Free sample - BOCHK Risk Management and Financial Performance. translation missing

BOCHK Risk Management and Financial Performance. BOCHK Risk Management and Financial PerformanceBank of China (Hong Kong) Limited (BOCHK) The Bank of China (Hong Kong) Limited (BOCHK) is among the largest commercial banking groups in Hong Kong. The Bank has over 300 branches. Despite the Bank’s magnitude and systemic risk management, it witnessed a decline in operational income and suffered a negative shock in 2008. Thus, it is critical to analyze the Company’s risk management policies, the measurement and management risk, and comparing the 2008 results with the previous year’s results. The annual comparisons will utilize the Company’s calculated ROE, and will be critical in understanding the Bank’s performance relative to the earlier periods.  Ã‚  Ã‚   I. Overall Risk Management The Bank for International Settlements (2004) provides guidelines for conducting interest risk management. Additionally, it provides the measures that can be used in managing the overall risk to a financial institution. The analysis of BOCHK will be based on the standards provided in the above book. The aim of the analysis will be to determine whether, the company adheres to the international standards of risk management. BOCHK’s 2008 report indicates that BOCHK’s risk-management governance structure is structured to cover the entire operations of the business. The Bank adopts a swift and prudent manner in managing its various risk exposures. The risk management structure meets the standards stipulated by BIS. Initially, the report indicates that to align the management strategies with the corporate strategies the Chief Risk Officer (CFO) reports directly to the Risk Committee and the Chief Executive Officer (CEO). CFO’s responsibilities are to ensure the proper implementation of policies and procedures and oversee the effective management and control of risk. The Bank publishes reports on a regular basis; this guarantees a timely assessment of the effectiveness of the risk control strategies. The determination of the effectiveness of the risk control measures lies with the Board of Directors. Additionally, the independent operation between the business units and the risk assessme nt units complies with the principle of segregation of duties. Independence is both sufficient and necessary for risk management (Khambata , Dara 2006). However, BIS requires that risk control functions report directly to the Board of Directors. Otherwise, there is a risk that the CRO and CEOmay conspire to fake the risk management reports; this would impair the objectivity of the risk management system. Secondly, BOCHK’s principal banking subsidiaries Nanyang and Chiyu, execute their risk management strategies independently. They adopt similar risk management strategies with their parent company and report to BOCHK’s management on a regular basis. Additionally, the company’s 2004 report indicates that the Bank utilizes stress testing. Stress testing is a risk management tool used in estimating risk exposure under stressed conditions, which arise from extreme but plausible macroeconomic conditions.  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚  Ã‚   The Bank’s information systems are well established to provide timely reports within different levels of management. The CRO stipulates specific procedures concerning the promotion of new products and activities. In addition, BOCHK prudently enacts and administers operating limits so that risk exposures are consistent with internal policies. However, the mere existence of risk management mechanisms does not guarantee sufficiency or effectiveness. Enforcement of risk control policies should be applied to ensure an efficient risk management system. II. Measurement and Management of Credit Risk According to note 4 of BOCHK’s 2008 financial statements, BOCHK manages two broad classes of assets: loans and advances, and debt securities and derivatives. The Company’s overall assets exposure to credit risk in 2008 was HK$1,364,462 million. This figure includes HK$1,111,073 million on-balance-sheet exposures and HK$253,389 million off-balance-sheet exposures. To safeguard its corporate interest, BOCHK should manage the credit risk that is related to these assets in a prudent manner, especially during a financial crisis. This part of the report will investigate how BOCHK measures and manages credit risk of these assets. To minimize the credit risk BOCHK adopted credit approval policies and procedures (BOCHK, 2008). These measures are evaluated and updated by the risk management department and other relevant departments. Regarding the loans and advances, BOCHK adopts different credit control procedures and credit grading systems depending on the level of risk exposure to the customers. Additionally, the Company utilizes bank scorecard for financial institutions, credit-scoring system for retail credit transactions, and small business credit scorecard for small firms. BOCHK identifies credit concentration risk by industry, customer, geographically, and counterparty risk. For instance, the Bank’s â€Å"classified or impaired† advances are HK$1,792 million in Hong Kong, HK$323 million in Mainland China, and HK$23 million elsewhere. Besides, loans and advances are classified in five categories to improve the Bank’s ability to identify and assess credit risk: â€Å"pass,† †Å"special mention,† â€Å"substandard,† â€Å"doubtable,† and â€Å"loss.