S. E. (1986). The Maslach Burnout Inventory. Palo Alto, CA: Consulting Psychologist Press. Maslach, C., & Jackson, S. E. (1981). The measurement of experienced burnout. Journal of Occupational Behavior , 2, 99-113. Maslach, C., Jackson, S. E., & Leiter, M. (1996). Maslach Burnout Inventory Manual (3rd ed.). Palo Alto, CA: Consulting Psychologists Press, Inc. Mukundan, J., & Ahour, T. (2011). Burnout among female teachers in Malaysia. Journal of International Education Research--Third Quarter , 7 (3), 25-37. Paoli, p. (2001). Third survey on the work environment 2000. European Foundation for the Improvement of Living and Working Conditions. Dublin: Loughlingstown House. Schaufeli, W. B., Leiter, M. P., Maslach, C., & Jackson, S. E. (1996). The Maslach Burnout Inventory--General Survey. Palo Alto, CA: Consulting Psychologists Press. Schaufeli, W. (2003). Past performance and future perspectives of burnout research. SA Journal of Industrial Psychology , 29 (4), 1-15. Schawab, R. L., Jackson, S. E., & Schuler, R. S. (1986). Who are our burned out teachers? Educational Research Quarterly , 10, 14-30. Timms, C., Graham, D., & Caltabiano, M. (2006). Gender implication of perceptions of trustworthiness of school adminstration and teacher burnou/stress. Australian Journal of Social Issues , 41 (3), 343-358.
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Tsigilis, N., Zournatzi, E., & Koustelios, A. (Special Issue June 2011). Burnout among physical education teachers in primary and secondary schools. International Journal of Humanities and Social Science , 1 (7), 53-58. Yip, B., & Rowlinson, S. (2007). The Crossover of Burnout and Engagement. CIB World Building Congress. Young, Z., & Yue, ,. Y. (2007). Causes for burnout among secondary and elementary school teachers and preventive strategies. Chinese Education and Society , 40 (5), 78-85.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS A Critique on Scientific Management

Mugheera Maqbool (Lecturer) National University Of Modern Languages Ahmad Zakariya (Lecturer) National University Of Modern Languages Ahmer Naveed Paracha (Asst. Professor) Kohat University of Science and Technology
Abstract
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The objective of this paper is to critically question the principles of Scientific Management and their application on human beings. A critique has been initiated on restricted, inflexible and extreme standardization and system which does not allow human imagination to play its role in dealing unknown events. The paper highlights the ethical dilemmas faced by human beings.
Keywords: Scientific management, Human nature, extreme standardization, ethical dilemma Introduction
Scientific Management is a movement that is related to work measurement propounded by Frederick Taylor (1911) in his book Principles of Scientific Management. It was launched at the end of first industrial revolution. It was a period of technological growth (1832-1848) and development in England which moved the country from agriculture to a manufacturing country. Moreover, the reform parliament came into being. According to the reform constitution rights to vote were given to the manufacturing centers, and states could not interfere in the businesses. Consequently, the power and control got shifted toward middle class. The technological developments had not only influenced the economy of the country but also inventions of rail road and telegraph created intense competition in business. Prosperity created more awareness among people. The number of groups of reform gave confronted ideas. One of them was the Chartists, they emphasized on Universal Manhood and rights of people. Then, Jeremy Bentham emphasized on Utilitarianism, it is derived from the idea that the rightness and wrongness of action depend on the ends. It promoted self interest and pleasure. Further, workers joined together and established associations which were called trade unions. At this time, competitors such as America and Germany emerged as empires. The progress of large railroad organizations created industrial enterprises, affluent society and economic well being of individuals. Organizations started vigorously searching for competent men. However, large organizations provided economic prosperity but it posed number of administrative problems too (Common, 1966, p. 303). These administrative problems were totally different and complex from smaller organizations. The disperse infrastructure of large organizations pose complexities and issues of managerial control and supervision. Industrial enterprises required solutions of these problems. So managers started discussions and read out publications to American Society of Association of Mechanical Engineers.
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Ultimately, it led to the movement of scientific management. In the past human being was given the priority but later it shifted to things. Such as processes, lay out, equipment, production techniques, and compensation systems. The main objective of the system was to produce and develop competent individuals and these individuals have to progress rapidly than before. Frederick Taylor was the chief engineer and he joined American Society of Association of Mechanical Engineers in 1886. He introduced piece rate system and shop management. Piece rate system was a wage system that dealt with differential rewards. Shop management emphasized the application of scientific methods on all processes of management and employees. Employees jobs, working conditions, and materials were scientifically managed so that standardized output could be achieved. Scientific management was based on Taylors philosophy of application that maximum benefits could be gained through the application of scientific methods on all managerial problems. Managerial functions such as selection, training, and development had to take place according to scientific methods. Moreover, it emphasized the division of work roles between management and labors. Managers were responsible for planning every activity of workers. Thus, it established centralized functions and specialized foremen. (Braverman, 1974) Research Inquiry This paper analyses the issues of scientifically managed human beings. The research traces the mechanistic and calculative approach in management. Organization is a social entity and displays human actions. Humans relationships with society and organization have great impact on them. Therefore this complexity poses the question that the application of natural science laws on organization and human is justified.
Research Design The understudy paper discusses a critique on scientific management. To build arguments critical theory is selected. It is a process of historical revision and provides more improved insight knowledge. It may lead to generalization when cultural, political, social, ethical circumstances are same (Guba,1994) . Epistemology of this paper is based on Constructivism. It leads to understand and reconstruct the constructs that had previously inquired by the researchers. Though, it aim towards consensus, but it provides opportunity for new interpretations depending on improved information. It promotes the idea that multiple knowledge exists and it also depends on interpreters competence, as well as different context (Carr & Kemmis, 1986). The main goal of constructivist researcher is to understand phenomenon in the social context ( Marcus, 1986).The criteria used for describing the inquiry are historical comparatives because it studies the social, political, and ethical situations of particular situation. It clears the misconception and misinformation. The nature of knowledge depends on historical insights which keep on transforming. The process of transformation takes place through improved and sophisticated information ( Lincoln, 1994) . The research technique is qualitative. The choice is based on the objective of the study ( Currall & Towler, 2003; Punch, 2005). Based on historical literature particularly Adam Smith, Russell, and Marshall ideas are summarized and then critically assessed.
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Literature Review The most prominent feature of scientific management was the incentive system. It was practiced in the workshops before the First World War. Unions charged the incentive system as a bad system, which not only squeezed blood of employees but also created anti social feeling among workers (Sir Dennis Robertson, 1921; Arthur Cecil Pigou, 1920). Bonus system grabbed the attention of human beings and gave rise to materialism in human beings (Florence, 1924, p. 95). William Ashley (1922) stated that all of the Taylors ideas were to make the men machines. During the first Industrial Revolution machines replaced the man and the animals from the manual work. This process was called mechanization. The development in technology and production processes required knowledge and understanding to effectively utilize human beings and machines jointly and separately. The mechanization phenomenon got attention of scientists and engineers from various disciplines. Consequently, the study was initiated in industrial engineering and it facilitated the mechanization (Russell, 1970). Social scientists referred the scientific management as merely the machine theory of organization. In which such enterprise was created that was incompatible with human beings. This transformed every employee in to appendage of machines. The idea was to exploit employees as much as possible to gain maximum benefits for employers. Marx had stated observations half a century ago which this system confirmed and it was criticized by labor associations, and unions. The advent of technology in the system created the opposing interests between humans and business (Hobson, 1914, p.207). Moreover, the improved system and methods of working reduced the employees ability of taking initiative, power of judgment, and responsibility. It was a great loss to the employees (Hobson, 1914, p. 212). Taylor proposed time and motion study that was one best way of performing tasks and to differentiate the best conditions, machines, tools and etc. The essence of time and motion study was that the human beings and their jobs were significant building blocks in the organization, and they could perform those tasks which machines could not perform. These individual building blocks need foremen and supervisors to analyze uncertainties and variance in work. Moreover, these supervisors need to be supervised and so on, and this led to tall hierarchy. So an individual could be called manager without decision making skills and rational judgment, simply on the basis that he could supervise some people. This notion of supervision could be observed in the bureaucratic organizations. In 1911, the magazine Engineer criticized the Taylors system as the hostile, unfair, and inhuman. The criticism was based on the separation of the thought from action in the system. It separated the planning from implementation and brain from muscles. Everything was handled and controlled by the stopwatch. It had great impact on the progress. But there was a lack of space for imagination (Robertson, 1923, p. 97)
The rationality of new system did not study individual capacity. According to the new system, employees used to perform those tasks which supervisors and foreman assigned them rather than looking at the possibility that what they might be capable of performing. The foreman might not appreciate the qualities of employees. Moreover, employees capabilities were seen by his output. A worker who was good operative considered to possess high capabilities.
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Specialized engineers were substituted by the supervisor, planning was replaced by the control. The departments created roles, skills, motion, and observed time for every activity and task. Each instruction was written for individual worker so the productive procedures of the department were called rationalized. However, this rationalized rigidity of roles and functions restricted the Planning to the higher level. But the workers had fixed roles. The planning departments have to plan cards for each worker. The only innovation was seen card system and the basic focus was on the operation and the immediate outcome rather than strategic perspectives (Marshall, 1919). One of the achievements of the new system was that unskilled workers could also perform the tasks. They used to observe the skilled workers and imitate the tasks. Further, they gained higher wages and incentives. The new system had increased the employee efficiency but provided little opportunities for reasoning and logic. But the question was just getting higher wages was an achievement (Marshall, 1919). Scientific management led to mechanistic, card and impersonal relationships between boss and employee. Moreover, personal relationships are replaced by written order. So it restricted the free expression of an individual. The foreman was responsible to take orders from specialized supervisors and give direction to his workmen without personal interactions. Employer and employee relationships were significant not from business point of view but employee trust, affection and esteem were considered capital of business. Drucker (1964) charged Taylor for making American management bureaucratic. Specialized tasks made the managers centralize power, planning became separated from performance. So the bureaucratic organizations run with managers divided from managed. Managers worked separately from production and used to manipulate human resource just like any other resource. Ultimately, the result was oppression and underutilization of personnel. So the Taylorism created problems in American business. Peter Drucker (1964) stated that an individual who possess the skill and techniques without understanding the fundamentals and logics of management, could not be called a manager but a technician. Drucker favored consensus than control for bringing harmony in the corporation. He argued that the firm is liable to fully understand the societal values and employees needs. The conflict between societal needs of managerial power and individuals need of satisfaction could be mitigated by adopting the methods which promote managerial attitudes in employees. Employees needed to take jobs as social agreement as well as agreement of subjection and association. Through this association employee could attain the ability to control their jobs. The working methods and environment would facilitate free participation in performing the tasks. The idea of participation represented a Christian belief of freedom. Taylor considered work avoiding behavior as a systemic problem and called it soldiering. The only reason he highlighted for work avoiding behavior was defective compensation systems. Taylor rejected the behavior organizations logic of soldiering. Behavior organization propounded that soldiering might occur due to lack of motivation and lack of morale. It showed the Taylors lack of understanding of the behavioral problems and human nature of employees (Braverman, 1974, pp. 86-7; Clawson,
1980, pp. 203-4).
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The new system portrayed the negative image of human nature. The words used for worker such as stupid and phlegmatic, critically depicted the status of workers in scientifically managed organizations. It further extended the argument that scientific management required workers with insufficient mental capabilities. Human beings were considered a mere source of producing output and the input was insufficient mental capacities (e.g. Hoffman and Woehr, 2005). The Taylor idea of managers as naturally good people and cooperative people also led to discrimination between workers and bosses. This idea is criticized from a behavioral, organization psychologists, it showed the Taylors behavioral approaches and his one-sided class attitudes by mentioning the cooperative model of the manager. Further, Taylor mentioned the training program which would make the manager fair and cooperative (Taylor, 1912, p. 153; Goldberg, 1992, pp. 44-5, 53). Taylor class differentiation and favoritism for class was obvious here. Copley (1919) observed the myopic greed of managers while it referred to appropriating and distributing material gains generated by Scientific Management. The myopic and managerial greed gave rise to discontentment in the workers. The new system managers used to break wage promises and their uncooperative behavior made the workers strike against the Scientific Management (Merkle 1980, p. 25). Extreme standardization of procedures and activities brought affluence in economy and society. It provided improved techniques of clear roles and functions. Even the goods produced were sold out on the basis of scientific methods (Whitaker, 1975). Standardization has its limitations. It could be efficient technique for short run benefits. However, in the long run it could be an obstacle against change (Marshall, 1919). Though, scientific management facilitated mass production, high wages, and amenities in short run, but its longer consequences brought alienation into the larger society, it could be traced back in the form of industrial struggle. Unions initially resisted it but afterwards it exploited it in the form of bargaining for their own interest. The result of extreme standardization of procedures created increased conflict between employees and employers. Common raised the significant question that how scientific management could deal scientifically with organizations as well as individuals (Commons, 1911, p. 464). Hoxie (1916) found out that Engineers gave less importance to labor relations .Labor relations play pivotal role in industrial systems. Robert Hoxie was interested to explore that why organized labor is against scientific management and how much scientific management is responsible for labor welfare. Ultimately Hoxie found out that time and motion study is the essence of scientific management and considered it the most serious threat for the workers (Robert Hoxie, 1916) After the Second World War social scientists and psychologist showed their concern about the workers problems. Employees were getting higher salaries and incentives but it became obvious that something was wrong. Therefore, Hawthorne Experiments were carried out in Western Electric's plants by Elton Mayo's followers to explore the problems faced by the workers and its impact in the society. First time these extensive studies were carried out by social scientists in industry regarding the psychophysical problems. The results showed that employees are human beings and they showed their preference to treated as humans. These studies became the foundation of human
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relations movement. The human relations movement propounded that an enterprise was a social system. However, there was no place and importance given to technology by these movements. Their stance was that better treatment should be given to employees. But they further argued that only better treatment was not the solution of the employees problems. They proposed that nature of jobs and the behavior of supervisors and managers need to be changed too (Roethlisberger and Dickson, 1939). Full employment conditions in countries such as Britain and America further highlighted the recognition of social and psychological aspects. Human relations school emphasized the importance of social and psychological aspects of human beings rather than technology, job, and mechanical requirements (Peter Drucker, 1952). Full employment led to personnel management. As the worker-manager aspect was contemplated a large movement brought forward. It raised questions such as person-centered supervision better than task-centered supervision, two-way communication better than one-way communication, persuasive style better than coercion, a democratic style of leadership better than an authoritative leadership? The idea is how the attitude of supervisors could be changed if the managerial style did not change (Likert, 1958). The opposing views of scientific management got attention about the nature of humanity and its basic needs and motivations at the work place. Abraham Maslow (1954) presented his need hierarchy, which postulated that as the more basic needs for food, security became satisfied, higher needs regarding group belongingness, self-esteem and self-actualization would become more salient. Asserting the same point Douglas McGregor (1960) presented two models of "industrial man" that which he called Theory X and Theory Y. The first theory described the traditional management view of employees which started with the first industrial revolution. The proponents were of the view that employees needed external control because they were basically lazy, irresponsible, selfish, etc. The second model described an emergent view: that employees were ordinary, and good human beings at work as much as they were at home or as citizens. The second perspective highlighted need for achievement, responsibility, creativity and understanding of others. Thus, they required internal control. These views had great impact when advanced industrial societies, especially the United States and Britain were flourishing. Moreover, they were into the second industrial revolution phase at this time new tasks, roles, and technologies were emerging. These changes required involvement, commitment, initiative and the good use of discretion at the bottom of the enterprise. This connection was not developed by anyone within the human relations approach. Nevertheless, a perspective of the human element of the enterprise developed that was incompatible with the machine theory of organization. No one tried to change the nature of the jobs themselves, which continued to be performed according to the principles of scientific management (Trist, 1968). There are number of accusations of Taylors scientific management for portraying negative image of human nature (1895a, 1895b, 1903, 1909, 1911, 1912). The main charge is that Taylor became too mechanistic, and too inhumane while describing human image. Taylorism received criticism since Taylor published his works on Scientific Management. Discussion The application of laws natural science on human beings and ethics had determined scientific ethics and human dealings. Human beings could not be predicted and their relations are extremely complex. It is utopia to treat human beings technically because
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of their diverse nature. Thus, it laid down the basis of objective organizations where humans were given objective without realizing their subjectivity. Materialism and race for money in the society eliminated the differentiation among the ways of distinguishing good, evil, right and wrong. Enigma of right and wrong had created loss of identity and produced relativism. The real differentiation of right and wrong was replaced by idea that everything could be right and wrong that depends on situation and beneficial ends. So Scientism has created lines between profession, organization and personal life. It had given dual roles, dual personalities, dual communication, and thought. The fruit of this dualism was confusion, frustration and enigma. It required a lot of compromise, and in this scenario, basically an individuals ethics were compromised. Scientism had really affected the values of human beings. The notion put forward is not to describe that science has dominated human beings but to highlight the fact that man has surrendered humanity, values and ethics in front of science. The central element in organization is people. Their growth and development are significant for organizations. The development refers to employee participation in administrative tasks which equip the employees with skills to handle complex situations. These situations are challenge for employees and stimulate learning capacity. Employees experience sense of ownership when they are given empowerment of decision making, participation and suggestions. According to the designation, position and the nature of job the people should be allowed to make necessary decisions. Scientism restricted intuition, logic and thought processes by restricting human beings to perform monotonous tasks. These tasks made employees skilled but their abilities of thinking analytically, problem solving skills, decision making abilities were Inflexible rules and structures not only bound activities of human beings but also their imagination, creativity and the capacity to face unexpected and uncertain situations. So the scientific management is potentially dangerous for dynamic efficiency and human betterment. Progress subsumes enthusiasm, health, creativity, opportunities for taking initiatives, and versatility. This offers a crystal contrast with rigidity, inflexibility, standards and orders. The application of science on policies makes them calculated and limited. Through the application of science the policy leaders and diplomats get scientific knowledge, scientific methods and scientific mind while replacing the emotional grounds. Policy making requires broad reasoning, vision, logics and perspectives to know the problems and issues at national and organizational level. The core elements of policy making are opinions, debates, suggestions and values. It requires involvement of people. Moreover, Policies are made for the people either at national level to solve issue or at organizational level to achieve strategic objectives. Human beings are different from each other so their interest and work values differ too. These values are moral principles that support to set the priorities. Human relations or co workers interactions provide the opportunity to display their emotions which is lacking in scientifically managed organization. The quality communication between supervisor and employee is significant not only for performing the job but also for creating healthy environment. It mitigates the status quo and class differentiation. The healthy peer relationships establish harmony in the organization. Further, It leads to emotional attachment with the group and organization. These interactions make the work meaningful and give the sense of belongingness to employees.
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The employees were driven through objective laws. So the extrinsic features of human nature replaced the intrinsic satisfaction, pleasure and happiness. The emphasis on tangible aspects gave rise to artificial hollow and trivial features of work. It made humans greedy and voracious for money. It thoroughly ignored the intrinsic and psychological aspects of employees which make the work virtuous. Consequently, The scientific society reflects dual society, one side represents the efficiency in production, higher wage rates, and managerialism , higher status , economically wealthy society however the other side of this society reflects moral decay, materialism , escape from social responsibility, no division between sacred and profane, accumulation of wealth, workaholics, secularism, loss of identity, and denial. Further, impersonal and mechanical ways of work has destroyed ethical value of work. The fair compensation and attractive wages are favorable tangible benefits but work subsumes ethical values reflect devotion, peace and beauty of human beings. Jobs require interest excessive specialization made the jobs dull and monotonous. Wage system gave rise to uncertainty and insecurity. Though machines made by the man produce more but efficiency of man is reduced. Conclusion The above discussion highlighted that Taylors philosophies of scientific management and their effects on human beings, their relations and organizations. Scientific management had given massive production, economies of scale, and cost effectiveness. The narrow focus of job and more significance to technology had created mere machines and mechanical life where only materialism prevailed. The working environment got deplorable within the firms because of lack of imagination, inflexibility, and rigidity. Bureaucracy created distance between employees. They got deprived of healthy feedback. There was no place for innovation because of fixed rules. Human imagination was confined to work in boundaries. It deteriorated human beings morally through extensive race, greed, materialism, status consciousness, tangible benefits and competition.
Practical Implications The new system portrayed managers as good people without self interest. This notion provides insight in to managers roles about their self interest and opportunistic behavior while dealing with workers has practical implications for management consultancy, management education, and for the practice of management in general. Students and practitioners may be informed model of self-interest. Moreover, it is significant to balance the role of manager and worker. It may be incorporated in managerial training to let workers imagine to equip with problem solving and decision making skills that is necessary for long term perspectives. In addition, it may provoke thought for the practitioners that theories and practices suitable for one region may need to be validated before implementation in the other regions according to context, standards, and conditions.
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Agility in Knowledge-Base Enterprises and Agile KM; A New Approach to Survey Importance of Reciprocal Impact between KM & Agility Seyed Mahmood Zanjirchi (Corresponding Author) Assistance Professor, Faculty of Economics, Management & Accounting;, Yazd University, Yazd, Iran Sayyed Hassan Hatami Nasab Industrial Management (MA), Jadad University Higher Education Institute of Yazd, Yazd, Iran
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The purpose of this paper is to describe some experiences with the implementation of knowledge management techniques in an agile organization development department. Based on a comprehensive literature review, the paper identifies six main knowledge management challenges faced by global business today. Then, the challenges are discussed in relation to managerial practice. The paper argues that developing a working definition of knowledge, dealing with tacit knowledge and utilization of information technology, adaptation to cultural complexity, attention to human resources, developing new organizational structures, and coping with increased competition are the main knowledge management challenges faced by global business today. Suggested implications include a more significant managerial emphasis on considering and dealing with the knowledge management challenges in a holistic manner, taking into account all internal and external factors influencing the knowledge-management process. Keywords Knowledge Management (KM), Agility, Agile Product, Knowledge-Base 1. Introduction The problem of how organizations can successfully deal with unpredictable, dynamic, and constantly changing environments has been a prevailing topic both in industry and academia for a few decades. Many different solutions have been proposed: networking, reengineering, modular organizations, virtual corporations, high performing organizations, employee empowerment, flexible manufacturing, just-in-time (JIT), etc. Among proposals of how to deal with an uncertain and unpredictable environment, the three notions of adaptive organization, flexible organization, and agile enterprise are the most predominant and popular. There are many different approaches to define each of these terms and there is much ambiguity concerning definitions and components of each of these concepts. Some authors make a sharp differentiation between those concepts while others use them synonymously. In general all concepts were considered as possessing the ability to adjust and respond to change (Sherehiy et al., 2007). Research on how organizations cope with uncertainty and change using the term adaptivity, investigated how the organizations form, structure, and degree of formalization influenced the ability to adapt (Burns and Stalker, 1961 Hage and Aiken, 1969; Hage and Dewar, 1973). In the 1980s, the research was more focused on the organizational flexibility. Reed and Blunsdon (1998) describe organizational flexibility as an organizations capacity to adjust its internal structures and processes in response to changes in the environment. In order to survive in the currently competitive and global business environment, most enterprises are struggling to change their existing business processes into more agile, product- and customer- oriented structures. In the dynamic business environment of today, maximizing and optimizing business performance is a critical requirement for maximizing business profitability and for returning shareholder value (Ballard et al., 2005). Among many enterprise assets, knowledge is treated as a critical driving force for attaining enterprise performance goals because knowledge facilitates the better business decision makings in a timely
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fashion. Knowledge management (KM) characterizes a systematic approach to ensure the full utilization of the knowledge base of an organization (Han & Park, 2009). However, since knowledge is created and utilized during the execution of business processes, if knowledge is separated from the business process context, it does not lead to the ability to take the right action for target performance. Similarly, because enterprise performance is achieved through the execution of business processes, business process and enterprise performance are closely interrelated (Han & Kang, 2007). Therefore, the successful and sustainable growth of an enterprise requires an enterprise to measure, improve, and manage its performance with respect to its processes. So, in order to achieve a higher performance, knowledge should be attached to the executed tasks, and participants must capture knowledge as part of their normal work. Consequently, knowledge must be embedded in business processes. This realization has created the necessity for process-centered knowledge management (PCKM) (Han and Park, 2009). 2. Agility The review of research on flexibility by Volberda (1996) and De Toni and Tonchia (1998) show that most of the definitions of the flexible organization emphasize the ability to adapt and respond to change. In the beginning of the 1990s, the new solution for managing a dynamic and changing environment emerged - agility. According to Gunasekaran (1999), agile manufacturing (AM) is the ability of surviving and prospering in a competitive environment of continuous and unpredictable change by reacting quickly and effectively to changing markets, driven by customer-defined products and services. Kidd (1994) defined agility as a rapid and proactive adaptation of enterprise elements to unexpected and unpredicted changes. Goldman et al. (1995) defined an agile organization as one that is capable of operating profitably in a competitive environment of continually and unpredictably changing customer habits. Dove (1996) subsequently segmented the concept of agility in to four dimensions, cost, time, quality, and scope. According to him, the agility of an organization comprised of a perfect balance among those four dimensions. Another early definition of agility included the ability to market successfully low-cost, high-quality products with short lead times and in varying volumes that provide enhanced value to customers through customization (Fliedner and Vokurka, 1997). Further definitions of agility were provided by Goranson (1999), Yusuf et al (1999), Dove (1999, 2001, 2005a,b), Sambamurthy et al (2003), Menor et al (2001) and Mathiyakalan et al (2005) among others. The creators of agility concept at the Iacocca Institute, of Lehigh University (USA) defined it as: A manufacturing system with capabilities (hard and soft technologies, human resources, educated management, and information) to meet the rapidly changing needs of the marketplace (speed, flexibility, customers, competitors, suppliers, infrastructure, and responsiveness) (Yusuf et al., 1999). Yusuf et al. (1999) proposed that agility is the successful application of competitive bases such as speed, flexibility, innovation, and quality by the means of the integration of reconfigurable resources and best practices of knowledge-rich environment to provide customer-driven products and services in a fast changing environment. Despite the differences, all definitions of agility emphasize the speed and flexibility as the primary attributes of an agile organization (Gunasekaran, 1999; Sharifi and Zhang, 1999; Yusuf et al., 1999). An equally important attribute of agility is the effective response to change and uncertainty (Goldman et al., 1995; Kidd, 1994; Sharifi and Zhang, 2001). Some authors (Sharifi and Zhang, 1999) state that responding to change in proper ways and exploiting and taking advantages of changes are the main factors of agility. The next common component of published definitions of agility is a high quality and highly customized products (Gunasekaran, 1999; Kidd, 1994; Mccarty, 1993; Tsourveloudis and Valavanis, 2002). As the brief overview of the agility definitions shows, this concept comprised both characteristics of adaptability and flexibility. It seems that these two terms represent the evolution of the idea of the organization or enterprise that is able to adjust. The agile enterprise/organization may represent the
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latest stage of development of this idea, which could combine all important notions from the adaptive and flexible organization concepts. Although, studies on agility utilize some ideas and practices related to the adaptive and flexible organization, many important developments on this topic from the organizational and management field were overlooked. In order to clarify the agility concept and to categorize the large diversity of strategies, techniques, and practices that are mentioned in the literature as components of agile enterprise need to have their origins investigated. In order to synthesize the agile enterprise concept, important knowledge related to managing the unpredictable and changing environment needs to be reviewed. 2.1. Knowledge-Base, one of core concepts of agile manufacturing Yusuf et al (1999), definition takes cognizance of the four main concepts of agility. It is increasingly being recognized that there are four key concepts for agile competition. These concepts include competition based on core competence management, virtual enterprise formation, capability for reconfiguration and knowledge-driven enterprise. The interactions of these four concepts are illustrated in Fig.1 these concepts are discussed in detail in the following section. Insert Fig 1 Here. The core concepts of agility 2.2. Core competence management Core competence may be associated with the corporation's workforce and product and identified at two different but related levels, the individual and the firm. The core competencies of individual include their skills, knowledge, attitude and expertise (Kidd, 1994). Through investment in training and education the core competencies of individuals within the enterprise can be upgraded and re-focused to take advantage of current and potential trends in customer requirements. Kidd (1994) and Goldman et al. (1995) have described people as the critical resource of an organization. Prahalad and Hamel (1990) stated that people are the competence carriers. The work of Prahalad and Hamel (1990) on core competence is uniquely outstanding. According to them core competence derives from corporate wide learning process, integration of diverse skills and streams of technologies, work organization, creation and delivery of value and capability for inter-organizational cooperation. 2.3 Virtual enterprise The virtual enterprise is deferent from the traditional corporate alliance. Fig. 2 presents three levels of cooperation among enterprises culminating in virtual partnership. The first stage represents enterprises that have operated as isolated islands. In stage three agile organizations form virtual enterprises and cooperate both at the corporate and operational levels. Agile teams work across the company partners. This is the climax of cooperative venturing. It allows resources and diverse skills which are spread across disparate organizations to be harnessed and coordinated for manufacturing products, simple or complex, very quickly in accordance with customer specifications (Draaijer, 1992). Insert Fig 2 Here. Partnership development model (Jin et al., 2008) 2.4. Capability for re-configuration Agile enterprises can easily make a significant shift in focus, diversify, configure and re-align their business to serve a particular purpose rapidly as the windows of opportunities open. The key to that, Prahalad and Hamel [27] argue, is to develop a strategic architecture featuring a corporate wide map of core skills. This type of organization is well positioned to take advantage of speed, by getting to the market before competitors with new products, and proactivity, by providing the products that will be required by customers just before the need arises. Operational reconfiguration is necessary to capitalize on the strategic architecture. Management must invest in technologies that confer operational flexibility at the plant level. However, Goldman and Nagel [9] have cautioned against placing excessive premium
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on technology concluded that the notion that new technologies confer competitive advantage through some intrinsic properties that they possess is a fundamental misconception. 3.Knowledge-driven enterprise Kidd (1994) has broadly defined knowledge, with respect to manufacturing, to include experiences of people in the organization, company reports, case histories, databases and other repositories. Organizations which intend to become agile should include the development of a well trained and motivated workforce, with the right set of skills, expertise and knowledge, as an essential element of their strategies. Such organizations are driven by knowledge and information possessed by and available to the work force. This epitomizes the notion that knowledge is power. The concept of knowledge-driven enterprises derives from increasing recognition of knowledge and information as the main differentiators of successful business. The success of any organization ultimately depends upon its ability to convert the collective knowledge and skills of its most critical resource - people - into solution products. The use and manipulation of information, as a key competitive instrument has also revolutionized the way that we think about manufacturing and how we operate it. The ability to control the new product introduction process from the conceptualization and design stages through manufacturing to shipment and product support requires the exploitation of a knowledge-rich work force and sophisticated information technology in most industrial sectors. 5. Agility & KM Relationship According to Kidd (1994), the nature of the competencies implied by agility is such that they would be better considered as intangibles, similar to intellectual property, company specific knowledge, skills, expertise, etc. Recently, in data processing, relational databases and association rules have been widely used in support of business operations, and there the size of database has grown rapidly, for the agility of decision-making and market prediction (for varying degree of importance for agility evaluation) (Jain et al., 2008). Therefore, knowledge discovery from a database is very important for sustaining essential information to a business (Berry and Linoff 1997; Han et al., 2000). Naylor et al. (1999) go further in stating that agility means using market knowledge and a virtual corporation to exploit profitable opportunities in a volatile marketplace. According to Jin et al (2008), the more general aspects of agility applied to the supply chain-operating environment (market sensitive, process integration, network based, and virtual) show that open relationships between the supply chain participants, the sharing of knowledge in the form of information and the use of technology to create connectivity (i.e. ability for organizations to share information in real-time). Yusuf et al (1999) defined agility as a successful exploration of competitive bases (speed, flexibility, innovation proactivity, quality, and profitability) through the integration of reconfigurable resources and best practices in knowledge rich environment to provide customer driven products and services in a fast changing market environment (Yusufetal.,1999). The concept of knowledge management and responseability as being the two cornerstones of agility was further elaborated by Dove (1999) where he stated that the Agility = Response Ability + Knowledge Management. Agility and agile manufacturing are recent organizational development philosophies that industry and academia are studying (Sarkis, 2001). Prior literature has investigated agility and innovativeness as important knowledge capabilities (Sambamurthy et al., 2003; Cho and Pucik, 2005). Agility refers to the ability to detect and seize continually and unpredictably changing market opportunities by assembling requisite assets, knowledge, and relationship with speed and surprise (Goldman et al., 1995; Sambamurthy et al., 2003). Enterprise portals facilitate the creation and management of knowledge repositories and the exchange of information and experiences among employees, helping organizations to achieve internal agility (Bowman, 2002). According to Sambamurthy et al. (2003), agility can contribute to organizational performance through three ways. First, by responding rapidly to changes in customer demand, an agile company can enhance customer satisfaction and loyalty, leverage the knowledge embedded in customers and take the advantage of the windows of opportunities that appear in the market from time to time (Kidd, 1994; COPY RIGHT 2011 Institute of Interdisciplinary Business Research
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Goldman et al., 1995). Second, agility enhances organizational performance through building a network of extended partnership to leverage the assets, knowledge and competencies of suppliers, distributors, contract manufacturers, and logistics (Venkatraman and Henderson, 1998). Finally, the effects of agility on organizational performance are also realized by rapidly redesigning and streamlining the firms business processes to accomplish speed, accuracy and cost economy (Teece et al., 1997). In adopting and developing the key elements of agility, there is a requirement for enterprises to overcome the philosophical challenges of a shift from mass/lean production to the customization environment of agile manufacturing. There is a substantial body of knowledge supporting the use of alternative costing systems for operations and production management and particularly mass/lean production (Hooper et al., 2001). Liebowitz (2005) asserted that part of the possible failure of KM initiatives, or managements skepticism towards KM, is the result of the inability to develop metrics to measure KM success. Because KM deals with intangible assets, metrics may be more difficult to obtain than from other assets. However, for-profit and not-for-profit organizations are developing such metrics. Liebowitzs article contains a highly useful chart detailing KM performance measures developed by the U.S. Navy. He detailed key factors as to why organizations embark on KM initiatives under the general categories of adaptability and agility, creativity, institutional memory building, organization internal effectiveness, and organizational external effectiveness (Meyer, 2006, p.111). Agility has been hailed as the next generation manufacturing philosophy for companies competing in all sectors of the economy (Kidd, 1997). The term agility refers to the ability of an enterprise to develop and exploit its inter- and intra-organizational capabilities to successfully compete in an uncertain and unpredictable business environment. Projected as the replacement for the lean/mass production philosophy, agility has four prime tenants (Goldman et al., 1995): Total solution products. Products perceived as solutions to individual customer problems. Virtual organizations. Leveraging of resources through co-operation. Knowledge management. Leveraging the impact of people and information on company operations. Entrepreneurial organization. Development of flexible, innovative organizational structures. In adopting and developing these key elements of agility, there is a requirement for enterprises to overcome the philosophical challenges to the customization environment of agile manufacturing. The agile environment is focused on the delivery of total solution systems rather than the traditional product focus associated with the mass/lean production paradigm. This requires emphasis on pricing and marketing strategies based on customer value (Khalifa et al., 2008).
6. Conclusion Michael Zack (1999) asserted that explicit knowledge is becoming more important in organizations. He suggested that organizations face a fundamental challenge in determining which knowledge should be made explicit and which should remain tacit. Certain knowledge might not be. If knowledge is made explicit, it can be routinely integrated and applied. Some knowledge may be inherently in articulable; a balance must be maintained. Managers should not accept tacitness blindly. Process knowledge is more valuable at the explicable level. In order to survive in the currently competitive and global business environment, most enterprises are struggling to change their existing business processes into more agile, product- and customer- oriented structures. In the dynamic business environment of today, maximizing and optimizing business performance is a critical requirement for maximizing business profitability and for returning
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shareholder value (Ballard et al., 2005). Among many enterprise assets, knowledge is treated as a critical driving force for attaining enterprise performance goals because knowledge facilitates the better business decision makings in a timely fashion. Knowledge management (KM) characterizes a systematic approach to ensure the full utilization of the knowledge base of an organization (Han & Park, 2009). In an agile and flexible enterprise structure, process is a core element of business operations. Therefore, business process utilizes knowledge during the process execution (Han & Park, 2009). By attend to ordained individual and organizational KM important to achieve suitable agility level in modern organizations that are themselves items to success and survival, thus scientific surveys between these important organizational items (KM and agility) must be as research preferences. These researches can feature new portal in support practices and organizational agility promotion, and would create more focus on goal in firms competition and growth way.
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Refrences
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Han, K. H., Park, J. W., (2009), Process-centered knowledge model and enterprise ontology for the development of knowledge management system, Expert Systems with Applications 36, pp. 7441 7447. Hooper. M. J., Steeple. D., Winters. C., (2001), Costing customer value: an approach for the agile enterprise, International Journal of Operations & Production Management, Vol. 21 No. 5/6, pp. 630-644. Jain, V., Benyoucef, L., Deshmukh, S. G., (2008), A new approach for evaluating agility in supply chains using Fuzzy Association Rules Mining, Engineering Applications of Artificial Intelligence 21, pp. 367385. Khalifa. M., Yu. A. Y., Shen. K. N., (2008), Knowledge management systems success: a contingency perspective, journal of knowledge management, VOL. 12 NO. 1, pp. 119-132. Kidd, P.T. (1997), Agile enterprise strategy: a next generation manufacturing concept, Institution of Electrical Engineers, Digest No: 97/386. Kidd. P. T., (1994), Agile Manufacturing: Forging New Frontiers, Addison- Wesley, Reading, MA. Liebowitz, J. B., (2005), Developing Metrics for Determining Knowledge Management Success: A Fuzzy Logic Approach, Issues in Information Systems, Vol. 6, No. 2, pp. 3642. Mathiyakalan, S., Ashrafi, N., Zhang,W.,Waage, F., Kuilboer, J.P., Heimann, D., 2005. Defining business agility: an exploratory study. In: Proceedings of the 16th Information Resources Management Con- ference, San Diego, CA, May 1518. Mccarty. F. H., (1993), Agility in Manufacturing, Manufacturing Engineering 111 (6), p. 8. Menor, L. J., Roth, A. V., Mason, C. H., (2001), Agility in retail banking: a numerical taxonomy of strategic service groups, Manufacturing and Service Operations Management, 3 (4), pp. 272292. Meyer, M. D., (2006), Preserving and Using Institutional Memory through Knowledge Management Practices (A Synthesis of Highway Practice), NATIONAL COOPERATIVE HIGHWAY RESEARCH PROGRAM (NCHRP) SYNTHESIS 365, Transportation research board of the national academies, p.111. Prahalad, C. K., Hamel, G., (1990), The core competence of the corporation, Harvard Business Review, pp. 79-91. Reed. K., Blunsdon. B., (1998), Organizational flexibility in Australia, International Journal of Human Resource Management 9 (3), pp. 457477. Sambamurthy, V., Bharadwaj, A. and Grover, V. (2003), Shaping agility through digital options: reconceptualizing the role of information technology in contemporary firms, MIS Quarterly, Vol. 27 No. 2, pp. 237-63. Sarkis. J, (2001), Benchmarking for agility, Benchmarking: An International Journal, Vol. 8 No. 2, pp. 88-107. Sharifi. H., Zhang, Z., (1999), A methodology for achieving agility in manufacturing organizations: an introduction, International Journal of Production Economics 62 (12), pp. 722. Sharifi. H., Zhang. Z., (2001), Agile manufacturing in practice-application of a methodology, International Journal of Operations and Production Management 21 (56), pp. 772794. Sherehiy. B., Karwowski. W., Layer. J. K., (2007), A review of enterprise agility: Concepts, frameworks, and attributes, International Journal of Industrial Ergonomics 37, pp. 445460.
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Toni. D. A., Tonchia. S., (1998), Manufacturingflexibility: a literature review, International Journal of Production Research 36 (6), pp. 15871617. Tsourveloudis. N. C., Valavanis. K. P., (2002), On the measurement of enterprise agility, Journal of Intelligent and Robotic Systems 33 (3), pp. 329342. Volberda. H. W., (1996), Toward the flexible form: how to remain vital in hypercompetitive environments, Organization Science 7 (4), pp. 359374. Yusuf, Y. Y., Sarhadi, M., Gunasekaran, A., (1999), Agile manufacturing: the drivers, concepts and attributes, International Journal of Production Economics, 62 (1), pp. 3343. Zack, M. H., (1999), Managing Codified Knowledge, MIT Sloan Management Review, Vol. 40, No. 4, pp. 4558.
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Annexure
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Fig.1. the core concepts of agility Core Competence Management
Virtual Enterprise
Agile Manufacturing
Capability of Reconfiguration
Knowledge-driven Enterprise
Fig.2. Partnership development model (Jin et al., 2008) Functions Enterprise Level 1: Enterprise as Island Functions Enterprise Level 2: Enterprise Level Co-operation Functions Enterprise Functions Enterprise
Functions Enterprise
Functions Enterprise
Level 3: Cooperation at Enterprise and Functional Levels Island
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The Study of Relationship between Organizational Structure and the competency of experts in Iran national Gas Company
Dr.Amirkhani.Amirhossein PhD, Instructor of management department of Payam-e Nour University (Iran) Nazarhasan Abad. Raana MA student of Payam-e Nour University (Iran) The current research was conducted through the help of Iran national gas Company
Abstract The current research is mainly aimed at studying the relationship between the organizational structure and the psychological competency of experts working in Iran national gas Company. The aspects of organizational structure were hereby studied in view of Robins perspective in three aspects named formality, centralization and complexity as independent variables and the psychological competency as a dependent variable. They all were put under consideration based on Speritzer studies in five aspects named eligibility, meaningfulness, effectiveness, independency and trust. The research method is of descriptive kind and the analysis method is of correlation one. Then a key question is raised. To answer the mentioned question, three hypotheses are being considered. The data are collected through standard questionnaires and analyzed based on both descriptive and inferential statistics. First, the research variables are being tested through descriptive statistical methods. A software named SPSS is applied to analyze the descriptive data but for analyzing the inferential data, another software named LIZREL is used. In case of descriptive statistics, statistical factors such as frequency, percentage, Mean , Standard deviation are being thoroughly considered. In case of inferential statistics, structural equation modeling is being applied. Key words: Organizational Structure, Psychological Competency, Formality, Complexity, Centralization 1. Introduction There have been great attempts on developing the organizations which were mainly concerned on issues including the reduction of hierarchy and bureaucracy, the establishment of a potentially active group and taking part in decision-making process in the lowest organizational level. The innovation of public organizations and their gradually increasing trend towards Outsourcing and decentralization due to the lack of flexibility in traditional structures made a great challenging change in which the role of employees and the need to make them as most competent as keys to reduce the size of the organization and enhance the services delivered to the customers have been hereby affected (Abdollahi and Nouh Ebrahim, 13; 1386). The competency concept is considered being a part of widespread changes we see in industries nowadays. The number of state personnel may expose to reduction, some level of management are omitted and the total number of the employees will reduce consequently and what is remained is a smaller organization with fewer employees who are essentially required to do more than before (Shermerhoun and others, 200:1386). The competency isnt simply a personal or group effort. The organizational structure, policies, values, culture and insentives are the factors which are highly potential in strengthening the personal or group behavior. The change of these structures is what everybody is looking to achieve. Your authority as a manager is limited. To question about and involve in organizational structure, you are essentially required to take risks (Eskaf vejaf 1991 as quoted from Iranjad Parizi 130:1383). Since the organizational structure verifies the way of communication, decision-making position and the way to provide and deliver reports and hierarchy, the whole features of an organization can be shown if it is best recognized. Considering the cases such a structure defines and verifies, the presence of a structure eligible with the goals and needs of organization is quite essential because all
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management decisions on planning, organizing, coordination and control are finally being implemented on the structure. So, such a structure is essentially required to be so eligible so that it can accomplish the decisions made. Here, it is required to design a highly efficient structure. Some organizational structures are designed in a way the organization cant adopt itself to the changes seen in strategy or the environment and also the other factors affecting the structure. In such conditions, the managers attempt on restructure the organization. Restructuring the organization is a radical change which may worse the relationships existing in that organization. So, it is essentially required to direct that change in a way to be positive and lead to enhanced situations in the organization. Such a change should be acceptable in view of the employees too. That is to mention, the organizations have their own special policies, principles and authorities. Some permanent functions are being repeatedly performed in this structure. Such a competition-based situation may expose to change when the quality and quantity-based Improvement of goods and the development of the networks are required. In such a condition, it is essentially required to design a highly efficient structure (Farahani. Harabadi, 54:1384). That is to mention, people who closely cooperate with each other are considered being as valuable Investments to the organization. The managers are essentially required to encourage their employees and prefer the benefits of the organization to their own benefits. Sometimes it is said the competent people can make the organizational structures as most efficient and competent but it may not be true (Rezaeean, 367:1380). 2. Statement of the problem and the importance of the research The competency of the employees is considered being as an important organizational issue. It may increase the employees competencies in responding to the great changes happening in working environments due to new attitudes and ideas (Li Chun Chang & Chieh Hsing Liu 1442:2008). In case of new organizational environments which are described with phrases such as complexity, confusion and fast changes, the employees are essentially required to be flexible, independent, innovative, responsible and creative and look for freedom of action. In organizational structures and management techniques, there should be some potential changes in a way all the employees are being involved in decision-making process, working groups are established, more authorities are given to the inferior employees and the hierarchy-based structure is being replaced by network-based organizational structure. Under such conditions, the organizations are required to be more flexible and dynamic. The managers are also required to thoroughly consider their employees interests and decisions. The employees are essentially required to consider themselves as belonged to the organization (Abdollahi and Nouh Ebrahim 12:1386). Competency is a new concept really concerned by many researchers, instructors, experts in organizational psychology and management official. That is to mention, this concept is of highly potential effect on the organizational and managerial efficiency and effectiveness. The competency of human resource can be considered being as a new technique to motivate the employees, drive their internal force and pave the way for new opportunities, talents and eligibilities to be hereby developed. It mainly starts with introducing some potential changes in the employees believes and attitudes. They are essentially required to believe they are enough competent and eligible to successfully perform a task. They should believe they have freedom of action and independency in performing a task given to them. They also should believe they can impact on the occupation-based results. They also believe that they are looking for meaningful and valuable goals. They also should believe they are being treated honestly and frankly. As they think of the job and the organization in such ways, a lot of organizational and personal benefits will be consequently achieved such as flexibility, creativity, problem-solving, job satisfaction, job functions with high quality and good health. Besides, the competent people are selfcontrolled. They simply accept their own responsibilities and think positively about themselves, others and the environment they are working. They are really optimistic about the job life and basically consider others being as their partners and colleges not as rivals. They strongly seek to find a solution as a problem occurs in job situations. They are never indifferent to such problems and never complain about it. They truly accept the criticisms and are always learning new concepts (Abdollahi and Nouh Ebrahim, 799:2010). Cognition-based competency is considered being as a factor influenced by the environment and organizational and personal factors. As an influential factor, it can potentially impact on the efficiency and innovation of an organization (Khalil Safari and colleges, 799:2010). Due to the
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importance of psychological competency as one of the most important factors leading to successful competency and cooperation-based process in decision-making stage, it is essentially required to verify the conditions affecting this variable (Harabadi Farahani, 4:1384). Considering the fact Iran national gas Company is one of the four main companies belonged to the ministry of oil and has crucial role in providing the resources and facilities required such as qualified and expert human forces with theoretical and scientific knowledge, it is essentially required to thoroughly consider the human resource and their competency as first priority. In such a way, the company will be thoroughly supported to achieve the assigned national and international goals which are the customer satisfaction and the maximum level of efficiency. The aspects of organizational structure including formality, centralization and complexity are considered being as managerial tools the official in charge can apply to achieve such goals. So, the study of the relationship between each of these organizational structures and the competency of the employees is of potentially high importance. 3. Theoretical concepts 3.1. Competency in view of psychology Recently a multidimensional concept of competency was considered by the related experts. They considered the competency being as analyzed behaviors and cognitions. Such a definition is mainly focused on personal experience (Thomas and Velthaves, 1990 as quoted by Khalil Safari and others, 799:2010). Based on this concept, psychological competency includes a vital thought of personal psychology in his/her working environment. It can be summarized in five factors: meaningfulness, eligibility, effectiveness, self-recognition and trust (Speritzer, 1995). 3.1.1. The meaningfulness of an occupation: It can be considered being as an opportunity by which people think they are following an important and valuable goal. They also think they are going through a road their time and internal force are considered being potentially valuable (Appelbeum & Hanger, 34:1998). 3.1.2. Eligibility: It is considered being as a belief expressing the skills and competencies a person required to accomplish a task as best (Fock et al and others 2:2010). 3.1.3. Effectiveness: The competent employees strongly believe they can have crucial role in achieving the goals assigned through performing the tasks as best. They also have control over the occupationbased consequences; have considerable effects on what are happening around and control the limitations and barriers (Speritzer, 1995 as quoted from Lussier, 9:2002). 3.1.4. Independency: The competent employees feel they are independent in performing the tasks assigned. They can make decisions about their own activities. They are also given authorities required to decide what, how and when to do the tasks assigned to them (Vecchio, 16:200). 3.1.5. Trustfulness: It can be considered being as knowledge or insight by which the trustee gets motivated to perform a task he/she is committed to. The competent people strongly believe they are behaved fairly and honestly. They also believe the final consequences of doing a job are quite good and valuable. On the other hand they feel self safety (Atkinson & Butcher, 7:2002). Recently, Menon proposed an efficient technique which best describes the psychological effect of competency functions such as transforming the authorities, imagining the increased efficiency and emphasizing the valuable targets. He defined the psychological aspect of competency as a cognition-based one which is projected through goal internalization, perceived competence and perceived control. The goal internalization is an independency feeling which shows the competency of people to perform a task based on their own abilities. The perceived competency includes some believes on authority, independency and the extent of decision-making which best cover the competency-based operations such as transforming the duties and authorities and increased level of cooperation (Erturk, 413:2009). The competency of the employees can be considered being as a key to verify the quality of services and consequently meet the customers needs as best. It mainly applies the employees perspectives and comments to meet the customers need and settle down their problem. In such a way, the quality of services and the customers satisfaction will gradually increase. For example, it can develop the employees independency-based competency as best. In case of making comments, the employees are allowed to make decision about the best ways to deliver services to the customers. Competency may also lead to more compatible and flexible employees. The employees can accommodate the customers need through competency. In such a way, high quality of services will be achieved. The competency can be considered being as a perquisite successful quality-based innovations. It has to be coagulated with
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delivery services processes in order to meet the customers needs as most efficiently. The employees will do well in their tasks if they are competent (Sioucho and others, 483:2006). The main features of competent organizations can be summarized as follow: 1- The competent employees 2- Close concentration on the tasks and functions assigned 3- Real working groups (based on the synergy principle, the establishment of efficient working group will bring about more outputs compared with single group. 4- Visible and real leadership 5- Good and effective communications (the researches best show the open communications are considered being as the first step to make the people competent) (Ahmadi and others, 285:1389). The competent organizations have cultures and structures which may facilitate and encourage the competency-based processes. They have flat structures which require less middle management than traditional organization since the decision-making process is put upon the inferior positions. The top managers are essentially required to spend less time on supervising their inferior officials in order to mainly focus on meeting the customers needs and market share. The people are themselves managers and so the control and management area will be more extensive. The managers are considered being as the facilitators and supporters who best help their inferiors to be more helpful (Lashli, 11:2001). 3.2. Organizational structure The organizational aspects and dimensions best reflect the special features of and organization. They describe the organization in the same way as the personality, behavior and visible features of a person reflect the person (seyed javadin, 18:1381). In organizational structure, it is highly important to know about the dimensions of the organization and its role and significance. These aspects are divided into two categories named structural and conceptual, which both considered being as the internal features of an organization (Najaf beigi, 124:1387). To Robins, factors such as complexity, centralization and formality are more efficient and helpful in establishing organizational structure and consequently controlling as best out of other related dimensions and aspects. They are considered being as the main aspects of an organization (Najaf Beigi, 125:1387). If the members of an organization are trained so that they can manage to self-controlled affairs and make best decisions about public issues, the organizational affairs will be in lowest level in view of formality. As the members of an organization best show that they cant make appropriate decisions and need to know a lot of rules and principles, the organizational affairs will be more formal. By formality, it is meant to control over the person doing a task (Hall, 107: 1384). The nature of formality is a level of rules and principles for the employees, depriving them from encouraging the creativity, self-controlling and learning. In case of organizational theory, high formality will be juxtaposed to the low formality. On the other hand, the high formality related to the mechanical structure and the low one to the organic structure (Nahm and others, 286:2003). In case of hierarchy of authorities, the centralization refers to high level of authority with highly efficient decision-making competency. As a decision is made in a high level of an organization, the organization is called a concentrated organization. As a decision is made in a low level of an organization, it is called non-concentrated organization (Deft, 30:1998). The complexity refers to the level of divisions in an organization. The horizontal division best shows the horizontal division degree between parts. The vertical one also best shows the depth or height of organizational hierarchies. Division based on geographical areas refers to the dispersion of the parts, facilities and human forces. The organizations have different structures which are applied mainly based on the conditions of that organization. To Estaker and Boronz, the most efficient structure is considered being the one adopting itself to the environment around. Generally, the structure of an organization can be divided into two mechanical and organic structures. The mechanical structures are considered for predictable and nonchanging environments and the organic one for changing ones (Gersov & Drazin, 2007). The mechanical structure of an organization is usually recognized by features including the complexity, high formality, and decentralization as well as planned behaviors in form of known principles. In such a known structure, the manager is mainly relied on the policies of the organization and may not immediately respond to unpredictable events (J.Miham et al and others, 2010). On the other hand, the organic structure is flexible and people can penetrate into this structure based on their level of
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knowledge and insight. The duties in mentioned structure are also flexible and mainly emphasize on information exchange. Features such as non-concentrated authorities, less rules and principles, unofficial communications and concerns on self-controlled aspects provide conditions required for organic structure to be more compatible with the environment ( March & Simon, 2009). In his researches, Lorain Powel emphasized that the organic structures provide better conditions for establishing and implementing the psychological competency due to having features including flexibility, being dynamic, freedom in action, being active, concerns on eligibility and etc. this isnt true about the bureaucratic and traditional structures. Such structures have limited conditions to establish and implement the psychological competency due to features such as high and strong formality, centralization on decision-making, extreme work division, limitations on employees comments, failure or weakness in performing the tasks given and etc (Vaezi & Sabzikaran, 165:1389).
3. Methodology
3.1. Research purpose The mentioned research is mainly aimed at studying the relationship between the organizational structure and the cognition-based factors. The main research question: Is the relationship between the competency of employee and the organizational structure of Iranian national gas company? 3.2. Research hypotheses 1- There is a meaningful relationship between the factors required to recognize the competency of Iranian national gas company employee and the formality. 2- There is a meaningful relationship between the factors required to know the competency of Iranian national gas company employee and the centralization. 3- There is a meaningful relationship between the factors required to recognize the competency Iranian national gas company employee and the complexity. 3.3. Research method In view of the goal, the sort of research is of applied one. The research method is of descriptive correlation sort. In this research, structural equations technique was applied in inferential statistics. 3.4. Data and information-collecting tools To extract the information required, both field and library-based methods were used. In case of fieldbased method, the questionnaires were chosen as the best and most suitable ones following studying different methods and asking for the instructors in charge. To study the variable of structure, Robbins standard questionnaire was used and Speritzer standard questionnaire for studying the competency. In case of library-based research method, a set of valuable management papers extracted from internetbased scientific sites, scientific magazines, PHD and MA thesis and the books related to the mentioned subject. 3.5. Participants and statistical sample The participants attended in the mentioned research include the employees of Iran national gas Company in 1389 which are 45 ones. We applied the simple random sampling a number of 160 questionnaires were distributed among the participants. Having collected the questionnaires, a number of 95 ones were finally considered being suitable. Then the information was all entered into the Spss software to be thoroughly analyzed. 3.6. The analysis of the research hypotheses through inferential statistics To test the hypotheses and make inferences on the participants attended in, structural equations modeling (SEM) was applied. Considering the mentioned hypotheses, the research conceptual model was established based on the figure 1. Then the following steps were taken: 3.6.1. The first step: the assessment and validity of the whole research model This research is mainly aimed at answering the following question; does the mentioned research model have potential consequences? To answer the mentioned question, different criteria like x2 or x2/df can
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be applied. Figure 2 best shows the research whole model (measurement model and structural model. It reflects the relationship between a factor and its related components in measurement model and also the relationships among the components in structural model along with their standard efficiency levels. Some of the statistics achieved are not well-defined and consequently are rejected due to the lack of efficiency. In order to enhance the mentioned model efficiency, some modifications were taken into account. The modification of a model is mainly accompanied by measurement model which is the relationship between a factor and its components. The T value is considered being as one of the most common way to measure the validity of the factors involved. So, values between 2 and -2 with error rate as equal to 5 shows the factor isnt meaningful and therefore can be rejected. In such a way, not only the validity of a model but also the value of it will be hereby increased. Figure 2 shows the research modified model (measurement model and structural model). As seen in table 1, all efficiency-based criteria in the modified model was more developed compared with the basic model in a way the modified model is of adequate efficiency. It is mainly due to the fact it has all factors required to be accepted such as the rates of CFI and NNFI which are over 90%. Having thoroughly considered the results achieved, it can be concluded the modified model is best suitable for testing the research hypothesis, that is, the relationship among the components involved in structural (conceptual) part of the model. 3.6.2. Second step: the evaluation and validity of research measurement model To evaluate the research measurement model, it is first essentially required to measure the dynamism. Convergent justifiability happens when all the factors required for measuring a variable have meaningful loadings in view of statistics. Considering the modifications taken in first step, the remaining factors to be measured in error rate as equal to 5% were meaningful which best reflects the validity of strong convergence in measurement model. To measure the efficiency of the factors involved, the number of factors available in modified model along with the efficiency rate of each component were presented in the table 2 as extended. Based on the results achieved from the mentioned table, all components available in research model except the complexity one are in suitable condition in view of internal adaptation or efficiency. It is mainly due to the fact their Alpha rate is considered being in acceptation area (over0/6). 3.6.3. Third step: testing the research hypothesis (the assessment and validity of research structural model). Having approved the validity of the measurement model and accuracy of factors related to the complete efficiency of the mentioned model, the assessment f structural model was taken into account to be started afterward. In general, as T value is over 2 or 2.576, the relationship between two components in error rates 5% and 1% respectively will be statistically meaningful. The summary of results on testing the research hypotheses are presented in the table 3. In this table, the column for correlation coefficient reflects the level of relationship between two components in research conceptual model. In fact, the effectiveness coefficient shows the relationship between two variables. The column for meaningful figures is related to each correlations involved in. as mentioned earlier, the number of figure should be less than -2 or more than 2 to be meaningful. Therefore, out of three hypotheses mentioned in research model, only one was accepted and the other two were rejected based on the samples and the documents collected. Considering the results on testing the research hypotheses and the ones proposed in modified model, the research modified model and the one similar to that of figure 4 were hereby proposed. 3.7. The evaluation of the position of research model components The position of all research model components, competency-recognizing factors, complexity, formality and centralization are studied through T test based on a given rate (up to 3) in this section. As seen in the table 4, the rate of T test or all factors except centralization was over 3. As a result the Pvalue (possibility value) will be almost equal to 0. One the other hand, the mentioned organization is in pleasant condition in view of the participants attended in. that is to mention, the organizational structure is of high complexity and formality but the level of centralization is low.
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7. Discussion and inference
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In the current research we raised a main question and proposed some hypotheses to answer this question. They were all analyzed through descriptive and inferential statistical methods. it was finally approved there is no meaningful relationship between these two variables named complexity and psychological competency of the employees working in Iran national gas Company. Besides, there is a relationship between centralization and formality and also between the formality and psychological competency but not as strong because they are closer to 0 rather than 1 showing the strong relationship. 7.1. First hypothesis It is mainly related to the presence of a relationship between the formality and psychological competency of the employees working in Iran national gas company in assurance rate 95% with meaningful figure 2.44 and correlation coefficient .29 which was finally approved. Considering the mentioned hypothesis, the existence of relationship between the job description and the employees real concern to exactly follow the rules and principles which were generally defined as formality was hereby approved. On the other hand, the relationship between the formality and competency was finally approved. Based on the results on group T test, the rate of formality is high in this area. In order to pave the way for accomplishing the competency, it is essentially required to decrease the level of formality to approach the organic structure. 7.2. Second hypothesis The hypothesis on the presence of meaningful relationship between the centralization and competency of the experts working in Iran national gas company in assurance rate 95% was finally rejected. We hereby came to this conclusion there is a meaningful relationship between the centralization and formality with meaningful rate 46%. Since there is a relationship between the formality and the competency, it can be said the centralization is of indirect relationship with psychological competency through formality variable. On the other hand, there is a relationship between the centralization and the level of formality supporting the employees competency. So, the authorities of managers in low organizational levels in performing the tasks given, controlling the implementation of decisions by top organizational officials, their direct interference and collecting the information required for decisionmaking and changing the information collected by them which are generally called centralization have meaningful relationship with psychological competency. Considering the fact the organic structure required less centralization level, it can be said such a relationship is weak. On the other hand, lack of centralization exists in this area but not adequate. 7.3. Third hypothesis The hypothesis on the presence of meaningful relationship between the complexity and psychological competency of Iran national gas company in assurance level 95% was rejected. The results best show there is no meaningful relationship between the complexity and the employees competency. On the other hand, the number of job descriptions available, the level of training required, the number of levels or hierarchies between the top organizational officials and operational levels, the intervals between the areas and central office and also the number of personnel in each department and area which are generally called the complexity variable have no meaningful relationship with the psychological competency. Since the level and the amount of required training exists in the complexity aspect, it is essentially required to thoroughly consider it. That is to mention, it is first required to think about the training programs the employees need to acquire. So, the main research question mentioned earlier can be answered as following; since the first hypothesis wasnt accepted and reflected the meaningful relationship between the centralization and formality and also the results on the second hypothesis saying that centralization is of a relationship with psychological competency through formality, it can hereby concluded there is a meaningful relationship between the organizational structure and psychological competency of the experts and officials working in Iran national Gas Company. In fact, such a relationship is considered being weak and the company is required to thinks about new techniques and strategies to approach the structure as most suitable to making the employees competent. 8. Further research suggestions To increase the efficiency of the employees in the tasks given to them and enhance the ability to respond to the issues raised to increase the level of responsibility and consequently making them as
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most competent, it is essentially required to decrease the number of regulations and principles imposed and omit the ones interfering the helpful and effective relationship between people in order to finally establish a trustful and reliable atmosphere in working environment. Besides, such rules and regulations are to be flexible in increasing the ability and competence of a person in the task given to him and finally increasing the efficiency, agility and the freedom on the work they are doing. In order to verify the employees internal control over the tasks given and making them as most respondent and responsible and also reducing the barriers affecting their positive actions in accomplishing the tasks as well as making them competent, it is essentially required to decrease awkward and trivial rules and regulations and establish a relationship between such rules and the employees common goals and wishes. The rules and regulations are mainly aimed at creating job security for the employees. In order to establish a strong commitment among the employees, it is essentially required to consider some rules towards the employees common culture. It is also ordain some written rules and regulations to verify the limit of freedom and personally enhancing the activities related to the employees tasks. To increase the competence, it is essentially required to thoroughly consider the limit of formality, transforming the authorities and freedom and independency to the employees. It is also essential to decrease the direct centralization for strengthening the self-controlled conception and increase the indirect supervision and control for establish a responsibility and commitment atmosphere between the employees. Besides, the application of information technology is required to be increased to both achieve the centralization and decentralization together. It is essentially required to pay attention to the employees training programs and direct them towards the competency of the employees as most. In competent organizations, the employees are required to be more responsible and independent. So the training programs should be considered being as the integral parts of competency-based processes. Unplanned training should no longer be implemented. In fact, all attempts should be directed towards the organic structure.
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References 1. Ahmadi, Parviz; Safari Kahreh, Mohammad; Nemati, Somayyeh; (1389); the competencybased management of employees (techniques, strategies, models, plans and measurements), Tehran, Cultural researches center, first edition. 2. Eskat Sintia, Jhaf, Dennis (1383), competency, (Mehdi Irannejad Parizi), Karaj, management and training researches institute, second edition. 3. Harabadi Farahani Majid, (1384); the relationship between the structure and competency of the employees working in Parsian Bank, MA thesis, University of Tehran. 4. Deft Richard et al, (1388); the theory and plan of organization, (Ali Parsaeean and Seyyed Mohammad Arabi), Tehran, Cultural researches center, eleventh edition. 5. Robbins Stephen (1387), the basics of organizational behaviors (Ali Parsaeean and Seyyed Mohammad Arabi), Tehran, Cultural researches center, twentieth edition. 6. Robbins Stephen(1387), the theory of organization( organizational structure and plan), (Mehdi Alvani and Hassan Danaee Fard), Tehran, Saffar, twenty third edition 7. Rezaeean Ali, (1385), the basics of organization and management, Tehran, the organization for studying and editing the books on human science of Universities, Semat Pub, ninth edition 8. Rezaeean Ali, the principles of management, Tehran, the organization for studying and editing the books on human science of universities( Semat Pub), the research and development center of human science, twentieth edition 9. Seyyed Reza, Seyyed Javadin, (1381), the basics of organization and management, Tehran, Negahe Danesh Pub. 10. Shermerhoun JOHN.r, J.Hant, Jemez; Azbroun Richard; (1386), Mehdi Irannejad Parizi, Mohammadali Babaee Zekliki, Mohammad Ali Sobhanelahi, Karaj, management research and training institute, fourth edition 11. Bijan Abdollahi, Nouh Ebrahim, Abdolrahim(1386), the competency of the employees: the golden key of human science management, second edition, Tehran 12. Bijan Abdollahi(1383), designing a model for psychological competency of experts and employees working in science, research and technology ministry, PHD thesis psychology and educational science faculty of Tarbiat Mooallem University 13. Kinla, Dennis (1383), the competency of human resources (Mehdi Irannejad Parizi and Suleiman Masom Ali), Tehran, Modiran Pub. 14. Reza Najafbeigi(1386), the organization and management, Tehran, Termeh Pub, fourth edition 15. Hall Richard el(1384), the organization( structure, the process and strategies), Ali Parsaeean and Seyyed Mohammad Arabi, Tehran, cultural researches center, fourth edition 16. Reza Vaeezi, Sabzikaran Esmaeel(1389); the study of relationship between the organizational structure and the competency of employees in Iran national Oil Company, Tehran, change management research magazine, No3. 17. Appelbaum, steven H ., Hongger, Karen(1998)"Empowerment: a contrasting overview of organizations in general and nursing in particular-an examination of organizational factors, managerial behaviors,jobdesign,andstructuralpower".Journalof empowerment in organization. V 6 N 2 .pp.29-50 18. Atkinson ,and Butcher, D(2002).'Trust in managerial relationship". Journal of management psychology , Vol.18 ,no.4 19. chang c-L , Liu , C- H , (2008) , Employee empowerment , innovative behavior and job Productivity of Public health nurses: A cross sectional questionnaire survey , International journal of Nursing studies . pp1442 1448 20. Erturk, A (2009) ,"Exploring predictors of organizational identification moderating role of trust on the associations between empowerment ,organizational support , and identifications "European journal of work and organizational psychology 19 (14),pp 409-441 21. Fock, H and Chiang, F and Au,K, Y. H, and Hui, M, K. (2010)" The moderating effect of collectivistic orientation in psychological empowerment and job satisfaction relationship" International Journal of Hospitality,( IN PRESS) 22. Lashley.C (2001) "Empower ment: HR strategies for service excellence "First published ,Great Britain 23. Lussier,R (2002).Human Relations in organization, 5 Edition , McGraw- HiH Companies.
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24. Nahm . A. Y, Vonderembse . M . A , Koufteros . X . A (2003) The impact of organizational structure on time-based 25. Safari, KH. Rastegar, A. Ghorban Jahromi ,R (2010)"The relationship between psychological empowerment and 26. Siu Chow . I. H , Chun Lo .Th . W ,Sha. Zh , Hong. J(2006) The impact of developmental experience, empowerment, and organizational support on catering service staff performance 27. 11. Vecchio , R ,2000," Organizational Behaviou r",4Edition,Horcourt. 28. 12-Mihm. Jrgen, Loch. Christoph. H, Wilkinson. Dennis and Huberman. 29. Bernardo. A, (2010). Hierarchical structure and search in complex 30. Organizations, Management science, Vol.56, No.5, PP 831-848. 31. 13-March, J. and Simon, H, (2009). Organizations, Blackwell, Cambridge, 32. MA, PP 195-324. 33. 14-Gresov. C and Drazin. R, (2007). Equifinality: functional equivalence in 34. Organization design, Academy of management review, Vol.22, PP 403-428.
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Annexure
Figures and Tables
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Organizational Structure
Formality H;1 Centralization H;2 H;3
Psychological dimensions of t
Psychological dimensions of competency
Complexity
Figure 1: Conceptual Research Model
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0.99 0.91 0.70 0.57 0.40 0.44 0.61 0.71 0.56 0.56 0.53 0.54 0.99 0.69 0.70 1.00 0.99 0.84 0.92 0.24 0.78 0.99 0.76 0.91 0.53 0.41 0.98 0.77 0.99 0.86 0.90 0.79 0.47 0.63 0.87 0.54 Q01 Q02 Q03 Q04 Q05 Q06 Q07 0.11 Q08 Q09 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 Q19 FOR Q20 0.11 Q21 Q22 Q23 Q24 Q25 0.08 Q26 Q27 Q28 Q29 Q30 Q31 Q32 Q33 Q34 Q35 Q36 0.38 0.32 0.46 0.72 0.61 0.36 0.68 0.49 -0.30 0.69 0.77 0.15 0.48 CEN 1.00 0.30 0.55 0.66 0.77 0.75 0.62 0.54 0.66 0.66 0.69 0.68 0.11 0.56 0.55 EMP 1.00
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-0.01 0.11 -0.41 -0.28 -0.87 -0.47
COM
1.00
1.00
Chi-Square=888.60, df=588, P-value=0.00000, RMSEA=0.074
Figure 2: General model of research, based on standard amounts

