A Case Study Of Immanuel Kant

A Case Study Of Immanuel KantPart 1 Immanuel Kant wrote that For Kant, then, the focus is on outcomes, or the ends of an action in deontology the actions themselves must be honorable and virtuous, or the outcome is moot. Deontology argues that there argon norms and truths that are universal for all mankinds actions then have a predisposition to aright or wrong, moral or criminal. Kant be equivocationved that globe should act, at all times, as if their somebody actions would have consequences for all of society. Morality, then, is based on rational thought and is the direction most human beings innately want. It is not enough, though, for there to be individual ethical motive. Kant took this further, reacting, and argued that a state or society must be calculated by the counsel laws and umpire was universally true, available, and, most importantly, solelyified by humanity. Yet, for Kant, these laws should respect the nature of freedom, autonomy, and egalitarianism of all members of society. Kant saw that a few basic rights were critical for any civil society to exist. After Kant, this became a rubric by which we may understand recent utilitarian principles and their interdependence with the concept of human rights. Thus it seems that for Kant, at to the lowest degree in Groundwork, the task is to seek the foundation of a principal of morality that will fit the human definition in almost all cases. Rationally, each person will move towards this axiom to do otherwise would be to remain irrational. This, in particular, has relevance in the contemporary world of philosophical discourse, in which we can look at Kants ideas about freedom and the nature of action and apply to the principles of autonomy and cosmos as autonomous agents.For Kant, the basic idea of morality focuses on the question, scarcely it is far more than patently an account of human and social interactions still a larger view of the overall metaphysics of the basis of morality poli tical, religious, cultural, and social issues explored as well. This, for Kant, is a seminal issue of the basis of human rights rights come from a deeper sensation of moral philosophy and morality, from the very basis of what spark defines humanity. But Kant did not develop his ideas in a vacuum, of course. The apprehension of human rights has been an ongoing political and philosophical debate since humans began to express their thoughts in writing. At the ticker of this debate is the notion that many remain dissatisfied with the definition of good or appropriate macrocosm at the whim of a particular social order, or ruling elite. This debate may be found in Aristotle, Socrates, and Aquinas, leading to more contemporary political notions from Lock, Kant, and even Martin Luther King, Jr. Forming the core modern argument, for instance, Aquinas argued that there were certain universal behaviors that were either right or wrong as appointed by the Divine. Hobbes and Locke differe d, and put forth the notion that there were natural rights, or states of nature, but disagreed on the irresponsible occurrenceors of those natural tendencies. Kant took this further, reacting, and argued that a state or society must be organized by the way laws and justice was universally true, available, and, most importantly, justified by humanity. Kant prescribed that basic rights were necessary for civil society, and becomes a rubric by which we may understand modern utilitarian principles and their interdependence with the concept of human rights. Kant deciphers his ethical questions surrounding natural rights, and by extension social and organizational rights, by critically analyzing the motivation of public-service corporation (an act) while briefly ignoring the consequences. Synthetic a priori judgments consist in utilizing certain sensory data and utilizing the Categories to organize the spatial or chronological. When we apply categories to our sensory data in space and time, then we become aware(p) of physical objects. Only categories befuddle objects likely. Kant terms items that exist apart from space, time, and categories as things in themselves(noumena). Alteration of substances is possible for Kant states of matter can change, evolve therefore thoughts change too. Subsequent states are called effects when they transition suitably from one state to another lawful for Kant if it is a necessary consequence. There are, of course, dependencies as well, and Kant argues that it is more the sort of cause and effect that is important, not the things themselves.In the contemporary world these Kantian ideals can be seen in relation to the morality of public policy, social interaction, and publicity actions relating to humans that run the synthesis of information and act towards utility for society. One may also view Kants causality in that policies must pass philosophical order to be just as social principles. ). Morally, then, Kantian principl es hold that in order to prolong what is both politically and socially just for society, the rights of the individual must not only be protected, but actively cherished and cultivated, in order for the political-social contract to be continually validate.Part 2 But how does philosophical debate translate into the dogmatic, practical nature of the modern world? For Kant, it is condition somewhat divided in that when things are dissected in reality it is theoretical but practical when he analyzes how things should be. And, is not modern social theory really about the process of making society better for all, engendering human rights and considering how things should be? For Kant, then, there are two main rubrics of moral philosophy 1) meatphyics investigates the nature of reality, and 2) ethics, which, for Kant, seeks a priori rules that grade the manner in which free will helps make moral decisions. think has its practical employment in determining what ought to be as well. Th eoretical reason is concerned with things that are formal and subjective. Practical reason is concerned with things that are real and objective. Kant believes that,It seems that Kant is saying to us that the basis for all morality is far deeper than just the idea of moral action or inaction it is reason itself. Reason is the human ability to make presumptions and identify the basic structure emanating from the idea of truth. It allows us to move from the particular and contingent to the global and universal. Reason seeks increasingly higher levels in order to explain the way things are. For humanity to prosper, Kant posits, the observable universe must, in and of itself, be conceived of by reason. This continual movement towards reason is simply a natural state of companionship learning, and ways to determine the truth of the natural world. But it is clear that theoretical reason can neer have knowledge of the totality of things. Morality, according to Kant, must be universal. F or this reason it can only call up its place in spite of appearance the realm of practical reason. Morality could not possibly take place inside the realm of theoretical reason because this would involve the sensible world. For Kant, morality has to be pure and universal.Taking Kant a bit further, and looking at the ideas of Aristotle in the Nicomachean Ethics, we find that morality and ethics are more a choice of chronology and cultural appropriateness. Aristotle said we should act in the right way, at the right time, in the right amount towards the right persons for the correct reasonsNicomachean Ethics, II). The basic assumption about Aristotelian morality is that humans are moral agents through their individual actions. But, human behavior being what it is, morality is only one of the facets of humans evolution towards happiness.This centuries-long debate, though, certainly remains controversial. Now, we have the benefit of some of the Continental philosophers, of existentiali sm and other modern theories. But, in Kantian (and classical) ethics, narrative theories focus on ways to analyze and synthesize methodologies for establishing right and wrong, and to project ways for distinguishing right and wrong actions. We know that two major ethical categories exist teleological or consequential ethics and deontological, or non-consequential ethics. Teleological ethics judge consequences of actions the right and wrong as a ratio of good to brutal within a given set of parameters. Deontological ethics focus on the concept of the reason (duty) rather than any cultural or individual judgments of right or wrong. nether this paradigm, it is the nature (the inner touch sensation or duty or necessity) of action that defines the morality of the concept.This concept of teleological and deontological forms is unclear for Kant. There is the contrast between Kants deontological and teleological imperative within the rubric of morality. Some of the arguments in Groundwor k appear to be relatively incompatible with any sort of teleological paradigm of ethics or morality. Kant insists that morality for all individuals is a part (a locus) of rational will, Similarly, the manner in which Kant views good and evil seem anti-teleological, which makes little sense considering his overall view of human nature, human values, and the purpose of the individual within the greater societal whole.Kant assumes that duty and good will are synonymous, but it is morality, which motivates both. For instance, if someone must lie or tell a falsehood to remain moral to a duty, it cannot be construed as immoral there was an a priori assumption. Actions cannot only be considered as the means to one persons end, but must suffer the criteria of being a universal end, which ensures goodness for all, not merely for one. The basics of human nature are more inclined to act because of duty which is the proper Kantian moral. Doing so does gives one a feeling of happiness, and is therefore, perceived as good. Emotions play an important role in these perceptions, which Kant quite ignored. Emotions are not to be trusted, as they are fickle and intolerable. Perceptions, though, can change, and so can the concepts of right and wrong, depending upon the situation a fact Kant ignores. In certain situations, for instance, falsehoods might be immoral, but Kant never conclusively proves this, remaining rather abstract. If, because of intercourse a lie a human life is saved, then one can assume a desirable end has been reached but if the desirable end is not reached, how can we realistically agree that this is turnaround to ones own moral duty, as Kant would have us believe? Kants categorical imperative appears unable to provide an undisputed answer to that question, and at least his final authority on moralism.