† For example, the total assets marked as substandard or below the high-risk category, accounted for 0.08% (HK$379 million). As for debt securities and securitized assets, the 2008 report indicates that BOCHK adopts external credit rating systems, such as Moody’s, to manage the Bank’s credit risk. Moody’s ratings for 2008 showed that 19.34% of BOCHK’s debt securities rated as â€Å"AAA† compared to 2.36% â€Å"lower than A3† debt securities. Particularly, BOCHK applied a comprehensive methodology to establish whether a certain asset/mortgage backed security, (ABS/MBS) is impaired. This was determined based on such factors as the mark-to-market price, external rating, and delinquencies. In addition to these factors, ABS/MBS are further required to pass the credit enhancement coverage ratio set by BOCHK. To manage credit risk in a dynamic market environment, the Bank has established policies, procedures, and appropriate credit risk limits. The corporate organization structure should define a clear line of authority and responsibility for supervising compliance with relevant rules (Khambata , Dara 2006). BOCHK’s Credit Risk Assessment Committee takes charge of assessing all credit-scoring facilities and reviewing reports submitted by risk management units independently. In addition, Khambata , Dara (2006) argue that collateral is another key element to manage credit risk. An independent appraiser determines the value of collateral for acquiring a new loan. Thus, the value of collateralized loans is determined based on the loan-to-value ratio limits. Additionally, BOCHK revalues and manages its collaterals periodically. BOCHK documents the acceptance criteria, the validity of collateral, and the revaluation of collateral on a regular basis. This is done to watch the status of co llateral. III. Financial Performance Comparison According to the 2008 reports, BOCHK’s ROA and ROE were 0.26% and 3.56% in 2008, and 1.48% and 16.64% in 2007 respectively. Additionally, BOCHK’s Profit Margin declined in 2008 to 5.97% compared to 24.24% in 2007. These were substantial declines within a year; they were attributed to the increase in impairment charges on the US non-agency residential mortgage-backed securities and other securities investment. Furthermore, a significant increase in Provision for loan losses/Total operating income from 2.22% to 24.95% and a dramatic decline in the investment-related commission income produced a negative impact on the Company’s profit in 2008. The sluggish investment environment that resulted from the global financial crisis led to increments in the provision for loan losses. As customers steered clear from the investment products, the investment, and insurance fee income decreased by 34.3% to HK$2,964 million. Note 12 shows that the net charge of impairment allowances increased from HK$1,448 in 2007 to HK$ 12, 573 in 2008. Despite the bleak financial environment, the ineffective credit risk management was still to blame for the sudden increase in loan impairment losses. From the perspective of overall risk management, it can be suggested that BOCHK should undertake more strict stress testing measures and scenario analysis to predict the sensitivity of risk factors with various degrees of severity. References Bank for International Settlements. (2004). Triennial Central Bank Survey: Foreign  Ã‚  Ã‚  Ã‚  Ã‚   Exchange and Derivatives Market Activity in 2004. BOCHK. (2008). Financial Report 2008. Khambata, M., Dara, Y. (2006). The Performance of Multinational Banking: Macro-Policy  Ã‚  Ã‚  Ã‚  Ã‚   Issues and Key International Concepts. (2nd ed.). New York: Quorum Books.

How to reduce smoking in america Essay Example | Topics and Well Written Essays - 1250 words

How to reduce smoking in america - Essay Example Cigarettes also come with huge financial implications to the smokers and their families; for instance, with a pack of cigarettes costing about 10$ in some areas, a pack per day smokers spent a whopping $3,650 in a year. In this regard, cigarette smoking not only leads to catastrophic health risks, it also comes with huge financial ramifications to the smokers and the American society in general. America should actively reduce smoking for the good of everyone as this is likely to have more benefits to the people such as improved health and financials. This paper will focus on how America can reduce smoking as a health hazard, to improve the health of its citizenry and to make America a better place for future generations. America has been traditionally engaged with the task of merely reducing preventable deaths through cigarette smoking especially in recognition of the fact that it cannot be stopped entirely. So much has been done already, but still there is yet a lot to be achieved i n that new cigarette addicts emerge every day in America. One of the major strategies that can work in America is the controversial cigarettes’ tax hike, which has a high potential of lowering the smoking rates in America. According to a research by the Campaign for Tobacco-Free Kids, there was a considerable drop in cigarette sales in 2009 after a 62-cent hike per pack was passed (Hargreaves); if this trend is anything to go by, then it means that a tax hike on cigarettes can have substantial public health benefits. Recently, president Obama’s proposal to affect a 94-cent per pack hike on cigarettes stirred a lot of debate with anti-smoking groups in support of the move against some tax experts and tobacco companies. The tax has been designed as a way of cutting smoking rates and a source of income for educational programmes across America; a cigarette free society would definitely make America a better place to live. The other approach that America should quickly ado pt in order to reduce smoking is to fund tobacco control programs that aim to limit smoking of cigarettes in America. A much disturbing revelation is that many US-state governments have not prioritized the task of reducing cigarette smoking in their expansive programs. According to Reuters, many US-state governments receive huge sums of money from tobacco sales and legal settlements with cigarette makers, but only a little is spent on funding programs that can help people reduce and quit smoking altogether (Gray). Anti-tobacco media campaigns can be another effective way of reducing smoking in America as this will raise awareness on the dangers of cigarettes to the public and the health benefits associated with reduced smoking. For instance, more aggressive approaches such as uncompromising graphic admonition on cigarette packages can be very effective on discouraging cigarette smoking; however, despite that this rule has been implemented in many countries around the world, as has b een maintained in the US federal courts (Daynard). This is largely because it is feared that the advertising may infringe on the manufacturers First Amendment rights thus cigarettes are still tolerated in American societies while the courts hesitate. Cigarette manufacturers would rather safeguard their profits at the expense of the unsuspecting public and as such would want nothing to jeopardize their trade in the

Sociology Essay Example | Topics and Well Written Essays - 500 words - 23