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0.71 0.64 0.44 0.37 0.60 0.68 0.51 0.59 0.61 0.61 0.71 0.72 0.82 0.37 0.73 0.78 0.47 0.46 0.75 0.87 0.83 0.41 0.63 0.93 0.58
Q03 Q04 Q05 Q06 Q07 Q08 Q09 Q10 Q11 Q12 Q14 Q15 Q18 Q20 Q21 Q23 Q25 CEN Q26 Q28 Q30 Q32 Q33 Q34 Q35 Q36 0.36 0.42 0.77 0.61 0.27 0.65 1.00 0.47 0.72 0.74 0.50 FOR 1.00 0.43 0.80 0.52 0.53 0.60 0.75 0.79 0.63 0.57 0.70 0.64 0.63 0.62 0.54 0.53
EMP
1.00
COM
1.00
i-Square=316.27, df=265, P-value=0.01675, RMSEA=0.045

Figure 3: General modified model of research, Based on standard amounts
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Organizational Structure Formality

r =%46
Cognitive factors of competency item
r =%29
Cognitive factors of competency
Centralization Figure 4: Proposed Research Model
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Table 1: Fitness indicators of Comprehensive model of study Modified research model Statistics 2 =316.27 ,df =265 1.193 Primary research model Statistics 2 =888.60 ,df =558 1.511 Acceptability scale Desirability scale
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Fitness indicator 2
2 3df
0 2 2df
(Chi Square)
2
df
2 0
df
df
RMSEA 0.045 0.074 RMSEA 0.08 0 RMSEA 0.05 (Root Mean Square Error of Approximation) SRMR 0.090 0.11 SRMR 0.10 0 SRMR 0.05 (Standardized Root Mean Square Residual) NFI (Normed Fit Index) CFI (Comparative Fit Index) GFI (Goodness of Fit Index) AGFI (Adjusted Goodness of Fit Index) Hoelters Critical N
0.90
0.60
0.90 NNFI
0.95 NNFI 1.00 0.97 CFI 1.00 0.95 GFI 1.00 0.90 AGFI 1.00 Close to GFI
0.91
0.62
0.95 CFI
0.79
0.66
0.90 GFI
0.74
0.61
0.85 AGFI
91 N (of sample) N=95
67 N (of sample) N=95
Table 2: Status indicators in the research model dimension Psychological dimensions of competency Complexity formality centralization Sum Number of initial indicators 15 6 7 8 36 Alpha ratio 0.820 0.441 0.397 0.688 0.782 Number of existing indices 12 3 5 6 26 Omitted questions Alpha ratio 0.893 0.586 0.621 0.699 0.788
1,2,13 16,17,19 24,27 29,31 1,2,13, 16,17,19, 24,27, 29,31
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Table 3: Relationship between items of research Research hypotheses significance digit Cognitive factors of competency Organizational Structure The first hypothesis: Cognitive factors of competency formality The second hypothesis: Cognitive factors of competency centralization The third hypothesis: Cognitive factors of competency Complexity 2.44 1.74 -0.30 0.29 0.21 -0.04 accept Reject Reject Test values Correlation coefficient Result of test
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Table 4: The result of Single group T-test to research items Tested value = 3 Item frequency mean Standard deviation 0.52761 0.54881 0.47356 0.62415 Mean standard error 0.5413 0.5631 0.4859 0.06404 statistic Value 7.467 6.917 2.631 2.075 Degree of freedom 94 94 94 94 PValue 0.000 0.000 0.010 0.041 Mean variance
Cognitive factors of competency Complexity Formality Centralization
95 95 95 95
3.4042 3.3895 3.1278 2.8671
0.40421 0.38947 0.12782 0.13289
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IMPACT OF IRRIGATION ON THE CROPPING PATTERN ON THE COMMAND AREA OF CHASHMA RIGHT BANK CANAL (CRBC), IN DIKHAN. Dr Mahmood Shah Department of Economics, Gomal University, DIKhan, KPK Pakistan Malik Amer Atta Institute of Education and Research, Gomal University, DIKhan, KPK Pakistan Dr Muhammad Wasim Akbar Department of Mass Communication Gomal University DIKhan, KPK Pakistan Wajeehuddin Nouman AIR Gomal University DIKhan, KPK Pakistan Tahir Ullah Jan Institute of Education and Research, Gomal University, DIKhan, KPK Pakistan ABSTRACT
The paper examines the change in the cropping pattern due to irrigation in the Stage I and II of the CRBC. There is a significant change in the cropping pattern after CRBC. Generally farmers have deviated from the expected cropping pattern. More area is put under the cultivation of cash crops as sugarcane and rice. It shows that the cropping pattern has significantly changed after CRBC. There are also significant differences in the cropping pattern distributaries-wise and farm size wise. Data indicates large variations in cropping pattern of the same crop even in the same season. These variations in general are due to some general factors such as available water supply, soil type, farm size farmers awareness etc. Keywords: Impact ; Irrigation ; Cropping Pattern ; Command Area ; Chashma Right Bank Canal (CRBC); Dikhan.
INTRODUCTION The importance of irrigation in crop production as well as increasing agricultural productivity and cropping pattern has been widely recognized all over the world. It is rightly pointed out by Dhawan (1998) that in the world as a whole in this century irrigated agriculture has been a dominant source of growth of crop sector, more so of food grains. For the last 40 years, the trend was continued in many regions, including East Asia and South Asia where the increase in food production is expected to come mostly from irrigated agriculture.
The Chashma Right Bank Irrigation Project (CRBIP) has a major role contributing to the agriculture sector of Khyber Pakhtun Khaw (KPK) and Punjab. KPK is relatively backward in terms of agriculture productivity than Punjab and Sind. Major crops include sugarcane, wheat, maize and gram. Within KPK, the southern districts are comparatively poorer and per hectare yields of crops are lower as compared to Peshawar valley. DIKhan is one of the southern most districts in KPK, where majority of people live below poverty line. Literacy rate is low. Unemployment is wide spread. Per hectare yields of crops are low. Area under cultivation is also low. The agricultural economy of the area has transformed a lot after the construction of Chashma Right Bank Canal (CRBC), because it has brought more area under cultivation than before, the yield of the crops has increased manifold. Crops like sugarcane and rice, which were not cultivated before CRBC, are now the
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main crops in DIKhan. This shows that cropping pattern has also changed significantly. (Sheladia Associates, 2001).
OBJECTIVES OF THE STUDY The main objectives of the study are as follows 1. To examine the impact of irrigation on the cropping pattern of the command area of CRBC. 2. To know the differences in the cropping pattern in CRBC by distributaries- wise. 3. To know the differences in the cropping pattern in CRBC by stage-wise. HYPOTHESIS 1. There is no significant difference in the cropping pattern after CRBC. 2. There is no significant difference in the cropping pattern of Stage I and Stage II of CRBC. LITERATURE REVIEW Various studies regarding the irrigation and cropping pattern are conducted not only in Pakistan, but all over the world. Of all these studies some studied are included here.
Merry and Wolf (1986) said about the irrigation system of Pakistan that irrigation system of Pakistan is based on Main River Indus and its tributaries. It irrigates about seventeen million hectares out of twenty million hectares of the cultivated land of the Indus basin. This system has not only increased the agricultural productivity many folds but also changed the cropping pattern and the cropping intensity. Ray (1992) in an empirical investigation analyzed the impact of irrigation on the post Independence period. He made conclusion that changes in the pattern of development and the use of irrigation has brought more area under cultivation, increased agricultural productivity, and changed the cropping pattern after the provision of sustained water facility. Mellor (1996) talked about the institutional reforms in the irrigation sector in Pakistan. With the institutional reforms not only the agricultural productivity can be increased but also there is a need to change the cropping pattern. Vaidyanathan (1993) several micro level surveys are also conducted to compare the agriculture performance in irrigated and un-irrigated areas. This shows that irrigated areas shows higher agricultural productivity, high value crops and a considerable change in the cropping pattern. Gill and Mustafa (1997) irrigation has direct as well as indirect effect. Directly it increases agricultural production and especially of food grains. Indirectly helps employment and has a positive impact on cropping pattern and cropping intensity and in turn puts more money (purchasing power) into the pockets of the poor. Sivasubramaniyan (2000) says that irrigation impact has several dimensions. The most important dimension is a major shift in the cropping pattern and cropping intensity. In turn all these dimensions are affected by the extent of the management of irrigation facilities and the sustained availability of the water.
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Palmer et al (2003) extended the work already done by Datt and Ravillion (1998). He concludes that although the use of agricultural mechanization and fertilizer has clearly increased the agricultural productivity but the irrigation has an important impact of not only increasing agricultural productivity it has also increased cropping intensity and changed cropping pattern. Hussain and Hanjra (2004) extensive review points out that irrigation has strong linkages directly and indirectly. Irrigation helps poor through increased production, higher yields, and a throughout the year farm and non farm employment. Indirectly more diversified cropping pattern and to switch from low valued crops to high valued crops. Apart from the above studies there are other studies also which shows the irrigation has strong bearings on the crop yield, pattern and intensity. These are Tayagi (1981), Satya Sai (1990), and Yadav (1990).
METHODOLOGY CRBC consists of three stages namely Stage I, Stage II and Stage III. Stage I and II lies in the province of Khyber Pakhtunkhaw while Stage III mostly irrigates the Punjab province. This paper includes only the first two stages of the CRBC that is Stage I and II. The primary sampling units are the distributaries. Six distributaries are selected in both the stages. In Stage I (Kot Hafiz, Additional and D-4) and in Stage II (D-5, D-7 and D-13) are selected. On each distributary 15 farmers irrigators were selected for interview; it means that for 6 distributaries 90 farmers were selected. Some farmers were selected from the head, some from the middle and some from the tail of watercourses of the distributaries.
A detailed questionnaire was prepared and also a secondary data was used from the Chashma Right Bank Irrigation Project (CRBIP) office in DIKhan. The data is collected in both the stages in Dec. 2009.
DATA ANALYSIS CROPPING PATTERN- DISTRIBUTARY WISE The shows a large variation in the cropping pattern. These variations are seen even in the same season in the same crop. The variations are attributed to the some factors as farm size, type of the soil, water supply and table, and awareness of the farmers. It is shown in the Table 2. Wheat: Wheat being a staple food is consistently grown in almost all the distributaries. Area covered by wheat production ranges from 42.4 % in distributary 7 to 54.7 % for distributary 13. In both the stages wheat is equally grown as in Stage I (Kot Hafiz, Additional and D-4) it is 50.9% and in Stage II (D-5, D-7 and D-13) it is 50.3 %.
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Table I. Distributary-wise Cropping Pattern for Rabi 2009- 10 and Kharif 2009 (Averages are weighted by area) Kot Hafiz Additional D-4 D-5 D-7 D-13 Total Wheat % 47.6 51.4 53.9 54.7 42.4 53.6 50.6 Gram % 0.0 0.3 19.4 6.1 2.7 10.0 6.0 Fodder Rabi % 4.9 2.3 4.2 4.2 1.2 4.2 3.5 Others Rabi % 0.2 0.8 2.0 0.0 1.2 0.1 .20 Fodder Kharif % 3.2 1.7 2.7 2.9 2.9 0.9 2.38 Rice % 17.8 0.3 21.4 17.3 15.6 23.7 16.0 Cotton % 0.1 1.0 0.0 0.0 0.0 0.0 0.18 Other Kharif % 2.8 21.7 3.4 0.7 0.5 1.3 5.0 Sugarcane % 29.2 16.6 9.7 9.9 26.3 12.5 17.3 Source: Survey Gram: Gram is the second largest crop of the project area in the Rabi season. In D- 4 it is only 19.4 %, while in rest of the Stage I it is negligible. In D- 13 of Stage II again it is 10.1 %. Fodder Rabi: In all the distributaries of both the stages the cultivation of rabi fodder is almost inconsistent. It is 1.1 % at D-7 at Stage II and a maximum of 5.1 % at Distributary Kot Hafiz of Stage I. Sugarcane: Farmers has put more area under cultivation for this cash crop as expected in the project. Expected cultivation was 8.6 while presently it is cultivated on 17.5 % of the area. Major cultivation of sugarcane is 26.3 % on distributary Kot Hafiz. Major reason for the large cultivation of this cash crop is due to number of sugar mills in DIKhan. Orchards: Only in Stage I orchards are grown. It is only 3 % at Distributary Kot Hafiz. Cultivation of orchards in Stage II is negligible. It is almost 1.2 % of both the stages. Rice: Cultivation of rice has also deviated from the expected of the project. It has become a major crop of the Kharif season. It is grown on all the distributaries of both the stages except at Additional due to sandy soil. It covers about 15.5 % of the total cropped area in both the stages. Cotton: Cotton is cultivated on a very small portion in both the stages. It is almost 0.18 % of the total cultivation. Other Kharif: This includes Maiz, Mungbean, and Vegetables. It almost covers 5.0 % of the area. CROPPING PATTERN BY FARM SIZE: As already explained the sugarcane is cultivated at an area more than projected in PCI of the CRBIP. It shows an interesting result when cropping pattern is taken farm wise. It is explained in the Table 2 below.
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Table 2.Cropping Pattern by Farm Size and Stage for the Rabbi Season of 2009- 10 and Kharif 2009 Small Medium Large Very Large Wheat % Gram % Fodder Rabi % Other Rabi % Fodder Kharif % Rice % Other Crops Kharif % Sugarcane % I 62.5 5.7 7.4 6.8 4.6 17 7.2 17.4 II 77.5 4.0 11.2 1.6 7.7 21.2 4.5 4.3 Total 70.0 4.9 8.3 5.6 5.5 18.0 6.3 14.1 I 54.6 4.4 4.5 4.7 2.7 13.9 5.2 17.0 II 52.3 7.4 3.1 0.5 2.3 19 0.6 11.7 Total 53.5 5.9 3.9 3.0 2.5 19.2 3.2 15.1 I 43.5 6.3 2.3 1.9 1.9 15.5 2.6 22.7 II 57.6 7.8 4.0 0.7 1.3 15.3 0.5 11.2 Total 50.5 7.0 2.9 1.5 2.0 15.3 2.8 19.0 I 35.0 7.0 2.3 0.5 1.7 10.0 1.4 15.1 II 34.6 1.8 0.7 0.1 0.7 16.0 0.0 17.0 Total 34.8 4.4 1.3 0.2 0.9 14.0 0.5 16.3
Note. Other crops Kharif also include Maize and cotton Table 2 shows that larger the farm, greater the area under cultivation of sugarcane. Stage I shows 19 % of the area cultivated by sugarcane on the very large farms, while 17 % on the small farms. Stage II shows that more than 25 % of the area by the very large farms and only 4.5 % on the small farms. It shows that large land owners are much wealthier or prosperous that is why they are more inclined more towards the cultivation of this cash crop. Secondly in each stage of CRBC there are number of sugar mills so location or presence of a mill is also a choice for the farmers to grow more sugarcane. Thirdly the more availability of water. On the other hand wheat cultivation is more than 66 % in Stage I and II in small farms as compared to 34 % or more in very large farms. More or less the same trend is shown by the gram. Fodder in the rabi season is more in the small farms while less in the large farms. Rice is an important crop of the Kharif season and uses more water. It is consistent across sizes. As for as fodder for Kharif season is concerned it again shows the same rabi trend that small farms grow more fodder as compared to large farms.
CROPPING PATTERN BY STAGE As for as cropping pattern in the two stages Stage I and Stage II is concerned there is not much difference in the cropping pattern in both the stages, with few exceptions in the other crops (Orchards, Vegetables etc). CONCLUSION Major crops in Stage I and Stage II grown in rabi season are wheat and gram, while rice in kharif and sugarcane during both the seasons. Rest of the crops constitutes only 10 % in both the seasons.
The main objective of the study is to see the change in the cropping pattern after CRBC. There is a significant change in the cropping pattern after CRBC. Generally farmers have deviated from the expected cropping pattern. More area is put under the cultivation of cash crops as sugarcane and rice. It shows that the cropping pattern has
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significantly changed after CRBC. Because, sugarcane and rice are cultivated on more areas of both the stages. There are also significant differences in the cropping pattern distributaries-wise. Data indicates large variations in cropping pattern of the same crop even in the same season. These variations in general are due to some general factors such as available water supply, soil type, farm size farmers awareness etc. There are no significant differences in the cropping pattern as for as stage wise pattern is concerned. In both the stages farmers are ignoring the cultivation of maize, cotton, oilseeds. In rabi season wheat is the dominant crop while rice is the dominant crop in the Kharif season. Sugarcane is a year round crop while other crops show insignificant areas. Major reason for the deviation to sugarcane crop is the presence of more sugar mills in each stage of CRBC. That is why the data shows that large and very large farms grow more sugarcane as compared to small and medium farms. A small percentage of oilseeds, cotton fodder and maize clearly show a deviation from the projected cropping pattern. Sugarcane exceeds projections more than 3 times.
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References Dhawa B D (1998). Indias Irrigation Sector: Myths and Realities, Presedential Address, Indian Journal of Agricultural Economics, Vol. 53, No. 1: 40-46.
Gill Z A and Khalid Mustafa (1997). Farm-Area, Cultivated Area, and Irrigated Area Distribution in Pakistan, 1972 90. Pakistan Journal of Agricultural Science. 34: 117. Hussain I and Munir A Hanjra (2004). Irrigation and Poverty Alleviation: Review of the Empirical Evidence. Irrigation and Drainage, 53: 1 15. Mellor J W (1996). Accelerating Agricultural Growth Is Irrigation Institutional Reforms Necessary. The Pak. Dev. Review, 35(4): 399-417. Merry J D and Wolf J M (1986). Irrigation Management in Pakistan. Sri Lanka: International Irrigation Management Institute (IIMI), No. 4, pp.12-19. Palmer R J and Kunal Sen (2003). What has Luck Got to do with it? A Regional Analysis of Poverty and Agricultural Growth in Rural India. The Journal of development Studies, Vol.40, No. 1: 1 31. Ray S K (1992). Development of Irrigation and its Impact on Pattern of Land Use, Output Growth and Employment Generation, Journal of Indian School of Political Economy, Vol. 4, No. 4, Oct.-Dec. Satya Sai K J S (1990). Impact of Irrigation on Intensity of Land Utilization in N. TAYAGI, p k Joshi and N T Singh (eds), National Symposium on Management of Irrigation Sysrem, Central Soil Salinity Research Institute, Karnol. 224- 239. Sheladia Associates(2001). Inc. USA, in association with Infra D Consultants (IDC), D.I.Khan., Pakistan. Project Impact Monitoring and Evaluation (PIME) Studies, Chashma Right Bank Canal Project. : 2-3. Sivasubramaniyan K (2000). Impact of Irrigation on Cropping Intensity, Cropping Pattern and Productivity under Tank Commands. Journal of the Gokhale Institute of Politics and Economics. Vol. XLII, No. 4, Dec: 325-349. Tayagi D S (1981). Growth of agricultural moutput and Labor Absorption in India, Journal of Development Studies, Vol. 18, No. 1: 167-176. Vaidyanathan A (1993). Impact of Irrigation on cropping intensity, cropping pattern and Productivity in tamil Nadu ( unpublished), MIDS, Madras. Yadav s S (1990). Irrigation and Intensity of Cropping: A Cross Sectional Analysis at State level, Mimeo, Institute of Economic Growth.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Surveying Ethical Climate on Organizational Health in Irans SMEs
Ghader Vazifeh Damirch (MA)
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Management Department of Islamic Azad University, Jolfa International Branch, East Azerbaijan, Iran
Gholamreza Rahimi (Phd)
Assistant Professor in Management Department of Islamic Azad University, Jolfa International Branch, East Azerbaijan, Iran
Abstract This study focuses on Iranian Small and Medium Sized Enterprises (SMEs). The Purpose of this study is Surveying Ethical Climate on Organizational Health in Irans SMEs. Theoretical framework of this study is Victor and Cullens (1988) Ethical Climate theory, and Drs. Nurit and William Cohens (1991) Organizational Health theory. Data has collected from 42 managers of SMEs in East Azerbaijan Province of Iran by two standard questionnaires of study variables. Ethical Climate Questionnaire, a 26 item scale by Victor & Cullen (1988) and Organizational Health Questionnaire , a 63 item scale Drs. Nurit and William Cohens (1991) Both the reliability and validity of measures has examined. Descriptive statistics has calculated for the study constructs. T-test has performed to compare means of the constructs between variables and Pearson correlation coefficients. Also it has calculated among the study constructs. Findings show that there is a relationship between ethical climate and Organizational Health in Irans SME. Keywords: Ethical climate, Organizational Health, SME Introduction The SMEs sector is the backbone of the developed economies throughout the world. They form the backbone of the private sector, make up over 90 percent of enterprises in the world, and account for 50 to 60 percent of employment. These shares are even higher in the manufacturing sector, and in developing economies, where such enterprises typically account for 90-95 percent, or more, of all industrial enterprises, 70-75 percent of industrial employment, and 50-60 percent of industrial output. The definition of SMEs varies depending on nation and region. There is little unanimity regarding the definition of SMEs in Iran. In the present study, enterprises between 10 and 49 employees are regarded as small enterprises. For developing economies SMEs often offer the only realistic prospects for increases in employment and value added. In Iran SMEs having only four percent of the total numbers of enterprises create almost 15.5 percent of national employment. But large enterprises constituting 13 percent of total enterprises contribute to 0.2 percent of national employment (Mirbargkar, 2009). Although individuals might not experience a culture in their organization (Schein, 1992), all individuals experience a climate, that is, a behavioral context, which they can describe (Rousseau, 1988). Ashcroft (1985) distinguishes between shared assumptions (culture) and shared perceptions (climate) and argues that culture informs climate by helping individuals to define what is important and make sense of their experiences. In recent years increasing attention has been focused on ethical
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behavior of managers, due in part to media exposure of a number of unethical actions of business managers. Unethical practices such as embezzlement, fraudulent billing practices, deception, favoritism, and nepotism are just a few of the issues recently raised by the news media and stakeholders. The ethical climate in an organization has been described as the shared perceptions of what is ethically correct behavior and how ethical issues should be handled (Victor and Cullen, 1987, p.51-52). From a symbolic integrationists perspective, climates emerge due to an interaction between persons and might take a reality of their own through this process (Rousseau, 1988, p. 153). An organizations ethical climate was found to influence the ethicalness of organizational members (Wimbush & Shepard, 1994; Peterson, 2002; Vardi, 2001). According to Lewis, Goodman, and Fandt (2001), organizations pay attention to ethical issues because the public expects a business to exhibit high levels of ethical standard. High levels of ethical standards protect individuals who work in organizations, employees dislike invasion of their privacy, being ordered to do something against their personal convictions, or working under hazardous conditions (Okpara,2002). Organizational Health Diagnostic and Development Corporation were formed in 1981 by Marvin Fairman. It is an organization's ability to function effectively, to cope adequately, to change appropriately, and to grow from within. Organizational Health, like personal health, may vary from a minimal to a maximal level. In other hand, Organizational health is defined by the ability of an organization to accomplish its mission, especially in terms of development and artistic outreach, support for employment for artists and cultural workers, access to the arts and audience development through an administrative structure that is solid and financially sound. We see that organizations judged to be in good organizational health are generally those that are based on a stated creative vision, have artistic vitality, and have competent staff and an efficient board. For the manager, it is necessary to identify and adopt practices that respond to the needs of his organization. In a healthy organization, all of the essential aspects of the infrastructure are healthy, well developed and robust.( Jocelyn, 2002) The Purpose of this study is Surveying Ethical Climate on Organizational Health in Irans SMEs. THEORETICAL BACKGROUND In the literature, nine theoretical ethical climate types are determined by using the two dimensional theoretical typology (Cullen et al., 1989; Victor and Cullen, 1988). These climate types are: self-interest; company profit; efficiency; friendship; team interest; social responsibility; personal morality; company rules and procedures; laws and professional codes. TABLE 1 shows Theoretical ethical climate types.
Ethical criterion Egoism Benevolence Principle Individual level Self-interest Friendship Personal morality Locus of analysis Local level Company profit Team interest Cosmopolitan level Efficiency Social responsibility
Company rules and Laws and professional procedures codes TABLE 1- Theoretical ethical climate types (Victor and Cullen, 1988)
According to Drs. Nurit and William Cohens (1991) Organizational Health includes and is dependent upon the following ten dimensions:
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Goal Focus - the ability of persons, groups, or organizations to have clarity, acceptance, support, and advocacy of school-wide goals and objectives. Communication Adequacy - that state when information is relatively distortion free and travels both vertically and horizontally across the boundaries of an organization. Optimal Power Equalization - the ability to maintain a relatively equitable distribution of influence between the leader and members of his/her work unit. Resource Utilization - the ability to coordinate and maintain inputs, particularly personnel, effectively with a minimal sense of strain. Cohesiveness - the state when persons or groups have a clear sense of identity, are attracted to membership, want to stay, and are willing to influence and to be influenced. Morale - that state in which a person, group, or organization have feelings of security, satisfaction, well-being, and pleasure. Innovativeness - that ability to be and allow others to be inventive, diverse, creative, and risk-taking. Autonomy - that state in which a person, group, or organization have the freedom to fulfill their roles and responsibilities. Adaptation - that ability to tolerate stress and maintain stability while changing to meet the unique needs of their stake holders. Problem-Solving Adequacy - an organizations ability to perceive problems and to solve them with minimal energy. Problems get solved, stay solved and the problem solving procedures are strengthened6. RESEARCH HYPOTHESES Main Hypothesis There is a v relationship between ethical climate and Organizational Health in Irans SME. Secondary hypotheses 1. There is a significant relationship between Self-interest and Organizational Health in Irans SME. 2. There is a v relationship between Friendship and Organizational Health in Irans SME. 3. There is a significant relationship between Personal morality and Organizational Health in Irans SME. 4. There is a significant relationship between Company profit and Organizational Health in Irans SME. 5. There is a significant relationship between Team interest and Organizational Health in Irans SME. 6. There is a significant relationship between Company rules and procedures and Organizational Health in Irans SME. 7. There is a significant relationship between Efficiency and Organizational Health in Irans SME. 8. There is a significant relationship between Social responsibility and Organizational Health in Irans SME.
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9.
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There is a significant relationship between Laws and professional codes and Organizational Health in Irans SME.
METHODOLOGY This study focuses on Iranian Small and Medium Sized Enterprises (SMEs). Data has collected from 42 managers of SMEs in East Azerbaijan Province of Iran by two standard questionnaires of study variables. Ethical Climate Questionnaire, a 26 item scale by Victor & Cullen (1988) and Organizational Health Questionnaire, a 63 item scale Drs. Nurit and William Cohens (1991) Both the reliability and validity of measures has examined. Questionnaire reliability was estimated by calculating Cronbachs Alpha via SPSS software that is shown in the table 2.
Variables Ethical climate Organizational Health Cronbach's Alpha 0.89 0.91
Table 2.Results of reliability variables from SPSS software
Descriptive statistics has calculated for the study constructs. T-test has performed to compare means of the constructs between variables and Pearson correlation coefficients. Also it has calculated among the study constructs. The analysis has performed with SPSS.
ANALYSIS AND CONCLUSION A) descriptive Analysis Table3 shows responders degree. According to table3, 12 percent of the responders have M.A degree, 67 percent have BA degree, and 21 percent have DA degree.
Responders degree
Valid MA BA DA Total Frequency 5 28 9 42 Percent 12 67 21 100.0 Valid Percent 12 67 21 100.0 Cumulative Percent 12 79 100.0
Table3- Responders degree
Table3 shows Managing background of the responders. According to table4, from the precedence point of view about 14 percent of responders have less than 5 years. 43 percent 6-10 years, 31 percent 11-15 years and finally 5 percent have more than 14 years of managing experience which is shown in table4. Managing background of the responders
Valid Less than 5 6-10 11-15 More than 16 Total Freque ncy 6 18 13 5 42 Percent 14 43 31 12 100.0 Valid Percent 14 43 31 12 100.0 Cumulative Percent 14 57 88 100.0
Table 4- Managing background of the responders
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B) Hypothetical Analysis
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Table 5 shows average grades of Ethical climate indices and organizational health and level of significance among averages and hypothetical average of 3.
Variables self-interest company profit efficiency friendship team interest social responsibility personal morality company rules and procedures laws and professional codes Average 3.01 2.98 2.61 3.26 2.67 2.83 2.68 2.71 2.84 2.89 AVG.DIF 0.21 0.24 0.14 0.26 0.3 0.17 0.32 0.29 0.16 0.11 Level of sig. 0 0 0.023 0 0 0.001 0 0 0 0.003 df 42 42 42 42 42 42 42 42 42 42 T 5.23 4.82 3.13 6.59 7.14 3.51 6.8 5.39 4.46 3.05
organizational health
Table 5- shows average grades of Ethical climate indices and organizational health and level of significance among averages and hypothetical average of 3.
As shown in table 5, average grades of organizational health and ethical climate indices, except for self-interest and friendship, are significantly lower than hypothetical average of 3. Study of grades frequency distribution related to ethical climate indices and organizational health showed that distribution of grades was normal and pre assumption of normality for using statistical test is provided. Findings related to research main hypothesis and secondary hypothesis obtained correlation coefficients related to main and secondary hypothesis are shown in following tables.
MH. There is a significant relationship between Ethical climate and Organizational Health in Irans SME.
Correlations Ethical climate Ethical climate Pearson Correlation Sig. (2-tailed) N 1 42 Organizational Health .616** .000 42
Table 6- Pearsons correlation coefficients of grades of Ethical climate and Organizational Health
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As shown in table 6, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.616, P=0). Therefore, Man hypothesis is confirmed. SH1. There is a significant relationship between Self-interest and Organizational Health in Irans SME.
Correlations Self-interest Self-interest Pearson Correlation Sig. (2-tailed) N 42 1 Organizational Health 0.53** .000 42
Table7- Pearsons correlation coefficients of grades of Self-interest and Organizational Health
As shown in table 7, correlation coefficient between grades of Self-interest and Organizational Health is positive and significant (r=0.53, P=0). Therefore, Secondary hypothesis No 1 is confirmed. SH2. There is a significant relationship between Friendship and Organizational Health in Irans SME.
Correlations Friendship Friendship Pearson Correlation Sig. (2-tailed) N 1 42 Organizational Health 0.391** .000 42
Table 8- Pearsons correlation coefficients of grades of Friendship and Organizational Health
As shown in table8, correlation coefficient between grades of Friendship and Organizational Health is positive and significant (r=0.391, P=0). Therefore, Secondary hypothesis No 2 is confirmed.
SH3. There is a significant relationship between Personal morality and Organizational Health in Irans SME.
Correlations Personal morality Pearson Correlation Sig. (2-tailed) N Personal morality 1 42 Organizational Health 0.32** .000 42
Table 9- Pearsons correlation coefficients of grades of Personal morality and Organizational Health
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As shown in table 9, correlation coefficient between grades of Personal morality and Organizational Health is positive and significant (r=0.32, P=0). Therefore, Secondary hypothesis No 3 is confirmed.
SH4. There is a significant relationship between Company profit and Organizational Health in Irans SME
Organizational Health Team Company Pearson Correlation 1 0.47** profit Sig. (2-tailed) .000 N 42 42 Table 10- Pearsons correlation coefficients of grades of Company profit and Organizational Health Correlations Company profit
As shown in table 10, correlation coefficient between grades of Company profit And Organizational Health is positive and significant (r=0.47, P=0). Therefore, Secondary hypothesis No 4 is confirmed. SH5. There is a significant relationship between Team interest and Organizational Health in Irans SME.
Correlations Team interest Team interest Pearson Correlation Sig. (2-tailed) N 1 42 Organizational Health 0.32** .000 42
Table 11- Pearsons correlation coefficients of grades of Team interest and Organizational Health
As shown in table 11, correlation coefficient between grades of Team interest and Organizational Health is positive and significant (r=0.32, P=0). Therefore, Secondary hypothesis No 5 is confirmed. SH6. There is a significant relationship between Company rules and procedures and Organizational Health in Irans SME
Correlations Company rules and procedures Pearson Correlation 1 Sig. (2-tailed) N 42 Organizational Health 0.562** .000 42
Company rules and procedures
Table 12- Pearsons correlation coefficients of grades of Company rules and procedures and Organizational Health
As shown in table 12, correlation coefficient between grades of Company rules and procedures and Organizational Health is positive and significant (r=0.562, P=0). Therefore, Secondary hypothesis No 6 is confirmed.
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SH7. There is a significant relationship between Efficiency and Organizational Health in Irans SME
Correlations Efficiency Efficiency Pearson Correlation Sig. (2-tailed) N 1 42 Organizational Health 0.549** .000 42
Table 13- Pearsons correlation coefficients of grades of Efficiency and Organizational Health
As shown in table 13, correlation coefficient between grades of Efficiency and Organizational Health is positive and significant (r=0.549, P=0). Therefore, Secondary hypothesis No 7 is confirmed. SH8. There is a significant relationship between Social responsibility and Organizational Health in Irans SME
Correlations Social responsibility Pearson Correlation Sig. (2-tailed) N Social responsibility 1 42 Organizational Health 0.582** .000 42
Table 14- Pearsons correlation coefficients of grades of Social responsibility and Organizational Health
As shown in table 14, correlation coefficient between grades of Social responsibility and Organizational Health is positive and significant (r=0.582, P=0). Therefore, Secondary hypothesis No 8 is confirmed. SH9. There is a significant relationship between Laws and professional codes and Organizational Health in Irans SME
Correlations Laws and professional codes 1 42 Organizational Health 0.463** .000 42
Laws and professional codes
Pearson Correlation Sig. (2-tailed) N
Table 15- Pearsons correlation coefficients of grades of Laws and professional codes and Organizational Health
As shown in table 15, correlation coefficient between grades of Laws and professional codes and Organizational Health is positive and significant (r=0.463, P=0). Therefore, Secondary hypothesis No 9 is confirmed.
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References
Rousseau, D. M. (1989), Psychological and implied contracts in organizations, Employee Responsibilities and Rights Journal, 2, 121139. Schein, E. H. (1992). Organizational culture and leadership (2 Jossey-Bass
nd
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ed.), San Francisco:
Peterson, D.K. (2002). Deviant workplace behavior and the organizations ethical climate. Journal of Business and Psychology, 17(1), 47-61. Vardi, Y. (2001). The effects of organizational and ethical climates on misconduct at Work, Journal of Business Ethics, 29, 325-337. Victor, B. and J. B. Cullen: 1987, A Theory and Measure of Ethical Climate in Organizations, in W. C. Fredrick (ed.) Research in Corporate Social Performance and Policy 9 (JAI Press, Grennwich, CT), 51-71. John O. Okpara,2002, The Influence of Ethical Climate Types on Job Satisfaction of IT Managers: Implications for Management Practice and Development in a Developing Economy, Academy of Business & Administrative Sciences (ABAS) 2002 Seventh International Conference, San Jose, Costa Rica, July 6-8, 2002 Harvey Jocelyn, Creative Management in the Arts and Heritage: Sustaining and Renewing Professional Management for the 21st Century, Ottawa: Canadian Conference of the Arts, 2002, p. 42. Seyed Mozaffar Mirbargkar, 2009, Global Competitiveness: Iranian SME, SCMS Journal of Indian Management, October - December, 2009.
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RFID Development Facors Efect In Supply Chain Management (Case study: Iran Tractor Manufacturing Co)
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Gholamreza Rahimi (Phd) Assistant Professor in Management Department of Islamic Azad University, Jolfa International Branch, East Azerbaijan, Iran Ghader Vazifeh Damirch (MA) Management Department of Islamic Azad University, Jolfa International Branch, East Azerbaijan, Iran
Abstract
Application of RFID for tracking each single part in the Tractor supply chain management is becoming very crucial in recent years. In this study, the factors influencing the RFID development in ITMCO and their weights and ranks are evaluated. The factors of the Lin framework have been used as the basis of this research. The fuzzy Delphi, Delphi and Fuzzy Analytic Hierarchy Process methods are adopted for three stages of the study. In the first stage, three of the Lin framework factors are rejected and replaced with seven more new factors. In the second stage, after performing three round of Delphi method, the dimension of each new seven factors is recognized, and finally in the third stage, the weights and ranks of factors and dimensions, influencing the RFID Development in supply chain management at ITMCO would be calculated. The results of the study have shown that the dimension of International Standard and Specification has the highest weight among other influential dimensions. The dimensions of Security, Cost, Infrastructure, Technology, and other factors have the next highest weight respectively. Keywords: Radio Frequency Identification, Supply Chain Management, Analytic Hierarchy Process.
1. Introduction Even though radio frequency identification (RFID) as a technology was developed during the 1940s, the first industry uses were occurring during the 1980s in tracking and access applications. Due to the relatively high costs of the RFID tags (> 50 US cents per tag) compared to widely used bar codes, the use of the technology was rather limited. Additionally, there was no unified standard, which resulted in incompatible vendor specific solutions. However, recent industry initiatives, e.g. by the worlds biggest retail company WalMart, USA resulted in decreased production prices (~ 20 US cent per tag in orders of 1 million) and due to learning curve effects
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they are likely to decrease further. Thus, the use of RFID in supply chain operations becomes more attractive [1] RFID is a technology for the automatic identification by radio of physical objects such as industrial containers, palettes, individual products and also people. The identification event takes place over transponders located in or on the respective objects, which can be addressed without physical contact, over the so-called "air interface", by the antenna on a scanner device. Transponders are manufactured in various shapes and styles, operate in various frequency ranges and have either their own battery (active transponder) or are provided with energy from the electromagnetic field of the scanner (passive transponder). On the other hand, scanners are available on the market as both mobile devices with limited range and as devices for stationary installation, to which one or more external antennas can be connected to enable coverage of larger areas [2]. The RFID system combines the various information technologies, such as database management system, computer network, firewall, etc., to provide an automatic, secure, and convenient real-time control system. The accuracy and timeliness are two main concerns in the operation process control of supply chain management. RFID technology can support real-time control of goods in the supply chain including raw material, work in process (WIP), and finished product. It can enhance the degree of automation, reduce the probability of error, and greatly improve the visibility of supply chain. Thus, the RFID system can be used in the receiving and dispatching of goods, stock management, theft prevention, product assembly, and personnel control. Typical areas of application for RFID lie, adjacent to classics such as animal identification or access control systems, above all in supply chain management, where the technology makes possible simplified goods turnover, automatic stock control in the storeroom resp. on the sales area, theft protection, product tracking etc [3]. Further application potential comes from the areas of product life-cycle management (e.g. with call-back actions, maintenance and service) and customer relationship management (e.g. for individualized product information) through to novel business models through use-based payments or vendor managed inventories [4], [5], [6]. Tractor industry is one of the areas in which RFID has been used through these years. It is constantly looking for innovative technologies to further improve both the quality of process- related data and thus the efficiency of their supply chain operations. RFID and it's potential for seamless data capturing and processing, increased supply chain visibility, and significantly reduced cycle times is one of the most promising technologies today and for the foreseeable future. The Tractor industry already uses RFID, e.g. in vehicle immobilizers since the 1990s. But the adoption in supply chain processes, however, is just at the beginning. This encompasses all those processes that are associated with the movement and shipping of goods from raw- material stage up to the final products which are delivered to customers as well as backwards at the end of the product's life for recycling purposes, i.e. procurement, inventory management, assembly control, order processing, distribution, transportation, quality control, theft control, anti-counterfeiting, and warehousing [7], [8].
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The purpose of this study is to modify the Lin framework [9] and then apply it in Iran Tractor Manufacturing company (ITMCO), in order to propose a new framework for that company. 2- Research methodology The research architecture of this article is structured as shown in figure 1. Firstly, the author, based on the framework proposed by [9], determines the final factors (and dimensions) influencing the RFID Development in supply chain management at ITMCO through Fuzzy Delphi Method. Secondly, this study recognizes the dimensions of added factors through Delphi approach. Finally, the author uses available data in an AHP questionnaire to propose overall weights and ranks of dimensions/factors through Fuzzy-AHP.
First questionnaire is to use Fuzzy Delphi Method to determine the final factors (and dimensions) Second questionnaire is to use Delphi Method to recognize the dimensions of added factors Third questionnaire is to use Fuzzy AHP method to calculate overall weights dimensions/factors
Figure 1. Research architecture by hybrid fuzzy-Delphi-AHP Since the RFID technology is still new to most industry managers and it would not be easy for them to provide valuable inputs, the key factors have to be achieved from the experts' opinions. Thus, questionnaires are designed and distributed to the 9 selected experts in the RFID committee at ITMCO. The RFID committee at ITMCO has been established for the development of RFID-related projects at ITMCO. This committee has about 20-30 experts who represent the various departments at ITMCO such as departments of IT, Systems design and analysis, Manufacturing, Quality, Sales, TPS, Logistics, Transportation, and also the members of ITMCO's supply chain such as ITISCO and TETPSCO. 2.1. Fuzzy Delphi Method The Delphi Method was first developed by [10] in corporation and has been widely applied in many management areas, e.g. forecasting, public policy analysis and project planning. However, the traditional Delphi Method also has some disadvantages, such as low convergence expert opinions, high execution cost, the possibility of filtering out particular expert opinions, and so on. Therefore, [11] proposed the concept of integrating the traditional Delphi Method and the fuzzy theory to improve the vagueness of the Delphi Method. Membership degree is used to establish the membership function of each participant. Reference [12] applied triangular fuzzy number to encompass expert opinions and establish the Fuzzy Delphi Method. The max and min value of expert opinions are taken as the two terminal points of triangular fuzzy numbers, and the geometric mean is taken as the membership degree of triangular fuzzy numbers to derive the statistical unbiased effect and avoid the impact of extreme values. The advantage of this method is simplicity that all the expert opinions can be encompassed in one investigation. As a result, this method may create a better effect of criteria selection. In general, the importance of performance appraisal indicators adopts a 1-10 point scale. But, in this study the 1-5 point scale was adopted. The Fuzzy Delphi Method uses the geometric mean as the basis for the decision making group to screen out the unsuitable factors and to avoid the influence of extreme values. Besides cutting down the consumption of cost and time, it also enables the decision makers to examine the fuzziness in the decision- making process and achieve a better outcome in factor selection. The steps of applying the Fuzzy Delphi Method follow.
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First, we used the set of 24 influence factors which proposed by [9] as the basis of our questionnaire. Also, we put an open up question at the end of this questionnaire in which the respondents were asked to mention any influence factor that they think it can be important for the research goal. Secondly, we use the questionnaire to gather the opinions of experts in the decisionmaking group, and the relative importance of influence factors and the ranking can be obtained. Thirdly, the fuzzy trigonometric function of each influence factor can be obtained from the expert questionnaire according to the following formulas: (1) = ( (2) i= 1, 2, 3, , n (3) (4) i= 1, 2, 3, , n Where is the fuzzy value of the importance of influence factor A; are lower limit, geometric mean, and upper limit of the values of the decision-making group for influence factor A, respectively; is the value of decision maker, for influence factor A. Fourthly, let the geometric means of the fuzzy trigonometric function of every influence factor constitutes the membership function . It represents the common understanding of the decision-making group to this factor. Fifthly, select a threshold value S to screen out the unsuitable factors. accept the influence factor A. (a) delete the influence factor A. (b) Basically, the threshold value is determined by the subjective conception of the decision maker, and it will directly influence the number of factors screened out. There is no simple way or universal rule to decide the threshold value. Based on the Delphi method, the study set a suitable threshold of S=3.0 by expert consensus, and s having S less than three (Table 1). eliminate Table 1:Specialists-reply lists. Factor Geometric Approved or Mean Value Rejected System establishment cost 4.1733 Approved System maintenance cost 3.8464 Approved System integration cost 3.9714 Approved Customization cost 3.51 Approved Training cost 3.05 Approved Operation cost 3.7522 Approved Reusability of tags 3.8089 Approved Readability 4.8775 Approved Limitation of frequency 4.1434 Approved Transmission distance 3.6673 Approved Equipment interference and 2.5830 Rejected human health Number of tags to be read 3.3123 Approved simultaneously Willingness of supply chain 4.5279 Approved members
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System integration Support and guidance from government Strong leadership System compatibility in the supply chain Standardization of frequency used Consistency of data format Personal privacy invasion Exposure and outflow of product information Relevant legal regulations Encryption technology Prevention of stealing and Loss 4.2033 3.2886 4.0788 4.0711 3.9609 4.1623 2.8469 2.8844 3.6246 3.6770 3.0449 Approved Approved Approved Approved Approved Approved Rejected Rejected Approved Approved Approved
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As showed in above, three factors of the Lin framework were rejected.These factors are: 1. Equipment interference and human health 2. Personal privacy invasion 3. Exposure and outflow of product information Also, seven factors have been gathered from the experts replies to open-up question at the end of the questionnaire. These seven factors are: 1. The extent of software information systems development at the organization in which the RFID deployment project is implemented 2. Owning the information network for reducing the record of the different types of information on the tag and protection of the information in that network 3. Selection of patterns which harmonized with new technology 4. Reduction of required labors for the organization 5. Utilization of RFID by business partners 6. The type of the business at ITMCO 7. Organizational culture
2.2. Delphi Method
The Delphi method was originally developed in the 50s by the RAND Corporation in Santa Monica, California. This approach consists of a survey conducted in two or more rounds and provides the participants in the second round with the results of the first so that they can alter the original assessments if they want to - or stick to their previous opinion. Nobody looses face because the survey is done anonymously using a questionnaire (the first Delphis were panels). It is commonly assumed that the method makes better use of group interaction [13] whereby the questionnaire is the medium of interaction [14]. The Delphi method is especially useful for long-range forecasting (20-30 years), as expert opinions are the only source of information available. In this study, the authors use Delphi Method to recognize the dimensions of the seven factors obtained from the previous stage. It must be mentioned that in this stage
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authors added other factors dimension to the five dimensions of the Lin framework. The steps of the Delphi Method are summarized below: (1) Perform a questionnaire survey in the 1st round: The questionnaire could include such questions as Which one of the six dimensions above is related to organizational culture? (2) Perform a telephone survey in the 2nd round. (3) Perform a telephone survey in the 3rd round. (4) Synthesize expert opinions to form a consensus. In total, the authors operated the survey in three rounds as listed in Table 2. It is necessary to know that the factors of the table represent the listed factors in the previous section, respectively.
Table2. The dimensions of proposed seven factors by Delphi Method (3 rounds; ( ) Number of votes by experts)
Round 1 st Round Factor 1 Infrastructure (5) Cost (2) Technology (1) Security (1) 2 nd Round 3 rd Round Infrastructure (8) Cost (1) Infrastructure (9) Factor 2 Infrastructure (6) Cost (2) Technology (1) Infrastructure (7) Cost (2) Infrastructure (9) Factor 3 Other factors (4) Technology (3) Standard (2) Other factors (7) Technology (2) Other factors (9) Factors Factor 4 Cost (5) Technolo gy (1) Infrastruct ure (1) Other factors (2) Cost (6) Other factors (3) Cost (9) Factor 5 Infrastruct ure (5) Cost (3) Technolog y (1) Infrastruct ure (7) Cost (2) Infrastruct ure (9) Factor 6 Cost (3) Infrastructur e (3) Technology (2) Standard (1) Infrastructur e (6) Cost (3) Infrastructur e (9) Factor 7 Other factors (7) Cost (2)
Other factors (8) Cost (1) Other factors (9)
( ): Number of Consensus from experts After the adjustment of the Lin frameworks factors, this research proposes the tree chart of the influential factors for the development of Radio Frequency Identification technology in ITMCOs supply chain management (Fig. 2).
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Figure 2. Tree chart of the influential factors for the development of RFID in ITMCOs Supply Chain Management