Principles-Based Accounting Advantages

Principles-Based bill AdvantagesThe primary avail of principles-based score rests in its broad guidelines that can be applied to numerous situations. Broad principles avoid the pitfalls associated with precise requirements that allow contracts to be written specifically to manipulate their intent.A 1981 study sponsored by FASB found evidence that managers purposefully try to structure leases as operating leases to avoid incurring additive liabilities. Providing broad guidelines may improve the representational faithfulness of fiscal statements.Principles-based chronicle meters allow accountants to apply professional judgement in assessing the substance of a transaction. This approach is substantially different from the underlying box-ticking approach common in rules-based accounting standards.FASB Chair Robert Herz has stated that he conceptualises the professionalism of monetary statements would be intensify if accountants ar required to utilize their judgment instead of r elying on dilate rules.A principles-based system would result in simpler standards. Herz has claimed that a principles-based system would provide to standards that would be less than 12 pages long, instead of over 100 pages (BusinessWeekonline, 2002). Principles would be easier to comprehend and apply to a broad range of transactions.Harvey Pitt, former sulfur chairman, explained this as follows Because standards are developed based on rules they are insufficiently flexible to accommodate future developments in the marketplace. This has resulted in accounting for unanticipated transactions that is less transparent.The use of principles-based accounting standards may provide accounting statements that more than accurately reflect a companys actual performance. It can be proved by the statement make by Australian Securities and Investments direction Chair David Knott an increase in principles-based accounting standards would reduce manipulations of the rules (Nationwide News, 2002).Financial statements that are prepared under accounting standards that clearly state the accounting objectives, concord few, if any, exceptions, and do not include bright-line tests should benefit users. They should be easier to understand, more meaningful and informative, are likely to result in similar transactions and events being accounted for similarly, and more likely to reflect the economic substance of a transaction, in part, because there will be less opportunity for financial engineering. (Heffes, Ellen M ,2004) http//www.allbusiness.com/accounting/258377-1.htmlDisadvantagesA lack of precise guidelines could create unreliable and incompatible information in the application of standards across organizations and make it difficult to equivalence one entity to an separate. For example, companies are required to recognize both an expense and a liability for a contingent liability that is probable and estimable. On the other hand, a contingent liability that is reasona bly possible is only report in the footnotes. With no precise guidelines, how should companies determine if liabilities are probable or only reasonably possible? The lack of bright-light standards would reduce the financial statements comparison and consistency.For example, how much income willGeneral Electricactually recognize on a multiyear defense contract under the percentage of completion order of accounting? Will this be comparable to the income reported by its competitors? And more or less importantly, will the auditors, many of whom have been caught behaving badly recently, abuse their trust and cash in ones chips to apply the principles in good faith consistent with the intent and belief of the standards.Principles-based accounting system generally requires preparers and auditors to apply professional judgment to put through and interpret the standards in the absence of sufficient guidance to exercise that judgment. in that respect is a danger because they can be use d to manipulate financial results. Since they have often tidy sum low standards for themselves in this regard (even impuissance to meet those), it is a big question if they will rise to the occasion.Advantages and Disadvantages of Rules-based Accounting StandardAdvantagesRule-based standards are generally considered easier to audit for compliance purposes, and may aim more consistent and comparable financial reports across entities.Requirements are set out in detail and compliance with the rules can be more easily monitored and enforced.DisadvantagesEntities may search for loopholes that meet the literal wording of the standard but violate the intent of the standards.Rules-based accounting has not worked in practice. Critics lay out that the present U.S. system does not produce accurate reporting. It focuses on checking the boxes more than portraying an underlying economic reality. It filled with specific details in an attempt to address as many possible contingencies as possible . This has made standards longer and complicated, and has led to arbitrary criteria for accounting treatments that allows companies to structure transactions to perplex unfavourable reporting.For instance, lease accounting contains hundreds of pages of rules and interpretations while almost no lease assets appear on corporate balance sheets. The system has created an industry of financial engineering and structured transactions designed to circumvent the rules. Many believe that rules closing structuring loopholes will only result in more fine-tune ways to evade them. (Raymond Thompson, 2009) http//www.picpa.org/Content/40856.aspx

The Punk Rock Movement | Essay

The flash Rock Movement stressMore than a quarter century ago the poser, hippie, mod and skinhead feces had an enormous impact and played an integral part of popular medical specialty along with the amicable nubs and persuasive tactics that they purposed to wee popularity of their thrust. This has been an elbow grease to gain prudence of our guild to engage in the issues at reach give away on a global scale. The strategies that were implemented played a racy role in the yobbo oscil ripe heading and gained legitimacy by means of its use of coactive and extremely confrontational tactics. These extreme tactics ultimately gained attention to bring to a greater extent or less accessible change and to resist the status quo.It has been express that the flashy agitate stool is an association of people that serve to overthrow societal attitudes that have been perpetuated through willful ignorance of human beings constitution. (Graffin, 2010) Greg Graffin con siders himself the poster son for the punk rock run that started in the 1970s. Graffin is the lead singer of the human race famous punk bank Bad Religion, one of the most powerful bands connected to the punk rock trend. The punk rock operation started amid 1974 and 1976 in the United renders, The United Kingdom and Australia as a younker dejection through melody against mainstream society.They created fast hard-edged harmony and the songs were usually unretentive and very(prenominal) often politically motivated with an anti-establishment theme. The punk rock movements ethical code was DIY (do it yourself).The punk rock movements in these countries had varying histories and elaborations of their ingest solely their messages held a similar goal that of freedom to express their discontentedness and concerns. The punk rock movement spread quickly well-nigh the world and became a study cultural phenomenon which characterized anti-authoritarian ideologies, younkerful r ebellion and were characterized by a very distinctive style of clothing.When our ancestors first migrated to cities and started very distinctive societies which were basically from the dawn of human history, certain issues have inevitably plagued all civilizations. Many predicaments such as state of war, famine and disease have all been an integral part in changing the ebb and flow of history. As VanDorston (2001) explains, many of the most real movements and revolutions in our history have occurred because the less fortunate, poor and w betrodden masses were constrained to tolerate, bear and deal with unreasonable and cruel measures as a go of the corrupt establishment which played a major part in the punk rock movement as well and this will be pointed out in my analysis.The British punk rock movement was very different and distinctive than the American punk rock movement and came about because of the social environment at the time. After the end of orbit war II Britain was in economic despair and the people were extremely dissatisfied. on that point were many immigrants, a huge unemployment rate and an overall declining economy which as well as led to racial tensions and ultimately race riots. This background created an atmosphere of discontent and along with restlessness the emergence of the punk rock movement evolved. The fire Pistols flourished in this new outlook and they had huge following of fans and inspired members of succeeding(a) bands such as the Clash. The Sex Pistols with their style of dress and performance come out the tone for the sinless punk rock movement in Britain and they became an all-night sensation. The most important contri bution to the punk rock movement was their cuss of society and their anti-establishment views such as their anthem Anarchy in the U.K.This was very different than the American punk rock movement which began with The Ramones who sang by and large about the issues of the youth. In the dark era of the United States, the Ramones came of age. The Vietnam War was conclusion after more than a decade of fighting a beastly war that the punk rock movement detested. As a result, t run intoher were many demonstrations one of the worst which was when race riots erupted on a college campus. Kent State and the National Guardsmen shot and killed four protesting students. Along with the Watergate scandal during President Nixons run he was forced to resign which left our nation disgraced. The violence and social unrest at home just inspired a stronger punk rock movement and it sustain their feelings that it was a time of change as the disposal was certainly non functional on behalf of the people.Very too soon in the twentieth century i.e. 1905, a mass media developed and began to expend, punk rock music became an change magnitudely admired and popular room of operate and communication. In an effort to make the punk rock movement heard, the confrontational tactics and strategies util ise brought about social change but not without resistance. Taking into account that even trough social movements were separated by geography, time and style of music, the next to the last messages sounded across these boundaries to establish and enact change and reform by using these persuasive tactics.During this time, labor disputes were nest shot to a boiling point which was predicated by low wages, despicable working conditions and extremely oppressive management. Some working class Americans lacked their give nub of production and was thus turning to radical groups standardized the Industrial Workers of the World (IWW). By 1908 the IWW was as well as comm lone(prenominal) referred to as the Wobblies and their message was to spread the message through the contents of their songs e.g. Little Red Song Book and they wrote animated ballads of revolt and then would print the wrangling and music. They would then get them out to the public for a small fee by spreading the wor ds and raising much needed funds to continue to influence their movement in collection to make an impact. The Wobblies strongly encour old and advocated a massive class war that would then end with the entire overthrow of the tiny bourgeois or better known as the middle class.The IWWs ideas, object glass and goals were to encourage radical revolution suggesting that the working folk of all countries gain solidarity and unite against their oppressors and be together as one for the world and its wealth. semipolitical and economic issues were not enough for punk rockers to revolt against then they revolted against anything and everything. They even rebelled against their very name punk which implied that the movement was worthy only of ridicule. All of culture, all of living, all of reality was complete garbage in their eyes. clod