Sociology - Essay Example This concept is what Wright Mills called â€Å"Sociological Imagination.† Mills (1956) contends that sociological imagination enables the person to look into himself as a part of a larger whole, and failed to â€Å"grasp the interplay of man and society† (as cited in Henslin, 2005). Poverty is not an isolated case pointing out to a particular country. Nations considered being the best in the world when it comes to financial capability, also having cases of families in poverty line. In the United States, though it is the source of the world’s â€Å"American dream,† was also devastated by disasters such as the memorable Hurricane Katrina, which turned the progressive New Orleans into a ghost town. Jobs were scarce after the disaster because of the damages caused by the hurricane to several business industries in both macro and micro levels (Kornblum, 2008). The problem was heightened by the recession of 2009 brought about by the foreclosure of the Lehman Brothers. Banks, real estates, and the marketing industry fell resulting to the retrenchment of jobs to save profit. The fall of the company delivered a domino effect to other businesses most especially in the real estate. Prices of mortgage have gone higher than usual; a price where the jobless and middle class Americans are unable to afford. Ling (2009) reported that families were desperate in search of job, food and shelter. The effect of the recession was clearly seen in certain places in Sacramento where people are forced to build â€Å"tent cities.† Life’s little rewards such as hot meal, hot shower, and accessibility to potable water are not the main issues; the people in the tent cities are more concerned of where to get a meal, shower and water. Living in the tent cities is like â€Å"starting to live all over again.† Poverty and homelessness may come from two significant and nondetachable things: personal and societal factors. The impact of the recession, the struggling budget

American Registry for Internet Numbers Essay Example for Free

American Registry for Internet Numbers Essay 1. American Registry for Internet Numbers (ARIN)- Provides services involving technical coordination and management of internet number resources. They support the internet through the management of internet number resources and coordinates the development of policies for the management of IP number resources. They also provide services for technical coordination and management of internet number resources in its respective services region. The services include IP address space allocation and ASN allocation, transfer and record maintenance. B. Internet Assigned Numbers Authority (IANA)- Responsible for the allocation of globally unique names and numbers that are used in Internet protocols that are published as RFC documents and for coordinating some of the key components that keep the internet running efficiently. They allocate and maintain unique codes and numbering systems that are used in the technical standards/protocols that drive the internet. Among such protocols are the domain names, number resources and Protocol assignments. C. Asia-Pacific Network Information Center (APNIC)- An organization that manages the internet number resources within Asia. They provide the number resource allocation and registration services that support the global operation of the internet. 2. An Ipv4 uses 32 bit IP addresses. The max number of of IPv4 addresses is about 4 billion. 3.The max number of Ipv6 addresses is about 48 billion. 4.The world ran out of Ipv4 addresses February 1, 2011. All networks must now allocate Ipv6 addresses. 5. Ipv4 addresses are exhausted 6. Ipv4 is still being used because the address pool supports the continual demands and extends its usefulness. Also because Ipv4 and Ipv6 are not compatible. 7. No because you cant resell them. Sources https://www.arin.net/ https://www.iana.org/ https://www.apnic.net/

Nonfiction Literacy and Current Events Essays -- science, Sony, Microso

Technology is not only a computer it’s making something better. Technology has been advancing everything and making it better. Technology doesn’t even have to be an object it can be something that has to do with science. That’s why I think that technology is good because it is making everything advanced and better than it was before. Technology is good. Technology is good because it makes our lives a whole lot easier. One reason why technology is good is because sony and Microsoft both have good systems but they are battling and seeing who’s system is better and that’s just making the systems better for us to use. In the article it says â€Å"Video games used to be seen as something for teenage boys who didn't have a lot of friends. But now a video game customer can be just about anyone. People spend nearly $63 billion worldwide on games. Almost half of those who play games are women and one-third are older than 36.† that is a good thing that more people are enjoying the video games since they came out with better technology. Now there are more people buying it because of the new technology. Another reason why technology is good is because now there is a way that doctors can find out if a baby has autism within 2 months of birth and that’s a good thing because now they can find out early and treat them wh en they are little. In the article it proves that, â€Å"Doctors usually cannot determine if a child has an autism spectrum disorder until age 2 at least. But, a new study finds that signs of it can be seen as early as two months after birth.† Since the doctors can find autism that early they can try to treat them as soon as possible. That way it won’t get too serious. The last reason why technology is good is for medical reasons is becau... ...hy people that say technology is bad are wrong. Technology is good for these reasons, sony and Microsoft both have good systems but they are battling and seeing who’s system is better and that’s just making the systems better for us to use, there is a way that doctors can find out if a baby has autism within 2 months of birth and that’s a good thing because now they can find out early and treat them when they are little, and for medical reasons is because scientists and doctors are trying to train the special need kids to make eye contact with the person that is talking to them early in their lives so they will have experience later in their lives while talking to people. That is why technology is good. Works Cited "Newsela | Nonfiction Literacy and Current Events." Newsela | Nonfiction Literacy and Current Events. N.p., n.d. Web. 09 Dec. 2013.