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2.3. Fuzzy AHP method Based on the proposed tree chart (Fig.2), ITMCO managers need to realize the significance (such as weight or priority) of each dimension/factor to allocate business resources or make better decisions in developing Radio Frequency Identification technology. This issue becomes a multi-criteria decision making (MCDM) problem. However, analytic hierarchy process (AHP) is a widely used MCDM tool first proposed by [15], [16]; AHP is a tool accessible to decision makers and researchers; and, it is one of the most widely used MCDM tools [17]. In traditional AHP, pair-wise comparison is made using a nine-point scale, which converts human preferences (i.e., numbers 3, 5, 7, and 9 meaning generally important', 'strongly important, very important, and absolutely important; and 2, 4, 6, and 8 for compromises between 3, 5, 7, and 9). Thus the AHP uses only absolute scale numbers for judgments and for their resulting priorities. Even though the discrete scale of AHP has the advantages of simplicity and ease of use, it is not sufficient to take into account the uncertainty associated with the mapping of ones perception to a number. In spite of its popularity and simplicity in concept, this method is often criticized for its inability to adequately handle the inherent uncertainty and imprecision associated with the mapping of the decision-makers perception to exact numbers. In the traditional formulation of the AHP, human judgments are represented as exact numbers. However, in many practical cases, the human preference model is uncertain and decision-makers might be reluctant or unable to assign exact numerical values to the comparison judgments [18]. Since some of the evaluation criteria are subjective and qualitative in nature, it is very difficult for the decision-maker to express his/her preferences using exact numerical values and provide exact pair wise comparison judgments. The traditional AHP cannot be applied in a straightforward manner to solving uncertain decisionmaking problems [19]. This is because the researcher is typically unable to explicitly relate his/her preferences due to the fuzzy nature of the comparison process [18]. In order to overcome all these shortcomings, FAHP was developed for solving the hierarchical problems. Reference [20] initiated trapezoidal fuzzy numbers to express the decision makers evaluation on alternatives with respect to each criterion while [21] was using triangular fuzzy numbers. Reference [22] introduced a new approach for handling FAHP, with the use of triangular fuzzy numbers for pair-wise comparison scale of FAHP, and the use of the extent analysis method for the synthetic extent values of the pair-wise comparisons. This study takes three steps for analyzing the Fuzzy AHP questionnaires as stated below: (1) Set up fuzzy paired comparison matrices: The authors could convert the responses of each question to fuzzy numbers according to the definitions in table 3. Also, according to [20], this research uses the equations below in order to calculate the average of the nine fuzzy numbers(nine responses for each comparison question) for obtaining the seven fuzzy comparison matrices: (5)
Where is the average of the fuzzy numbers and its three points are calculated by the following equations: (6) (7)
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(8)
Table 3. Definition of fuzzy numbers [22] Fuzzy number (1,1,1) (0.33,1,1.67) (1.33,2,2.67) (2.33,3,3.67) (3.33,4,4.67)
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Definition Equally important Moderately more important Strongly more important Very strongly more important Extremely more important
(2) Calculate the local weights of the factors by extent analysis (EA) method: This study uses Changs extent analysis method as the basis for handling FAHP which is stated below: Let be an object set, and be a goal set. According to the extent analysis method of [23], each object is taken and extent analysis for each goal is performed respectively. Therefore, m extent analysis values for each object can be obtained, with the following signs: (9) are triangular fuzzy numbers. Where all the The value of fuzzy synthetic extent with respect to the ith object is defined as: (10) The degree of possibility of is defined as: (11) When a pair (x, y) exists such that Since and , and , then we have are convex fuzzy numbers we have that: (12) (13) and
Where is the ordinate of the highest intersection point D between (see Figure 3).
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Figure 3. The intersection between
and
When following equation:
and
, the ordinate of D is given by the
(14) and , we need both the values of and To compare The degree possibility for a convex fuzzy number to be greater than k convex fuzzy can be defined by: numbers (15)
),
Assume that: vector is given by:
. For
Then the weight (16)
Where vectors are:
are n elements. Via normalization, the normalized weight (17)
Where is a nonfuzzy number [18]. (3) Calculating the global weights of the factors by the multiplication of local weights of dimensions and their respective factors.
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After the deployment of three steps above, the local and global weights of the dimensions and factors and thus, their ranks have been obtained as showed in table 4. Note: The dimensions and factors which have weights less than zero are considered as inconsiderable and thus, they have not any rank.
Table 4. The local and global weights of the dimensions/factors by FAHP. Item Local weights Global weights Rank D1 0.199926495 (3) F01 0.200709854 0.040127218 13 F02 0.110392357 0.022070357 16 F03 0.253531911 0.050687746 8 F04 -0.031414428 -0.006280576 F05 0.063497116 0.012694756 18 F06 0.048156302 0.009627721 19 F07 0.152196388 0.03042809 15 F08 0.202930499 0.040571183 12 D2 0.119017336 (5) F09 1.021096505 0.121528186 5 F10 1.311994061 0.156150039 3 F11 -0.098067314 -0.01167171 F12 -1.235023252 -0.146989178 D3 0.194814551 (4) F13 0.239636649 0.046684706 11 F14 0.250364334 0.048774615 9 F15 -0.078577741 -0.015308087 F16 0.198620162 0.038694098 14 F17 0.24985262 0.048674926 10 F18 0.263754085 0.051383134 7 F19 -0.082692985 -0.016109797 F20 -0.040957123 -0.007979044 D4 0.367280245 (1) F21 0.355525445 0.130577473 4 F22 0.161752736 0.059408585 6 F23 0.482721819 0.177294188 2 D5 0.345673939 (2) F24 1.75228605 0.60571962 1 F25 -0.747806376 -0.258497175 F26 -0.004479673 -0.001548506 D6 -0.226712565 (-) F27 1.080346044 -0.244928023 F28 -0.080346044 0.018215458 17
The results show that the ranking of the weights of the dimensions are: international standard and specification (0.367), Security (0.345), Cost (0.199), Infrastructure (0.1948), Technology (0.119), and Other factors (Which has an Inconsiderable effect). These results manifest the two most influential dimensions for ITMCO to
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develop Radio Frequency Identification (RFID) are international standard and specification and security. This means the company should strengthen these two areas, including system compatibility in the supply chain, standardization of frequency used, consistency of data format, relevant legal regulations. The least influential dimension is technology. That is, the optimal outcome depends on the other four dimensions. Among these dimensions, there are two (i.e. international standard and specification, and security) whose weights are over 70% in all dimensions. On the other hand, the results show that the ranking of the weights of factors are: relevant legal regulations (F24), consistency of data format (F23), limitation of frequency (F10), system compatibility in the supply chain (F21), readability (F09), Standardization of frequency used (F22), Owning the information network for reducing the record of the different types of information on the tag and protection of the information in that network (F18), system integration cost (F03), system integration (F14), The extent of software information systems development at the organization in which the RFID deployment project is implemented (F17), willingness of supply chain members (F13), Reduction of required labors for the organization (F08), system establishment cost (F01), strong leadership (F16), reusability of tags (F07), system maintenance cost (F02), Selection of patterns which harmonized with new technology (F28), Training cost (F05), operation cost (F06), and the rest of factors have inconsiderable effect. The result shows the top two factors (factors having weights over 70%) and their weights of global ranking are: relevant legal regulations (0.6057), and consistency of data format (0.1772). These results indicate that the factors are fully distributed over international standard and specification, and security, and this distribution is more in accordance with the dimensions ranking results.
3- Conclusion This research has combined qualitative research and quantitative analysis to propose a majority of points for Iranian Tractor maker (ITMCO) planning strategy for developing Radio Frequency identification in its supply chain by a hybrid fuzzyDelphi-analytic hierarchy process approach (FDAHP), in which the proposed framework consists of the six dimensions and 28 factors, including: cost , including eight factor (system establishment cost, system maintenance cost, system integration cost, customization cost, training cost, operation cost, reusability of tags, Reduction of required labors for the organization), technology , including four factor (readability, limitation of frequency, transmission distance, number of tags to be read simultaneously), infrastructure , including eight factor (willingness of supply chain members, system integration, support and guidance from government, strong leadership, The extent of software information systems development at the organization in which the RFID deployment project is implemented, Owning the information network for reducing the record of the different types of information on the tag and protection of the information in that network, Utilization of RFID by business partners, The type of the business at ITMCO), international standard and specification, including three factor (system compatibility in the supply chain, standardization of frequency used, consistency of data format), security, including three factor (relevant legal regulations, encryption technology, prevention of stealing and loss), other factors , including two factor (organizational culture, Selection of patterns which harmonized with new technology). Clearly, this research has tried to
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modify the Lin(2009)[9] framework for the ITMCOs supply chain circumstances in order to propose a new framework in which it is more workable than former framework. All in all, the findings of this research can make a tremendous contribution to the Iranian Tractor industries in planning operative strategies for developing RFID all over their supply chains. In addition, this study verifies the practicability for the proposed model through case study; it appears this model can fit the analytic needs in developing RFID for Iranian Tractor industries. For the organizations which consider RFID and other automatic identification technologies to be implemented in their supply chains, this study suggests the method in which the ROI of the RFID , barcode, and other auto-id systems for a specific application must be compared to each other in order to select the best auto-id technology for being worked in that application. There are some applications in the supply chains which might be better suited to barcode rather than RFID and vice versa. It depends on the type of the application and no one can say that RFID is fully superior than other auto-id technologies.
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References
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[1] Sheffi, Y., RFID and the innovation cycle. The International Journal of Logistics Management, 2004,15 (1), 1-10. [2] Garfinkel, S.; Holtzman, H. Understanding RFID Technology. In: Garfinkel, S.; Rosenberg, B. (eds.) (2005). RFID. Addison-Wesley, Upper Saddle River, 2005, pp 15-36. [3] Bose, l. ; Pal, R., "Auto-ID: Managing Anything, Anywhere, Anytime in the Supply Chain", Communications of the ACM, 48(8), pp. 100-106, 2005. [4] Ferguson, G. , "Have Your Objects Call My Objects". Harvard Business Review, 80(6), pp. 138144, 2002. [5] Fleisch, E.; Dierkes, M. , "Ubiquitous Computing: Why Auto-ID is the Logical Next Step in Enterprise Automation", Working Report, Auto-ID Center, MIT, Cambridge, 2003. www.autoidlabs.org/whitepapers/stg-autoid-wh004.pdf. [6] Kelly, E. P.; Erickson, G. S., "RFID tags: commercial applications vs. privacy rights", Industrial Management & Data Systems, 105 (6), pp. 703-713, 2005. [7] Strassner, M. and Fleisch, E., "Segment evaluation - Applications of Auto-ID technology in the automotive industry", M-Lab Report, No. 15, St.Gallen, 2002. www.m-lab.ch. [8] Lu, B.H.; Bateman, R.J. and Cheng, K.," RFID enabled manufacturing: Fundamentals, methodology and applications", International Journal of Agile Systems and Management, 1(1), pp. 73-92, 2006. [9] Lin, L. C. , "An Integrated Framework for the Development of Radio Frequency Identification Technology in the Logistics and Supply Chain Management". Computers & Industrial Engineering, Vol. 57, pp. 832-842, 2009. [10] Dalkey, N., & Helmer, O., "An experimental application of the Delphi method to the use of experts". Management Science, 9, pp. 458-467, 1963. [11] Murry, T. J., Pipino, L. L., & Gigch, J. P. , "A pilot study of fuzzy set modification of Delphi", Human Systems Management, 5(1), pp. 76-80, 1985. [12] Hsu, T. H., & Yang, T. H., "Application of fuzzy analytic hierarchy process in the selection of advertising media", Journal of Management and Systems, 7(1), pp. 19-39, 2000. [13] Hder, Michael and Hder, Sabine , "Delphi und Kognitionspsychologie: Ein Zugang zur theoretischen Fundierung der Delphi-Methode", ZUMA-Nachrichten, vol. 37, 19, p. 12, 1995. [14] Martino, J. P. , "Technological Forecasting for Decision Making", 2nd edition, North Holland, New York, Amsterdam, Oxford, 1983. [15] Saaty, T. L. , "The analytic hierarchy process", New York: McGraw-Hill, 1980. [16] Saaty, T. L. , "How to make a decision: The analytic decision processes", Interfaces, 24(6), pp. 19-43, 1994. [17] Vaidya, O. S., & Kumar, S., "Analytic hierarchy process: An overview of applications", European Journal of Operational Research, 169, pp. 1-29, 2006. [18] Kahraman, C., Cebeci, U., & Ulukan, Z., "Multi-criteria supplier selection using fuzzy AHP", Logistics Information Management, 16(6), pp. 382-394, 2003. [19] Deng, H., "Multicriteria analysis with fuzzy pair-wise comparison", International Journal of Approximate Reasoning, 21, pp. 215-231, 1999. [20] Buckley, J. J., "Fuzzy hierarchical analysis", Fuzzy Sets and Systems, 17, pp. 233-247, 1985. [21] Laarhoven, P. J. M., & Pedrycs, W., "A fuzzy extension of Saaty's priority theory", Fuzzy Sets and Systems, 11(3), pp. 229-241, 1983. [22] Chang, D. Y., "Applications of the extent analysis method on fuzzy AHP", European Journal of Operational Research, 95, pp. 649-655, 1996. [23] Zhu, Y. Jing and D. Chang, A Discussion on Extent Analysis Method and Applications of Fuzzy AHP, European Journal of Operational Research, Vol. 116, No. 2, pp. 450-456, 1999. [24] Chang, D. Y., "Extent analysis and synthetic decision", Optimization Techniques and Applications, Vol. 1, p. 352, 1992.
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Determining the level of Influencing of Intellectual capital Efficiency on Brand Value of the Companies Accepted in Tehran Stock Market
Hossein Rezaei Dolat Abadi Associated Professor, Management Department Faculty of Administrative Science and Economics, University of Isfahan Address: Isfahan University, Science and Economics Department, Hezar jerib Street,Isfahan, Iran. Najmeh Tavakoli(Corresponding author) MA of Accounting ,Islamic Azad Yazd Branch University Address: Islamic Azad Yazd Branch University, Sfayh Street,Yazd, Iran.
Abstract The limit of financial statements provided by the traditional accounting in explaining and developing the value of companies depends on this fact that economical sources and value do not just consist of producing the goods and having high inventory or turnover cash flow ,but the Intellectual capitals should be also considered in the most pessimistic production state.The purpose of this study is to investigate the effect of Intellectual capital efficiency on brand value of the companies in Tehran stock market. In this study , the effect of Intellectual capital indexes (human capital efficiency , and the capital employed in structural , customer , process , and renewal on brand value of 52 companies was investigated in the time range of 2008-2004 with the use of structural equations and Amos software . The results of the study show that the coefficient of capital efficiency in human , structure , customer , and process has a positive and significant effect on brand value , but the effect of capital employed efficiency on the brand value is not positive and significant . Among the other results of the current study, the significant relationship between the Human capital efficiency and customer capital efficiency as well as between the structural capital efficiency and process capital efficiency can be also mentioned. Keywords: Intellectual capital, human capital, structural capital, capital employed, brand value. 1. Introduction We live in an age in which a large number of organizations are faced with the increasing need to have creativity, competitive advantage , and risky flexibility ]1[ . The importance of the need to competition, utility, and confronting the future dangers along with the day by increased organization changes [2] and emergence of the knowledge oriented economy age, new concepts were raised which have a noticeable share in increasing the competition power and the organizations envisage with the quick environmental changes. Organizational sources adopted a new definition in the age of knowledge economy and also targeted a wider range. The sources have been defined newly as all different kinds of assets which enable a company to implement its strategies effectively and effectively, as well as to improve its competitive power. This definition consists of large varieties of assets as physical and non physical ones like the employees proficiencies, invention right or ownership, etc [3]. physical and tangible assets of a company are no considered as the most important part of its supplies, but it is the intangible assets and supplies which hanks to their rarity , value , and non imitative nature are taken are taken in to account for the other companies. Intellectual capitals can present a new complete model to observe
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the organizational value in the process if finding a method to measure and assess the intangible assets .Intellectual capitals can be considered as a new model to observe the hidden organizational values[4]. 2. Review of the literature Moving the societies from traditional age to the information one, the importance of Intellectual capital has increased. This importance can be the effect of such factors as information technology revolution, increasing importance of knowledge and knowledge oriented economy, as well as the effect of innovation and creativity as the competition determining element [5] In the industrial period, the prices of property, machineries equipments and raw materials were considered as the efficient elements of the commercial units, while in the information age the efficient use of Intellectual capital often determines the success or failure of the commercial units [6]. The first attempt related to the concepts of Intellectual capital owes to fritz Machlab,s studies in 1962 . However, innovation of Intellectual capital concept is historically attributed to an economist called John Kont Galbrice in 1969. Of course , James Tabin,s attempts in the later half of the previous century should not be forgotten , his relativity based model , Kiwi - Tabin model , could provide for the first time the organizations with an instrument to be able to examine the effective performance of the organization Intellectual capital. Edvinson , who is considered as one of the pioneers in Intellectual capital , defines the difference between market value and book value as Intellectual capital value. In this viewpoint Intellectual capital has been made of human and structural capitals [7]. Holman (2005) defines Intellectual capital as the parts of as Intellectual, Knowledge, information, Intellectual property, and experience, using it can make wealth [8]. Broking [1996] has presented a comprehensive definition of as Intellectual capital as a combination of intangible assets which enables the organization to do its own tasks [9]. In the most accepted classification design , Intellectual capital is divided into three sub fields of human , structural , and customer capital , human capital is deemed as the base of Intellectual capital and essential element in performing its duties , and also it is the reserve of organization Knowledge which is displayed by the employees. Structural capital can be referred to everything which exists in the organization and supports the employees (human capital). This kind of capital as a supporting foundation enables the human capital to perform its duties. Structural capital is under the possession of the organization and exists there even when the employees leave the organization [9]. Customer capital is considered as a bridge and organizer of Intellectual capital operation, and is also seen as a determining factor in changing the Intellectual capital to the market value [10]. The capital employed, seen from the side of balance sheet supplies, is referred to the whole current and long term assets. Today, the intangible aspect of economy has been based on Intellectual capital and knowledge and information make its primitive and basic material . In order for the organizations to participate in present markets , they need in every from and kind the information and knowledge to improve their performance. Conducted studies represent an increase of 60- 75 percent in the value of Intellectual capital and intangible assets in the price of the firms shares. In other words, it can be said that nowadays the management of Intellectual capital will reach the organizations to more successes in future horizons of the competitive markets. 3. Background of the Study A lot of evidences indicate that there is a positive relationship between the Intellectual capital and firms performances Abdollah Aziz, study in Jordan [11] showed that there is a direct relationship between the elements of Intellectual capital and performance of drug making companies. In addition , Arboor Valing [13] showed in his study that by using the value added model in IT industry , measuring the Intellectual capital causes the value of stock market to be increased and influences the firm performance positively. Ton etal,s research in Singapor [19] showed that there is a significant correlation between the Intellectual capital and future performance Of the firm , the rate of Intellectual
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capital growth is directly dependent on the firm performance , and also the effect of Intellectual capital on the performance of active firms in different industries is different . Veng and chang [16] dealt with examining both the relationship between the parts of Intellectual capital from the cause and effect aspect and the effect of Intellectual capital elements on the commercial performance of Taiwanian companies . Human capital also affects the performance indirectly and through the three kinds of renewal , process , and customer capitals . In addition, there is a cause and effect relationship between the four elements of Intellectual capital . Human capital affects both renewal and process capitals . Renewal capital also affects the process one and in turns the process capital Affects the customer ons too . Finally, customer capital affects the performance. In this study , Root Oranus [12] has dealt with examining the Intellectual capital to disclose the economical interest in four countries of Belgum , France , Germany , and the Netherlands , whose results show the Intellectual capital brings forth the better disclosure of economical interest . In a study , Riahi Balkoei [14] dealt with examining the relationship between the Intellectual capital and performance of American multinational companies ; By choosing the number of requests protecting the commercial signs as the Intellectual capital measurement criterion as well as the ratio of added value to the whole assets as the performance measuring criterion , he found that there is a significant and positive relationship between the performance and intellectual capital of , American multi-national companies . In a study in Taiwan , shiv[18] dealt with examining the relationship between Intellectual capital ( value added Intellectual coefficient) and financial performance of Taiwanian firms .The results of this study show that value added Intellectual coefficient has a positive correlation with profitability (return on assets) and the market value (market to book value ratio), while it has a negative correlation with the utility (assets turnover ).In a study , fayrer and Williams [15] dealt with examining the relationship between the physical capital value added efficiency ,human capital , and structural capital with profitability , utility ,and market value of the companies accepted in Juhansburg stock market in south Africa with the use of correlation analysis and linear regression . The results of this study show that the elements of Intellectual capital , except the human capital , affect directly the commercial performance . chen et ats research in Taiwan[17] showed that the companies Intellectual capital has a positive and significant effect on the markets values and their financial performance . In addition , the expanses of research and development have a positive effect on the value and profitability 3.1. Research Hypotheses Considering the study of domestic and foreign back grounds of the research, the main hypothesis there of can be stated as follows: Main hypothesis: Intellectual capital has an effect on brand value. According to the variant and main hypothesis, the following Sub-hypotheses are taken into account. Sub-hypotheses: H1: Customer capital has an effect on the brand value. H2: Human capital has an effect on the brand value. H3: Employed capital has an effect on the brand value. H4: Process capital has an effect on the brand value. H5: Renewal capital has an effect on the brand value. H6: Structural capital has an effect on the brand value.
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4. Researcher Method
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This research is a descriptive kind and applicable in terms of the purpose. This research aims at measuring the companies Intellectual capitals and testing these methods empirically in Tehran bonds stock market. To do so , at first the efficiency of Intellectual capital elements ( human capital , capital employed , customer capital , process capital , and renewal capital ) were calculated based , on paliks method for the time period of 2008 to 2004. Then in the next stage, the main hypothesis of the study by which the Intellectual capital has an effect on the brand value , is assessed by using the structural equations . The statistical community of this research consists of the companies accepted in Tehran bonds stock market, among them the following authorized ones have been chosen as the sample: 1) The companies which have been accepted in bonds stock market before 2004. 2) The under examination companies have incurred no losses during the under study period, and based on the accounting report have had net profit after tax. 3) The companies which had reported their audited financial statements to the stock market during the study period. Considering the conducted investigations, among the accepted Companies 52 ones were known qualified in Tehran bonds stock market and were chosen as the statistical samples. It is necessary to say that considering the limitations enforced in the statistical sample, some of the industries are without the agents.
4.1. Data gathering instrument and research information The library and field methods have been used in this study to gather the data and information. theoretical foundations of the research have been gathered from the books,theses ,internet articles, magazines , specialized Persian and Latin sites as well as theoretical framework of the research back ground ,and also the needed financial data has been extracted from Novin Rahavard software and informational bases of Tehran bonds stock market organizations (financial statements and the yearly audited along With notes of the companies ). 4.2. Variables and the whole research procedure According to the conducted researches, the element of human, process ,structure ,employed, and customers capitals have been used as the agents affecting the brand value in this study. Thanks to the lack of sufficient information this study in the financial statements of the firms accepted in the bonds stock market for measuring the renewal capital .the hypothesis of renewal capital effect on the brand value was omitted . and as it can be seen , the following conceptual model (figure 1) shows the whole research procedure , main hypotheses , as well as the manner of the under study variables affecting . based on this , the dependent and independent variables are defined as follows (figure 1) This model variable is as follows: 1-Huma capital 2-Structural capital 3- Customers capital 4- Employed capital 5- Process capital (independent variable) 6-Brand value (dependent variable) 5. Hypotheses testing using the structural equations method: In this study this technique has been also used to test the hypotheses and examine the totality of the model since the entire model hypotheses are altogether and at the same time with the use of route analysis and structural equations the results are presented in the form of figure and chart as follows. the noticeable point in this method is that the thing being tested is the model the researcher has composed with the use of theoretical foundations and respective literature, and the out put of this
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analysis may be needed in the form fitting indexes to measure the model . In addition, it may be needed to omit some hypothesis from the model which have not been confirmed at the level of 5% significant , or to add some suggestions which enjoy sufficient and logical theoretical foundations for making new relationships . This point should be taken into account that the model fit aims at reaching less k-Square value and more freedom degree. 5.1. Testing sub-hypothesis: 1) Customer capital has an effect on brand value. 2) Human capital has an effect on brand value. 3) Capital employed has an effect on brand value. 4) Process capital has an effect on brand value. 5) Structural capital has an effect on brand value. Having tested the hypothesis, the model has been finally improved and the significant level of each one of the relations along with the standard regression coefficients has been also presented. As it has been also shown in the table, all of the hypothesis except the 1-3 one have been confirmed at 5 percent significant level and it can be concluded that there is a significant relationship between the human and customer capital s as well as the process and structural ones . In the following figure , the final research model along with the model fit indexes and regression coefficients have been presented which form the base of our conclusion and analysis . The following table represents a report of main indexes of final model fit. As it can be seen, the very much important RMSEA index has been reported less than 0.1 and 0.069 and among GFI, PNFI, PCFI indexes are acceptable. (Table 2) 6. Conclusion Brand is one of the most important kinds of structural capital which has a great importance in terms of affecting the strategic marketing decisions. In spite of the importance of brand as a intellectual capital in making value for different beneficiaries with different interests and orientations, it can be considered as the superiority source of dynamic and constant competition for the organization. In the current study and after the hypothesis testing (intellectual capital has an effect on brand value ) , experiential evidences show a positive and significant relationship between the human capital efficiency , structural capital , customer capital , and process capital with the brand value . However , there is no positive and significant relationship between the efficiency of employed capital and the brand value . so , the more the company enjoys higher levels of intellectual capital ( human capital , structural capital , process capital , and customer capital ) , it will have more brand values , and so more interest levels too . Among the other results of this test , the presence of significant relationship between the structural and process capital , as well as between the human and customer capital can be mentioned too . This means that the process capital is dependent on the structural one , and the customer capital dependent on the company human capital too.
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References 1-Dietz,Jan L.G. DEMO: Towards a discipline of organization engineering . European Jornal of Operational Research, 128,2001,351-363. 2-Pienaar, Heila & Penzhorn, Cecilia. Using the Balanced Scorecard to Facilitate Strategic Management at an Academic Information Service. Libri, vol. 50.2000.pp.202-209. 3.Camelo-Ordaz ,Carmen,Martn-Alca,Ferrnando &Valle-Cabrera, Ramon .Intangible resources and strategic orientation of companies An analysis in the Spanish context. Journnal of Business Research ,5,2003,95-103. 4.Chu,Po Young.lin,Yu Ling&Yar Liu,Tzu.Intellectual capital:An empirical study of ITRI.Technological Forecasting& Social Change,73.2006,886-902. 5-Guthrie, J .(2001). The Management, Measurement, and the Reporting of Intellectual Capital. Journal of Intellectual Capital, 2 (1), 27-41. 6-Sonnier, B. M., Carson, D. C. and Carson, P. P. (2007). Accounting for Intellectual capital: The Relationship between Profitability and Disclosure. Journal of Applied Management and Entrepreneurship, 12 (2), 3-14. 7-Stewart, T. A. (1997). Intellectual Capital: The New Wealth of Organizations. New York: Doubleday. 8-Holmen, J. (2005). Intellectual Capital Reporting. Management Accounting Quarterly, 6 (4), 1-9.. 9-Bhartesh, K. R. and Bandyopadhyay, A. K. (2005). Intellectual Capital: Concept and its Measurement. Finance India, 19 (4), 1365-1374. 10-Chen, M., Cheng, S. and Hwang, Y. (2005). An Empirical Investigation of the Relationship between Intellectual Capital and Firms Market Value and Financial Performance. Journal of Intellectual Capital, 6 (2), 159-176. 11-Abdel-Aziz Ahmad Sharabati and Shawqi Naji Jawad , Nick Bontis.(2010), Intellectual capital and business performance in the pharmaceutical sector of Jordan ,Management Decision.pp.105-131. 12-Raf Orens , Walter Aerts , Nadine Lybaert. (2009), Intellectual capita disclosure, cost of finance and firm value , Management Decision,pp 1536-155. 13- Ann,Arbor,Valuing,(2007) Intellectual Capital firms performance: modifying value Adde Intellectual coefficient(VAIC)in Taiwan II industry, theses doctoral. 14-Riahi-Belkaoui, A. (2003). Intellectual Capital and Firm Performance of US Multinational Firms. Journal of Intellectual Capital, 4 (2), 215-226. 15-Firer, S. and Williams, S. M. (2003). Intellectual Capital and Traditional Measures of Corporate Performance. Journal of Intellectual Capital,4 (3), 348-360. 16-Wang, W. and Chang, C. (2005). Intellectual Capital and Performance in Causal Models: Evidence from the Information Technology Industry in Taiwan. Journal of Intellectual Capital, 6(2), 222-236. 17. Chen J., Zhu Z. and Xie H.Y. Measuring intellectual capital: a new model and empirical study. Journal of Intellectual Capita 2004; 5(1):195-212. 18-Shiu, H. (2006). The Application of the Value Added Intellectual Coefficientto Measure Corporate Performance. International Journal of Management, 232), 356-365. 19-Tan, H. P., Plowman, D. and Hancock, P. (2007). Intellectual Capital and Financial Returns of Companies. Journal of Intellectual Capital, 8 (l),76-95. 20-K. Donelaicio str.(2010),Model of Organizations Intellectual Capital easurementLina Uziene Inzinerine Ekonomika-Engineering Economics,21(2),pp151-159. 21-Day-Yang Liu, K-An Tseng, Szu-Wei Yen. (2009),The incremental impact of intellectual capital on value creation ,Journal of Intellectual capital .pp 260-276. 22- Jamal A, Nazari and Irene M . Herremans. (2007)Extended VAIC model: easuring Intellectual capita component. Journal of Intellectual capital,8(4),pp595-609l. 23-Laurence Lock Lee. James Guthrie, (2010), Visualising and measuring intellectual capital in capital markets : a research method , Journal of Intellectual capital,pp 4-22. 24- Inderpal Singh and J-L.W.Mitchell Van der Zahn(2009)Intellectual capital prospectus disclosure and post- issue stock performance , Journal of Intellectual capital,pp.425-45. 25- Alladin o.Ukiwe(2009).Ihe Joint Impact of Brand Value and Advertising on Corpprate Financial Perfomance and on Stock Reyurn .Acase Study of the computer Industry , theses doctoral. 26-Brand Equity management in a multichannel multimedia retail Environment , journal of Interactiive marketing 24(2010)58-70.
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Annexure
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CCE
HCE
CEE
BV
PCE
SCE
Figure 1- Conceptual Total Model
CCE
.38
HC E
.43
.48
z1
.37
BV
PCE
.61 .55
SCE
Figure 2 : Final research model
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Estimate BV <--- CCE BV <--- HCE .772 .730 S.E. C.R. P Label
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BV <--- PCE .890 BV <--- SCE .900 Table 1-1 : The summary of hypothesis testing results ( Improved model ) Regression Weights: (Group number 1 -1 Default model) Estimate BV <--- CCE .481 BV <--- HCE .431 BV <--- PCE .371 BV <--- SCE .549 Table 1-2: Standardized Regression Weights: (Group number 2 -1 Default model) Estimate S.E. C.R. P Label CCE <--> HCE 1.040 .012 4.015 .000 PCE <--> SCE 1.029 .012 6.415 .000 Tabale1-3-Covariance: (Group number 3 - 1Default model) Estimate CCE <--> HCE .381 PCE <--> SCE .609 Correlations: (Group number 4 -1 Default model) Estimate S.E. C.R. P Label 1.127 .097 11.597 000 .032 .003 11.597 000 1.152 .099 11.597 000 .033 .003 11.597 000 6249.300 538.853 11.597 000 Variances: (Group number 5 -1 Default model)
CCE HCE PCE SCE z1
Table 1-4-: show that there is a positive and significant relationship between the human capital and customer capital with process capital and Structural capital.
Model Default model Saturate d model Independ ence model CMIN 27.9941 0.000 261.765 DF 8 0 10 0.000 12.465 P 0.066 CMIN/DF 3.4926 GFI 0.941 1.000 0.338 0.255 0.300 AGFI 0.839 PGFI 0.617 RMSEA 0.069 .286 CFI 0.904 1.000 0.000 PNFI 0.580 0.000 0.000 PCFI 0.581 0.000 0.000
Table 2: The summary of statistical results of final model fit indexes
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS University Roles in Achieving Iran's 20-Year Vision Plan Case Study (University of East Azerbaijan province)7
Gholamreza Rahimi (Phd)
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Assistant Professor in Management Department of Islamic Azad University, Jolfa International Branch, East Azerbaijan, Iran
Ghader Vazifeh Damirch (MA)
Management Department of Islamic Azad University, Jolfa International Branch, East Azerbaijan, Iran
Abstract The development of a country depends on the creation of a scientific idea and provides high quality education systems. In this study, we have tried to investigate Irans university roles in achieve Irans 20-Year Vision Plan and find reply to this question Is there relationship between university roles and Iran's 20-Year Vision Plan.? In this research for collecting data we used the library and field resources so that for compiling the literature of the research we used library sources specially Irans 20-Year Vision Plan documents.The population was all deans of the public (31), non-government (34) and distance educational system universities (30) in the province of East Azerbaijan. Date gathering has done by a questionnaire that its stability has reported 89%. To analyze the data resulted from collected questionnaires deductive and descriptive statistical methods are used. In deductive level to test the hypothesis of the research we used Pierson correlation test (r) and to determine the meaningfulness level of (r) we used t-test. Findings show that there is relationship between university roles and Iran's 20-Year Vision Plan. Keywords: Educational System, Educational Structure, Educational Costs, Educational Products, Research Activity, University, Irans 20-Year Vision Plan INTRODUCTION Development can be viewed as a state of progress. There are varieties of issues that can be viewed as an important part and parcel of the development process of any country. It is believed that university is the most important factor for integrating the developing and developed countries. We cannot ignore the effect of Academic development in our daily life even in developing countries (Nahmudi, 2010). Academic development is centered on the educational accomplishment of a given country. Academic development is the oil that turns a countrys development wheel. The rate at which a country can grasp new ideas, technological infusion and quickly embrace borrowed technology depends on its level of academic development. The major measure of educational accomplishment of a country is the presence of a university, which not only produces graduated labor force but also serves as the torch
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This paper is based on the final report based on research projects sponsored by Islamic Azad University, Kaleybar Branch
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for the lower rungs of academic ladder. In other words the success of a person is viewed in terms of his educational accomplishments. Strictly speaking in a fair society the educated enjoy good jobs and fat salaries as the uneducated either become their juniors or their servants (Saburi, 2009). Generally, the university system is woven around three comprehensive activities: instruction for undergraduate, graduate, and professional degrees; research geared to expanding the frontiers of knowledge; and outreach or dissemination of learning beyond the boundaries of the institution through the printed word, scholarly associations, formal and non-formal instruction, and worldwide telecommunications and computer linkages (Farasatkhah & Ganeizadeh, 2009). In 2002, Iran's Expediency Council approved the 20-Year Vision Plan to promote the position of the Islamic Republic of Iran in national, regional and international levels in which Iran becomes a developed country in twenty years, with the first economic, scientific and technical stand in the region. The 20-Year Vision Plan has considered and emphasized twenty-year goals for developing countries and focuses on the economic dimension of the first scientific, economic and technical stand in the region. In order to meet the ends of the program, it must equip national and international forces (the Expediency Council, 2008). The mission-oriented report of the plan contains 10 chapters and sets qualitative and quantitative objectives that support long term socio-economic development from 2005 to 2025 years. They take into consideration the strategic and innovative priorities of various scientific and technological fields. The plan also calls for promoting public understanding of science, as well as establishing research infrastructure with more focus on setting up science and technology parks to encourage private sector investment in science. and also calls for decreasing emigration of elite professionals and specialists to other countries using several measures, including ways of boosting employment in higher education and providing special facilities, preserving their social status and preparing facilities and regulations in entrepreneurship. The final aim of the plan is producing native science and knowledge, innovation, self- sufficiency and environmental protection, as well as focusing on advance sciences to achieve a first ranking in the innovation index in the Middle East (the Expediency Council, 2008).. The explorative approach was chosen to prioritize branches of science and technologies. The expert panels, using the foresight techniques, explored the trends (social, technological, economical, environmental, and political) and the future's scenarios (Hidge, 2007). To promote a knowledge-based economy, Iran has announced a 20-year "comprehensive plan for science" focusing on science in higher education and industry-university research partnerships. Concerning scientific development, we need to redefine the parts of our scientific strategy - those that are based on the five principles of educational system, educational structure, educational costs, educational products and research activity and can provide an infrastructure for meeting the goals of the 20-Year Vision Plan document (the Expediency Council, 2008). The development of a country depends on the creation of a scientific idea and provides high quality education systems. So, in this study we have tried to investigate
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Irans university roles in achieve Irans 20-Year Vision Plan and reply to this question Is there relationship between university roles and Iran's 20-Year Vision Plan.? RESEARCH HYPOTHESIS Main Hypothesis There is relationship between university roles and Iran's 20-Year Vision Plan. Secondary Hypothesis is: 1. H1. There is relationship between educational system of universities and Iran's 20-Year Vision Plan. 2. H2. There is relationship between educational structure of universities and Iran's 20-Year Vision Plan. 3. H3. There is relationship between educational costs of universities and Iran' 20-Year Vision Plan. 4. H5. There is relationship between educational products of universities and Iran's 20-Year Vision Plan. 5. H5.There is relationship between research activity of universities and Iran's 20-Year Vision Plan.
RESEARCH OBJECTIVES Main objective There is relationship between university roles and Iran's 20-Year Vision Plan. Secondary objectives 1- Understanding and determining relationship between educational system universities and Iran's 20-Year Vision Plan. 2- Understanding and determining relationship between educational structure universities and Iran's 20-Year Vision Plan. 3- Understanding and determining relationship between educational costs universities and Iran's 20-Year Vision Plan. 4- Understanding and determining relationship between educational products universities and Iran's 20-Year Vision Plan. 5- Understanding and determining relationship between research activity universities and Iran's 20-Year Vision Plan.
of of of of of
METHODOLOGY The recent research is a field work methodically and applied from the goal point of view. In this research for collecting data we used the library and field resources so that for compiling the literature of the research we used library sources specially Irans 20-Year Vision Plan documents, and field work resources to test the thesis of the research. The population of this study, all the deans of public universities, non-government universities and distance educational system universities (Payame-Noor) in the province of East Azerbaijan. We determined the amount of the sample size with the used of p.q sampling method, which obtained 31 public universities, 34for nongovernment and 30 distance educational system with 95 percent confidence level. In this study the stability of questionnaire through cronbach alpha method for the questionnaire has been reported 89%, for educational system 82%, for educational
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structure 90%, for educational costs 84%, for research activity 79% and for educational products 87%. Questionnaire was made on 5 point likert scale to verify the impact of variables. In order to analyze the data resulted from collected questionnaires deductive and descriptive statistical methods are used, and to display some statistical data we used column diagram and in deductive level to test the hypothesis of the research we used Pierson correlation test (r) and to determine the meaningfulness level of (r) we used ttest.
ANALYSIS B) Descriptive Analysis Table1 shows Std. Error of Mean, Median, mode, Std. Deviation, Variance, Maximum, Range, minimum and sum of all variables.
Iran's 20Year Vision Plan 96 0 .973 educational system Statistics educational structure educational costs 96 0 .242 13.00 13 1.388 1.926 5 10 15 408 educational products 96 0 .272 12.00 12 1.562 2.439 6 9 15 388 research activity 96 0 .289 12.00 12 1.661 2.758 7 9 16 412
Valid 96 96 Missing 0 0 Std. Error of .348 .228 Mean Median 46.00 13.00 12.00 Mode 38a 14 12 Std. Deviation 5.589 2.000 1.311 Variance 31.239 4.002 1.718 Range 19 7 5 Minimum 38 9 10 Maximum 57 16 15 Sum 1506 421 395 a. Multiple modes exist. The smallest value is shown Table1- Statistics
Table 2 shows responders degree. According to table1, 44 percent of the responders have M.A degree and 56 percent have PH.D degree.
Vali d PHD MA Total Responders degree Frequency Percent Valid Percent 54 56 56 42 44 44 96 100.0 100.0 Table2- Responders degree Cumulative Percent 56 100.0
Table3 shows Managing background of the responders. According to table3, from the precedence point of view about 21.87 percent of responders have less than 2 years. 4.62 percent 3-5 years, 18.75 percent 6-9 years, 44.46 percent 10-13 years experience in managing and finally 7.29 percent have more than 14 years of managing experience which is shown in Table3.
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Managing background of the responders Frequenc Percent Valid Cumulative y Percent Percent Less than 2 21 21.87 21.87 21.87 3-5 39 40.62 40.62 62.49 6-9 18 18.75 18.75 81.24 10-13 11 11.46 11.46 92.73 More than 14 7 7.29 7.29 100.0 Total 96 100.0 100.0 Table 3- Managing background of the responders
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Vali d
C) Data Analysis The results obtained from survey and testing the research hypothesis have come below. H1. There is relationship between educational system of universities and Iran's 20Year Vision Plan.
Correlations educational system Pearson Correlation 1 Sig. (2-tailed) N 96 Iran's 20-Year Vision Plan 0.423 .000 96
educational system
Table 4- Pearsons correlation coefficients of educational system of universities and Iran's 20-Year Vision Plan.
This hypothesis is measured by 3 questions of educational system of universities and 12 questions of relating to Iran's 20-Year Vision Plan. As shown in table 4, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.423, P=0). Therefore, Man hypothesis is confirmed. According to obtained t (6.51) from testing the main hypothesis which is bigger than the critical point of t-table in fault ability level =0/05, so with reliability level of 95 percent we can be said the main hypothesis is approved, and we can say that educational system of universities in East Azerbaijan Province is affecting in Iran's 20-Year Vision Plan. In other words, there is a meaningful relationship between educational system of universities and Iran's 20-Year Vision Plan and we can reject the H0. According to obtained determination quotient, educational system of universities variable explains 18.89 percent of dependent variable variance of Iran's 20-Year Vision Plan in East Azerbaijan Province. This means that 18.89 percent of variation in Iran's 20-Year Vision Plan in East Azerbaijan Province is dependent upon independent variable.
H2. There is relationship between educational structure of universities and Iran's 20Year Vision Plan.
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Correlations educational structure Pearson Correlation 1 Sig. (2-tailed) N 96 Iran's 20-Year Vision Plan 0.536 .000 96
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educational structure
Table 5- Pearsons correlation coefficients of educational structure of universities and Iran's 20-Year Vision Plan.
This hypothesis is measured by 3 questions of educational structure of universities and 12 questions of relating to Iran's 20-Year Vision Plan. As shown in table 5, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.536, P=0). Therefore, Man hypothesis is confirmed. According to obtained t (8.78) from testing the main hypothesis which is bigger than the critical point of t-table in fault ability level =0/05, so with reliability level of 95 percent we can be said the main hypothesis is approved, and we can say that educational structure of universities in East Azerbaijan Province is affecting in Iran's 20-Year Vision Plan. In other words, there is a meaningful relationship between educational structure of universities and Iran's 20-Year Vision Plan and we can reject the H0. According to obtained determination quotient, educational structure of universities variable explains 28.73 percent of dependent variable variance of Iran's 20-Year Vision Plan in East Azerbaijan Province. This means that 28.73 percent of variation in Iran's 20-Year Vision Plan in East Azerbaijan Province is dependent upon independent variable.
H3. There is relationship between educational costs of universities and Iran' 20-Year Vision Plan.
Correlations educational costs Pearson Correlation 1 Sig. (2-tailed) N 96 Iran's 20-Year Vision Plan 0.232 .001 96
educational costs
Table 6- Pearsons correlation coefficients of educational costs of universities and Iran's 20-Year Vision Plan.
This hypothesis is measured by 3 questions of educational costs of universities and 12 questions of relating to Iran's 20-Year Vision Plan. As shown in table 6, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.232, P=0). Therefore, Man hypothesis is confirmed. According to obtained t (3.31) from testing the main hypothesis which is bigger than the critical point of t-table in fault ability level =0/05, so with reliability level of 95 percent we can be said the main hypothesis is approved, and we can say that educational costs of universities in East Azerbaijan Province is affecting in Iran's 20-Year Vision Plan. In other words, there is a meaningful relationship between educational costs of universities and Iran's 20-Year Vision Plan and we can reject the H0. According to obtained determination quotient, educational costs of universities variable explains 5.38 percent of dependent variable variance of Iran's 20-Year Vision Plan in East Azerbaijan Province. This means that 5.38 percent of variation in Iran's 20-Year Vision Plan in East Azerbaijan Province is dependent upon independent variable.
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H4. There is relationship between educational products of universities and Iran's 20Year Vision Plan.
Correlations educational products Pearson Correlation 1 Sig. (2-tailed) N 96 Iran's 20-Year Vision Plan 0.682 .000 96
educational products