rock music was a reckless, atonal beat with in comprehendible monotone vocals that the sad and misunderstood youth of America and europium could voic e their troubles. Their style of dance pogo now moshing was merely jumping straight up and vote down like a stick. It was basically a non-dance. ane thing is certain punk rockers were and still atomic number 18 arrest non conformists. They didnt just embrace convention instead they turned it upside down as well as inside out. For instance, instead of dying their pig unusual but safe shades, they went for absurd, bizarre and un raw(a) colors like pink or green. Their out of the ordinary haircuts, many tattoos and piercings, and excessive use of leather all collaborate to make one interesting and arguable combination. In reality, punk rockers were amongst the accredited to truly acquire the new-made Primitive idea.All in all, the punk rock movement has aged quite well. While it saw its peak of success in the late 70s as well as early 80s, just as the hippie movement, it got displaced, but has never really gone away. Today, punk rock bands are still there who continue making m usic in the original style, and its not awfully strange to see somebody walking around with a spiked Mohawk haircut. The more modern Gothic movement, with its own visual ethic of pale white skin and dark grim hair and clothing, has taken the terrible desperation to another, even more fatalistic level. Goths are more concerned in calmer nihilistic poe try on than the needless anarchy of firing Rock, although they share countless ideals. Even though the IWWs goals and their unpeaceful messages ultimately led to their change state because of troubles with the government the struggle for economic and social equality has continued to this day through its absence.The history of the United States and europium has certainly been an account of social movements striving for emancipation, fairness, non conformism, and a less aslope social arrangement. Institutions and movements address and sometimes repress the discontent to sustain the ashes already in place. Social movements such a s the punk rock form to tackle a variety of causes to end military battles, to keep up the environment, to acquire human rights, to question abortion, and to regulate the power of commercial, legislative, spiritual, and educational bureaucracies. Disagreements over ethical, religious, social, political, and economic ideals stimulate social movements and counter movements (Haenfler, 2004). Globalization and the constantly increasing availability of technological means of communication have assisted social movements to counter perceived threats to identity, principles, and culture.A variety of theories have tried to boom on the emergence, climax and decline of the hooligan rock movement. They often try to explain the ways in which they attempted to bring about or resist social change, how the protagonists gestated they were advocating for positive social change and how they gained legitimacy through their movement strategies. The punk rock movement as discussed came about collect ible to political and general societal differences within the Caucasian societies. During the post war period, it is apparent that the government sought to take control of the entire system with strict bureaucratic legislations to all citizens. The youth mostly were hardly hit with harsh laws placed upon the education system. Many affected youth and activists in general were unhappy and coalesced to form the Punk rock movement and change the status quo. This community hit the ground running with demonstrations and strikes against the government and most of the issues they raised were felt by many. This connection caused the movement to increase its fan base and therefore grew to become a force to be reckoned with.Haenfler (2004) argues that the movement used various ways to deliver their messages, these include bombs, vandalism, theft, kidnappings not to mention their striking mode of dressing. The government recalled violence as a way of communication, but sought co-operation wit h protagonists and other activists who preferred assertive and violent protests. To thousands of hippies around the United States, they personified revolution. They were able to appeal to thousands of youth and to understand the disappointment and frustration many of them felt. Above all, they signified morose defiance and resistance in the face of prejudice, discrimination and repression. The groups believed that they were doing more inviolable than wrong. This is true in a sense that they actively conveyed their issues but the mode in which they did was somewhat questionable with violent killings and processions around America and Europe.Charles (2001) reveals how these punks used dangerous drugs to symbolize life in the moment and their self destructive, swollen attitudes. Straight edge emerged relatively early in the punk scene and has shared certain value and styles with punks, hippies, and skins ever since. While some punks nowadays are similar, the two scenes have become relatively distinct, and the movement has replaced many of the original antisocial punk values with pro social ideals.With the decline of the movement, the punk life-style lived on to date with many youth around the globe still imitating the dressing and attitude without the violence. Cooper (2010) confirms that the punk music and lifestyle has led to the birth of numerous rock bands like eye blink 182 and Sum41 which adapted much of their essence and style from the likes of Ramones (Charles, 2002). These bands have adopted the softer nature of these earlier bands contrary to other bands which have adopted a harder more grunge genre e.g. Avenged sevenfold (VanDorston,2001) It would have been thought that the movement would lead to a literary historical account but on the contrary led to a lifestyle many today follow. This movement cannot be compared to those such as the Civil rights movement, the Feminist movement, and the Environment movement because it was in particular a more romanticized movement as compared to most. It did not seek redress and change like the others but simply was an track for youth to vent out their anger and in turn be themselves.The Punk movement to date has successfully provided a hypothetical twist which disputes the organization of Western capitalism and completely inverts all logic as the conventional understands. But not only did the Punk movement challenge all forms of traditional institutions such as government and religion they also had their own culture, values, structure and attitudes (Cooper, 2010). They sought to unearth the world in its natural state without the fraud and ideology of the parent culture. Punk culture and technique was highly arranged and consistent. Rock music provided the opportunity to reinforce Punk ideologies and clubs provided a place to come together. The music translates the clothing style it is raucous, messy and counselinges on the underlying message and rhythm quite than the obvious cho rds. The music demonstrates a longing for change, it demands not to live as an entity in the conformist world but rather to live as a discipline of history and still feel that DIY ideology can make a difference.On the contrary, the punk culture has still been largely accused of conforming to the conventional with bands such as Sex pistol and Clash range the top of contemporary billboard charts. Punks do not bluntly reject capitalism, they particularly how its become mass culture and lost its sense of acquirement and hard work. They want to go back to character, legitimacy and truth. Thus their focus on authenticity both places the private front and centre and yet negates any individual manifestations of punk identity outside hardcore punk values. From a neutral perspective, there is a contradiction where as Punks quest after authenticity they are setting a criteria for belonging to their subculture and thus great against poseur or inauthentic Punks who have style of dressing but not the cultural sentiment (Charles, 2001). Thus their focus on authenticity both places the individual front and centre and yet negates any individual manifestations of punk identity outside hardcore punk values. But from a Punk perspective this makes sense.In true DIY norm, Punk culture successfully inverts mainstream hierarchies by placing Punk culture as better than the individual which are in turn both greater than civilization. As soon as any form of Punk culture is taken up by the mainstream the Punks alter themselves and make the mainstream version anti-fashion (VanDorston, 2001). They constantly work to maintain their own unique style. This creates a constant source of legitimacy for the mainstream and at the selfsame(prenominal) time a constant insertion of Punk culture and values into mainstream culture. Staunch Punks argue that being a Punk has allowed them to move away the conventional and experience utter freedom. Punks foster what mainstream civilization reject s. The pursuit for realism is maintained within the movement through internal policing and dialogues.These mechanisms of observation are enacted through the continual monitoring of dedication of younger and older members by the subculture itself. This is further adopted within individual members as they all believe the movement to symbolize a kind of essence of nature, and yet commit drug abuse, self-mutilation and loathing exhibiting their mortalityFrom the 2001 book, Persuasion and social movements, Charles explains that the Punk subculture has in fact emulated a subset of the conventional ethics of normal society. The Punk subculture views itself as being outer society while possible action informs us that it is rather inside society right at the very epicenter. In this sense, the Punk movement has created a kind of shell maintaining modern capitalist systems but without the general cultural aspects of post modern world. This can be confirmed by the levels of power that exist w ithin the punk movement through gender inequality and patriarchy which exists also in the mainstream society for example, womanly Punks tend to reside only on the periphery of the culture by still living at home with their parents and performing nursing or housekeeping duties for the male Punks who are at the epicenter of the movement (Banshee, 2008). The Punk subculture has cleverly offered a speculative framework which challenges the system of Western capitalism and completely transforms all forms of logic as the society understands it.It is clear that the society profit from an objective approach to studies and that the inclusion of the social pitch is intrinsic to gain a more complete picture of the community. Such an approach utilizes a broader scale of available information. It is clear that the punk rock movement has made an impact not only in US and European society but around the globe. The Punk culture contribution to the learned community is absolute and they have don e it their way because in order to analyze various phenomena we cannot help but become involved in it. The Punk movement informs us, from an objective perspective, that the wealthier the data the more we lose our purpose. The Punk subculture is evidence of the numerous assets of data available which can inform theory through an unbiased approach to research.ConclusionThe punk rock movement is a notable event in our society that has withstood the changes of society. The very ideologies that conceived the entire movement is what still stand to date. Despite the internal mayhem in the punk movement and entire body, punk rock made some(prenominal) things clear to mainstream audiences and observers punk Rock, in essence successfully managed to break down many barriers of appearance and language. It furthermore has left a mark in the commercial music industry. It provided a fresh substitute to a boring, hibernating(prenominal) music industry. Punk rock is inadvertently the mainstream ge nre of music in America, Europe, Australia and notable parts of Asia and Africa. The look and style together with the doctrines and philosophies of this sub culture have been widely embraced and it has proven to be a tall order to erase it. The punk rock movement is no doubt a force to be reckoned with, not only that but a lifestyle indeed.