Conductng a Internal Analysis Within Kraft’s Corporation

CONDUCTING AN INTERNAL ANALYSIS WITHIN KRAFT’S CORPORATION INTERNAL ANALYSIS AND SWOT ANALYSIS TRIDENT UNIVERSITY INTERNATIONAL AVIE MARIE JOHNSTONE STRATEGIC MANAGEMENT MGT599 MODULE 2 SESSION LONG PROJECT PROFESSOR LARRY BANKS NOVEMBER 5, 2012 Rapid growth and under developed financial and operational controls are common characteristics of many start-up operations, including companies, joint ventures, departments and divisions. Inadequate or improperly working controls can lead to fraud, loss of customers, and even business failure.Managers of start-up operations often fail to adequately address the need for controls because they lack the knowledge of how to address control risk, lack resources to address control risk, or they perceive other issues as being more critical. The manager’s dilemma is how to efficiently balance the need for strong controls with the everyday demands associated with running a newly formed business. (Denise Dickins, Margaret O’Hara, Jo hn Reisch). (2009). Resources are the inputs into a production process.They can be capital, equipment, patents, skill sets of individual employees and/or managers, financial resources, etc. Resources can be tangible or intangible. Individually, they may not necessarily lead to a competitive advantage – it is how they are used and the synergies they create that make them strategically valuable. Give me as much information as you can find about the following as it relates to the Kraft Foods Company: Tangible Resources Physical Resources S&P Dow Jones Indices, a unit of McGraw-Hill Companies Inc. , said that Kraft Foods Group Inc. will replace Alpha Natural Resources Inc. n the S&P 500, Alpha Natural Resources will replace Korn/Ferry International in the S&P Mid Cap 400, and Korn/Ferry will replace Pulse Electronics Corp. in the S&P Small Cap 600 after the close of trading on Monday, October 1. S&P 100 & 500 constituent Kraft Foods Inc. is spinning off Kraft Foods Group to share holders in a transaction expected to be effective after the close of trading on that date. The Kraft Foods stub, which will change its name to Mondelez International Inc. and its ticker symbol to MDLZ, will remain in the S&P 100 & 500. (Kraft Foods Group to Replace Alpha Natural Resources In S&P 500). Nov. 7, 2012). 2. Financial Resources Kraft Foods, the newly independent company that was spun-off from its parent last month, reported stronger-than-expected third-quarter earnings and sales on Wednesday and reaffirmed its full-year guidance. The North American grocery business operating brands such as Oscar Mayer and Kraft cheese posted net earnings of $470 million, or 79 cents a share, compared with a year-earlier profit of $417 million, or 70 cents. (Jennifer Booton). (November 7, 2012). Analysts in a Thomson Reuters poll were looking for earnings of just 69 cents.A reflection of stronger volumes and pricing as well as increased advertising investment, revenue for the three-month p eriod ended Sept. 30 grew 3% to $4. 61 billion from $4. 47 billion a year ago, edging above the Street’s view of $4. 56 billion. For the fiscal year of 2013, Kraft Foods had reaffirmed the GAAP EPS view of $2. 60 stating that the revenue was expected to grow in line with the North American food and beverage market. The consensus, excluding special items, was to look for a full of year earnings of $2. 66 on sales of $19. 28 billion. (Jennifer Booton). (November 7, 2012). 3. Human ResourcesThe food industry is one of the most highly competitive centers of commerce worldwide. Consumer demand for high-value, healthy, convenient foods; advancing technology; globalization; and new distribution methods keep leaders and frontline employees in a state of constant change with comparable demands on human resources professionals. (IBM). (30-Jun-2010). â€Å"It shows just how open Kraft Foods is to new approaches. † That focus has helped Kraft Foods become the world’s second -largest food company, with annual revenues of approximately US$50 billion and sales in more than 160 countries.It also keeps HR strategists on the lookout for better ways to attract and recruit key talent, streamline processes and maintain operational excellence. (IBM). (30-Jun-2010). Kraft Foods decision makers determined that one lever to support those efforts and an ambitious multiyear transformation was to outsource selective back-office functions, said Karen Isaacson, Kraft Foods’ vice president of HR administration outsourcing. To that end, they sought a transformation partner that could deliver an integrated solution to help them meet technology and functional needs, and support their growth strategy.Kraft Foods’ search led to IBM. (IBM). (30-Jun-2010). 4. Other? Kraft Foods Group Inc stood by its full-year outlook on Wednesday as it works to better tailor its product portfolio to a weak economy in North America, the only region the newly independent company no w operates in. Kraft was spun off last month from the maker of Cadbury chocolates and Oreo cookies, which goes by the name of Mondelez International. Unlike Mondelez, which got some 45 percent of its sales from developing markets, Kraft focused on slower growing North America? Jennifer Booton). (November 7, 2012). Further, U. S. consumers face stubbornly high unemployment and slow economic growth. In the weakened economy, Kraft had to drive their sales volume with more advertising and a greater range of products and prices, in what they called a â€Å"good, better, best† strategy. (Martinne Geller). (February 10, 2009). â€Å"The economic environment has not improved and that creates a burning platform for Kraft, our customers and our industry. † Kraft shares were down 22 cents, or 0. 5 percent, at $44. 