Table 7- Pearsons correlation coefficients of educational products of universities and Iran's 20-Year Vision Plan.
This hypothesis is measured by 3 questions of educational products of universities and 12 questions of relating to Iran's 20-Year Vision Plan. As shown in table 7, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.682, P=0). Therefore, Man hypothesis is confirmed. According to obtained t (12.87) from testing the main hypothesis which is bigger than the critical point of t-table in fault ability level =0/05, so with reliability level of 95 percent we can be said the main hypothesis is approved, and we can say that educational products of universities in East Azerbaijan Province is affecting in Iran's 20-Year Vision Plan. In other words, there is a meaningful relationship between educational products of universities and Iran's 20-Year Vision Plan and we can reject the H0. According to obtained determination quotient, educational products of universities variable explains 46.51 percent of dependent variable variance of Iran's 20-Year Vision Plan in East Azerbaijan Province. This means that 46.51 percent of variation in Iran's 20-Year Vision Plan in East Azerbaijan Province is dependent upon independent variable.
H5.There is relationship between research activity of universities and Iran's 20-Year Vision Plan.
Correlations research activity research activity Pearson Correlation Sig. (2-tailed) N 1 96 Iran's 20-Year Vision Plan 0.557 .002 96
Table 8- Pearsons correlation coefficients of research activity of universities and Iran's 20-Year Vision Plan.
This hypothesis is measured by 3 questions of research activity of universities and 12 questions of relating to Iran's 20-Year Vision Plan. As shown in table 8, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.557, P=0). Therefore, Man hypothesis is confirmed. According to obtained t (9.29) from testing the main hypothesis which is bigger than the critical point of t-table in fault ability level =0/05, so with reliability level of 95 percent we can be said the main hypothesis is approved, and we can say that research activity of universities in East Azerbaijan Province is affecting in Iran's 20-Year Vision Plan. In other words, there is a meaningful relationship between research activity of universities and Iran's 20-Year Vision Plan and we can reject the H0. According to obtained determination quotient, research activity of universities variable explains 31.02 percent of dependent variable variance of Iran's 20-Year Vision Plan in East Azerbaijan Province. This means that 31.02 percent of variation in Iran's 20-Year Vision Plan in East Azerbaijan Province is dependent upon independent variable.
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MH. There is relationship between university roles and Iran's 20-Year Vision Plan.
Correlations research activity research activity Pearson Correlation Sig. (2-tailed) N 1 96
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Iran's 20-Year Vision Plan 0.824 .002 96
Table 9- Pearsons correlation coefficients of research activity of universities and Iran's 20-Year Vision Plan.
The main hypothesis is measured by 3 questions of research activity of universities and 12 questions of relating to Iran's 20-Year Vision Plan. As shown in table 9, correlation coefficient between grades of Ethical climate and Organizational Health is positive and significant (r=0.824, P=0). Therefore, Man hypothesis is confirmed. According to obtained t (20.6) from testing the main hypothesis which is bigger than the critical point of t-table in fault ability level =0/05, so with reliability level of 95 percent we can be said the main hypothesis is approved, and we can say that research activity of universities in East Azerbaijan Province is affecting in Iran's 20-Year Vision Plan. In other words, there is a meaningful relationship between research activity of universities and Iran's 20-Year Vision Plan and we can reject the H0. According to obtained determination quotient, research activity of universities variable explains 67.98 percent of dependent variable variance of Iran's 20-Year Vision Plan in East Azerbaijan Province. This means that 67.98 percent of variation in Iran's 20-Year Vision Plan in East Azerbaijan Province is dependent upon independent variable.
CONCLUSION Findings show that there is relationship between university roles and Iran's 20-Year Vision Plan. According these findings, we must take cognizance of the fact the development of our country greatly depends on those among us who work in the area of education. Nowhere in the world has sustained development been achieved without a well functioning system of education, and without superb universities from whose research laboratories numerous, inventions have gone a long way to improve the quality of life and to provide the much needed labor force. If we want to build entrepreneurs in Iran, we must at the same time build the intelligentsia. The educational system of a country is the base upon which the countrys development lies. Properly trained manpower is the oil that will turn the country development wheel. It seems, despite being under sanction for about 30 years, this plan will enable Iran to sustain its scientific progress, making it a good model for developing countries to follow as it demonstrates self-reliance on a domestic pool of talents and technological know-how. SUGGESTIONS The university should impart on its graduates the various skills that will enable them to join the labor force without hassles. The university should have academic freedom so that the frontiers of knowledge are probed and explored. University students should be encouraged
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to develop new ideas and participate in active discussions of challenging ideas with fellow students. Lecturers should act as the catalysts to these challenging ideas. The university lecturers and dons should be the chief advisers to the president in matters pertaining to scientific, economic and social issues The university should act as the principal focus upon which the lower echelons of academic hierarchy are centered. In this case the university should play and integral role in ensuring that the zeal of academic standards in primary and secondary levels of education is high. The university should play in the development of Iran is to pass information from one generation to another through teaching. Universities were crucial to the cultural and social vitality of the Iran and Islam. The university should help solve immediate problems facing the country and in the communities which they exist. The university should create new knowledge. Inventions worldwide are the result of the creative ideas of university professors and their advanced students.
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References Tagizadeh.H and Tari. GH. 2007, Graphic pattern of research in the humanities, Tehran, Hafiz publication
Hafeziniya.M, 2004, Introduction to research in the humanities, Tehran, SAMT publication Khaki.GH, 2009, Research Methodology in Management, Tehran, Islamic Azad University publication Delavar. A, 2006, Applied Probability and Statistics in Psychology and Educational Sciences, Tehran, Virayesh publication, 12 Edition Saburi. A, 2009, Science production in Iran in 2007, Rahyaft journal, No41,p35-40. Farasatkhah. M and Ganeizadeh. M,2009, The role of scientific associations and academics in the scientific assessment and policy, Rahyaft journal, No 41,p5-12.
Nahmudi. M, 2010, Development of the necessary breathing space for the development of technology, Iran Technology Analysts Network, http://www.itan.ir/ general policies CD, Version 2, Spring 2008, the Commission of the Expediency Council, http://majma.ir/ Hidge E (2007). Theory and Practice in the field of foresight. Foresight, 9(6): 36-46.
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Impact of Training on Job Turnover: Evidence from Contemporary Literature Abdul hakim Ahmad Dardar PhD Scholar, Department of Management and Human Resource Development Universiti Teknologi Malaysia, Skudai Johor, Malaysia Dr.Ahmad Jusoh Associate Dean, Post Graduate Research Studies Faculty of Management and Human Resource Development Universiti Teknologi Malaysia, Skudai Johor, Malaysia Dr.Amran Md Rasli Dean, Faculty of Management and Human Resource Development Universiti Teknologi Malaysia, Skudai Johor, Malaysia
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Abstract Training is debated in literature to be linked with employee job turnover intention and job satisfaction. The purpose of this paper was to review the contemporary literature that link employee training to turnover intentions and employee job satisfaction. The review of the contemporary literature presents mixed results that links training positively and negatively to both employee turnover intentions and job satisfaction. This review of contemporary literature suggest the need to broaden the horizon of research in developing and under-developed countries f Asia and North Africa to better savvy the significance on the role of training and training quality and its consequences. Keywords: Impact ; Training ; Job Turnover; Evidence ; Contemporary Literature 1. Introduction Building human capabilities and retaining them in organizations for a longer period of time is turning to be a significant challenge for business organizations of all sorts. This requires sound and competitive human resource practices such as training to be grounded by business organizations to ensure employee individual growth and concurrently reaping benefits from skilled and trained human resources to enhance organizational productivity. Human resources stand as a source of competitive advantage for all types of business organizations and considered as an intimate asset possessed by an organization. Parallel to that recruiting skilled human resource is shaping up as a challenge in this competitive business arena and retaining a skilled human resource even has become an internal competitive challenge for all sorts of organizational globally (Butler and Waldroop, 1999). Contemporary literature illustrates the growing concern of researchers in establishing the reasons, which makes the employees vulnerable in a specific organizational setting. Research on the issue over the decades has signaled the significance of realizing the human resources as an organizational asset rather than an ordinary functional commodity of an organization. The difference in organizational performance globally is largely attributed to the differences created by the human resources in creating a safe and conducive working environment, which triggers a passion among the employees to develop a long term association with the organization and concurrently contribute meaningfully to the growth of their
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respective organizations (Hwang and Kue, 2006; Lambert et al., 2001). Contemporary literature, which entails human resources, on job training and employee turnover intention mainly, deals with the business organizations operating in developed economies (Chaaban, 2006; Min, 2007; Maertz et al. 2003), whereas, literature remains scant pertaining to the business organization, which operate in developing and conservative North African countries. This paper review the contemporary literature and empirical studies pertaining to the role of training and its impact on job turnover intention and job satisfaction to implicate suggestions for developing countries to control the ongoing and ever increased issue of turnover.
2. Literature Review This section reviews the contemporary literature on the role of training in business organizations with respect to its impact on employee turnover intentions and job satisfaction. 2.1 Training Training is a planned initiative taken by the organization to impart the job knowledge and skills and also to modify the attitudes and behaviours of employees in ways consistent with the goal of the organization (Noe, 2002). Training programs may help to fill the competency gap between the existing and required competencies in order to accomplish the organizational goals in effective manner. Effective training programs result in increased production; reduce job turnover, and greater employees satisfaction (e.g. Harris, 1990; Sample, 1990; Mathiew, 1991; Tannenbaum, et al., 1991). Noe and Wilk (1993) suggested three types of benefits can be gained from training; personal benefits, career benefits and job-related benefits. Firstly, personal benefits represent the extent to which employees believe that participation in training activities help them in improving their job performance and making progress towards their personal development. Secondly, career benefits result from participation in training activities that lead to identifying the career objectives, reaching career objectives and creating opportunities to purse new career paths. Finally, job-related benefits help the participants to improve their workplace relations e.g. with coworkers, subordinates and managers. Moreover, Geale (1995) concluded that additional individual benefits from training include career advancement, mobility, job security, pride, job satisfaction and personal fulfilment. Several studies have indicated that availability of training and education programs are important factors in augmenting the job satisfaction and reducing job turnover among employees at workplace (Reddy, 1996; Bartlett, 1999). It is evident that training programs significantly impart the knowledge and skills of organizational members, and as a result, they are in better position to accomplish the targets in effective ways. 2.2 Job Turnover Job turnover has grasped considerable research attention among human resource researchers around the globe and based on their empirical findings, they had drawn different implications. First, turnover can have positive and negative effects on employees careers, and their self-concept about their job. It affects the stayers and as well as the leavers (Sheehan, 1988; Hall, 1994). Second, turnover is potentially costly and organizations need to document these costs carefully (Gaudet, 1990). To find the suitable replacement, organizations have to bear the monetary and as well as
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non monetary costs on hiring and training of new inductees. Third, job turnover can have a positive impact on organizations. In many cases, turnover can create opportunities for promotion, infusing new ideas and technology via replacements, stimulating changes in policy and practice and removing poor performers (Staw, 1995). Finally, lack of job turnover may create its own set of problems, such as blocking career development paths, entrenching out-dated methods, and accumulating poor performers (Dalton and Todor, 1994). Two types of job turnover: voluntary and involuntary turnover exist (Gerhart, 1990; Iverson, 1999; Judge, 1993; Lee and Maurer, 1997; Mueller and Price, 1990). Price (1977) defined voluntary turnover as the movement across the membership boundary of an organization as a choice by the employee, whereas, the involuntary turnover is discussed as a movement across the membership boundary of an organization other than the choice of an employee. Voluntary turnover in literature can be predicted by turnover intention (Mueller et al ., 1994). Also the actual turnover is more difficult to predict than turnover intention (Cha, 2008). Lee and Mowday (1987) advocated on the use of turnover intention rather than actual turnover because the former is relatively less expensive and sensitive when it comes to collect data on turnover intentions than actual turnover. Similarly, Price (2001) suggested turnover intentions construct as alternative in measuring actual turnover. Van Dick et al. (2004) correspondingly, suggested that intent to turnover is an excellent predictor for turnover. Research has pointed overwhelmingly to employee turnover as being related to job satisfaction. Thus, it may be concluded that turnover is, in fact, outcome of the turnover intentions (Rahman et al., 2008). Despite the copious literature, which classifies the reasons of employee job turnover, and suggests mechanism to control the extent of turn through creating a conducive environment, which proffer stimulation and opportunities to employee growth through training, yet, no standard reason could be ascertained from the literature explaining why people leave the organization (Ongori, 2007). Though, Jeromy (2001) listed eight reasons of job turnover, which are low wages, inadequate benefits, lack of career advancements, lack of union representation, poor relationship with management, poor understanding of the job, lack of proper training and poor working environment, and additional reasons for job turnover were highlighted by Abassi and Hollman (2000), which include hiring practices, managerial styles, lack of recognition, lack of competitive compensation systems and toxic workplace environments. The other kinds of job turnover factors are related to the individual work variables such as job satisfaction with pay, promotion and work condition (Arthur, 2001). Boxall et al. (2003) also concluded that the main reason of turnover among employees was more interesting job elsewhere. All these empirically established reasons provides the basics to control the employee turnover through minimizing the extent and impact of these classified reasons, yet, empirical findings are required from various developing and conservative economies to ascertain the true factors that impact significantly on employee turnover intentions in many developing and conservative economies.
2.3 Training and Job Turnover The relationship amid training and job turnover has been widely established in the literature, but the inconsistent results reported in literature discussing the role of training and its impact on job turnover makes the relationship complex and demands the horizon of the research to be expanded to establish the concrete and unified
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boundaries of the relationship (Mincer, 1988 and Harris, 1990). For instance, dearth of proper training may lead to poor job performance, which in turn cause higher job turnover rate. Organizations, which have realistic understandings regarding the essence of training, have a lower job turnover rate and a higher success ratio. Contradict to these findings, some researchers argued that training and development affect job satisfaction and organizational commitment, which in turn affect staff retention (Lam and Zhang, 2003; Lowry et al., 2002; Pratten, 2003; Taylor et al., 2001). Further, Harris (1990) postulated that organizations try to reduce job turnover through the provision of training programs to its members and find training programs as ways to broaden employees' skills. Whereas, Veum (1997) in his study on young workers found weak evidence on the fact that training reduces job turnover. In another study by Elias and Peter (1994) concluded that training does not help to reduce job turnover. Correspondingly, Bishop (1991) found no significant relationship between training length or training intensity and job turnover. Salipante and Goodman (1976) discovered that offering training alone had no effect on employee retention, and Green et al. (2000) concluded that training does not have significant effect on job mobility. Contrary to the above findings, Sheng (2003) reported that employees who are more satisfied with their access to training programs are more likely to leave. One likely reason could be that individuals use training to enhance their employment opportunity and job mobility. On the other hand, Reddy (1996) suggested that there is a relationship between job turnover and the availability of training programs, but the exact nature of this relationship is unclear. Table 1 summarises the relationship between training and job turnover based on the empirical studies found in literature. A careful survey of the contemporary literature on the role of training and its impact of employee turnover intentions provide no significant and concrete evidence to generalize the positive effect of training of employee turnover. The differences in results reported by leading researchers suggest that more careful analysis is needed through the expansion of research horizon in developing and under-developed countries of the world. Next section discusses the role of training in relation to employee job satisfaction.
Table 1: Summary of the Relationship between Training and Job Turnover Author name /year of study Positive Negative Significant Non significant
Lutchman (2008) Males Elias , Peter (1994) Females Ferris and Urban (1984) Bishop (1991)
2.4 Job satisfaction Job satisfaction is generally agreed upon by researchers to be an affective reaction to a job that results from the employees comparison of actual outcomes with
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those that are desired (Arora et al., 2010). Job satisfaction has been recognized as an important factor and one of the serious concerns to many organizations. It is a set of favourable feelings and emotions to which employee view their work (Pak, 2007). Undoubtedly, work is an important aspect of peoples lives as most people spend a lot of their time at work. Therefore, an understanding of the factors involved in job satisfaction is relevant to improve the well being of a significant number of people (Oshagbemi, 1999). Interest in studying employees job satisfaction has continued for a number of reasons. It consistently has been shown to be related to: (a) employee behaviours, such as job search activities, job turnover, absenteeism and to a lesser extent performance effectiveness ;(b) characteristics of the employee's role, including autonomy and responsibility, job variety and task identity and role conflict and ambiguity; and (c) personal characteristics of the employee, such as age, sex, need for achievement, and job tenure (Arora et al., 2010). Higher job satisfaction among employees enables them to put more efforts for the greater good of entire organization.
2.5 Training and Job Satisfaction Though, there reported no direct link in the literature between training and job satisfaction (Rowden, 2002). However, Rowden and Conine (2005) proposed that training may be used as a tool to increase job satisfaction. In a study of Patsrick and Owens (2006), results showed that there is a significant relationship between training and job satisfaction and specifically the employees who receive training programs were more satisfied than those who did not receive training. In another study, Sahinidis and Bouris (2008) also confirmed that training has a positive impact on employees job satisfaction. In many organizations, training is among the mechanisms of enhancing employees job satisfaction. 2.6 Job Satisfaction and Job Turnover Researchers have investigated the relationship between job satisfaction and job turnover. The results indicate significant variations; positive, as well as negative relationships between the same variables (Sheng, 2003). For instance, Mobley (1997) revealed that dissatisfied employees are more likely to leave the organization than satisfied ones. Correspondingly, Oliver (1998) found that high job turnover is usually the result of job dissatisfaction combined with the ability to secure more fitting employment elsewhere. Thus, strengthening workers job satisfaction is instrumental in decreasing job turnover (Muchinsky, 1993; Muchinsky 2000). Job Satisfaction has reported to have a negative correlation with turnover intentions, as established by earlier empirical researches, but the results of the contemporary research illustrates a modest correlation and suggest that little or modest impact of employee job satisfaction on employee turnover intention (Rahman et al., 2008), though Irvine and Evans (1995) found no significant relation between job satisfaction and job turnover. The majority of research indicates that job satisfaction has a significant negative impact on job turnover. Conflicting results found by Hom Katerberg and Hulin, (1979) even in situations where an employee is satisfied with his or her job, they may find more attractive job opportunities elsewhere, thus causing them to leave. However,( West, 2000; Henryhand, 2009) reported positive relationship between job satisfaction and turnover intention. In the light of the above discussion, Table 2 presents a summary of the studies on job satisfaction and job turnover relationship.
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Table 2: Summary of the Relationship between Job Satisfaction and Job Turnover Author name /year of study Positive Negative Significant Non significant
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Price (1992) Mobley (1997) Oliver (1998) Irvine and Evans (1995) Lambert et al . (2001) Hellman (1997) Rahman et al .( 2008) West (2000) Henryhand (2009) Chen (2005)
Job satisfaction has long been recognized as an important variable in explaining turnover intention. However, many researchers have reported several other variables that may have important role in explaining the job turnover and job satisfaction relationship, as job satisfaction alone is not enough to predict the employee job turnover intention (Hwang and Kue, 2006). Howard and Homma, (2001) conducted a research on Japanese career women and argued that job satisfaction, alone, is not a sufficient predictor of turnover intention. The possible predictor pertained to turnover intentions is the perception of alternative job opportunities among the employees ((Rahman et al., 2008),). Job opportunity is delineated as the availability of alternative jobs in the environment, and is the type of labour market variable emphasized by economists (Hwang and Kue, 2006). Several studies have found alternative job opportunities to be a significant predictor of turnover. This suggests availability of employment may also have a significant positive effect on turnover intent. Workers are more likely to express turnover intentions when they perceive that there are other acceptable employment opportunities (Lambert et al., 2001). Next section discusses the empirical studies that relate the alternate job opportunity to job satisfaction and turnover intentions.
2.7 Alternative Job Opportunities and Turnover Intention and Job Satisfaction Several scholars have predicted the positive relationship between alternatives and job turnover though no hard and firm evidence was discovered in the literature. For instance, Hwang and Kuo (2006) revealed a significant positive correlation amid perceived alternative job opportunities and turnover intention in the public sector organizations. Correspondingly, Thatcher, Stepnia and Boyle (2003) conducted a research on turnover of information technology workers and also found a strong positive correlation between perceived alternative job opportunities and turnover intention. Whereas, Harman et al (2009) study no significant relationship between alternative job opportunities and turnover intention, and parallel to that Khatri et al (2001) reported that perceived alternative employment opportunities is a poor predictor of turnover intention.
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Table 3: Summary of the relationship between Alternate Job Opportunities and Job Satisfaction and Job Turnover Author name /year of study Positive Negative Significant In significant
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(Rahman et al . (2008) (Hwang and Kue, 2006) Thatcher, Stepnia and Boyle (2003) Harman et al .(2009)
2.8 Conclusion and Implications
There exist no standard framework for understanding the job turnover process as a whole, as wide range of factors have been found useful when it comes to interpreting job turnover (Morel et al., 2004). It is also on the record that no constant reason makes the employees in many organizations decide to leave. The relationships between job turnover and its potential determinants are still inviting the future studies (Barrick and Zimmerman, 2005). Though review of the literature suggest that for organizations to limit the employee turnover intentions and maximize the employee job satisfaction, they must ensure that its employee experience satisfaction through the provision of adequately designing the training and development programs. Organizations must ensure the contents and design of the training proffer applied learning experience and knowledge to the employees and organizations must also ensure that training is imparted by highly skilled and professional trainers and carried out in conducive, friendly environment to stimulate the passion of improving the selfintegrity, belongingness and pride. Quality training enables employees to experience more job satisfaction and consequently lower job turnover intentions among satisfied employees. This signify the commitment on the part of the organization as employers to devote energies in meeting the employee expectations; and one way of doing that is through the provision of the development of training courses that proffer applied learning and meet employees expectations. We through this research suggest that researchers should broaden the horizon of the research by undertaking empirical researches to confirm the relationship amid quality of training programs and turnover and job satisfaction in different parts of the world. As it would enhance the understanding of the critical elements that contribute to the variance of training outcomes i.e. job turnover and job satisfaction.
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Pak, O.G. (2007). The Efect of Organizational Learning on Organizational Commitment, Job Satisfaction and Work Performance. Ph.D. Thises. University Putra Malaysia. Patrick, L., and Owens, Jr. (2006). One More Reason Not to Cut Your Training Budget: The Relationship Between Training and Organizational Out Comes.Public Personnel Management. 35, No.2. Pratten, J.D. (2003). The Training and Retention of Chefs. International Journal of Contemporary Hospitality Management, Vol. 15 No. 4, pp. 237-42. Price, J. (1977). The Study of Turnover. Ames, IA; Iowa state university press. Price, J. L. (2001). Reflection on the Determinants of Voluntary Turnover. International Journal of Manpower, 22(7/8), 600-624. Price, J.L. (1992). The Study of Turnover. Amea, IO: Iowa State University Press. Quantitative and Qualitative Research (2 th Ed.). Upper Saddle River, NJ:Merrill Prentice-Hall Rahman, Abdul., Naqvi ,Raza. S. M. M., and Ramay, Ismail. M. (2008) Measuring Turnover Intention: A Study of IT Professionals in Pakistan. International Review of Business Research Papers Vol. 4 No.3 P.45-55. Reddy, N. V. (1996). The Relationship Between Training and Job turnover Among Secretairial Personnel in the Florida State University System: Ph.D.thises. Florida State University. USA. Rowden, R. W., and Conine Jr, C. T. (2005). The Impact of Workplace Learning on Job Satisfaction in Small US Commercial Banks. Journal of Workplace Learning Vol. 17 No. 4, 2005 pp. 215-230. Rowden, R.W. (2002).The Relationship Between Workplace Learning and Job Satisfaction in Small and Mid-Sized Businesses. Human Resource Development Quarterly, Vol.13, pp. 407-26. Sahinidis, A. G., and Bouris, J. (2008). Employee Perceived Training Effectiveness Relationship to Employee Attitudes. Journal of European Industrial Training Vol. 32 No. 1, pp. 63-76. Salipante, p., and Goodman. (1976).Training, Counseling, and Retention of the Hardcore Unemployed. Journal of Applied Psychology, 61 Sample, J.A. (1990). The Design. Development, Implementation and Evaluation of a plan of action to Control Turnover of Security Specialists in A State Psychiatric Hospital. Unpublished Ph.D. Dissertation, Florida State University. Sheehan, E.P. (1988). The Effects of Employee Turnover on Those Who Stay: Equity Theory Approach. DAL, 49; No.10B.pp4590. University of California as Santa Cruz. Sheng, Y.H.C. (2003). An Examination of the Relationship Between Employee Turnover and Job Satisfaction at Kirby Forensic Psychiatric Center, New York City. Ph.D.thises.USA Staw, B.M.(1995).The Consequences of Turover. Journal of Occupational Behaavior, 1p.253-273. Tannenbaum, S. I., Mathieu, J.E., Salas, A., and Cannon- Bowers J. A. (1991). Meting Trainees Expectations: The Influence of Training Fulfilment on the Development of Commitment, Self- Efficacy, and Motivation. Journal of Applied psychology. 76(6):759 769.
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Taylor, R., Davies, D., and Savery, L. (2001).The Role of Appraisal and Training in Reducing Staff Turnover in the Western Australian accommodation industry. Management Research News, Vol. 24 Nos 10/11, pp. 56-7. Thatcher, J. B., Stepnia, L. P. and Boyle R. J. 2003. Turnover of Information Technology Workers: Examining Empirically the Influence of Attitudes, Job Characteristics and External Markets, Journal of Management Information Systems, Vol. 19, No. 3, pp. 231-261. Van Dick, R., Christ, O., Stellmacher, J., Wagner, U., Ahlswede, O., and Grubba, C., et al.(2004). Should I Stay or Should I go? Explaining Turnover Intentions With Organizational Identification and Job Satisfaction. British Journal of Management, 15(4), 351-360. Veum, J. R. (1997). Training and Job Mobility Among Young Workers in the United States. Journal of Population Economics, 10(2), 219-233. West, M. S. (2000). "Employee Turnover In Mexico: A Cultural Investigation Of Causes.. Doctor of Philosophy .Arizona State University. West, M.S, (2000).Employee Turnover in Mexico: a Culture Investigation of Causes .Ph.D.Thesis. Arizona State University. Mexico.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Analysis of customer satisfaction among intermediaries in the B2B markets: Case study of customers of Behpakhsh Company in Isfahan City
Ali Sanayei
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University of Isfahan, Iran Faculty of Administrative Science & Economics Department of Management
Ali Shaemi
Mahdi Ghasemi Shorije (Corresponding author)
Abstract While customer satisfaction has recently attracted a lot of attention among academics and practitioners, most academic research on this construct has focused on consumer goods using the individual consumer as the unit of analysis. Customer satisfaction in industrial markets is an under-researched area so far. The authors measure customer satisfaction among intermediaries. This research is based on data that obtained through a survey study. Data analysis was conducted by spss software and the equation structural modeling of Amos. The results show that the reliability with 1 weight has the greatest impact on customer satisfaction, product information and commercial aspects with weights of 0.966 and 0.962 are the important factors respectively. In this model the estimation of overall satisfaction is 0.67. Keywords: Customer Satisfaction, Business 2 Business Marketing, Organizational Customer, Product Feature, Commercial Aspects, Reliability
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1. Introduction
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Most academicians and practitioners understand that enhanced customer satisfaction usually leads to increased customer retention, positive word-of-mouth, and higher profits (Fornell, 1992). Increased customer satisfactions also reduce the number of complaints and the costs of complaint handling. Measuring customer satisfaction and understanding the factors that drive satisfaction can therefore help firms discover ways to improve product quality, which in turn may lead to increased competitive advantage (Cravens et al., 1988). Recent International Organization for Standardization (ISO) 9000 changes also embrace customer satisfaction as a focus of the standard and require ISO 9000 certified companies to collect and analyze customer satisfaction data and use this information to improve organizational performance (Bond and Fink, 2003). Given the importance of customer satisfaction for a firms long-term business survival and growth, monitoring customer satisfaction and diagnosing what factors drive customers satisfaction should be an essential activity of every firm. Due to the complexity of organizational buying situations, it is likely that a purchase managers satisfaction with a supplier may be driven more by one set of factors (such as those covering commercial aspects of a transaction), whereas the engineering managers satisfaction with the same supplier may be driven more by another set of factors (such as those encompassing technical information about the product). If this conjecture is right, then it makes good business sense to emphasize different factors in communicating with organizational buyers based on their functional areas instead of taking a one shoe fits all approach (Goutam Chakraborty 2007). Goutam Chakraborty et al (2007) said: We believe that B2B sale people are already aware of such differences in the needs of different organizational buyers and use customized communications during the pre-sales period to uniquely appeal to different departments within the same firm (customer). However, we have not seen published studies that documented the fact that an organizational buyers satisfaction is also differentially influenced by factors that relate systematically to the buyers functional areas. In industrial marketing settings, the relationship between buyer and seller is frequently long-term, close, and involves a complex pattern of interaction between and within each company (Hakonsson, 1982). Customer satisfaction in industrial marketing should therefore be understood as relationship specific (Homburg and Rudolph, 2001) although there is no single established method for measuring customer satisfaction (Zeithaml et al., 1990; Fornell, 1992). 2. Theoretical development There are many studies that highlight the importance of customer satisfaction for a firms success and how customer satisfaction can be measured (Oliver, 1980; Keaveney, 1995; Youjae, 1993; Zeithaml et al., 1996), but most of these studies are limited to the area of business-to-consumer (B2C) marketing. It is difficult to make broad-based generalizations from B2C studies to business-to-business (B2B) contexts because there are many underlying differences between consumer buying (B2C) and organizational buying (B2B) behavior. Organizational buying is a complex process and involves many people from different functional areas, multiple goals and potentially conflicting decision criteria (Webster and Wind, 1972; Anderson et al., 1987). Previous research (Pingry, 1974; Strauss, 1962; Mast and Hawes; 1986) reported that different buying center members (such as engineers versus buyers) consider different factors as important in choosing an industrial supplier. For instance, Mast and Hawes (1986) reported that in selecting suppliers, purchase managers (buyers) consider discount more important than engineers. Similarly, Pingry (1974) reported that purchasing agents consider commercial characteristics of a supplier more important than do engineers. Most academicians and practitioners understand that enhanced customer satisfaction usually leads to increased customer retention, positive word-of-mouth, and higher profits (Fornell, 1992). Increased customer satisfactions also reduce the number of complaints and the costs of complaint handling. Measuring customer satisfaction and understanding the factors that drive satisfaction, can therefore help firms discover ways to improve product quality, which in turn may lead to increased competitive advantage (Cravens et al., 1988). Given the importance of customer satisfaction for a firms long-term business survival and growth, monitoring customer satisfaction and diagnosing what factors drive customers satisfaction should be an essential activity of every firm. In B2C contexts, most of the customer satisfaction research has focused primarily on the disconfirmation of expectations model, which states that feelings of satisfaction arise when consumers compare their perceptions of a products performance to their expectations (Oliver, 1980). As per the marketing concept, any product should be considered as a total product that includes core benefits from the product as well as auxiliary dimensions associated with that product. The customer is satisfied when he/she feels that the products performance is equal to or more than what was expected (confirmation). But if perceived performance falls short of his/ her
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expectations (a negative disconfirmation), then the customer is dissatisfied (Oliver, 1980). This model is easy to apply in a B2C context, but may be difficult to adopt in B2B Contexts. Research findings and theoretical discussions about consumer behavior often have little relevance for the industrial marketer (Webster and Wind, 1972). There are many underlying differences between B2C and B2B customer satisfaction. The most important difference is that the purchasing agent is different from the ultimate user of the product or service. Therefore, the satisfaction with the purchase process across various departments of a customer may be an important consideration in organizational customer satisfaction (Tanner, 1996). In industrial marketing settings, the relationship between buyer and seller is frequently long-term, close, and involves a complex pattern of interaction between and within each company (Hakonsson, 1982). Customer satisfaction in industrial marketing should therefore be understood as relationship specific (Homburg and Rudolph, 2001). Although there is no single established method for measuring customer satisfaction (Zeithaml et al., 1990; Fornell, 1992), many studies follow three steps: 1- Determining the dimensions on which the products and services provided can vary; 2- Asking customers to rate their perceptions of the company on those dimensions; and 3- Asking customers for an overall satisfaction rating with the company (Perkins, 1993). The customers overall satisfaction with the companys products and services is thought to be influenced by the customers perceptions with each of the salient product component that forms the total product. Thus, the salient product components can be viewed as the drivers of overall satisfaction (Sharma et al., 1999; Rossomme, 2003). 1.2 product feature The product is the core of the exchange and, as a result, the characteristics of the product (price, product quality) are likely to have significant effects on an industrial relationship (Hakonsson, 1982). Because of the complexity of products in industrial marketing (Hutt and Speh, 2004), extensive technical documentation is frequently needed. Hence, perception of product-related information often emerges as a driver of customer satisfaction in a B2B context (Homburg and Rudolph, 2001). 2.2 Commercial aspects Services also play an important role in determining an industrial customers satisfaction. This includes technical services such as maintenance, repair, and operation services (Jackson et al., 1995); financial services such as credit policy; and services that support the products and systems after delivery, including warranty coverage. Order handling and complaint handling are particularly important in B2B. 3.2 Reliability Order handling includes order planning, order generation, order receipt and entry, scheduling, and fulfillment. This order handling eventually leads to delivery reliability and timely delivery to the customer. It is known that a majority of customers do not complain and that if they do the problem is usually very serious (Andreasen and Best, 1977). Thus, it is also important that a supplier respond adequately to any complaint and have an established policy to handle returns (Banting, 1984). While it is possible via literature review to identify broad generic issues (such as reliability, price, etc. as discussed above) that customers may consider important in B2B contexts, because of the diversity and complexity of products/ services in B2B contexts, such issues need to be validated by conducting exploratory research with domain experts from the specific industry. Therefore, we conducted six in depth interviews with customers of the sponsoring firm to develop the following list of issues that customers may consider important in determining their satisfaction with the firms products and services. 1 delivery schedule; 2 sales people; 3 order handling; 4 complaint handling; 5 -products; 6 product relative information; 7 price and credit policy; and 8 -advertisement.
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It seems that the above eight items can be reduced to three different dimensions, namely Reliability for the first two items (1 to 4), Product feature for items 5 and 6, and Commercial aspects for items 7 and 8. We note that Homburg and Rudolph (2001) proposed similar dimensions. Based on the above the hypotheses are: H 1: buyers perception of reliability product feature commercial aspects of a supplier will be positively related with overall satisfaction with the supplier. H 2: buyers perception of products product related information of a supplier will be positively related with product feature. H 3: buyers perception of Delivery schedule Salespeople Order handling Complaint handling of a supplier will be positively related with reliability with the supplier. H 4: buyers perception of Prices and credit policy Advertisement of a supplier will be positively related with commercial aspects. 3. Research Methodology This research can be categorized as descriptive survey research. The statistical population of this research was the customers of Behpakhsh Company in Isfahan city. The sample size estimated to be 208 based on Cochran formula. The data gathering instrument was a self administered questionnaire which consists of two sections All the items were measured using five-point Likert scale items with anchor points 1 = strongly disagree and 5 = strongly agree. To test the reliability of data gathering instrument, a preliminary study has been conducted with a sample of 30. The results of the primary sample show that Cronbach alpha () index is 0.89, which indicate a good reliability. In this research we used Structural Equation Model (SEM) for testing hypotheses. For analyzing relation between constructs, we used Confirmatory factor analysis (CFA). For determine that to what extent, indexes are acceptable for measuring patterns, first we must analyzing all of the measuring patterns separately. For this base, first, measuring patterns related to variables are tested separately. Seven common model-fit measures were used to assess the models overall goodness of fit: the ratio of to degrees-of-freedom (df), Chi-Square (CMIN), goodness-offit index (GFI), Error of Approximation (RMSEA), adjusted goodness-of-fit index (AGFI. Finally, to determine the extent of the effects of variables, regression analysis has been used. 4. Data Analysis and Findings Table 1 shows demographic data. As it is shown, most of the respondents were male with 21 to 30 years of age. Their level of education falls mostly on categories of Diploma and less degree. Table 2 shows the result of one sample test. Given that amount of Sig of some factors is smaller than 0.05 (sig<0.05), It can be concluded that the satisfaction of both products and sales people based on positive mean difference is in the acceptable range. Also the satisfaction of both complaint handling and advertisement based on negative mean difference is not in the acceptable range. Other factors, according to the amount of the Sig of 0.05 (sig> 0.05) are equal to mean. Table 3 presents General indexes of measuring patterns (CFA). (chi-square) is fit for Giving that for all of measuring patterns p> 0.05, could result that the ratio of measuring patterns. Goodness-of-fit index (GFI) for all measuring patterns is above 0.95 (GFI> 0.9), showed that data are fit to patterns. RMR for all measuring patterns is below 0.05 (RMR<0.05), showed that minimum error in patterns and acceptable fitness of them. Comparative fit index (CFI) for all measuring patterns except actual use is above 0.95 (CFI> 0.9) can be concluded that data clearly support measuring patterns. RMSEA index for measuring patterns is below 0.1 (RMSEA< 0.1), showed that data are fit to patterns. And eventually, given the above contents can be concluded that measuring patterns have a good fitness and in the other words, general indexes confirmed that data clearly support measuring patterns. Table 4 shows the result of regression weight of factors. The amount of regression weight of factors is more than 0.7 and based on p-value of the sub factors and the main factors can conclude that these factors estimate satisfaction very well. Noted that p-value must be smaller than 0.05 to confirm the factors effect.
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5. Conclusion
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The hypotheses are tested in a structural equations model, as shown in table 3. The models key statistics are good since the GFI is 0.976, the CFI is 0.993, the RMSEA is 0.052 and the AGFI is 0.933. We can thus safely conclude that the model is valid. The result shows, the reliability with one weight has the greatest impact on customer satisfaction, after that product information and commercial aspects with weights of 0.966 and 0.962 are the important factors. In this model the estimation of overall satisfaction is 0.67 that Show these factors significantly affect customer satisfaction. Given that amount of Sig of some factors is smaller than 0.05 (sig<0.05), It can be concluded that the satisfaction of both products and sales people based on positive mean difference is in the acceptable range. Also the satisfaction of both complaint handling and advertisement based on negative mean difference is not in the acceptable range. Other factors such as Information related to product satisfaction, order handling satisfaction, price and credit policy satisfaction, delivery satisfaction, and overall satisfaction of the Company, according to the amount of the Sig of 0.05 (sig> 0.05) are equal to mean.
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References Abdul, M & Alhassan G (2005)Instrumental and interpersonal determinants of relationship satisfaction and Commitment in industrial markets Journal of Business Research. vol, 58. pp, 619628. Tikkanen, H (2002)Customer satisfaction in industrial markets. opening up the concept. Journal of Business & Industrial Marketing. Vol. 17 No. 1, pp. 25-42. Anderson, E. W., & Fornell, C. A (1994) customer satisfaction research prospectus, in Rust, R.T. Chakraborty, G. Srivastava, P& Marshall, F (2007) "Are drivers of customer satisfaction different for buyers/users from different functional areas? Journal of Business & Industrial Marketing. Vol. 22 Iss: 1. Pp, 20 28 Cravens, D.W., Holland, C.W., Lamb, C.W. Jr and Moncrief, W.C. III (1988), Marketings role in product and service quality Industrial Marketing Management, Vol. 17. pp, 285-384. David, J & Burns, L (2006) "Customer satisfaction in a retail setting: The contribution of emotion", International Journal of Retail & Distribution Management. Vol. 34 Iss: 1. pp, 49 66 Edward, U & Ross, L (2003) "Customer satisfaction and the marketing quality interface", Journal of Business & Industrial Marketing. Vol. 18 Iss: 3. pp, 204 218 Festge , F& Schwaiger , M (2007) "The drivers of customer satisfaction with industrial goods: An International Study", , Vol. Advances in International Marketing. Iss: 18. Pp, 179 - 207 Fornell,C., Johnson, M.D., Anderson,E.W., Cha, J . And Bryant,B.E.(1996), The American customer satisfaction index: nature,purpose,and findings Journal of marketing, Vol.60 No.4.pp,718 Fornell, C. A National Customer Satisfaction Barometer, the Swedish Experience, Journal of Marketing 56, 6-21(1992), Ganesan , SH (1994), Determinants of Long-Term orientation in buyer-seller relationships, The Journal of Marketing: American Marketing Association. Vol. 58, No. 2. pp, 1-19 Hass, R (1989) Industrial marketing management: text and cases (4ed). Pws KENT Publishing company 655p. Hill, N & Alexander, J (2000),Handbook of Customer Satisfaction and loyalty Measurement , Gower Publishing, Ltd. 290 P Hakonsson, H. (1982), Industrial Marketing and Purchasing of Industrial Goods An Interaction Approach, John Wiley & Sons, London. Homburg, Ch & Rudolph, B (2001) Customer satisfaction in industrial markets: Dimentsional and multiple role issues Journal of Bu Standards siness Research.vol.52. pp,15- 33. Mast, K.E. and Hawes, J.M. (1986), Perceptual differences between buyers and engineers, Journal of Purchasing and Material Management, 22 / 1. Pp, 2-6. Mohr, J &. Spekman, R (1994) Characteristics of partnership success: Partnership attributes, communication behavior, and conflict resolution techniques, Strategic Management Journal. Vol. Pp, 135152
Moore, Ahttp://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V69-45K1HFMJD&_user=1400092&_coverDate=02%2F28%2F1994&_rdoc=1&_fmt=high&_orig=search&_orig in=search&_sort=d&_docanchor=&view=c&_searchStrId=1555502859&_rerunOrigin=scholar.goo gle&_acct=C000052580&_version=1&_urlVersion=0&_userid=1400092&md5=8409d62dee31012 69b53bd01eba24fa9&searchtype=a - fn1 &. Schlegelmilch, B (1994), Improving service quality in an industrial setting Published by Elsevier Science Inc. pp, 83-92
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Morris, H (1988) Industrial and organizational Marketing, Columbus, Merrill publication, 658p. Oliver, R.L. (1980), A cognitive model of the antecedents and consequences of satisfaction decisions, Journal of Marketing Research, Vol. 17 No. 4. Pp, 460Paul G. Patterson, R. Spreng,A (1997) "Modelling the relationship between perceived value, satisfaction and repurchase intentions in a business-to-business, services context: an empirical examination", International Journal of Service Industry Management. Vol. 8 Iss: 5. pp, 414 - 434
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Pingry, J.R. (1974), The engineer and purchasing agent compared, Journal of Purchasing and Material Management, Vol. 10, November, pp. 31-45 Rade B. Vukmir (2006) "Customer satisfaction", International Journal of Health Care Quality Assurance. Vol. 19 Iss: 1, pp.8 - 31. Rossomme , J (2003) Customer satisfaction measurement in a business to business context : conceptual framework , Journal of Business & Industrial Marketing . Vol .18.No2.pp, 179 195 Tanner JF. Jr(1996). Buyer perceptions of the purchase process and its effect on customer satisfaction. Ind Mark Manage.vol; 25.pp, 25 -33. Webster, F. and Wind, Y. (1972), A general model for understanding organizational buying behavior, Journal of Marketing,Vol. 36 No.2.pp, 12-29. Zeithaml, V.A., Berry, L. and Parsuraman, A. (1996), The behavioral quality, Journal of Marketing,Vol. 60 No.2. pp, 31-46.
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consequences of service
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Annexure
Factors of Satisfaction
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Products Product- related Information
Product feature
Delivery schedule Salespeople Order handling Complaint handling Reliability Total Satisfaction
Prices and credit policy Advertisement
Commercia l aspects Figure1: Research conceptual model