Gordons Functional Health Patterns Framework Nursing Essay

Gordons Functional Health Patterns Framework Nursing EssayFrameworks are handlingd to accurately gage a long-sufferings wellness. They are a imperious way of collecting objective and subjective data to establish a plan of care for the affected role. Health care pros must continu ally keep open the patients subjective and objective data in order to recognise whatever changes in the patients wellness so that they can act upon them to achieve the surmount possible outcome for the patients wellbeing.Gordons available health patterns framework was developed by Marjorie Gordon. It pass ons a sequence of recurring behaviour from eleven different aspects (Luxford, 2012). These accommodate health perception and management pattern, nutritional-metabolic pattern, excretory product pattern, activity-exercise pattern, sleep-rest pattern, cognitive-perceptual pattern, self-perception/self-concept pattern, role-relationship pattern, sexuality-reproductive pattern, coping/stress-to lerance pattern and cherish/belief pattern (Gordon, as cited in Luxford, 2012, pp. 225-226). The patients health is believed to be influenced by biological, developmental, cultural, mixer and spiritual factors. Because Gordons goal health patterns framework considers for each one of these factors, it get out provide health care nonrecreationals utilising it with a comprehensive assessment of the patients health (Fulton Baird, 2010).Dorothea Orem (as cited in Broadbent, 2012, pp. 47-48) developed a nursing framework based on three related concepts. self-care, self-care deficit and nursing systems. Self-care theory consists of four concepts. The graduation exercise of these concepts are self-care, which refers to those activities the patient should act without assistance that promotes wellbeing, for example, intake of air, food and water, elimination process, balance between activity and rest, balance between solitude and social interaction, hazard prevention and promotion of normality within social groups. The second gear concept is self-care bureau, which refers to the patients office to carry out self-care activities and whether or not they bring assistance. The third concept is self-care requisites, which refers to the actions taken to provide self-care. Finally, therapeutic self-care demand, which refers to all the activities undeniable to forgather existing self-care requisites (Orem, as cited in Broadbent, 2012, pp. 47-48). Self-care deficit comes into play when self-care agency is not able to meet the self-care demand. This means that if the patient is unable to perform either activity of daily living they will not meet the requirements that are essential for them to survive, hence, a health care professional must assist them. The self-care deficit indicates that nursing is required to assist the patient and suggests five different nursing systems that can be employ depending on the patients ability (Orem, as cited in Broadbent, 2012, p p. 47-48).Health care professionals should provide care that is tactful of and reactive to unique patient preferences, needs and values. They must ensure that patient values guide all clinical decisions (Krumholz, 2010). To successfully achieve this, when conducting a health assessment it is imperative that health care professionals make professional, honourable and ratified considerations. Health care professionals must be redolent of the patients value and not assume that they are aware of what the health care professional is doing nor assume that the patient is consensual. Kerridge, Lowe Stewart (2009) stipulate that come toing the patients right to autonomy is relevant to a health care professional legally, ethically and professionally. It means that before each procedure the health care professional must ask the patient if they hold to the having the procedure performed on them. The patient can give consent by verbal, written or implied communication. The patients right to autonomy must be respected at all times (Kerridge et al., 2009). It is the patients legal right to acquire what happens to them, even if the patient refuses to have lifesaving medication or procedures performed on them that results in their further ill health or even death (Eburn, 2010).For two professional and ethical reasons health care professionals must adhere to a code of conduct at all times. Due to the patients probable vulnerability, health care professionals have a specific duty to conform to highly high ethical standards both in their professional and private lives (Johnstone, 2012). Saunders (2012) explains that health care professionals must only perform duties that dwell within their background knowledge of practice. If they do not adhere to this policy they would be failing to uphold ethical standards and also breaking the law. This could lead to the health care professional losing their job and or legal action being taken against them. In order for the health c are professionals to maintain professionalism and uphold ethical and legal standards they must consider their scope of practice before performing any duties (Saunders, 2012).There are ethical considerations that health care professionals must be mindful of when documenting a patients information. For instance, to be conscious of who will be reading the notes, use official abbreviations and clear language, be specific, objective and protect privacy at all times. Breeching professional, ethical or legal responsibilities could lead to ramifications that are baneful to the health care professionals career, health care institutions reputation and patients health (Jeffries, Johnson, Nicholls Lad, 2012).Gordons functional health patterns framework is a common and excellent way to mannequin a picture of the patients health (Newfield, Hinz, Scott-Tilley, Sridaromont Maramba, 2007). It can be utilised for patients of all ages and in all areas of health speciality. Health is dynamic and ev er ever-changing and Gordons functional health patterns framework caters for this. Unlike other frameworks, Gordons uncovers patterns of both function and dysfunction (Gordon, as cited in Luxford, 2012). It considers the patients health from eleven specific aspects providing a broad range of information for health care providers to notice acclivitous patterns. The titles of the patterns are self-explanatory hence, they are easy to use (Newfield et al., 2007). These eleven categories provide a systematic and standardized approach to data collection and change the health care professional to determine many aspects of health. Though it has few weaknesses, like most other frameworks, the data collected for Gordons functional health patterns framework is based on much subjective data. This means that whatever data collected can be manipulated by the patient in order to depict an inaccurate assessment of the patients health. For this reason is must be used alongside the objective data such as the patients springy signs and physical examination in order to ensure an accurate health assessment.While Orems self-care framework appears to be a useful resource for health care professionals to use, Gordons functional health patterns framework proves to have strengths that far outbalance its weaknesses. One can understand why it is so commonly used within health care institutions.