48 in late morning trade.The broader market, as measured by the S&P 500 index, was down more than 2 percent, a day. Kraft said net income rose to $470 million, or 79 ce nts per share, from $417 million, or 70 cents per share, a year earlier. Revenue increased 3 percent to $4. 61 billion. Most of the increase came from volume gains and selling a more expensive mix of products, with a smaller contribution from price increases. (Martinne Geller). (February 10, 2009). The company affirmed its 2013 outlook, calling for earnings of $2. 60 per share and revenue growth in line with the rest of the North American food and beverage market.Kraft’s revenue in the current fourth quarter would be flat to down due to a comparison with the years earlier period when retailers increased orders in advance of a price increase. Kraft would eventually lose sales of some of its products that it pruned from its portfolio. (Martinne Geller). (February 10, 2009). Intangible Resources 1. Technical Resources In applications from salty to sweet, the Kraft Food Ingredients technology team did offer ingredient solutions and application technology across a wide range of ma nufacturing processes. (Ask KFIC). (2010).Leveraging the knowledge of the parent company Kraft, there was an understanding of the basic science of food processing, as well as the art. In the dedicated application labs, Kraft Foods place a special emphasis on developing cost reduction technologies, translating to lower finished product costs for the customer. Kraft’s employers were the leaders in flavor technology and did play a key role in identifying the best ingredient solution for their needs. The employers of Kraft provided onsite regulatory, quality and specification management and offer pilot plant facilities dedicated to developing ingredients for application evaluation. Ask KFIC). (2010). 2. Intellectual Resources In perspective of Kraft’s complete understanding of the entire gamut of business across every employee. Increase in intellectual capital came along with new business ideas & better practices. Developing expertise in business management; focusing on ma king the business to be a pioneer. Creation of staff slots, keeping good employees within the company. Tight Integration: Reduced cost, build brands & develop people. (Jennifer Booton). (November 7, 2012). 3. Goodwill Company ProfileThe value of business goodwill is in the throws of a major revival under the tent of mutual interest and partnership. Amid a global partnering boom, the future value of your business is at stake. Go-it-alone competitive practices are for the scrapbook. (Jennifer Booton). (November 7, 2012). Partnering opportunities created by the communications and distribution revolution along with a global explosion in consumption and production are reshaping the ability of companies to reach larger audiences and acquire value creating resources. A growing number of countries are announcing international business alliances.Small to large enterprises are discovering partners across the global Internet. Nearly any business conference you attend this year is sure to featu re passionate evangelists espousing the virtues of strategic alliances and economic goodwill. (Jennifer Booton). (November 7, 2012). Kraft Foods Inc. goodwill also engaged in manufacturing and marketing packaged food products, including snacks, beverages, cheese, convenient meals and various packaged grocery products. During the year ended December 31, 2008, the Company had operations in more than 70 countries and sold the products in approximately 150 countries.The company managed and operated, through two commercial units: Kraft North America and Kraft International Kraft North America which operates in the United States and Canada. On August 4, 2008, the company completed the spin-off of its post cereals business. The brands of the company span five consumer sectors: snacks, beverages, cheese, grocery and convenient meals. (Jennifer Booton). (November 7, 2012). Valuation Summary: †¢Last Updated 10/23/2009 †¢MG Value $11 †¢MG Opinion Overvalued †¢Value Based on 3% Growth $23 †¢Value Based on 0% Growth $14 Market Implied Growth Rate 4. 15% †¢Net Current Asset Value -$19. 44 †¢PEmg 16. 80 †¢Current Ratio 1. 13 †¢PB Ratio 1. 64 (Martinne Geller). (February 10, 2009). Key Data: Balance Sheet – 6/30/2009 †¢Current Assets $11,688,000,000 †¢Current Liabilities $10,303,000,000 †¢Total Debt $18,610,000,000 †¢Total Assets $64,654,000,000 †¢Intangible Assets $13,257,000,000 †¢Goodwill $28,225,000,000 †¢Total Liabilities $40,358,000,000 †¢Outstanding Shares 1,474,970,000 (Martinne Geller). (February 10, 2009). Earnings Per Share – Diluted 2009 (estimate) $1. 93 †¢2008 $1. 22 †¢2007 $1. 48 †¢2006 $1. 71 †¢2005 $1. 72 †¢2004 $1. 56 †¢2003 $1. 96 †¢2002 $1. 90 †¢2001 $1. 17 †¢2000 $1. 38 †¢1999 $1. 20 (Martinne Geller). (February 10, 2009). Earnings Per Share – Modern Graham †¢2009 (estimate) $1. 61 †¢2008 $1. 48 †¢2007 $1. 63 †¢2006 $1. 73 †¢2005 $1. 71 †¢2004 $1. 67 †¢Valuation History: 10/23/09 – Value $11, Actual Price $27. 01, Overvalued & Speculative 7/17/09 – Value $10, Actual Price $27. 30, Overvalued & Speculative (Martinne Geller). (February 10, 2009). 