Characteristics Description Gender Age Female Male Less than 20 years 21 to 30 years 31 to 40 years 41 to 50 years more than 50 years Education Diploma and less Advanced diploma Bachelor Master Degree and above Frequency 0 208 3 68 67 57 13 152 31 20 5 Percent 0 100 1.4 32.7 32.2 27.4 6.2 73.1 14.9 9.6 2.4
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Table 2. One-Sample Test
Test Value = 3 Index Mean df Sig. (2-tailed) Mean Difference
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Confidence Interval %95 of the Difference Lower Upper
Satisfaction with Products Satisfaction with Salespeople Satisfaction with Product- related Information Satisfaction with Order handling Satisfaction with Prices and credit policy Satisfaction with Advertisement Satisfaction with Complaint handling Satisfaction with Delivery schedule Total satisfaction
3266.3 2718.3 0278.3 9942.2 9347.2 6922.2 7453.2 0631.3 9836.2
207 207 207 207 207 207 207 207 207
0.000 0.000 0.656 0.926
3265.0 2717.0 0277.0 0059.-0 0652.-0 3077.-0 2546.-0 0631.0 01638.-0
2138.0 1514.0 0952.-0 1307.-0 2316.-0 4334.-0 3822.-0 0786.-0 1138.-0
4393.0 3922.0 1508.0 1189.0 1011.0 1821.-0 1271.-0 2048.0 0851.0
4400. 000.0 000.0 381.0 751.0
Table 3 .General indexes of measuring patterns (CFA)