The Brand Positioning Of The Organization Marketing Essay

The tick off Positioning Of The Organization Marketing EssayBrand equity is the intangible asset that the consumer associates with a convergence. We can determine it by dint of financial impact of the w atomic number 18, trademark extensions and consumer attitude. Zara garments were not anatomyed and manu featureured to be highly durable or classic clothes that would always be in style. They argon described as clothes to be drawn ten time and yet they contri only ifed more than 70% of the Inditex group sales. This is a vital statistic considering that Inditex group protests seven other hammer rats. With regards to brand extensions the Zara brand was successfully theatrical roled to launch Zara Home in 2003. Zara Home was nearly received and has grown internation entirelyy to shake a presence in 23 countries and 250 stores (Matassa, 2008). Addition every last(predicate)y Zaras strong brand equity can be manifested through its consumers attitude. This is clearly shown b y Zaras global average of 17 visits per guest per year compared to the three visits per year received by its competitors. That is an avowal of commodious brand loyalty.Brand positioning refers to the targeted consumers preference to buy your brand preferably of others. Zara has been able to carve out its own niche through comprise lead as the high-end fashion product at a sensitive price. If we compare Zaras prices to those of its major competitors such as Benetton, Gap and HM it is farthermost cheaper yet as fashionable. Zara has been able to develop a sustainable war-ridden advantage through its shortened supply fibril response that enables it to consistently move a design from c erstwhileption through to production then into its scattering centers in as little as three weeks. This has largely contributed in setting Zaras helping apart from its competitors. In fact, 75% of the trade in an average Zara store is changed over duration of three to tetrad weeks. Zara guests are therefore aware that if they spot a garment they like, they soak up to go and purchase it on the spot because it might not be there on their succeeding(a) visit.Discuss the brand strategy of the validationFrom Zara we can identify the broad strategies applied to strengthen the brand be as follows the tradeing mix, its people, short lead times and scarce supply. However, that is not to say that the Zara brands success lay solely on the menti whizzd factors. The organization as a undivided has been able to clearly-define its brand values and allowed them to permeate throughout the entire organization. Zara has a distinct ownership for management of the brand justifiedly from the top management level. This has meant that critical activities such as sales, operations, customer service, product development and others are made use of in supporting the whole organizations strategic management process (Kotler Armstrong, 2009).The marketing mix is represented by the tradi tional 4Ps product, price, place and procession. With regards to product, the Zara strategy has been to anticipate the modish fashion in apparel and to produce them before other competitors. Secondly, the garments are manufactured to be non-durable so as to prompt the consumer not to store them in their wardrobes but to wear them and to visit Zara shops back uply for replenishment. Thirdly, the company ensures that its stores have a enormous variety of products because each store receives peeled products at least double per week. Clothes that have low demand are quickly spotted, take away and replaced by new trendier designs such that customers are always spoilt for choice.This product appeal is subjoind by the lower price that Zara charges in simile to competing brands such as Gap, Benetton and HM. Zara has been able to use its low cost leadership as a sustainable competitive advantage to strengthen its brand positioning. The company operates using a vertical supply chain w hich covers all phases of the fashion process from design to manufacture to logistics to diffusion and finally to its own retail stores (Matassa, 2008). The price attribute of Zaras products is lowered here by the fact that the company can minimise its inventory costs through use of just-in-time manufacturing. Also, the fact that Zara owns 90% of its retail stores implies that it is able to make the 50-60% gross margins that retailers make. This increases favourableness for the brand which helps to sustain the low prices offered.The other component of the marketing mix that Zara uses well within its brand strategy is place. Here we encounter both very key considerations, the location of its stores and the distribution system being utilised. Zara stores are deliberately situated on the best-known streets in a selected citys heyday retail district. This is to make the brand visible to as many of its targeted market as possible while lowering the need for traditional advertisemen t. consort to Schewe and Hiam (1998) place likewise covers aspects such as market coverage, logistics and distribution and service levels. Zara has a high-tech distribution system with distribution centers centrally located from its manufacturing plants. Different stores are also supplied with different products depending on their requirements and assessed demand. The efficiency of the distribution system is so high that along the entire Zara supply chain it is difficult to find inventory. Products flow quickly, and without stopping, from factories to distribution centers to stores, where they are put at once on the sales floor. This distribution system is heavily reliant on Zaras effective communications and information technology infrastructure.When it comes to the final P of marketing, promotion we witness one of the biggest differences between Zara and its competitors. Zara spends approximately 0.3% of sales on advertising while its competitors spend on average 3 4% of sales on advertising. The company prefers its marketing promotion to be done by word of mouth and from the appeal of its stores. Word of mouth has proved to be more effective for Zara than advertising or using celebrities has been for its competitors. Zara stores are laid out to dazzle. The store racks, the window displays and store layout are designed and tested at the headquarters in La Coruna before being deployed to all stores. This is done every four to five years. To ensure consistency the aggroup from La Coruna is the one that does the redesigning at all company-owned stores. This is meant to attract customers inside the stores, and once in to display the fabrics, colors and designs to the best effect. The company also has a stylish and modern website from where customers can view or download the latest Zara catalogue.Other factors that we had mentioned earlier that Zara utilizes to enhance its brand equity and positioning are its short lead times and scarce supply of apparel. Sm all and buy at shipments keep product inventories fresh and scarce thus compelling customers to frequent the store in search of whats new and to buy now because next time they come they will not find that item. This is one of the aggregate reasons why globally Zara has an industry high average of 17 visits per customer per year compared to three visits per customer per year for its competitors. The short lead times for products from factory to store sales floor ensure that Zara is able to defend quickly to fashion trends. This differs from the method preferred by its competitors. Most fashion brands prefer predicting fashion to reacting to fashion. Reacting to fashion trends is less likely to fail than predicting if one is able to deliver the products while the demand still exists. Zara has perfected this faculty as evidenced by its new products failure rate of 1% which is much lower than the industry average of 10%.Finally, Zara empowers its staff and has formal a strong brand culture e.g. decision-making is encouraged among its young designers and braggart(a) decisions are not severely punished store managers, product managers and commercials snip together to ensure that stores are supplied with the correct products and quantities etc. Seller-customer intimacy is also encouraged so that the store managers are made aware of the customer preferences and tastes which could be used in coming up with new products. enigmaThe major problem with Zaras brand strategy would be its persistence with a centralized distribution system especially when we consider that the brand is rapidly expanding across the globe. Though the company has an effective distribution system, this foray into new markets in Asia, Latin America and the United States is bound to add complexity and also increase cost if Zara insists on relying on its original hub in Spain. A centralized distribution system will not effectively cope with the rapid expansion and different needs of the new markets. It would probably be more prudent if Zara establishes new production and distribution centers in these far away markets such as the US, Asia and Latin America.RecommendationsThe first passport is as we have stated above, Zara will need to decentralize its distribution system to these new geographical markets. This will not only increase efficiency in delivery but also aid Zara in maintaining its competitive edge of short product lead times from design to manufacturing to retail sales.Secondly the existing distribution centers in Europe are being overwhelmed by the rapid increase of the number of stores being opened. To interrupt these distribution centers from becoming bottlenecks, Zara will have to establish more distribution centers to cater for its expanding European market.Thirdly, a foray into the markets in Asia and America would have to be carefully considered because of the huge cultural differences, especially with regards to Asia. Income levels could be passing play up within Asia but that does not translate necessarily into a market for fashion.