4.Other (cultural, reputational, strategic alliances)? How will the business acquire goodwill? It is cultivated through the best of practices, such as good governance, customer service, efficiency, branding, pricing fairness, innovation, authenticity, consideration, cooperation, collaboration, thoughtfulness, decency, understanding, trust and community. (Anirban Mazumdar). (Mar 24, 2012). This result is reflected in the valuation of the business reputation as measured by the loyalty of the customer’s base and the reliability, stability and good practices of management and its employees.The dollar amount of Kraft’s good represented the excess price over fair market value that th e consumers expected to get at the takeover of the company. (Anirban Mazumdar). (Mar 24, 2012). Alliance minded executives use their goodwill on a daily basis in communicating with stakeholders. Without the consistent expression of goodwill, they knew, it was virtually impossible to sustain a partnering synergy that could build goodwill and benefits all stakeholders. The alternative course would in time result in stagnation. (Anirban Mazumdar). (Mar 24, 2012).Fostering goodwill among the stakeholders prepared their organization for partnering. The commitment to goodwill created change and built value. Apply goodwill on a daily basis. It may be your most powerful strategy in preparing for, processing and succeeding in the formation of alliances. To develop a continuous UVP plan extends your alliance road map by duplicating your forecast calculations to include all potential alliances you foresee into the future. How far can you go using this strategy? If possible, don't stop until yo u're able to imagine this process reaching a global scale or an exit strategy.Finally, your alliance plan must weigh alliance costs and risks against the benefits/costs/risks of alternative strategies. (Anirban Mazumdar). (Mar 24, 2012). Whether your enterprise takes the role of a marketer or a supplier, you should consider formulating a phased in partnership plan containing a list of target partner prospects, financial validations, and a timeline and undertake a marketing initiative aimed at shaping a receptive and synergistic relationship with partner executives and operational teams.Executing the plan is your next challenge. Don't hesitate to seek help in developing your plan and making it happen. (Anirban Mazumdar). (Mar 24, 2012). Early 21st Century: Integrating Nabisco into Kraft Foods Inc. and an IPO Philip Morris completed its acquisition of Nabisco in December 2000 and immediately began integrating the Nabisco operations into those of Kraft Foods and Kraft Foods Internation al. In March 2001 Philip Morris created a new holding company for the combined operations known as Kraft Foods Inc.The previous Kraft Foods was renamed Kraft Foods North America, giving the new Kraft Foods two main units: Kraft Foods North America and Kraft Foods International. The two CEOs of these units were, Betsy D. Holden and Roger K. Deromedi, respectively, however, they were also named co-CEOs of Kraft Foods Inc. In June 2001 Philip Morris sold a 16. 1 percent stake in Kraft Foods to the public, retaining the remaining shares. The second largest IPO in U. S. history, the offering raised $8. 8 billion, which Philip Morris earmarked to reduce debt it had incurred in acquiring Nabisco. (Kraft Foods Inc. History). (2002). As it was integrating Nabisco and attempting to meet the anticipated annual cost savings of $600 million by 2003, Kraft Foods also began divesting some of the marginal brands it had acquired in the takeover. By late 2001, the company had announced that it had re ached an agreement to sell the Farley's and Sathers confection brands as well as its Mexican pasta business, which included the Yemina and Vesta brands.Additional divestments were expected for Kraft, which as one of the top two food companies in the world with revenues approaching $35 billion could be very choosy about which brands to retain in its very powerful portfolio. (Kraft Foods Inc. History). (2002). Dorria L. Ball is the senior director of Human Resources, Beverages, for Kraft Foods, headquartered in Tarrytown, NY. In her role, Ms. Ball and her team are responsible for developing and leading the implementation of all human resources strategies and activities in support for all Beverages Business unit functions from marketing to manufacturing.Ms. Ball has worked as an employee with Kraft Corp. for over 18 years in Sales Management, where she held numerous assignments of increasing responsibility, calling on customers and leading teams. She transitioned into human resources i n 1994 and has since held a variety of human resources generalist and specialist assignments across a number of functions and business sectors. Most recently, Ms. Ball became the Senior Director of Global Diversity and Work Life, where she was responsible for developing and implementing the Global Diversity and Work Life strategy for Kraft Foods worldwide. Dorria L. Ball). (Feb. 2007). Further, Ms. Ball is one of the founding members of ASCENT, and was formerly on the Conference Board's Council on Workforce Diversity, the Thurgood Marshall Scholarship Fund advisory board, the steering team of the William J. Clinton Foundation's Harlem Small Business Initiative, and the Boston College Global Workforce Roundtable Steering Committee. In addition, Ms. Ball is a member of Alpha Kappa Alpha sorority and the Abyssinian Baptist Church. (Dorria L. Ball). (Feb. 2007).Distinctive capabilities are those competencies possessed by a firm that cannot be copied or can be replicated only with great difficulty or resources. Determine the distinctive capabilities of the Kraft Foods Company as it relates to as many of the following as you can: 1) Architecture An American food favorite, Kraft Macaroni & Cheese Dinner has been serving up smiles since 1937. Long highly relevant and visible, Kraft Foods wanted to ensure its brand was differentiated and that it would reach its full potential moving into the future. Over the years it had also created a range of Macaroni & Cheese sub-brands that fragmented its core brand.Macaroni & Cheese, Easy Mac, and Deluxe were all highly successful, but would benefit from a more prominent association with Kraft Foods. In summer 2009, the Kraft Macaroni & Cheese team approached Landor with a challenge: to refresh and contemporize its look, help differentiate itself better from competitors, and visually streamline its portfolio of over 50 Macaroni & Cheese products. (Landor Associates). (June 2011). Kraft's brand promise was to bring smiles to everyo ne's faces, and through research, it learned that it owned several compelling equities in customer's minds: happy, smiles, and joy.Inspired by these emotions, the company arrived at the metaphor of a county fair just like a day at the fair Kraft Macaroni & Cheese is a source of all American joy for the whole family. Drawing from the county fair metaphor, a new designed a new brand identity and packaging. The concept was further brought to life through improved brand architecture that united the portfolio of Kraft Macaroni & Cheese sub-brands under one brand promise, Landor’s visually unified them, and emphasized their connection to each other and Kraft Foods. Landor Associates). (June 2011). To help establish proprietary equities, Kraft Foods applied to register their design as a trademark. Although other macaroni and cheese brands used blue and yellow on their boxes, Kraft’s packaging, architecture system, and identity reclaim the colors as that of Kraft Macaroni & Ch eese. Kraft Macaroni & Cheese redesign succeeded in strengthening and reclaiming the brand's visual equities, differentiating it from private label, and creating a strong master brand to unite three disparate sub-brands.Our packaging and noodle smile identity provided the basis for the Kraft Macaroni & Cheese integrated marketing campaign, which in 2010 helped drive gross revenue up 3. 8 percent, increased dollars by 9 percent, and raised its overall market share by 0. 4 points. (Landor Associates). (June 2011). 2) Reputation, and The absence of well-established laws governing social media communications make it challenging for companies to contest reputation damage on Facebook.However, this shouldn’t stop them from putting a proactive social media reputation strategy in place. Leading food and beverage corporation, Kraft Foods Inc, has put in place a 6 pronged strategy to address various kinds of reputation risks on Facebook. . (John Paulo Cardoso). (Mar 28, 2012). Weâ€℠¢ve summarized Kraft Foods’ Facebook reputation management processes in the graphic, below: . (John Paulo Cardoso). (Mar 28, 2012). Kraft Foods reputation risk management strategy includes both at internal employees and external stakeholders.A typical risk management process is as follows: †¢Kraft Foods’ Social Media team takes ownership of all its postings as detailed in its Facebook posting rules this provides clarity of ownership and helps ensure a standard, congenial conversation. †¢Kraft Foods’ Social Media team continuously monitors Facebook postings for negative sentiment, profanity, and hateful comments – these trigger an immediate damage control response. †¢Once a risk event is detected, the Social Media team uses a Crisis Potential Questionnaire consisting of 15 questions, to determine the severity of the reputation risk event.This helps the company to decide on the de-escalation time frame, and channels of de-escalation. . (John Paulo Cardoso). (Mar 28, 2012). †¢Kraft Foods’ Social Media team uses a Social Media escalation document to direct resolution steps to the correct internal stakeholders, and prescribes the course of action for various reputation risk events. †¢In times of crisis, the Moderator on the Social Media team checks any communication which goes out on behalf of Kraft Foods, to ensure it accurately represents the company’s point of view. However, if a sustained and malaise reputation risk persists despite the company’s best attempts to alleviate it, the Social Media team consults the legal department for possible legal recourse. . (John Paulo Cardoso). (Mar 28, 2012). 3) Innovation. There are no red flags with Kraft's new name change. On Aug. 4, 2011, Kraft Foods Inc. announced plans to divide and create two independent public companies: a high-growth global snacks business and a high-margin North American grocery business. And now on March 21, 2012 they announ ced its plans for its snack food corporate name as Mondelez International, Inc. IBM). (30-Jun-2010). What this demonstrates is that the company truly understood the strength of its brands and how they have built a relationship with customers. And now they were using this knowledge to manage the branding of its new independent company to leverage the platform â€Å"make today delicious. † The move to invent a new word and taking the time to let everyone know the phonetic spelling is the right thing to do for a multinational conglomerate rather than trying to leverage one of its current brand names. (IBM). (30-Jun-2010).The Chairman and CEO Irene Rosenfeld had said that he would be implementing a new global snacks company, looking for a new name that would serve as an umbrella for their iconic brands, reinforce the truly global nature of this business and build on our higher purpose to make today delicious. Mondelez captured a perfect idea of a delicious world and saying that i t would serve as a solid foundation for the strong relationships. Kraft Foods Inc. brands knew how to build relationships with its customers and now applying it to the market and their investors. (IBM). (30-Jun-2010). REFERENCES: Denise Dickins, Margaret O’Hara, John Reisch. 2009). Frameworks for establishing and evaluating internal controls: a primer and case study. Journal of Case Research in Business and Economics. Kraft Foods Group to Replace Alpha Natural Resources In S 500. (Nov. 7, 2012). http://www. nasdaq. com/article/kraft-foods-group-to-replace-alpha-natural-resources-in-sp-500-20120925-01231#. UJswqGcyCSo Jennifer Booton. (November 7, 2012). Kraft Foods Posts Strong 3Q Profit After Spin-Off. FOXBusiness. http://www. foxbusiness. com/industries/2012/11/07/kraft-foods-posts-strong-3q-profit-after-spin-off/ IBM. (30-Jun-2010). Kraft Foods builds on success to