Total satisfaction Product information Commercial aspects
Index
Reliability
CMIN P GFI RMR CFI RMSEA AGFI
20 0.086 0.976 0.024 0.993 0.052 0.933
33 0.06 0.962 0.049 0.979 0/077 0.923
11 0.2 0.982 0.044 0.994 0.043 0.956
3 0.475 0.995 0.011 1 0 0.972
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Table 4 .Standardized Regression Weights
P value 0.000 0.000 0.000 Estimate 1 0.966 0.962 Index Reliability Product information Commercial aspects Satisfaction with Products Satisfaction with Salespeople Satisfaction with Product- related Information Satisfaction with Order handling Satisfaction with Prices and credit policy Satisfaction with Advertisement Satisfaction with Complaint handling Satisfaction with Delivery schedule
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0.000 0.000 0.000 0.000 0.000 0.000 0.000 0.000
0.737 0.888 0.852 0.782 0.744 0.827 0.827 0.739
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Economic Conditions of India in the Age of Muslim Rulers During 12th to 16th Century
Dr. Farooq Aziz (Corresponding Author) Assistant Professor Department of Business Administration Federal Urdu University of Arts, Science and Technology Gulshan-e-Iqbal Campus, Karachi, Pakistan. Dr. Syed Abdul Aziz Director Hamdard Institute of Education and Social Sciences Hamdard University Karachi, Pakistan. Dr. Tasneem Fatima Assistant Professor Department of Education Federal Urdu University of Arts, Science and Technology Abdul Haq Campus Karachi, Pakistan. Syed Muhammad Fahim Assistant Professor Department of Commerce Defence Authority Degree College, Karachi, Pakistan
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Abstract During the time period of 12th to 16th century a big area of India particularly North India was under Muslim rulers. From economic point of view it was a good time period for this region a significant development was observed in all walks of life, particularly standard of living of Indians was increased which was due to increase in agricultural, industrial and trading activities. The Muslim rulers had tried to improve the methods of production in different sectors particularly in agriculture sector. Construction industry was at its peak, with that trading activities were also increase due to easy transportation facilities and roads. Keywords: Economic Conditions ; India ; Age ; Muslim Rulers ; 12th to 16th Century 1. Introduction
Muslims attack on north India through Khyber Pass was started in 979 (Sheikh Muhammad Ikram 1986, p 56), when Nasir-Ud-Din Subiktageen has defeated the Raja Jay Pal and established the first Muslim government in this region. During the time period of 1186 to 1526 Muslim has gradually expended their government. During this time period their government was expended from North India to Bengal (Abu Naeem Abdul Hakeem Khan 1970, p1017). The basic objective of this paper is to analysis the economic conditions of that age in India. Economic activities of that time can be analyzed in the context of agriculture sector, industrial sector, commerce, trade and general standard of living. A brief analysis of these sectors is as follows. 2. Agriculture Sector Traditionally each Indian village was considered as single self-sufficient unit, because all the requirements of the people of town were available in the same village or economic unit. It was correctly said that, if any Indian village was completely isolated from rest of the world then its economic setup was not change. This situation was quite same in this age, each village or economic unit was capable to produce all of its requirements. Majority of the people at that time was linked with agriculture sector. Muslim rulers of that time did not take any interest to change or improve the situation on the contrary they were mainly interested to maintain status-quo, because these conditions were suitable for their government.
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2.1 Agricultural Production
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The basic statistics about agriculture sector and its production for example average size of farm, methods of production and proportion of people which were dependent on agriculture sector are not available. But it is confirmed that Wheat, Rice, Cotton, Millet, Barley were main agriculture products and herb, condiments and sandalwood were the main exportable items. Muslims had tried to improve their methods of production and were successful up-to large extents. 2.2 Rural and Cottage Industry Conditions of this sector were very poor because the methods of production and level of knowledge of producers were very low. In this context wine and sprit industry was significant which has still maintained its position. 2.3 Economic Conditions of Farmers Economic conditions of farmers were very poor. A big proportion of agriculture production was taken up by the government in the form of rent and other taxes and minor amount was available to the farmers for their requirements of whole year. This was the reason that their economic conditions were very poor (Kanwar Muhammad Ashraf 1989, pp162-169). 3. Industrial Sector Whereas the industrial sector was concerned solid evidences are available that this sector was quite advance at that time. Cloth, iron, stone work, oil and paper industries were significant at that time in this region. These industries were established mostly in rural areas and their products were having a good market in the cities particularly in Delhi. Some major industries of that time were as follows 3.1 Textile Textile industry was the biggest industry of that time; all types of garments were made. Cotton was the main crop; this was the reason that abundant raw material was available at that time, which was exported in the form of cloth through the sea ports of Bengal and Gujarat. Due to this export a significant development was observed in the areas of sea ports particularly Gujarat. 3.2 Ironwork Mines of iron core, lead and mercury were available in India and this raw material was used to produce different products. A number of products were available at that time, out of which standard of some products for example swards were quite high. 3.3 Stonework and Construction Industry No doubt Muslim Rulers of that time has significantly developed this industry. They were highly interested in the construction of different buildings for example masajid, forts, monuments etc., this is the reason that, they have constructed a number of buildings in their age and significantly promoted this industry. 3.4 Paper, Sugar and Leather Industry Paper industry was established in Gujarat but it was at its initial stage and no significant activities were there in this regard. Sugar cane was one of the biggest crops of India and sugar was produced throughout the India with sugar cane. The same situation was with leather industry its raw material was abundantly available throughout the India. A big proportion of Muslims at that time were linked with this industry in different forms. 3.5 Conditions of Industrial Level There was not any significant difference between the working conditions of agriculture and industrial workers. There was not any concept of protection of their rights. However the prices of products of industrial labour were significantly high and their expertise were also increased during this time period (kanwar Muhammad Ashraf 1989, pp 171-185). 4. Business and Trade At that time a chain of roads were established and these roads were in quite good condition. Means of transport were also easily available these roads were necessary for the movement of army but traders were also allowed to use them. Small businesses were restricted just to the shops, fairs and different types of markets. But the large scale businesses were concentrated in the hands of few casts and some
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particular classes. Government intervention in business was almost zero and no rules and regulations were established in this regard. Muslim traders were spread over the whole Indian territory, however business in sea ports were quit advance and the role of middle man was important. Concept of bills of exchange was there and it was practiced under government rules and regulations. Rate of interest was between 10% to 20% for large and small loans respectively. Rate of interest for small loans was high. Whereas the business ethics were concerned their open violation was a common practice, temporary improvement was observed due to government pressure but letter on situation were riverside. However in sea ports level of moral values was quite high. 5. Standard of living From the point of view of standard of living society was openly divide in two classes that is which they have and which they do not have. Rulers and alight class of the society on one side and general public was on the other side, the standard of living of former class was extra ordinary high and Muslim rulers spent huge amount on different heads and occasions the salary level of government employees were also extra ordinary high. Traders and different professional were also getting extra ordinary high income but the real statistics are not available in this regard (Kanwar Muhammad Ashraf 1985, pp 186220) 5.1 Price Level Prices at that time were depend on crops in case of good crops their level was decreased and vice versa. Since as it was said that each Indian village was a complete and independent unit, hence it was very difficult to access the general price level of that time. However general prices of basic commodities were not so high, with that transportation cost at that time was also very low, hence it can be said that overall standard of living was high (Ishwari Parsad 1986, pp 241). Conclusion During the time period of 12th to 16th century the economic conditions of North India under Muslim rulers were much better particularly the level of income of persons related to industry, commerce and trade. But the conditions of agriculture sector were not so good. During this time period methods of production were improved a significant improvement in construction industry was noted. Muslims had improved the transportation conditions and means of transport as well. Overall it was a good time period from economic point of view. References Ashraf, kanwar Muhammad (1989), Hundastani Muashara Ehd-e-Wasta Main (Urdu), translated by Qammer-u-din, New Dehli. Ikram, Sheikh Muhammad (1986), Aab-e-Kusar (Urdu), 11th ed., Lahore. Khan, Abu Naeem Abdul Hakeem (1995), Tarekh-e-Islam (Urdu), Lahore. Parsad, Ishwari (1986), A short History of Muslim Rule in India, Lahore.
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Consumers Online Shopping Cart Use and its effect on Frequency of Online Buying (Malaysian online Industries)
Mahmoud Manafi Islamic Azad University of Iran, The branch of Marvdasht Roozbeh Hojabri DBA Student, MMU, Faculty of Management Mehrdad Salehi MBA student, MSU, Faculty of Management Pagah Khatibi
MBA Student MMU, Faculty of Management
Reza Gheshmi Islamic Azad University of Iran, the branch of Marvdasht
Abstract
This research attempts to identify the main factors have effect on online buying as a part of E-commerce through Frequency of shopping online cart use. Furthermore investigating and measuring the impact of the main factors which have affect on online buying, have given the insight to improve current situation of Malaysian online market. Keywords: Online shopping cart use, E-commerce, and Organizational Intent
1. Introduction
As a matter of fact, the way of human life's and developing online activity will be increased the motivation of this research to use online shopping carts in Malaysia. Due to the fact, Malaysia show high potentiality of Ecommerce and great background of online using method. One of the basic conditions for using online shopping carts is the acceptance of consumer of this electronic commerce. We can honestly expressed the availability of some main important determination of these acceptance such as ease of use (Ha and Stoel, 2009), website of personality (Poddar et al., 2009) and tendency consumers of e-commerce websites (Wang et al., 2009). Besides, Another researches (Arnold and Reynolds, 2003; Bridges and Florsheim, 2008) Distinguished the beneficial and clear motivation of online shopping carts. These clear and beneficial motivation could be
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data, entertainment and finally convenience( Papacharissi and Rubin, 2000)
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mentioned as using internet in general like, beneficial interpersonal, searching for On the other hand, most of them could be also usable for particular behavior of using online carts. Utilitarian motivation: as (Overby and Lee and Noble et al., 2006; To et al., 2007) believed that these motivation for using online shopping carts may include buying in a particular shopping session and financial motivation for associated with saving budget and money by price promotion from online and internet. This utilitarian motivation can be used widely for both task based and goal directed such as putting a favorite item on the cart for buying or saving money and time. Electronic purchasing are so beneficial carts because they can save amount space prior for purchasing. Not to mention, hedonic and experiential views of these online shopping carts are also be usable. Hedonic motivation: this motivation defined as the judgment of the shoppers based on the experience and scarified as the costumers' may go and purchase for the experience they have when completing the task. Therefore this kind of motivation can be both enjoyment and fun (Babin et al., 1994). Those online shopping carts based on the hedonic motivation covering various types of shopping for example, gratification, adventure, value or idea shopping. Arnold and Reynolds, 2003).for instance, for the entertainment form adventure kind of shopping clarifies while they are shopping for stimulation and escapism. For the example of gratification it is believed that this form of shopping helped shoppers to control their stress and overcome their bad mood and feeling .idea shopping bring about new idea, fashion and innovation. Last but not least value shopping concludes rewards and excitement by searching a deal and achieving an item on sale (Arnold and Reynolds, 2003). As it was clarified, many researches about online shopping has done , but one of the nearest studies among the rest with the same aim is (A.G. Close and M. KukarKinney, 2010) motivation behind consumers online shopping cart use. This research will highlight some independent variables that perceived fabulous result of
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frequency online buying in Malaysia including, current purchase intent, taking advantage of price promotion, entertainment purpose, organizational intent, and research and information.
2. Framework & hypothesis
In above framework (Close & Kinney, 2010) some variables have been chosen and hypothesis also are defined as follows:
2.1. Current purchase intent
As Howard and Sheth illustrated in 1969, purchase intention is a mental state reflecting the consumers plan to buy in the stipulated time. In latter researches, Current online purchase intent hint at an online shoppers intention to use their virtual cart during the internet session. The cart is a virtual trolley for internet buying products at this session which needed temporarily for completing the transaction. Having enthusiasm to purchase at online shopping may lead to a boosted frequency of placing items in the cart.
H1: Current purchase intent has a direct impact on increasing the frequency of
consumers online shopping cart use.