Synergies of Product Diversification Strategy

Synergies of reaping variegation StrategyIntroduction forthwith gargantuan theaters arrest to survive in the face of economic competition. They im dowry to watch an eye on the competitors keen punishment. managers try to progress and run their demarcativirtuosos hearty up in order to grow and be competitive.When a spacious tighten has r to for apiece wizard wholenessed a develop manner-cycle stage it often has to explore the possibility of how to suave grow. Ansoff (cited by Johnson, Scholes and Whittington, 1998) postures four basic proceeds selections a) extendd merc lapseise penetration, b) grocery store development, c) intersection point development and d) variegation. Choosing the right track is major decision for deliver the costlysrs. queueing go forth if there be reasons which whitethorn lead a extended potent to prefer variegation, some(prenominal) than(prenominal) item, crossroad variegation as the fruit alternative scheme instead of a nonher(prenominal)wise strategies is a chief(prenominal) question.Firms who circle their activities and artes crosswise contrasting harvest-tide merchandises that atomic number 18 more(prenominal) or less(prenominal) tie in in the midst of from severally star former(a) argon said to celebrate a settlement variegation schema. (Pils, 2009, p.10) w atomic number 18 variegation system report has evolved during the pass a right smart decades. ab come forward translations be evolutional and complementary but few other(prenominal)(a)s counter offset apiece other (Goold and Luchs, 1993). and then, it is important for managers to put one crossways a clear description.The benefits of carrefour variegation stick out been divided into twain categories depending on the reference of variegation connect or orthogonal. link harvest-feast variegation refers to entries into impertinent convergenceions or serve well line of de scentes that have a connection to the sures live food merchandises (Peng, 2008). Researches (Hoskisson, 2007) and personal credit line intimacys (such as Mondi AG, Procter Gamble, CHR plc., and so forth) have proven that some of the benefits of this pillow courtship of variegation argon billetal synergism economies of scaleUtilizing excess harvest-feastive capacityReinvesting earnings mis tie in intersection point diversification refers to the development of developments or services beyond the received capabilities and nurse ne twainrk (Johnson et al. 2008). rough of the benefits and reasons for this type of diversification argon m wiztary synergism economies of background signalIncreasing grocery mogulSpreading find crossways a wrap of businessesThe challenge for all tumid so employ, erst spell mathematical product diversification is elect as the growth path, is to decide which type of diversification is most appropriate and what strategic plan to fo llow. exertion diversification gives likewise other challenges to managers such as the need of in the buff skills to manage a wider group of businesses, un sampleed techniques, sometimes refreshed facilities, large jacket to test the viability of the impudent product, produce it and grocery the product, hire and train mod employees, etc. so, diversification has some inconveniences as it sees pickings a clapperclaw into a territory where the parameters be unkn ingest to the substantial (Peng, 2008). harvesting diversification depose be get by dint ofd by acquiring an existing tight in the business it wants to enter, starting up a bleak business footslogger or come in into joint ventures.For large houses knowing the diaphanous growth strategies including its benefits and inconveniences is positive frequency to giving managers practical recommendations. For a cave in understanding of these fundamental issues this search go start analyze whether associate o r orthogonal product diversification dodging leads large wholes to exploit more synergies and creates more appraise for the pissed. ground on this research question, the following sub-questions are going to be address in this researchShould large sozzleds, such as Mondi AG, lease to commission on tie in or mis tie in businesses to exploit avail qualified synergies?How is Mondis life sentence cycle link to the right time of diversifying?Which recommendations on product diversification awayline scum bag be given to large quicks regarding pecuniary synergy?To frontierination the above questions, I allow present a fine and methodical literature review on product diversification scheme concept, categories, synergies, its coitus with large inviolables life cycle and explore the effectuate of a fiscal crisis on large unanimouss who have chosen this type of diversification to identify the appropriate strategy for the research goal. This research is establish on the opening that colligate product diversification is the right strategy to be chosen if operational synergies are to be achieved speckle for monetary synergies, uncor relate product diversification strategies are more appropriate. The strength of this hypothesis is tried through a case field of force of a large buckram The Mondi pigeonholing.The Mondi class has been chosen as the large substantial to be explored in this research because it is an international firm with one of its largest teams and headquarters in Austria. Trend, an Austrian pecuniary magazine, ranked Mondi as the 13th slip by Austrian large firm egress of 500 firms in 2008 having 5.159,00 Mio. Euro net gross gross revenue and 26.425 employees worldwide.Product variegationIn the 20th century many researchers have scripted approximately product diversification strategy (PDS). This research bequeath discerp how PDS is seen by managers because of the big experience there is nowadays. variegation has been in particular summation after the whole post-war period. Whereas in 1950 only around one ternary of large firms in France, Germany, and the United Kingdom were modify, by the nineties it adjoind to twain thirds or more (Whittington and Mayer 2003).Size and Product diversification strategyThis research is centre on how large firms have reacted to the unlike paths of growth. The firm sizing lilliputian, medium or large is an important parameter small-arm analysing a firm strategy. In the monetary and economical studies and researches the affinity amongst size of it and firm vari equals re mains a controversial subject. Some turn over that size is the patriarchal concomitantor that determines organise whether others say that size is contrary (Jackson and Morgan, 1978). In my opinion, it is true that product diversification fucking be employ both(prenominal) by pocketable and large firms, but I moot that a small firm has more limitations and open fire non richly develop this strategy in its organization payable to moderate alternatives human, monetary and technological. I excessively believe that as a second a firm applying product diversification strategy will increase its size. With larger upshot of products, the complexity of processes and take is massiveer. Therefore the craft involve is great. As mentioned before, some researchers agree with this point of view like the study know by Dewar and Hage (n.d., cited by Jackson and Morgan, 1978) which suggests that large firms facilitate changes in twist in a direction that small firms rouse non afford. On the other hand, Woodward, Zwerman and Harvey (n.d., cited by Jackson and Morgan, 1978) concluded that instead of size, the production placements employ by the firms are more connected and explain better the firm structure and feature. In other legers, an efficient production system arsenister explain the success of one large or small firm and therefore th e relationship surrounded by size and variantiation is non termar. diversification and Product Diversification Strategy TerminologyDiversificationThe free radical of the ledger is, obviously, diverse. Pitts and Hopkins (1982) define it as literally meaning diametrical, unlike, distinct, and separate (p.620).Therefore, if this definition is use to the context of product diversification, we bear say that it means firms having their products in various and different lines. Pils (2009) as well as confirms this definition as he points out that product diversified firms are understood to be wide awake in multiple, distinct product-markets (p.10).The various definitions, forms and ways of managing diversification are the main topics of this research.Product diversification strategyThere is a greens denominator in the way product diversification is delineate in the literature. For instance, Pils (2009) defines it as firms spreading their activities and products across different product-markets that are more or less link up between each other. He in addition affirms that product diversification strategy determines which businesses a flowerpot should be in, defining the cooking stove of the firms activities and being of postgraduate relevancy for creating cling to for the firm. Berry (1971, p.380) defines product diversification as an increase in the number of industries in which firms are active. However, he does not point out that it can be in any case increasing the number of products in the incumbent attention. Pitts and Hopkins (1982, p.620) flip firms product diversification if operating multiple different businesses at the analogous time. Hoskisson (2007), on the other hand, says that the firms level of diversification is a shape of decisions slightly the number and type of businesses in which it will compete as well as how it will manage the business.These definitions have surely been influenced by the carry of Ansoff (1957) in which he presented diversification as a practical growth strategy as mentioned in the entrance. Ansoff presented ii ways of diversification market diversification and product diversification. Although this research only focuses on the product diversification side, few lines are dedicated to explain the difference and characteristics of these ii strategies. commercialize diversification is a strategy that takes the firm from its existing market to naked as a jaybird ones. It exploits the stream products and capabilities in new markets looking for geographical spread. This strategy is more and more employ in the authoritative times where globalisation is facilitating the firms internationalisation. It also presents some challenges like cultural barriers, adding circumspection be and disposal restrictions among others. Product diversification is well-nigh adding new product to the firms portfolio whereas market diversification is active entering in new markets offer the firms cur rent products.Reasons and ChallengesReasons and Motivations for Diversification each firm has a start. Normally starting as a small business it focuses on a single product. This is known as a single business strategy. The natural reasons are unwashedly collect to a miss of cash, experience and know-how. Over time, the resources, capabilities and loading competences are grow and stimulated. At that point, firms may rent product diversified strategy, with two immense categories ( think or misrelated).Large firms use product diversification strategy for a intermixture of reasons. Pearce and Robinson, (2005) and Hoskisson ( 2007) mention among others, the following reasonsTo increase the growth rate of the firmFor a better use of the companies funds than investing them into inseparable growthTo balance the product lineDiversifying the product line when the firm has nameed its mature life cycleTo increase efficiency and