Abraham Lincoln and the Telegraph

President Abraham Lincoln used the telegraph extensively during the Civil War, and was known to spend many hours in a small telegraph office set up in the War Department building near the White House. Lincolns telegrams to generals in the field were a turning point in military history, as they marked the first time a commander in chief could communicate, practically in real time, with his commanders. And as Lincoln was always a skillful politician, he recognized the great value of the telegraph in spreading information from the army in the field to the public in the North. In at least one instance, Lincoln personally interceded to make sure a newspaperman had access to telegraph lines so a dispatch about action in Virginia could appear in the New York Tribune. Besides having an immediate influence on the actions of the Union Army, the telegrams sent by Lincoln also provide a fascinating record of his wartime leadership. The texts of his telegrams, some of which he wrote out for the transmitting clerks, still exist in the National Archives and have been used by researchers and historians. Lincoln's Interest in Techology Lincoln was self-educated and always highly inquisitive, and, like many people of his era, he had a keen interest in emerging technology. He followed the news of new inventions. And he was the only American president to obtain a patent, for a device he designed to assist riverboats to cross sandbars. When the telegraph changed communication in America in the 1840s, Lincoln would certainly have read about those advances. Its likely he knew about the wonders of the telegraph from newspaper articles he read in Illinois before any telegraph wires had reached that far west. When the telegraph started to become common through the settled parts of the nation, including his native Illinois, Lincoln would have had some contact with the technology. As a lawyer working for railroad companies, Lincoln would have been a sender and receiver of telegraph messages. One of the men who would serve as a government telegraph operator during the Civil War, Charles Tinker, had done the same job in civilian life at  a hotel in Pekin, Illinois. He later recalled that in the spring of 1857 he chanced to meet  Lincoln, who was in town on business related to his legal practice. Tinker recalled that Lincoln had watched him sending messages by tapping the telegraph key and writing down incoming messages he converted from Morse code. Lincoln asked him to explain how the apparatus worked. Tinker recalled going into considerable detail, describing even the batteries and electrical coils as Lincoln listened intently. During the campaign of 1860, Lincoln learned he had won the Republican nomination and later the presidency via telegraph messages which arrived in his hometown of Springfield, Illinois. So by the time he moved to Washington to take up residence in the White House he was not only aware of how the telegraph worked, but he recognized its great usefulness as a communication tool. The Military Telegraph System Four telegraph operators were recruited for government service in late April 1861, soon after the attack on Fort Sumter. The men had been employees of the Pennsylvania Railroad, and were enlisted because Andrew Carnegie, the future industrialist, was an executive of the railroad who had been pressed into government service and ordered to create a military telegraph network. One of the young telegraph operators, David Homer Bates, wrote a fascinating memoir, Lincoln In the Telegraph Office, decades later. Lincoln In the Telegraph Office For the first year of the Civil War, Lincoln was barely involved with the militarys telegraph office. But in the late spring of 1862 he began to use the telegraph to give orders to his officers. The Army of the Potomac was becoming bogged down during General George McClellans Peninsula Campaign in Virginia, Lincolns frustration with his commander may have moved him to establish faster communication with the front. During the summer of 1862 Lincoln took up the habit he followed for the rest of the war: he would often visit the War Department telegraph office, spending long hours sending dispatches and waiting for responses. Lincoln developed a warm rapport with the young telegraph operators. And he found the telegraph office a useful retreat from the much busier White House. One of his constant complaints about the White House was that job seekers and various political figures wanting favors would descend upon him. In the telegraph office he could hide away and concentrate on the serious business of conducting the war. According to David Homer Bates, Lincoln wrote the original draft of the Emancipation Proclamation at a desk in the telegraph office in 1862. The relatively secluded space gave him solitude to gather his thoughts. He would spend entire afternoons drafting one of  the most historic documents of his presidency. The Telegraph Influenced Lincoln's Style of Command While Lincoln was able to communicate fairly quickly with his generals, his use of communication was not always a happy experience. He began to feel that General George McClellan was not always being open and honest with him. And the nature of McClellans telegrams may have led to the crisis of confidence that led Lincoln to relieve him of command following the Battle of Antietam. By contrast, Lincoln seemed to have a good rapport via telegram with General Ulysses S. Grant. Once Grant was in command of the army, Lincoln communicated with him extensively via telegraph. Lincoln trusted Grants messages, and he found that orders sent to Grant were followed. The Civil War had to be won, of course, on the battlefield. But the telegraph, especially the way it was used by President Lincoln, did have an effect on the outcome.