2.2. Taking advantage of price promotion
Maxwell in 2001 mentioned that many Internet users prefer electronic-trailers to offer price or have lower price than offline retailers. In this paper price promotion cart use refer to the amplitude to which consumers place items in their online shopping carts in
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price by the shoppers which is called On Sale.
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order to take advantage of purchase cost. So one of the price promotions is to reduce
H2: Taking advantage of price promotion has a direct impact on increasing the
frequency of consumers online shopping cart use.

2.3. Entertainment purpose
Lin, 1999, Luo, 2002; Wolfinbarger and Gilly, 2001 indicate that placing an entertaining window in items in online shopping for attracting consumers has a major role in the frequency of consumers online shopping cart use. As consumers often use the Web for entertainment (Mathwick et al., 2001), some may find online shopping and the act of placing items in their virtual cart pleasurable.
H3: Entertainment purpose has a direct impact on increasing the frequency of
consumers' online shopping cart use.

2.4. Organizational intent
When consumers go to online shopping they can make a wish List for themselves, that is, they can select the items which want to buy in the near future and put them in their online carts and whenever they want just click on the wish list and buy those items. Like Amazon.com and BestBuy.com. This kind of purchasing is organizational use of shopping cart.
H4: Organizational shopping intent has a direct impact on increasing the frequency of
consumers online shopping cart use.

2.5. Research and information search
As Luo in 2002 mentioned Informativeness is another key consideration in consumers decision to use the internet. Some shoppers can use the cart for research purpose and shopping research tools. According to Punjand and Moore in 2009 the main motivation for online shopping is the ability to easily search. In this paper research and information search refers to the information that consumers gather when using online shopping cart.
H5: Research and information search intent has a direct impact on increasing the
frequency of consumers' online shopping cart use.

2.6. Frequency of shopping online cart use
One of the most important purposes of retailers is to convert the online shoppers to online buyers. Frequency of online buyers refers to the online buying. There are two
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motivation as Rohm and Swaminathan, 2004;
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types of motivation for online shopping and online buying. For online shopping the Seiders et al., 2000; Wolfinbarger and Gilly, 2001mentioned is the discomfort of transferring goods from store to store. While for onlin buying the utilitarian is a motivation which increases the purchasing online.
H6: Current purchase intent has a direct impact on increasing the online buying, and H7: The online shopping cart use has a direct impact on increasing the online buying.
3. Method
This research as a quantitative research needs to gather data for hypotheses testing, and for this purpose population is all customers of online services that because of nature of this research sample is chosen among 350 students of three famous private in Malaysia.SPSS17 as a suitable software will be able to show impacts of each independent variable on dependent variables which have been showed in above framework.
4. Data Analysis and Results
After distributing all questionnaires among mentioned students, 289 of them were analyzed that shows in the following table. In this table H1, H2, H4, H6, and H7 are accepted, but H3 and H5 are rejected. It means that any increase in Current Purchase intent, Taking advantage of price promotion, and Organizational intent will increase the Frequency of shopping online cart use, and thereby Frequency of online buying. Furthermore current purchase intent directly effect on Frequency of online buying. On the other hand entertainment purpose and Research and Information search do not have significant affect on Frequency of shopping online cart use. Table1.
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5. Conclusion 5.1. Summary
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There are many factors may affect on online buying behavior as a part of Ecommerce, and they can be related to external and internal environment of organizations, among these factors some of them can improve Frequency of shopping online cart use. They are Current Purchase intent, Taking advantage of price promotion, and Organizational intent. Besides, any increase or improvement in Frequency of shopping online cart use can increase Frequency of online buying.
5.2. Future study & Recommendation Although many people think using online services can decrease environmental pollution, many researchers and scientists have found out it can be dangerous for green environment. Therefore focusing on minimizing of these pollutions and maximizing the quality of services can be debatable. Also researching on finding the best HR practices that has potential to increase impact
of effective factors in using frequency of shopping online cart use can be a good subject for future study.
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References
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Arnold M, Reynolds K. Hedonic shopping motivations. J Retail 2003; 79(2):7795. Anderson JC, Gerbing DW. Structural equation modeling in practice: a review and recommended two-step approach. Psychol Bulletin 1988;103(4):41123. Babin BJ, Darden WR, Griffin M. Work and/or fun: measuring hedonic and utilitarian shopping value. J Consumer Res 1994; 20(4):64456. Bagozzi RP, Yi Y. On the evaluation of structural equation models. J Academy Mark Sci1988;16(1):7494. Bloch PH, Sherrell DL, Ridgway NM. Consumer search: an extended framework. J Consumer Res 1986;13(1):11926. Bridges E, Florsheim R. Hedonic and utilitarian shopping goals: the online experience. J Bus Res 2008;61(4):30914. CharneyT, Greenberg BS .Uses and gratifications of the Internet. In: LinCA, AtkinD, editors. Communication Technology and Society Audience Adoption and Uses. Cresskill, NJ: Hampton; 2001. p. 35378. Close Aneline G, Kukar-Kinney M, Beyond buying: Motivations behind consumers online shopping cart use, Journal of Business Research 63; 2010. P. 986-992 Fishbein M, Ajzen I. Belief, attitude, intention, and behavior: an introduction to theory and research. Reading, MA: Addison-Wesley; 1975. Flanagin AJ, Metzger MJ. Internet use in the contemporary media environment. Human Communication Res 2001;27(1):15381. Ha S, Stoel L. Consumer e-shopping acceptance: antecedents in a technology acceptance model. J Bus Res 2009;62(6):56571. Howard JA, Sheth JN. The theory of buyer behavior. New York: John Wiley; 1969. Ko H, Chang-Hoan C, Roberts MS. Internet uses and gratifications: a structural equation model of interactive advertising. J Advert 2005;34(2):5770. Kukar-Kinney M, Close AG. The determinants of consumers' online shopping cart abandonment. J Academy Mark Sci 2010(35): 24050. Lueker T. Abandonment surveys help boost sales. Marketing News 2003;37(24):16 21. Luo X. Uses and gratifications theory and e-consumer behaviors: a structural equation modeling study. J Interactive Advert 2002;2(2).
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Magill K. Building a better shopping cart. Multichannel Merchant 2005;1(8):189. Mathwick C, Malhotra N, Rigdon E. Experiential value: conceptualization, measurement and application in the catalog and internet shopping environment.JRetail2001;77(1):3956. Menon S, Kahn B. Cross-category effects of induced arousal and pleasure on the internet shopping experience. J Retail 2002;78(1):3140. Noble SM, Griffith DA, Adjei MT. Drivers of local merchant loyalty: understanding the influence of gender and shopping motives. J Retail 2006;82(3):17788. Oliver RL, Shor M. Digital redemption of coupons: satisfying and dissatisfying effects of promotion codes. J Product Brand Management 2003;12(2):12134. Papacharissi Z, Rubin AM. Predictors of internet use. J Broadcast Electron Media 2000;44(2): 17596. Poddar A, Donthu N, Wei Y. Web site customer orientations, Web site quality, and purchase intentions: the role of web site personality. J Bus Res 2009;62(4):44150. Punjand G, Moore R. Information search and consideration set formation in a webbased store environment. J Bus Res 2009;62(6):64450. Rohm AJ, Swaminathan V. A typology of online shoppers based on shopping motivations. J Bus Res 2004;57(7):74857. SeidersK, BerryLL, Gresham LG. Attention, retailers! How convenient is your convenience strategy? Sloan Manage Rev 2000;41(3):7989. Wang S, Beatty SE, Mothersbaugh DL. Congruity's role in website attitude formation. J Bus Res 2009;62(6):60915. Wolfinbarger M, Gilly MC. Shopping online for freedom, control and fun. Cal Manage Rev 2001; 43(2): 3455. Wolin LD, Korgaonkar P. Web advertising: gender differences in beliefs, attitudes and behavior. Internet Res: Electron Netw Appl Policy 2003;13(5):37585.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS The Impact of E-Services on Customer Dependencies (Transportation industry in Iran)
Masoomeh Shahbazi Moghadam PhD student, UTM, Perdana School Roozbeh Hojabri DBA Student, MMU, Faculty of Management Mahmoud Manafi Islamic Azad University of Iran, the branch of Marvdasht Mehrdad Salehi MBA student, MSU, Faculty of Management Reza Gheshmi Islamic Azad University of Iran, the branch of Marvdasht
Abstract
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This quantitative research attempts to show the impact of E-Services on Customer Dependencies in transportation industry of Iran. Since the structure of e-services in Iran is dependent to some issues such as political issues, level of technology, and cultural issues, elements have effect on Customer Dependencies can be different. By using the interesting framework these effects are measured. Key words: Customer Acceptance, Customer Satisfaction, Customer Dependencies, and EServices.
1. Introduction Internet retailing (also referred to as business to customer e-commerce), entails the use of a web interface that allows business transactions between a business entity and their customers, with online payment capability. It includes such online transactions as internet banking, electronic data interchange, electronic settlement as well as purchases of goods and services over the internet (Malone, 1999). One important sector that can benefit immensely from ecommerce is transport and logistics. In fact, it has been reported that supply chain management is one of the sectors that have been largely influenced by the advent of the internet (Saloner & Spence, 2001). In this paper, a literature review of various works on ecommerce with specific focus on customer acceptance, customer satisfaction as well as customer dependency and retention (customer loyalty) is afforded. Intensive literature search has been carried out for each of the three components and a logical conclusion drawn. Using e-services in Iran because of specific conditions such as political issues, level of technology, and cultural issues needs to be studied differently. Therefore this research
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attempts to identify the main factors have effect on Customer Dependencies in transportation industry in Iran. Furthermore, measuring the impact of any elements on Customer Dependencies will be done.
Advantages of e-services The advantages of using the internet for business purposes are quite numerous, some of which will be recounted. First of all, e-commerce ensures a transparent flow of goods from source to destination (Bowersox & Daugherty, 1995). Moreover, it enables the virtual integration of physically disintegrated units, which then allows for the integrated management of these units (La Londe & Powers, 1993). It also allows centralized and decentralized management within the same operating system (Bowersox, 1992). Other advantages of the technology have been mentioned in the fields of purchasing (Ellinger & Daugherty, 1998), marketing and logistics (Rahman, 2004). Due to the internet, a key happening across industries today is the emergence of a global marketplace just a mouse click away. Since the advent of the internet, the number of companies using e-services continues to increase dramatically; thereby distorting the traditional supply chain management system. In the pre-net economy, a companys supply management is regarded good enough if it ensures long lasting relationships with vendors, with the company maintaining close cooperation with suppliers in improving design and quality, minimizing cost and mutual sharing of benefits (Rahman, 2004). With the advent of the internet, it has become even cheaper, quicker and smarter to conduct business transactions across the globe using the cyber space (Harvey & Richey, 2001).
E-business and Supply Chain Management In the transportation of supplies, raw materials and finished products, many different carriers may be used for routing from source to the final destination, which sometimes turns out to be inefficient. This includes the lack of real-time information necessary for timely response to demand-supply disequilibria, so as to avoid build-up of excess inventory (Mason, Mauricio Ribera, Farris, & Kirk, 2003). Secondly, the current use of propriety technologies by the various key players in the transport sector makes this inefficiency even more pronounced because it poses hindrances to the wide adoption of the technology. The introduction of ecommerce can solve some of these inefficiencies (Malone, 1999).
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E-business and Customer Acceptance
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It is argued that generally, people tend to be comfortable working with the existing technology and are unwilling to endure the extra effort and risk involved in adopting the superior new technology (Woodside, 1996). In a social context, the idea of adopting new technologies may receive objection from staff that are already conversant with the existing inferior technology. Research has shown that merely bringing a superior new technology to market is no assurance of customer acceptance and eventual replacement of the existing inferior technology (Gatignon & Robertson, 1989; Ram, 1987). In fact, this proposition tends to hold even where the adoption of the new technology will result in a massive improvement in service quality and reduced customer charges. Even where eventual customer acceptance is imminent, it often requires a long period for the superior new technology to replace even half of the existing inferior technology. One reason for this phenomena is the fact that customer acceptance of new technology requires customers to move out of their comfort zone (Woodside, 1996). Hence, it requires intensive marketing and product evaluation through triangulation of data collection procedures (Denzin, 1989) as mentioned in (Woodside, 1996), face to face interviews and a long period of trials (Woodside, 1996). For a thorough analysis of the factors that influence customer acceptance of e-services, we shall resort to the Technology Acceptance Model (TAM), an important theory outlining factors that affect customer acceptance of an information system (Davis, 1986). The Technology Acceptance Model postulates that there are two distinct factors that influence peoples acceptance or rejection of technology: the perceived usefulness and the perceived ease of use. The perceived usefulness of the technology refers to the extent to which a person is convinced that using the technology will lead to improved job performance. The perceived ease of use on the other hand, refers to the extent to which a person is convinced that the use of a technology would be effortless. It is argued that the higher the perceived usefulness and the perceived ease of use levels, the higher the acceptance level. Various research works have been done to further validate the TAM at various levels of technology deployment. The research by (Ndubisi & Jantan, 2003), in a survey involving many business outfits, confirmed that the perceived usefulness has direct influence on the usage of an information system. They further argued that the perceived ease of use (through usefulness) indirectly influences information system usage. The work by (Eriksson, Kerem, & Nilsson, 2005) applied the TAM model to internet banking and found out that the usage of ebanking increases with the perceived usefulness. However well designed and easy to use an ebanking service may be, they mentioned, customers will not desire to use it if they do not
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is an integral component for customer acceptance.
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perceive it as useful. Hence, it is concluded that for internet banking, the perceived usefulness
E-business and Customer Satisfaction For a company, one of the most important things to ensure in e-commerce is customer satisfaction, which can be usually accomplished through an internet platform called electronic customer relationship management (E-CRM). With the increasing consumer acceptance of the internet as a reliable platform for buying goods and services, coupled with the fact that improved customer service quality plays a pivotal role in retaining existing customers as well as attracting would be buyers, researchers focus on the required improvements needed in order to increase customer satisfaction. The work in (Arshad, Ahmad, Janom, & Mohamed) for example, focused on the quality of internet based ticketing systems in the transport sector, particularly for train and bus services using web observations. In the study, the researchers observed 41 E-CRM features of companies mainly in Europe, which were then fitted into 11 determinants of internet service quality, namely: ease of use, reliability, linkage, structure and layout, incentive, information, efficiency, communication, security, support and appearance. From these, it was found that the two most important determinants that are critical to customer satisfaction are appearance (web page appearance) and linkages (links).
E-business and Customer Dependency and Retention (customer loyalty) Customer satisfaction is one of the most important determinants of customer dependency and retention (also known as customer loyalty) in most business settings. With the collapse of a number of dot-com companies, managers had to relearn that despite the fact that the emergence of the World Wide Web has changed the business model; the ultimate goal of a company is to make profit (Rosenbloom, 2002); and that the traditional principles of marketing have not been made obsolete even with the advent of e-commerce. Moreover, it is emphasized that companies not only need to attract new customers, but must also endeavor to retain existing ones so as to guarantee profitable repeat business. For a company, it is mentioned that a loyal customer is worth about ten times its average customer (R. E. Anderson & Srinivasan, 2003). A business entity without customer loyalty is bound to collapse regardless of how well the business model is designed. In a bid to increase their loyal customer base, most companies endeavor to continually satisfy their customers and develop long term relationships.
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However, despite the fact that the level of a customers satisfaction can be a good yardstick to predict his/her future behavior, it must be noted that measures of satisfaction usually tend to be positive (Peterson & Wilson, 1992). In fact, for many firms, the relationship between customer satisfaction and purchasing behavior is intangible (Mittal & Kamakura, 2001). This, by extension, implies that the there exist an intuitive kind of relationship between satisfaction and loyalty, as it is further confirmed by later research works in (Cronin Jr & Taylor, 1992; Newman & Werbel, 1973; Woodside, Frey, & Daly, 1989); the strength of which is found to vary significantly under various conditions. The work in (Jones & Sasser, 1996) argued that the strength of the relationship between satisfaction and loyalty is a function of the competitive structure of the industry being studied. On the other hand, (Oliver, 1999) mentioned that even though satisfaction eventually results in loyalty, true loyalty can be attained only when such factors as embedded social network are present. This issue became even more challenging with the advent of e-commerce, as competing businesses are just a mouse click apart. In contrast, the nature of the website design can also boost customer satisfaction. The work in (Dabholkar, 1996) argued that there exist a strong positive relationship between a customers enjoyment of using the website and the perceived quality of the service. Every business wishes to have as many loyal customers as possible because they increase the financial buoyancy of the company (E. W. Anderson & Mittal, 2000). Loyal customers tend to buy more goods and services than new customers and one-time buyers, and can be suitably served with minimal operating cost. Moreover, this class of customers not only pay regularly prices but are also likely to encourage prospective customers by word of mouth (van Riel, Liljander, & Jurriens, 2001). In the research conducted by (Reichheld & Schefter, 2000), it is argued that for web-based business transactions, trust emerges as the main determining factor for customer loyalty, not price. They further mentioned found that up to half of the customer base of some e-service providers are accrued through referrals. Besides, prospective buyers are found to seek advice from loyal customers, whose recommendation boost their confidence; and hence minimizing the companys running cost for providing customer assistance. However, it must be noted that not every single loyal and satisfied customer of a business outfit implies increasing profits (Storbacka, 1994); it may require a few years before starting to pay dividend even though it is in the interest of the business outfit to ensure that all customers are retained before paying more attention on the profitable ones. The retention of ecustomers, as mentioned in (Reichheld & Schefter, 2000), must be ensured through the
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provision of improved quality of service being delivered, not just technology. In (van Riel, et al., 2001), these three service components that affect customer loyalty are identified to be the core services, supplementary services and the user interface. In an attempt to outline the factors that may increase or reduce the impact of e-satisfaction on e-loyalty, the authors in (R. E. Anderson & Srinivasan, 2003) studied various individual level variables such as inertia, convenience motivation, and purchase size, as well as business level variables such as trust and perceived value offered by the e-business. The result of the study indicated that the relationship between customer satisfaction and customer loyalty tends to be emphasized by convenience motivation and purchase size, trust and perceived value; whereas inertia tends to minimize it. It can therefore be argued that customer satisfaction and costumer loyalty are multi-faceted concepts dependent on different factors, a firm understanding of which requires further research and conceptualization. 2. Research Method This research as a quantitative research focuses on hypotheses testing according to following frame work (Ooi Sin Cheak, 2006): Figure1.
Hypotheses also are defined as: H1: Customer Acceptance is positively correlated to E-service initiative. H2: Customer Satisfaction is positively correlated to Customer Acceptance that comes from e-services implementation. H3: Customer Dependencies is positively correlated to Customer Satisfaction. On the other hand primary data are gathered by distributing questionnaire among 100 customers of e-services of some transformation companies in Iran (randomly). Furthermore, investigating these correlations is done by t-test in SPSS 17. 3. Results & Discussion After hypothesis testing, these results (following tables) have been obtained that accept all hypotheses.
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Table1.
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In the table1, the calculated t value is 2.872 which is greater than 2.306. It means that H1 is substantiated. Therefore any improvement in e-services in transportation industry in Iran can effect on customer Acceptance positively. Table2
According to table2, the calculated t is 11.580 which shows any improvement in customer acceptance causes improvement in customer satisfaction. Table3.
Table3 shows that, since calculated t is 11.856 and it is greater than 2.571, H3 is also substantiated. It means that customer satisfaction in transportation industry affect on customer dependencies. 4. Conclusion 4. 1. Summary In this paper, a review of research works on e-commerce with respect to customer acceptance, customer satisfaction and customer dependency and retention (customer loyalty) are afforded. For each of the three components, various works have been analyzed. Firstly, some uses of ecommerce are highlighted. The paper then studied the impact of e-commerce on supply chain management, which according to some researchers, is one of the sectors in which the impact of the internet is largely felt. Furthermore, the various factors affecting the level of customer
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acceptance, customer satisfaction, and customer dependency and retention (customer loyalty) in e-commerce, as mentioned by different researchers, are discussed in detail. Based on the various postulates by the different researchers which is partly as a result of the variety of conditions under which the different researches were conducted, we concluded that the factors affecting customer acceptance, customer satisfaction and customer dependency (loyalty) are multifaceted; and hence require further research works in order for conclusions to suite various scenarios. 4.2. Future study & Recommendation Government supports can improve the online and IT services in different industries of Iran. It is clear that this improvement can be useful in many aspects. For example data warehousing by companies will enhance their performance. On the other hand IT services as a powerful tool contributes to create knowledge because it is one of the advantages of knowledge sharing which may be facilitated by IT services. IT improvement implies E-services improvement and thereby customer loyalty. Another interesting issue for future study can be identifying the main factors according relevant level or type of industry.
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References
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Anderson, E. W., & Mittal, V. (2000). Strengthening the satisfaction-profit chain. Journal of Service Research, 3(2), 107. Anderson, R. E., & Srinivasan, S. S. (2003). E satisfaction and e loyalty: A contingency framework. Psychology and Marketing, 20(2), 123-138. Arshad, N. H., Ahmad, F., Janom, N., & Mohamed, A. Service Quality in Internet Retailing: A Study on Land Transportation Services. Bowersox, D. J. (1992). Logistical excellence: it's not business as usual: Digital Pr. Bowersox, D. J., & Daugherty, P. J. (1995). Logistics paradigms: the impact of information technology. Journal of Business logistics, 16, 65-65. Cronin Jr, J. J., & Taylor, S. A. (1992). Measuring service quality: a reexamination and extension. the Journal of Marketing, 55-68. Dabholkar, P. A. (1996). Consumer evaluations of new technology-based self-service options: an investigation of alternative models of service quality. International Journal of research in Marketing, 13(1), 29-51. Davis, F. D. (1986). A technology acceptance model for empirically testing new end-user information systems: theory and results. Sloan School of Management, Massachusetts Institute of Technology. Denzin, N. K. (1989). The research act: A theoretical introduction to sociological methods (Vol. 3): McGraw-Hill. Ellinger, A., & Daugherty, P. (1998). The effect of information integration on customer satisfaction. International Journal of Purchasing and Materials Management. Eriksson, K., Kerem, K., & Nilsson, D. (2005). Customer acceptance of internet banking in Estonia. International Journal of Bank Marketing, 23(2), 200-216. Gatignon, H., & Robertson, T. S. (1989). Technology diffusion: an empirical test of competitive effects. The Journal of Marketing, 35-49. Harvey, M. G., & Richey, R. G. (2001). Global supply chain management:: The selection of globally competent managers. Journal of International Management, 7(2), 105-128. Jones, T. O., & Sasser, W. E. (1996). Why satisfied customers defect. Journal of Management in Engineering, 12(6), 11. La Londe, B. J., & Powers, R. F. (1993). Disintegration and re-integration: logistics of the twenty-first century. International Journal of Logistics Management, The, 4(2), 1-12. Malone, P. (1999). Business to Business E-commerce Case Study Transport and Logistics australia.
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Mason, S. J., Mauricio Ribera, P., Farris, J. A., & Kirk, R. G. (2003). Integrating the warehousing and transportation functions of the supply chain. Transportation Research Part E: Logistics and Transportation Review, 39(2), 141-159. Mittal, V., & Kamakura, W. A. (2001). Satisfaction, repurchase intent, and repurchase behavior: Investigating the moderating effect of customer characteristics. Journal of Marketing Research, 131-142. Ndubisi, N. O., & Jantan, M. (2003). Evaluating IS usage in Malaysian small and mediumsized firms using the technology acceptance model. Logistics Information Management, 16(6), 440-450. Newman, J. W., & Werbel, R. A. (1973). Multivariate analysis of brand loyalty for major household appliances. Journal of Marketing Research, 404-409. Oliver, R. L. (1999). Whence customer loyalty. Journal of Marketing, 63(4), 33-44. Ooi Sin Cheak (2006), Northport (Malaysia) BHD: The impact of E-Services on Customer Dependencies , MBA thesis in Multimedia University, June. Peterson, R. A., & Wilson, W. R. (1992). Measuring customer satisfaction: fact and artifact. Journal of the Academy of Marketing Science, 20(1), 61-71. Rahman, Z. (2004). Use of internet in supply chain management: a study of Indian companies. Industrial Management & Data Systems, 104(1), 31-41. Ram, S. (1987). A model of innovation resistance. Advances in Consumer Research, 14(1), 208-212. Reichheld, F. F., & Schefter, P. (2000). E-loyalty: your secret weapon on the web. Harvard business review, 78(4), 105-113. Rosenbloom, B. (2002). The ten deadly myths of e-commerce. Business horizons, 45(2), 6166. Saloner, G., & Spence, A. M. (2001). Creating and Capturing Value Perspectives and Cases on Electronic Commerce: John Wiley & Sons, Inc. Storbacka, K. (1994). The nature of customer relationship profitability: analysis of relationships and customer bases in retail banking. van Riel, A. C. R., Liljander, V., & Jurriens, P. (2001). Exploring consumer evaluations of eservices: a portal site. International Journal of Service Industry Management, 12(4), 359-377. Woodside, A. G. (1996). Theory of rejecting superior, new technologies. Journal of Business & Industrial Marketing, 11(3/4), 25-43. Woodside, A. G., Frey, L. L., & Daly, R. T. (1989). Linking service quality, customer satisfaction, and behavioral intention. Journal of Health Care Marketing, 9(4), 5.
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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS Determination of Compound Rate of Return of Emerging Markets: A Case Study of Karachi Stock Exchange
Dr. Muhammad Arshad Haroon Assistant Professor of Commerce, Government Sindh College of Commerce, Hyderabad, Sindh, Pakistan. & Adjunct Assistant Professor of Accounting and Finance Department of Management Sciences, Isra University, Hyderabad, Sindh, Pakistan. Dr. Qammaruddin Mehar Assistant Professor Department of Management Sciences, Isra University, Hyderabad, Sindh, Pakistan.
Abstract
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The purpose of this study is to provide a logical and factual way of investment to the prospective Pakistani institutional and individual investors. The study provides information about detailed analysis of compound rate of return of the companies listed on KSE through 2004-2008 in perspective of dividend yield and capital gain. The results indicate that only 19 percent listed companies are generating compound rate of return more than 20 percent which greater than risk free rate offered by the different saving schemes in the country during the period under review. The study is primarily designed with the background of compound rate of return, risk and return and detailed profitability analysis. The approach in presentation has been made simple so that it could be understood and used even by those who do not have sufficient knowledge in the field of finance. Keywords: Compound rate of return, Dividend Yield, Capital Gain Introduction People of all ages and all over the world have appreciated the wisdom of putting by something in their days of plenty and good health for use in the twilight of their lives or for the support of their dependents in case of their death The same approach can be considered fit for equity investors who carefully invest their money with the hope to gain return on investment in future. Investments opportunities vary from country to country depending upon the countrys economic growth, political condition, commerce and industry, development and macro economic structure. However, developed nations have the opportunity of diversification of investment not only in real assets but also in financial assets, thereby becoming a microscopic partner in gigantic industries and earning their shares of profits in the form of dividends8 and bonuses9. However, their problem is not simple in the sense that it is not restricted to mere preservation of goods, coins and jewelry. Their problem is to invest wisely in industries which provide reasonable opportunities for growth over the period of time and afford them
8
Payment made to shareholders, usually once or twice a year out of a companys profits after tax. Dividend payments do not distribute the entire net profit of a company, a part or substantial part of which is held back as reserves for the companys expansion. Dividend is declared on the face value or par value of a share, and not on its market price. When a companys free reserves are high, it may choose to capitalize part of it by issuing bonus shares to existing shareholders in proportion to their holdings, to convert the reserves into equity. Bonus shares are issued free of cost, but since the number of shareholders remains the same and their proportionate holdings do not change, bonus shares do not improve the shareholders ownership of the company. After an issue of bonus shares the price of a companys share drops, more or less in proportion to the issue. However, since the dividend rate is often maintained, the shareholder gets a larger yield on the increased holding and when the share price APPRECIATES, the investor makes further gain
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reasonable compound rate of return on investment per annum yield by way of dividends and capital gain. Although, the principle of limited liability10 protects them from losses in excess of their invested capital, their problem is also to see that the capital does not depreciate irretrievably. In the context of developing countries where the investors generally attempt to outperform the market generating excess return that should be excess from the total return of the market. In this respect, it is important for investors, who want to invest in the most volatile equity markets of developing countries, should be thoroughly familiar with the various form of investment. They must also have some general and conceptual knowledge to decide as to which securities would be best for them to generate highest compound rate of return. Further, equity investors any where all over the world prefer to invest in high-dividend stock due to two reasons. First, the investment in high dividend securities provide relatively stable expected return on investment in unsure and stagnating markets and second they are supposed to outperform the market by composting portfolios that consist of highest dividend yield stocks. Dogs of the Dow or top ten strategy is one of the most famous dividend yield strategy refers to investment in the ten stocks of the Dow Jones Industrial AverageDJIA or any other major stock index which have the highest dividend yields in that markets. The strategy is further modified and known as small dogs or live depot in this way only the five (of the ten) stocks are chosen with the lowest price per share. In 2005, Deutsche Borse introduced DivDAX consists of 15 stocks based on high dividend yield stocks. The introduction of this index is recognition of high dividend yield stocks that is the most favorite criterion of the longterm investors at the time of making any investment decision. In Pakistan, it is the common practice that dividend is paid at quarterly which creates slight complex computation of dividend yields per annum while most of the investors and academicians annualize it on the basis of past performance of the company. This paper has been especially designed with a view to determine compound rate of return and risk associated with them of the companies listed on Karachi Stock ExchangeKSE during the period of 2004 to 2008. The examination covers all the major sectors of KSE as well as blue chips listed on it. It is worth mentioning that academic literature provides very few studies on this area, however, dividend yield is the most relevant research area which remains regularly under discussion of academic literature. So, the following literature reviews mostly relate to the earlier studies conducted on both dividend yields and compound rate of return. Literature Review Graham and Dodd (1934) first observed the effects of dividend payment on the value of a company. They investigated that the payments and their effects of a liberal portion of earnings in dividends adds to the attractiveness of a stock. Black and Scholes (1974) concentrated on securities returns instead of prices and dividend yields instead of dividend payments. They also extended the modeler capabilities of Capital Asset Pricing ModelCAPM equation by a dividend yield term. In their extension, they considered portfolios instead of single stocks including diversification effects. They used the data from 1926 to 1966 of New York Stock ExchangeNYSE and showed that dividend yields did not have a consistent impact on expected returns. Litzenberger and Ramaswamy (1979) analyzed the NYSE stocks taking the data from 1936 to 1977. They used an extension of the CAPM, and found a significantly positive relation between (before tax) expected returns and dividend yields. Blume (1980) was the first who identified the so-called "U-shape'" between dividend yield and total return and concluded that taxation did not affect the relation between dividend yield and pre-tax return. He used cross-sectional regressions to analyze NYSE data from 1936 to 1976. His study based on the average returns on non-dividend paying stocks for a given beta coefficient exceeded the average returns of all dividend-paying stocks as a group. He documented that only those stocks with extremely high dividend yields showed a higher return on average. The work of Blume further extended by Keim (1985) presented the same results as Blume showed. Keim also observed a U-shape between dividend yield and return for NYSE data from 1931 to 1978 and confirmed that tax effects cannot explain this effect. He explained the U-shape by size of the firm he segregated small corporations in the zero dividend
10
A privilege enjoyed by the shareholders of a limited company. If the company goes bankrupt and does not have enough assets to meet its obligations,
the shareholders cannot be asked to pay any more. Their liability ends when they have paid for their shares
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yield-group and in the highest dividend yield group while the largest corporations were not the largest dividend yield corporations. Christie (1990) conducted study on NYSE taking the period from 1926 to 1985 and analyzed differences in returns between dividend paying and non-paying corporations. He explained the familiar U-shape but, by starting in 1946, the returns of non-paying corporations were negative (except in January) resulting in an increasing return-dividend-yield function. He showed that dividend expectation effects were at least as important as tax effects. Fama and French (1988) examined the stock of NYSE from 1927 to 1986. They used regression analysis to find future returns on current dividend yields and used different time horizons to compute returns. They concluded that the longer this time horizon the larger was the variation of the returns that could be explained by the variation in dividend yields. Hodrick (1992) analyzed NYSE data from 1926 to 1987, to test the predictive power of dividend yields to explain future returns by regressing the compound return on the preceding dividend yield. He used vector auto-regression (VAR) to generate one-step-ahead linear predictions to avoid biases driven by autocorrelation. He concluded that dividend yields had predictive power to explain returns for all three methodologies except that when returns were computed over longer time horizons. Goetzmann and Jorion (1993) used S&P 500 index data from 1927 to 1990, whereas Nelson and Kim (1993) examined S&P Composite Index data from 1871 to 1987, both compared the results of an ordinary least squares (OLS) regression with the results of simulations, both studies entail that the tstatistics produced by an OLS regression on lagged dependent variables are biased upward to an extend that often leads to false inferences. Goetzmann and Jorion (1995) also studied whether dividend yields could predict long-horizon stock returns. The applied NYSE data on a monthly basis and U.K. stock exchange data on a yearly basis from 1872 and 1871, respectively, to 1992, no strong evidence was found for this forecasting power. Furthermore, they inferred from their study that using long time series is not a remedy but can seriously bias inference when survivorship is an issue. Levis (1989) examined the influence of dividend yields on stock returns for the London Stock ExchangeLSE using returns from 1961 to 1895. He found that dividend yield and price-to-earnings (PE) ratio had a stronger effect on return than market value and share price. Morgan and Thomas (1998) anticipated a negative relation between dividend yield and total return because of the higher rate of taxation on capital gains relative to dividend income in the U.K. They used data from 1975 to 1993 of LSE; their results indicated the U-shape observed by Blume (1980) and Keim (1985) for U.S. data. They explained this non-linearity due to the size effect and a seasonal effect for the zero-dividend portfolio which had significantly larger returns in January and April with the latter suggested to be due to the end of the U.K. tax year. Chen, Grundy, and Stam-baugh (1990) concluded the relation of dividend yield and return over time but at least part of this relation could be attributed to dividendrelated changes in risk measures. As the beta coefficient which is only risk measure, dividend yield as an additional repressor had a significantly positive influence on the return. However, he concluded that by including the sensitivity of the return to the excess return of junk bonds as another risk measure, the significant influence of dividend yield on return vanished. Additionally, the study conducted by Chen, Grundy, and Stambaugh did not show clearly a tax-induced penalty on cash dividends. McManus, ap Gwilym, and Thomas (2004) examined from 1958 to 1997 using U.K. market data to find the influence of the payout ratio on the relation between dividend yield. Their study result indicated that the payout ratio had an important impact on the statistical significance of dividend yield in explaining return. Clinebell, Squires, and Stevens (1993) analyzed U.S. market data from 1966 to 1989 and found that high-dividend paying stocks had lower systematic risk (beta coefficient) in down markets than in up markets. It means that high-dividend-yield stocks did not offer a special downside risk protection as had often been suggested. Gombola and Liu (1993b) examined U.S. market data from 1970 to 1984 and found that dividend yield was positively related to return during bear markets but negatively related to return during bull markets. Gombola and Liu (1993a) analyzed the period 1969 to 1984 of U.S stock market and found that not only a negative relation between systematic risk and dividend yield but also a significantly positive alpha for corporations paying high and stable dividend yields. Ap Gwilym, Morgan, and Thomas (2000) used LSE data from 1975 to 1997 and concluded that systematic risk rose with decreasing dividend stability and increasing dividend yield within all non-zero dividend yield groups, while the
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zero-dividend portfolio had the highest systematic risk. Alpha decreased very sharply when considering portfolios with lower dividend yields. They found a significantly positive alpha for corporations paying high and stable dividend yields. Filbeck and Visscher (1997) analyzed the dogs a well-known of the Dow strategy for the U.K. market. They used the Financial Times Stock Exchange (FTSE) 100 Index data based on returns, the Sharpe ratio, and the Treynor ratio. They concluded that the dividend yield strategy could not show an effective way of consistently beating the market between 1984 and 1994. A quite similar examination was conducted by Visscher and Filbeck (2003) for the Canadian stock market. They compared the performance of the Toronto 35 top ten strategy with the one of the Toronto 35 Index itself and with the one of the Toronto Stock Exchange (TSE) 300 Composite Index between 1987 and 1997. Their examination showed a success of the dividend yield strategy against both benchmarks and based on all three measures for different holding periods with just a few exceptions for the shortest holding period. Kotkamp and Otte (2001) analyzed the DAX top ten strategy, the DAX low five depot, and the DAX low one depot. They conclude that all three strategies had a positive mean excess return in comparison to the DAX and the whole German stock market from 1961 to 1998 with most of these results being highly significant. This also held when transaction costs were taken into account and returns were computed on a risk-adjusted basis using the Sharpe ratio.
Research Methodology and Data The companies selected for study are those which are profitable. Some of these companies are showing very high yield on investment. High yield does not mean that accompany is fleecing the public. It can be seen that actual profits (dividends & bonus shares are a very small element of compound rate of return or total yield. The major portion of yield comprises of Capital Gain. The capital gain is not realized profit and it is considered as unrealized profit. The capital gain has also been adjusted and assumed as a profit in this study while determining compound rate of return on investment. The capital gain usually comprises speculation, reduction in buying power of currency and increase in the assets of the company. Just as the market value of other properties such as house, lands, flat or jewelry increase with passage of time, similarly the market value of shares of well managed companies may also increase with passage of time. Because a share represents a specific portion of property of company in most situations, capital gain basically compensates for reduction in the buying power of the currency due to this reason it has been included. By now, we know that high yield/rate of return from a company does not necessarily mean that a company is over profiteering. In fact about half of the companies listed on the stock exchange are trading far below the acceptable rate of return. The method of study used for determining compound rate of return is explained below. There are 609 companies listed on the KSE during the period under review. Out of these 365 companies were selected for analysis, 51 companies were discarded due to incomplete data. The companies whose mean (high/low) market value of shares was quoted to be 100% of par value on 2008 were presumed to be profitable. These companies were selected for study, the market value of the listed companies was taken on yearly high/low basis of 2004 and 2008 and then mean was computed to obtain capital gain. The companies whose financial data was not available for any reason were discarded. The companies whose financial data consisted of less than two year duration were also rejected from the study. A total of 51 companies were rejected. However, the general formula to compute dividend yield is as follows:
DYi(y) = Di.t(y) P (y) i.t-1

With DYi(y) denoting the dividend yield of stock i in year y, Di.t(y) denoting the dividend on stock i in year y (paid on day t) and P(y) i.t-1 denoting the closing price of stock i in year y on day t-1. Therefore, dividend yield is just the quotient of dividend and closing price of the stock on the day preceding the
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dividend payment. Where as, for determining compound yield/rate of return/profitability has been computed for each year since 2004 to 2008 by using the following model: (P1-P0)+D P0 Where P1 denotes the beginning price, P0 indicates ending price and D shows the total dividend paid (Cash & Bonus). To determine the compound rate of return, the arrangement of the basic future value (present value) of annuity equitation can be used to determine for the compound interest (discount) rate implicit in an annuity if we know (1) the annuitys future (present) value, (2) the periodic payment or receipt, and (3) the number of periods involved. To determine the compound annual interest rate i implicit in this annually problem for this study, the following future value of an annuity equation has been used: FVn = PVo (FVIFi.n ) The standard deviation has been used to measure the risk of annual yield for ordinary shares. The standard deviation is found by squaring the differences from the average annual yield, dividing the sum of the squared differences by the number of items being measured, and taking the square root of this number. The standard deviation of the average annual yield is the indication of risk. The formula for the standard deviation is:
X2 N
Where is the standard deviation, 2 is the sum of the difference around the mean squared and N is the number of observations.
Results The graph given in the end after the references shows the frequency distribution of the companies that have been found to have positive compound growth during the period under study. The graph shows that total 115 companies have positive compound growth out of 365 companies selected for study which depicts that only 19 percent companies are producing positive compound growth as compared to total number of listed companies. It is also worth mentioning that 25 companies are found to have 10 to 20 percent compound growth, 47 companies are found to have 20 to 30 percent compound rate of return while only 21 companies have been generating more than 30 percent compound growth in terms of rate of return during the period under review. All analyzed companies ranked from high to low by their compound rate of return/ yield from 2004 to 2008 are presented in table 2 motivated by Gombola and Liu (1993a) and ap Gwilym, Morgan, and Thomas (2000), the standard deviation of the of the mean capital gain of highest and lowest low price is given as a measure of capital gain stability. However, the observed period from 2004 to 2008 was characterized as a boom period of Pakistani stock exchanges. Therefore, the standard deviation of capital gain does not seem to be an appropriate measure of compound rate of return in this study. It might be possible that investors could define an unstable dividend as a dividend of non-constant amount instead of constant profits up to a certain level due to generating capital gain to out perform the market. While, Antje Henne, Sebastain Ostrowski, Peter Reichling (2007)11 utilized the mean-adjusted standard deviation (adj.std. dev.) of dividend payments to equalize the standard deviation of the single dividend payments dividend by their mean.
Gombola and Liu (1993a) and ap Gwilym, Morgan, and Thomas (2000) also used a measure of dividend stability based on dividend payments. In contrast to our study, their measure only takes dividend cut into accounts.
11
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The column 9 of table 2 contains the stocks compound rate of return per annum yield motivated by Blume (1980) and Keim (1985) for the U.S market and Morgan and Thomas (1998) for the U.K. market is also observable at the Pakistani stock market or whether the relation between compound dividend yield and total return on investment corresponds to the Pakistani financial system. The column also provides useful information about the effective compound total returns of the stock since these returns illustrate the development of the companies over the whole period. A completely different result can be seen for the risk measures. At first, it seems that standard deviation had random influence on the total risk of an investment regardless of almost same compound dividend yield. The table 1 that shows sector-wise information about the companies listed on KSE during the period under study. The column-1 of the table shows that 609 companies were listed in KSE during the period under study while the column-2 provides sector-wise information relating of those companies that were selected for study or that presumed as profitable. It has been clearly depicted that only 96 companies were found to have a compounded rate 20 percent or above. These results are surprising for investors as well as for other regional markets. The results also provide a clear outlook and good investments opportunities for long and medium-term investors. It needs to be pointed out here that the period for study was five years and can be considered quite sufficient for medium-term investment. If an investor invested his/her money in 2004 he/she certainly earned substantial return which was far more than other investment modes available in the country like national savings schemes with annual return on investment remained around 10 to 12 percent and any fixed income security whose annual compound rate of return also remained approximately 8 to 12 percent during the period under review. Column 4 of the table-1 shows the percentage of companies that were selected for study from each sector as compared to the total number of listed companies. It is worth-mentioning that only 19 percent companies are generating more than 20 percent positive compound rate of return. The study reveals that Food and Personal Care-products is the major sector whose 61 percent companies successfully crossed the strict criteria of selection, out of this 61 percent 93 percent companies have found to have positive compound rate of return which is greater than 20 percent or above. Besides this, Tobacco, Leather and Tanneries are the sectors whose 60 percent companies selected for study; both sectors are performing quite well in terms of generating positive compound rate of return. Cable & Electrical Goods, Cement, Chemicals, Fertilizer, Glass & Ceramics, Leather & Tanneries, Miscellaneous, Paper & Board, Power Generation & Distribution, Refinery. Technology & Communication, Textile Weaving, Tobacco, Transport, Vanaspati & Allied Industries, Woolen are the sectors are also performing satisfactorily because the selected companies for study have generated positive compound rate of return during the period under review. To sum up, the above results show that for an investor who wanted to follow a buy-and-hold strategy, who was interested in low risk or high performance instead of just looking at the return, and who wanted to invest in a few stocks, only a strategy based on dividend yield seemed to had been appropriate. Conclusion The purpose of this study was to examine compound rate of return during the period of 2004 to 2008 and its influenced on the performance of any particular stock and overall market. One object of this study was also to examine the applicability Dogs of the Dow or top ten strategy in the emerging market like KSE. It is worth mentioning that, on the one hand, compound rate of return/yield had no significant influence on excess return and, on the other hand, there was either very low or negative relation between compound rate of return/yield and risk. It is also pointed out that major portion covered by compound rate of return comprises on capital gain and not of dividend declared by the companies during the study period. To be concise, all results were inferred from the companies listed on KSE and a time horizon of just five years and show clearly beyond any doubt that investment in the companies listed on KSE is significantly superior to saving schemes of financial institutions. The highest rate of return of savings schemes remained around 12 percent per annum. Whereas minimum compound rate of return from selected companies is 15.32 percent which is significantly superior to savings schemes of financial institutions. It is hoped that prospective investors both (individual and institutional) will get benefit from this study. They may use this study as a reference at the time of
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taking any investment decision. It is also hoped that the investor will pursue the goal of greater return with a sense of discipline and persistency and becomes the master of financial journey.
References Ap Gwilym, 0., G. Morgan, and S. Thomas, 2000, Dividend Stability, Dividend Yield and Stock Returns: UK Evidence, Journal of Business Finance & Accounting 27, 261-281. Black. F. and M. Scholes, 1974, The Effects of Dividend Yield and Dividend Policy on Common Stock Prices and Returns, Journal of Financial Economics 1, 1-22. Blume, M. E., 1980, Stock Returns and Dividend Yields: Some More Evidence, Review of Economics and Statistics 62, 567-577. Chen, N.-F.. B. Grundy, and R. F. Stambaugh. 1990, Changing Risk, Changing Risk Premiums, and Dividend Yield Effects, Journal of Business 63, S51-S70. Christie, W. G., 1990, Dividend Yield and Expected Returns - The Zero-dividend Puzzle, Journal of Financial Economics 28, 95-125. Clinebell, J,M., J. R. Squires, and J. L. Stevens, 1993, Investment Performance of High Income Stocks over Up and Down Markets, Journal of Economics and Finance 17, 77-91. Deutsche Borse, 2005, DivDAX - Der Dividendenindex der Deutschen Borse, Februar 2005. Fama, E. F. and K. R. French, 1988, Dividend Yields and Expected Stock Returns, Journal of Financial Economics 22, 3-25. Filbeck, G. and S. Visscher, 1997, Dividend Yield Strategies in the British Stock Market, European Journal of Finance 3, 277-289. Goetzmann, W. N. and P. Jorion, 1993, Testing the Predictive Power of Dividend Yields, Journal of Finance 48, 663-679. Goetzmann, W. N. and P. Jorion, 1995, A Longer Look at Dividend Yields, Journal of Business 68, 483-508. Gombola, M- J. and F.-Y. Liu, 1993a, Considering Dividend Stability in the Relation between Dividend Yields and Stock Returns, Journal ofFinancial Research 16, 139-150. Gombola, M. J. and F.-Y. L. Liu, 1993b, Dividend Yields and Stock Returns: Evidence of Time Variation between Bull and Bear Markets, Financial Review 28, 303-327Graham, B. and D.L, Dodd, 1976, Security Analysis, special reprint of the 1934 first edition, McGrawHill, New York. Hodrick, R, J., 1992, Dividend Yields and Expected Stock Returns: Alternative Procedures for Inference and Measurement, Review of Financial Studies 5, 357-386. Keim, D.B,, 1985, Dividend Yields and Stock Returns-Implications of Abnormal January Returns, Journal of Financial Economics 14, 473-489. Kotkamp, S. and M. Otte, 2001, Die langfristige Performance von DAX-Dividendenstrate-gien, Kredit und Kapita! 34, 393-417.
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Levis, M,, 1989, Stock Market Anomalies - A He-assessment Based on the UK Evidence, Journal of Banking and Finance 13, 675-696, Litzenberger, R. H. and K. Ramaswamy, 1979, The Effect of Personal Taxes and Dividends on Capital Asset Prices - Theory and Empirical Evidence, Journal of Financial Economics 7.163-195. McManus, I., 0. ap Gwilym, and S. Thomas, 2004, The Role of Payout Ratio in the Relationship between Stock Returns and Dividend Yield, Journal of Business Finance &:Accounting 31, 1355-1387. Morgan, G. and S. Thomas, 1998, Taxes, Dividend Yields and Returns in the UK Equity Market, Journal of Banking & Finance 22, 405-423Nelson, C. R. and M. J. Kim, 1993, Predictable Stock Returns: The Role of Small Sample Bias, Journal of Finance 48, 641-661. Visscher, S. and G. Pilbeck, 2003, Dividend-Yield Strategies in the Canadian Stock Market, Financial Analysts Journal 59, 99-106. Antje Henne, Sebastain Ostrowski, Peter Reichling (2007), FEMM Working PaperNo.17, July-2007, 12-25
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Annexure Graph Showing Frequency Distribution of the Companies of Compound Rate of Return
50 45 40 35 30 25 20 15 10 5 0
Series2
47
25 22 17
0
1-----5 0
0
5-----10 0 10-----20 25 20-----30 47 30----40 22 40-----50 17
2
50-----60 2
1
60-----70 1
0
70-----80 0
0
80-----90 0
1
90-----100 1
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Table 1
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Sectorwise Performance of Public Limited Companies Listed on KSE

Column * S.No 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 Sectors Automobile Assembler Automobile Parts & Accessories Cable & Electrical Goods Cement Chemicals Commercial Banks Engineering Fertilizer Food & Personal Care-Pruducts Glass & Ceramics Insurance Investment Banks/Cos./Securities Leasing Companies Leather & Tanneries Miscellaneous Modarabas Oil & Gas Exploration Companies Paper & Board Power Generation & Distribution Refinery Sugar & Allied Industries Synthetic & Rayon Technology & Communication Textile Composite Textile Spinning Textile Weaving Tobacco Transport Vanaspati & Allied Industries Woolen Close-end Mutual Funds Jute Pharmaceuticals Class & Ceramics Total *Col 1 2 3 4 5 6 Total No. of Listed Companies No. of Companies selected for study No. of Companies which compound Rate of Return 20% or above Percentage of companies in relation to Total Numer of companies in sector No. of Companies selected for study Percentage of companies in relation to Total Numer of companies in sector Percentage of companies in relation to selected Numer of companies in sector 609 115 96 19% 16% 1 13 11 9 21 26 25 13 4 23 11 38 30 16 5 26 34 4 10 13 4 37 19 10 60 106 18 3 5 10 5 2 5 2 4 3 6 3 5 2 14 1 15 7 1 3 5 3 2 2 1 1 7 1 1 5 8 1 2 1 3 1 3 4 1 4 3 6 2 4 2 13 1 12 5 0 3 5 2 1 2 1 1 6 0 1 4 5 1 2 1 3 1 4 38% 18% 44% 14% 23% 12% 38% 50% 61% 9% 39% 23% 6% 60% 19% 9% 50% 20% 8% 25% 19% 5% 10% 8% 8% 6% 67% 20% 30% 20% 5 31% 9% 44% 14% 23% 8% 31% 50% 57% 9% 32% 17% 0% 60% 19% 6% 25% 20% 8% 25% 16% 0% 10% 7% 5% 6% 67% 20% 30% 20% 6 80% 50% 100% 100% 100% 67% 80% 100% 93% 100% 80% 71% 0% 100% 100% 67% 50% 100% 100% 100% 86% 0% 100% 80% 63% 100% 100% 100% 100% 100%
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Table 2 S.No
Ticker Symbol Company's Name Sector Mean Price 2004 Mean Price 2008 Capital Gain (Average)
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Total Cash Dividend
Total Bonus Dividend
Total Cash+ Bonus+ Capital Gain
Total Average Rate of Return on Investment Yield (%)
Average Rate of Return on Investment per Annum Yield (%)
Compound Rate of Return Investment Per annum (Yield)
STDEV of Mean Price
10
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29
Fazal Vegetable Ghee Mills Ltd. Mirpurkhas Sugar Mills Ltd. Bata Pakistan Ltd. Jahangir Siddiqui Co.Ltd. Sazgar Engineering Works Ltd. Hallmark Insurance Co. Ltd. MCB Bank Limited Johnson and Phillips (Pakistan) Ltd. First Nat.Equities Mehr Dastgir Textile Mills Limited Pak ReInsurance Co Eastern Federal Union Insurance Co. Ltd. Unilever Pakistan Fazal Textile Mills Ltd. Silver Star Insurance Co. Ltd. K.S.B. Pumps Co. Ltd. Javedan Cement Ltd. First Capital Sec. Corp Ltd. Service Ind. Mustehkam Cement Ltd. Shezan International Ltd. Rafhan Maize Products Ltd. Pangrio Sugar Mills Ltd. AKD Capital Limited Huffaz Seamless Pipe Industries Ltd. National Foods Limited. United Insurance Co. of Pakistan Ltd. Pak.Int.Con.Ter.Lt Dawood Capital Management Ltd.
FAZAL MIRKS BATA JSCL SAZEW HMICL MCB JOPP FNEL MDTM PAKRI EFUG
Vanaspati & Allied Industries Sugar & Allied Industries Leather & Tanneries Investment Banks/Cos./Securities Automobile Assembler Insurance Commercial Banks Cable & Electrical Goods Investment Banks/Cos./Securities Textile Spinning Insurance Insurance
7.5 12.2 66.4 94.7 15.8 4.0 55.2 9.4 11.6 6.5 65.6 78.4 276.0 99.9 6.6 35.3 16.4 17.0 26.8 14.3 78.1 547.5 3.6 133.9 20.2 101.3 8.3 23.2 8.1
584.90 154.45 646.50 820.16 112.35 29.58 356.40 65.63 69.70 45.23 405.53 490.09 1,643.50 584.90 32.00 191.62 89.35 82.59 142.36 78.70 370.67 2,620.00 18.12 661.50 86.90 388.70 25.96 98.32 31.18
577.40 142.25 580.15 725.46 96.60 25.58 301.23 56.25 58.10 38.75 339.91 411.69 1,367.50 485.05 25.38 156.34 73.00 65.64 115.61 64.43 292.55 2,072.50 14.57 527.62 66.73 287.45 17.71 75.10 23.05
1.50 2.25 20.00 9.00 1.10 0.00 44.80 0.50 10.00 0.00 4.00 19.23 176.00 4.00 0.00 14.30 5.67 0.00 6.50 0.00 51.50 256.00 0.00 0.00 2.73 9.50 0.00 3.60 0.00
0.0 0.0 0.0 41.9 4.5 0.0 4.5 0.0 1.5 0.0 45.6 9.2 0.0 0.0 6.9 1.0 0.0 14.8 0.0 0.0 2.0 0.0 0.0 5.0 7.9 68.0 11.9 2.0 5.0
578.90 144.50 600.15 776.41 102.22 25.58 350.54 56.75 69.60 38.75 389.46 440.08 1,543.50 489.05 32.25 171.64 78.67 80.42 122.11 64.43 346.05 2,328.50 14.57 532.62 77.39 364.95 29.58 80.70 28.02
7618.67 1084.43 804.52 719.86 548.98 539.38 535.32 505.33 500.00 498.46 493.46 461.33 459.24 389.78 386.79 386.58 381.13 374.42 356.47 351.31 342.94 325.30 310.42 297.85 283.59 260.44 258.48 247.45 244.91
1523.73 216.89 160.90 143.97 109.80 107.88 107.06 101.07 100.00 99.69 98.69 92.27 91.85 77.96 77.36 77.32 76.23 74.88 71.29 70.26 68.59 65.06 62.08 59.57 56.72 52.09 51.70 49.49 48.98
139.13 66.63 58.63 55.86 49.59 49.20 49.04 47.80 47.58 47.51 47.30 45.91 45.82 42.61 42.46 42.45 42.19 41.86 40.96 40.70 40.27 39.34 38.54 37.85 37.06 35.72 35.60 34.94 34.79
408.28 100.59 410.23 512.98 68.30 18.08 213.00 39.77 41.08 27.40 240.35 291.11 966.97 342.98 17.94 110.55 51.62 46.41 81.75 45.56 206.86 1465.48 10.30 373.08 47.18 203.26 12.52 53.10 16.30
ULEVER Food & Personal Care-Pruducts FZTM SSIC KSBP JVDC FCSC SRVI MUCL SHEZ RMPL PNGRS AKDCL HSPI NATF UNIC PICT DCM Textile Spinning Insurance Engineering Cement Investment Banks/Cos./Securities Leather & Tanneries Cement Food & Personal Care-Pruducts Food & Personal Care-Pruducts Sugar & Allied Industries Miscellaneous Engineering Food & Personal Care-Pruducts Insurance Transport Investment Banks/Cos./Securities
982
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Table 2 (Continued) S.No
AUGUST 2011
VOL 3, NO 4
Total Cash Dividend
STDEV of Mean Price
10
30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55
Kakakhel Industries Ltd. Fauji Fertilizer Bin Qasim Universal Insurance Co. Ltd. Shakarganj Foods Limited Samin Textiles Limited HinoPak Motors Ltd. Colgate Palmolive (Pakistan) Ltd. Atlas Insurance Limted Pakistan Services Ltd. First Dawood Investment Bank Ltd. EFU Life Assurance Limited Pakistan Tobacco Co. Ltd. Al-Noor Sugar Mills Ltd. Pak Datacom Limited Nestle Pakistan Ltd. Climax Engineering Company Limited Aruj Garment Accessories Limited Siemens Pakistan Engineering Co. Ltd. United Brands Limited Sitara Chemical Industries Ltd. Khyber Tobacco Co. Ltd. Adamjee Insurance Co. Ltd. Biafo Industries Limited Lucky Cement Limited Mari Gas Company Limited East West Life Assurance Co. Ltd.
KAKA FFBL UVIC SKFL SMTM HINO COLG ATIL PSEL FDIBL EFUL PAKT ALNRS PAKD
Vanaspati & Allied Industries Fertilizer Insurance Food & Personal Care-Pruducts Textile Weaving Automobile Assembler Chemicals Insurance Miscellaneous Investment Banks/Cos./Securities Insurance Tobacco Sugar & Allied Industries Technology & Communication
6.5 10.0 11.0 3.4 8.9 146.5 181.0 35.3 127.1 17.5 154.9 41.4 7.6 28.5 442.5 7.3 6.7 474.2 17.4 85.6 6.8 89.0 12.8 34.7 88.0 7.6
28.45 35.14 32.93 14.38 36.69 563.03 672.03 109.59 495.50 58.00 566.00 135.56 23.19 88.10 1,527.50 26.50 19.63 1,476.30 58.85 281.10 20.35 287.69 35.73 104.21 271.29 23.90
21.95 25.12 21.93 10.95 27.84 416.53 491.03 74.31 368.38 40.53 411.10 94.16 15.64 59.65 1,085.03 19.25 12.93 1,002.10 41.45 195.47 13.60 198.69 22.90 69.51 183.29 16.31
0.00 8.50 1.75 0.00 0.00 30.00 51.00 22.70 10.90 0.50 15.93 22.15 5.50 16.60 91.50 0.00 4.50 230.00 3.65 25.25 3.00 9.19 7.40 3.94 17.83 1.00
0.0 0.0 13.1 0.0 0.0 0.0 5.6 9.5 1.0 10.9 11.4 0.0 0.0 1.0 0.0 0.0 0.0 0.0 0.0 1.0 0.0 3.8 0.0 7.5 0.0 0.0
21.95 33.62 36.78 10.95 27.84 446.53 547.65 106.51 380.28 51.90 438.46 116.31 21.14 77.25 1,176.53 19.25 17.43 1,232.10 45.10 221.72 16.60 211.63 30.30 80.94 201.12 17.31
237.69 235.31 234.36 219.71 214.58 204.80 202.57 201.94 199.13 196.98 183.06 180.93 180.00 171.53 165.90 165.52 160.07 159.83 159.20 158.94 145.85 137.78 136.26 133.26 128.55 128.06
47.54 47.06 46.87 43.94 42.92 40.96 40.51 40.39 39.83 39.40 36.61 36.19 36.00 34.31 33.18 33.10 32.01 31.97 31.84 31.79 29.17 27.56 27.25 26.65 25.71 25.61
34.35 34.20 34.14 33.23 32.90 32.27 32.12 32.08 31.89 31.75 30.81 30.67 30.60 30.02 29.62 29.59 29.20 29.19 29.14 29.12 28.17 27.56 27.45 27.22 26.86 26.82
15.52 17.76 15.51 7.74 19.69 294.53 347.21 52.55 260.48 28.66 290.69 66.58 11.06 42.18 767.23 13.61 9.14 708.59 29.31 138.22 9.61 140.50 16.19 49.15 129.61 11.53
NESTLE Food & Personal Care-Pruducts CLIM ARUJ SIEM UBDL SITC KHTC AICL BIFO LUCK MARI EWLA Cable & Electrical Goods Textile Composite Cable & Electrical Goods Miscellaneous Chemicals Tobacco Insurance Chemicals Cement Oil & Gas Exploration Companies Insurance
983
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AUGUST 2011
VOL 3, NO 4
Total Cash Dividend
STDEV of Mean Price
10
56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 75 76 77 78 79 80 81
National Bank Of Pakistan Sapphire Fibers Ltd. Haseeb Waqas Sugar Mills Limited Haji Dossa Ltd Shaheen Ins.Company Ltd. Engro Chemical (Pak) Ltd. Altern Energy Ltd.. Pakistan Paper Prouducts Ltd. Buxly Paints Ltd. Azgard Nine Ltd. Singer Pakistan Limited Exide Pakistan Ltd. Annoor Textile Mills Ltd. Metrropolitan Steel Corporation Ltd. Frontier Sugar Mills and Distillery Ltd. The Fronties Sugar Mills & Distillery (O)Ltd Moonlite (Pak) Ltd. Tri-Pack Films Limited Dedex Eternit Limited. Attock Refinery Ltd. Good Luck Industries Ltd. Sanghar Sugar Mills Ltd. Indus Motor Company Limited International Knitwear Ltd. Platinum Insurance Co. Ltd. Tri-Star Modarba 1st.
NBP SFL HWQS HDOS SHNI ENGRO ALTN PPP BUXL ANL SING EXIDE ANNT MSCL FSMLO FSMLO MOON TRIPF DADX ATRL GLIN SANSM INDU INKL PLIC FTSM
Commercial Banks Textile Composite Sugar & Allied Industries Miscellaneous Insurance Fertilizer Power Generation & Distribution Paper & Board Chemicals Textile Composite Cable & Electrical Goods Automobile Parts & Accessories Textile Spinning Engineering Sugar & Allied Industries Sugar & Allied Industries Woolen Miscellaneous Engineering Refinery Food & Personal Care-Pruducts Sugar & Allied Industries Automobile Assembler Textile Composite Insurance Modarabas
64.2 71.1 15.7 49.0 22.0 98.6 6.5 53.9 21.3 23.0 30.3 62.0 4.9 16.4 24.5 24.5 14.0 77.5 45.1 92.0 95.5 5.9 110.6 5.8 4.1 2.8
183.89 226.13 49.28 146.00 68.35 275.55 19.80 130.75 61.00 64.37 85.90 171.58 14.20 47.58 68.70 68.70 39.99 199.68 111.60 228.40 258.00 16.38 249.95 15.75 11.13 6.88
119.66 155.03 33.63 97.03 46.33 176.98 13.30 76.83 39.68 41.34 55.65 109.55 9.30 31.15 44.20 44.20 25.97 122.18 66.55 136.40 162.50 10.45 139.33 9.95 7.01 4.13
20.08 5.85 0.00 6.50 0.00 28.50 0.00 28.00 3.50 2.75 0.00 11.00 0.00 0.00 1.50 1.50 0.00 20.50 15.25 12.50 8.00 0.00 54.50 0.00 0.00 0.50
5.8 0.0 0.0 0.0 0.0 0.0 0.0 5.0 0.0 2.0 3.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 18.1 0.0 0.0 0.0 0.0 0.0 0.0
145.58 160.88 33.63 103.53 46.33 205.48 13.30 109.83 43.18 46.09 58.87 120.55 9.30 31.15 45.70 45.70 25.97 142.68 81.80 167.03 170.50 10.45 193.83 9.95 7.01 4.63
126.67 126.27 114.86 111.38 110.33 108.45 104.62 103.66 102.46 100.17 94.61 94.36 89.80 89.65 86.53 86.53 85.13 84.10 81.58 81.55 78.53 76.37 75.21 71.55 69.82 68.18
25.33 25.25 22.97 22.28 22.07 21.69 20.92 20.73 20.49 20.03 18.92 18.87 17.96 17.93 17.31 17.31 17.03 16.82 16.32 16.31 15.71 15.27 15.04 14.31 13.96 13.64
26.71 26.68 25.78 25.50 25.42 25.27 24.95 24.88 24.78 24.59 24.12 24.10 23.71 23.70 23.43 23.43 23.31 23.22 23.00 23.00 22.74 22.55 22.44 22.12 21.96 21.81
84.61 109.62 23.78 68.61 32.76 125.14 9.40 54.32 28.05 29.23 39.35 77.46 6.58 22.03 31.25 31.25 18.36 86.39 47.06 96.45 114.90 7.39 98.52 7.04 4.95 2.92
984
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AUGUST 2011
VOL 3, NO 4
Total Cash Dividend
STDEV of Mean Price
10
82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99
Pakistan PVC Ltd. Murree Brewery Company Ltd Zulfeqar Ind. Crescent Fibres Limited Dadabhoy Sack Limited First Invest Modaraba Shield Corporation Limited EMCO Industries Limited Punjab Oil Mills Ltd. Ghandhara Ind. Ltd Gillette Pakistan Limited Pakleather Crafts Limited Gillette Pak Choudhry Textile Mills Ltd. Askari General Inusrance Co. Ltd. Pak Petroleum Ltd. Pakistan General Insurance Co. Limited. Thal Industries Corporation Ltd.
PPVC MUREB ZLFI CFL DBSL FIM SCL EMCO PUNO GHNI GLPL PAKL GLPL CHUT AGIC PPL PKGI TICL ENGL ICI ADOS MEBL ICIBL ALQT DMTX BWHL
Chemicals Food & Personal Care-Pruducts Food & Personal Care-Pruducts Textile Spinning Paper & Board Modarabas Food & Personal Care-Pruducts Glass & Ceramics Vanaspati & Allied Industries Automobile Assembler Food & Personal Care-Pruducts Leather & Tanneries Food & Personal Care-Pruducts Textile Spinning Insurance Oil & Gas Exploration Companies Insurance Sugar & Allied Industries Leasing Companies Chemicals Engineering Commercial Banks Investment Banks/Cos./Securities Textile Spinning Textile Spinning Automobile Parts & Accessories
5.8 74.9 57.9 5.7 7.0 2.7 47.9 8.4 23.2 12.6 65.0 11.1 65.0 17.5 21.9 116.7 5.9 19.0 4.1 86.6 10.0 18.7 5.9 7.7 7.0 37.2
15.48 165.45 135.88 14.43 17.50 6.92 119.40 20.95 48.35 31.29 160.46 25.78 160.43 41.98 48.03 234.58 13.50 39.65 9.55 178.71 23.25 37.65 13.46 17.50 14.85 75.58
9.70 90.58 78.03 8.73 10.53 4.27 71.53 12.53 25.13 18.69 95.46 14.68 95.43 24.48 26.10 117.88 7.65 20.67 5.48 92.11 13.25 19.00 7.58 9.80 7.85 38.40
0.00 25.63 15.10 0.00 0.75 0.00 5.25 0.50 4.70 0.00 0.80 1.75 0.50 1.00 0.00 46.15 0.50 5.75 0.00 23.50 0.00 0.00 0.00 0.00 1.00 6.74
0.0 8.3 2.1 0.5 0.0 0.0 0.0 0.0 5.0 0.0 0.0 0.0 0.0 0.0 5.3 1.0 0.0 0.0 0.0 0.0 0.0 5.1 0.0 0.0 0.0 1.5
9.70 124.51 95.23 9.23 11.28 4.27 76.78 13.03 34.83 18.69 96.26 16.43 95.93 25.48 31.44 165.03 8.15 26.42 5.48 115.61 13.25 24.12 7.58 9.80 8.85 46.64
67.97 66.29 64.61 61.84 61.65 60.94 60.37 54.60 49.95 48.29 48.09 47.97 47.58 45.57 43.40 41.41 39.32 39.24 34.36 33.49 32.50 29.31 29.02 27.27 26.43 25.45
13.59 13.26 12.92 12.37 12.33 12.19 12.07 10.92 9.99 9.66 9.62 9.59 9.52 9.11 8.68 8.28 7.86 7.85 6.87 6.70 6.50 5.86 5.80 5.45 5.29 5.09
21.79 21.64 21.48 21.23 21.21 21.15 21.09 20.55 20.11 19.95 19.93 19.92 19.88 19.68 19.47 19.28 19.07 19.06 18.57 18.48 18.38 18.06 18.03 17.84 17.76 17.66
6.86 64.05 55.17 6.17 7.44 3.02 50.58 8.86 17.77 13.21 67.50 10.38 67.48 17.31 18.46 83.35 5.41 14.62 3.87 65.13 9.37 13.44 5.36 6.93 5.55 27.15
100 English Leasing Limited 101 I.C.I Pakistan Ltd. 102 Ados Pakistan Limited 103 Meezan Bank Ltd. 104 Invest Capital Investment Bank Limited 105 AL-Qadir Textile Mills Limited. 106 D. M. Textile Mills Ltd. 107 Baluchistan Wheels Limited
985
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AUGUST 2011
VOL 3, NO 4
Total Cash Dividend
STDEV of Mean Price
10
108 Noor Silk Mills Ltd. 109 KASB Modaraba 110 Suraj Cotton Mills Ltd. 111 Noon Pakistan Ltd. 112 New Jubilee Life Insurance Ltd. 113 Apollo Textile Mills Ltd. 114 Al-Mal Securities & Services Limited 115 Ghandara Nissan Limited
NORS KASBM SURC NOPK NJLIC APOT AMSL GHNL
Synthetic & Rayon Modarabas Textile Composite Food & Personal Care-Pruducts Insurance Textile Spinning Investment Banks/Cos./Securities Automobile Assembler
14.9 3.4 7.0 66.5 29.7 10.2 8.9 16.0
33.13 7.34 15.50 137.03 64.80 21.45 18.40 32.63
18.26 3.92 8.50 70.50 35.07 11.28 9.50 16.63
0.00 0.25 0.00 10.00 0.50 0.50 0.00 0.00
0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0
18.26 4.17 8.50 80.50 35.57 11.78 9.50 16.63
22.72 21.61 21.43 21.01 19.66 15.72 6.74 3.91
4.54 4.32 4.29 4.20 3.93 3.14 1.35 0.78
17.37 17.25 17.23 17.19 17.04 16.62 15.63 15.32
12.91 2.77 6.01 49.85 24.80 7.97 6.72 11.76
986

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

Vol .3, No. 4 August 2011

Interdisciplinary Journal of Contemporary Research in Business

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

Prof. Renee Pistone

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

COPY RIGHT 2011 Institute of Interdisciplinary Business Research

INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

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INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS

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