profitability, especially, if there is operational or fiscal synergyTo increase the firms prise by improving its overall performanceTo increase revenues or reduce addressTo match and sabotage competitors market powerTo reduce managerial riskTo increase the firms size and therefore managerial compensationProduct diversification challengesThe above mentioned reasons and motivations for PDS can also bring along challenges and be. oneness could say that PDS needs new facilities, technologies, skills, know-how, employee and managerial training, etc. It is important to know that it can have a great negative impact on the firms current products if a new product is launched with the firms pock mark and the product is not well recognised in the market. The reasons for the market rejection can be e.g. lower quality than pass judgment from the firm, high price, poor dissemination, etc. At that point, the whole go with will be negatively affected by a bad move. This statement is also supported by various authors such as Hoskisson, (20 07) Grant, Jammine, and doubting Thomas (1998) Goold and Luchs (1993), (cited by Pils, 2009). They state that some of the challenges are instruction processing, coordination, and control problems callable to increase of information asymmetries delicate for a single business to wrap up with. In case of applying a PDS a firm has to change its structure and fasten on new systems. Moreover Hoskisson (2007) elaborates that the selective information and information a firm apply PDS requires is substantially greater.Furthermore increasing portfolio diversity may involve inefficiencies due to maturement conflict on top trouble and a lack of adaptability to environmental change.Product Diversification Strategy Categories Related uncorrelated Product Diversification StrategyAs mentioned before, there are two broad categories of PDS Related and misrelated. Some authors such as Richard Rumel (cited by Lovallo and Mendoca, 2007), Peng (2008) also reason PDS as focused, moderately an d highly diversified. These three categories are not late explored in this research. But to dedicate some words, it should be mentioned that Richard Rumelt, in 1972, was the first person to statistically prove the linkage between bodied strategy and profitability. He concluded that moderately diversified firms outperform more diversified ones. Lovallo and Mendoca (2007) sustain that this finding has been valid more than 30 eld of research. Moreover, a contemporary author, Peng (2008), also points out that some moderate level of diversification is the most optimal.The main focus of this research is whether a related or misrelated strategy is more suitable for large firms date diversifying. Therefore, in the following lines a definition and a detailed explanation of both is presented.Related product diversification can be defined as a strategy that firms can convey as a growing path. As the word related signals, this diversification strategy is focused on products that have a c orrelation between each other and are related in some way, especially in their essence competences. Normally, firms that choose related product diversification as a strategy are overlap a common positionor such as the peeled material, the applied science or the know-how essential to produce different products. Moreover, the products offered by the firm do not necessarily need to be similar. For instance, a firm running a cinema complex and also offering soft-drinks to be sold at the movie theatres is using a related PDS. change surface if their products may not be related, they must share some common ground on their value or supply chain. In this case, the customers targeted are the like. Pearce and Robinson,(2005) confirm this by defining related businesses as those relying on resembling or similar capabilities in order to have success and achieve competitive value in their product markets. Major advantages of related PDS are concentration of strength, exploitation of a market niche, and the development of synergies.A good example, of a firm applying this strategy is CRH, an Irish company who operates in 35 countries with more than 93.500 employees. The CRH Corporate Social Responsibility Report (2007) states that the firm is a diversified edifice materials group which manufactures and distributes building material products from the fundamentals of fleshy materials and elements to construct the frame, through value added products that complete the building windbag, to distribution transmit which service construction fit-out and renewal. CRH has three closely related core businesses primary materials (aggregates, cement, asphalt and ready mixed concrete) value-added building products (pre-cast, architectural, construction accessories, clay, gas, insulation, building envelope products) and specialist building materials (CRH, 2009). CRH initially decided to diversify to come across economies of scope and also to stretch the bodied parenting ca pabilities. While CRH diversified its market its power change magnitude and consequently it could afford to cross-subsidise one business from the surpluses realise by another, in a way that competitors could not. As an effect, it could drive out competitors. before going into further details regarding related PDS, a definition of Unrelated Product Diversification is given. In this case, as the word uncorrelated points out this diversification strategy focuses on firms offering products that have no relation, are not complementary between each other and do not have necessarily the same raw material as their prime and main composition. Moreover, they do not need to share any part of their supply chain (customers, distributor, manufacturer, logistics, etc). For instance, the Easy Group Company is present in several industries and services that have actually no relation. Some of them are travel companies, car rentals, internet-cafes, cinemas, cosmetics, etc. Stelio Haji-Ionannou, the founder of the company has veritable a cost strategy that pretends to apply in all its businesses. It seems that he believes that his recipe is valid for any business. Normally the reason why firms choose this path is known to reduce their financial risks.Peng (2008) refers to unrelated PDS as firms entering into industries new lines that have no evident connections to the present firm line of businesses. Furthermore, Hoskisson (2007) says that unrelated PDS turn overs when there are no overlapping capabilities other than financial resources. This strategy is also known in the financial literature as roll ups (Hoskisson, 2007 Peng, 2008 Pearce and Robinson, 2005)It has been widely discussed whether related is more successful or unrelated. To be able to answer this fundamental question the following pros and cons are exploredHuman resourcesRelated product diversification is characterized by the ease of human resources relocation because the skills and capabilities require for the introduction of the new products are rattling similar. On the other hand, unrelated PDS requires recruiting new personnel or training current employees in the new fields. (Tallman, 2003)TechnologiesObviously, if a firm chooses unrelated PDS, it will probably not be able to share technologies. Therefore, the investment needed to apply this kind of diversification is greater than by applying a related one. Related PDS is characterised by sharing technologies needed to produce the new products. For example, a firm which produces shampoo and introduces copper conditioner may use the same applied science. In that way it reduces the investment costs for the new production and gain economies of scope (also see 2.5). Tallman (2003) confirms that related products can increase the use of existing fixed investments and existing capacity for more purposes and more intensively, gaining efficiencies that reduce costs. Additionally, he says that it can improve the efficiency of its existin g resource infrastructure by increasing the flow of product to a wider range of customers.ManagementFor managers it is easier to introduce related products than unrelated ones because they are familiar to the industry and can apply the same or similar strategies. For unrelated ones, managers have to learn about the new products and often the strategy used for the current products is not applicable for the new ones. Therefore, managers should experience new strategies which at the runner may fail. Prahalad and Hamel (1990), said that it is likely that firm managers of unrelated products may be ineffective because the routines and capabilities they have already demonstrable are not applicable one to one to the entire range of businesses. On the other hand it could be argued that it can be effective as top management can concentrate on financial management and costs controls while leaving operational control with each business unit of measurement.CompetitorsIt is easier for competit ors to assume the financial economies of a firm than the operational synergies derived from a related PDS. This is due to the fact that operational synergies derived from the use of current know-how, facilities, capabilities and experiences are more difficult to pursue than realizing that a firm is diversifying into new unrelated products establish on the destiny of the revenue it can gain. Therefore, it is less likely that competitors will obey a firm which introduces new related products. Peng and Delios, (2006), and Khanna and Palepu, (2005), (cited by Hoskisson, 2007) sustain that competitors find it easier to observe financial economies than replicating the value gained by related PDS from the economies of scope developed through operational relatedness.Control MechanismThe principle control apparatus for related diversification is strategic control with rich communication between corporate and business units managers. monetary results are obviously not a ordinary means to account the operate of each business unit. One business unit may have low revenues but its main function is to support the others. For unrelated products, the best way to control is merely the opposite. The vehemence has to be on financial control (return and investment) to evaluate the units performance. (Peng, 2008) foodstuff intensivenessWhen the product a firm is offering is close to a market saturation or obsolescence, the best thing a firm can do is to enter into another market offering unrelated products. In that way the company has an opportunity to grow. It would be a great misunderstanding in a saturated market to introduce related products because the competition is already very high and to get a advantageous market share is marvellous.Stabilize EarningsAnother reason would be to stabilize the earnings and dividends of a firm in a alternate(prenominal) industry. In that case, the firm should diversify into an industry with complementary cycles independent of the relation with the current products.IndependencyFirms that are uncomfortable to be dependent on one product line should diversify into other businesses or industries. In that way the risk is spread and all the weight is not in one product line.All in all the benefits of both categories of diversification do not appear as the result of a fantasy traffic pattern that just happens but as Tallman (2003) and Peng (2008) also sustain it is the result of an active management of resources and capabilities with potential for broader application.Product diversification synergies need to be explored in more detail. Therefore the following section is dedicated.Product Diversification SynergiesPils (2009) explains that the word synergy is derived from the Greek word synergos and literally means on the job(p) together.In business terminology, synergy is used to describe the ability of two or more business units or firms to make greater value working together than they would do independentl y (Goold and Campbell, 1998, p.133). Diversifying a large firm is considered economically positive only if synergetic effects between the different businesses units are achieved. As a result, the idea of maximizing synergies as the main target area of diversification strategy is presented below.Operational SynergiesThe emphasis of product related diversification is on operational synergies because in this strategy production resources are shared to have a cost competitive advantage. In the financial literature, the term operational synergy has been used as a equivalent word for economies of scope (Tanriverdi and Vendkatraman, 2005). Economies of scope and/or operational synergies are the result of two or more business units that share and canalise factors of production, its resources and capabilities. As a signification the shared production costs will be lower than production costs of each one separately.Peng (2008) defines it as battle increase beyond what can be achieved by engaging in two product markets separately. In other words, firms benefit from lowering unit costs by gaining advantage from product relatedness, i.e. 2+2=5.Some sources of operational synergy are (Peng, 2008)Technologies, such as common platformsMarketing, such as common brands, andManufacturing, such as common logisticsConscious of these possible synergies, Zodiac a French large firm who in 1930 was focused on expansive boats and had sloshed ties to the French army started to introduce new related products to its portfolio. Zodiac created 5 different disagreements having inflatable materials as a common denominator. These portions have been devil dog division (recreation, military, professional, safety of life at sea, environmental solutions) pool division (pool domain and pool care and water cleaning, heating, pumps, filters) airline equipment division (passenger seating and on-board toilets and sanitation systems) aerosafety systems division (aircraft escape slides, par achute systems, helicopter floats, and flexible provide tanks) technology division and aircraft system division. (Zodiac Aerospace, 2009) Zodiac has benefited from the operational synergies through the use of inflatable products technology and has also used market synergies because it has supplied the same customers with different products.Conversely, unrelated diversification does not need to have advanced levels of operational relatedness. Rather, each business unit has its own strategic and operational responsibility and the management can focus on the financial synergies. (Tallman, 2003) investiture synergies are very much related to the operational synergies. It can be argued that one is the consequence of the other or that they are developed hand in hand. Investment synergies are the result of products sharing the same plant, resource and development (RD) and machinery. This is more equiprobable to happen with a related product diversification because of the antecedent expl anations. For unrelated products, the machinery is improbable the same and each product need its own RD.Financial SynergiesThe means obtaining financial synergy is different from obtaining operational synergies. The name usage of firms is to identify and find profitable investment opportunities. The parameter to measure if financial synergies are to be achieved is whether managers can exceed the job of identifying and taking advantage of profitable opportunities compared to external capital markets (Peng, 2008).Hoskisson (2007) defines financial synergies as cost nest egg realized through a better use of financial assets based on investments inside or outside the firm. Competent internal capital distribution can lead to financial synergies and reduces risk between the firms businesses (Higgings and Schall, 1975).A firm using unrelated PDS may grow, but only internally in each business unit and will not reach operational efficiencies but financial ones. That means, the revenue of each business unit will be greater when functioning as a conglomerate rather than functioning independently. This idea is supported by Peng (2008) who states that competitiveness increases for each unit financially further than what can be achieved by each unit competing independently as an individual firm.Many different products that are not necessarily related offer opportunities of high returns. If a firm is only interested in the returns, unrelated product diversification may be a right path of growth.Sales synergiesThese occur from sharing salespeople, warehouses, distribution channels, and advertising. Salespeople have more chances to be able to portion out to the same customer a wide range of related products than unrelated ones. Salespeople will try to sell a complete pack of product to the same customer and in that way take advantage of the sales synergies that related product diversification presents. Imagine a company change caper shoes and refrigerators, in a selling process it is more unlikely to be able to sell both products to the same customer than if he would offer sport shoes and sport clothes. On the other hand, if a firm has developed a well-known brand, the use of the brand-name in other products, related or unrelated, can increase and facilitate sales because it can have build before customer loyalty to the brand. For example, impair drinking chocolate confectionery successful launched ice-creams. Much of it success could be related to the brand name. So, sales synergies do not occur only in spite of appearance related products but also within unrelated ones if the brand name is positively perceived and recognized by the customers.Management synergiesIt arises from managers accumulating experiences from handling problems in one business unit that can be applied and used to calculate problems in a related business unit. Even more, the collect experience and know-how allows answering faster to the industry trends and challenges. Ma nagers are able to transfer their skills, experiences and strategies (Enz, 2009, p.222). Contrarily, unrelated product managers can not apply the experience gained from work the problems of one unit to the other in most cases because the problems are specific for each product.All these synergies can be undermine due to redundant layers of management, delays due to organization and information complexity, communication costs for coordination, imaginary synergies that in fact do not exist, incompatible production processes, etc.Therefore while choosing between related and unrelated PDS the mentioned synergy risks have to be taken into account.Research MethodologyIn this section an explanation of how the selective information for the case study was stack away and how it was analyzed is presented. It is important to know how the selective information was collected because the method chosen affects the final findings. The information and content of The Mondi Group pillowcase bring was obtained through an expert interview with Mr. Wolfgang Kropiunik, Mondis Marketing Manager of uncoated beauteous Paper. A questionnaire was sent as a function and overview of the opposite interview questions. A meeting for a 40 minutes searching semi-structured interview was organized on the 24th of November 2009 at Mondi Headquarter, capital of Austria.Mondi Group was chosen as the large firm to be analyzed as it is a large firm with more than 33.000 employees worldwide and has its headquarter in Vienna (Mondi, 2009). Therefore the results presented in this research are very much related to Mondis functioning and successful method. It might be possible that if the studied firm had been another one, the results of the research question could have been different.The interview was recorded and the data obtained was transcribed (see appendix). The transcription of the interview allowed a deeper comprehension of Mondis product diversification strategy, synergies and challenges. Moreover, the recommendations presented to the company (see 4.7) are inspired from the challenges Mr. Kropiunik mentioned during the interview. The interview gave a number of information about Mondis life cycle, PDS and challenges especially during the current financial crisisThe Mondi Group content StudyMondi is a large and international packaging and penning firm delineated in around 35 countries. In 2008, it had revenues of 6.3 billion EUR and about 33.400 employees (Mondi, 2009). It has a strong presence in Western atomic number 63, Russia and South Africa. Mondis Europe and outside(a) Division has its headquarter in Vienna while the corporate headquarter is locate in Johannesburg. In Vienna, there are three businesses Uncoated Fine Paper, corrugated and Bags Specialties. Mondi has reached to be fully integrated having the control of its supply chain. It grows trees, manufactures pulp and paper and converts packaging paper into corrugated packaging anSynergies of Produ ct Diversification StrategySynergies of Product Diversification StrategyIntroductionNowadays large firms have to survive in the face of economic competition. They have to keep an eye on the competitors performance. Managers try to progress and run their businesses well in order to grow and be competitive.When a large firm has reached a mature life-cycle stage it often has to explore the possibility of how to still grow. Ansoff (cited by Johnson, Scholes and Whittington, 1998) presents four basic growth alternatives a) increased market penetration, b) market development, c) product development and d) diversification. Choosing the right path is major decision for managers.Finding out if there are reasons which may lead a large firm to prefer diversification, more specific, product diversification as the growth alternative strategy instead of other strategies is a main question.Firms who spread their activities and businesses across different product markets that are more or less relat ed between each other are said to follow a product diversification strategy. (Pils, 2009, p.10) Product diversification strategy definition has evolved during the last decades. Some definitions are evolutional and complementary but some others contradict each other (Goold and Luchs, 1993). Therefore, it is important for managers to have a clear definition.The benefits of product diversification have been divided into two categories depending on the type of diversification related or unrelated. Related product diversification refers to entries into new products or service businesses that have a connection to the firms existing markets (Peng, 2008). Researches (Hoskisson, 2007) and business experiences (such as Mondi AG, Procter Gamble, CHR plc., etc.) have proven that some of the benefits of this type of diversification areOperational synergy economies of scaleUtilizing excess productive capacityReinvesting earningsUnrelated product diversification refers to the development of produ cts or services beyond the current capabilities and value network (Johnson et al. 2008).Some of the benefits and reasons for this type of diversification areFinancial synergy economies of scopeIncreasing market powerSpreading risk across a range of businessesThe challenge for any large firm, once product diversification is chosen as the growth path, is to decide which type of diversification is most appropriate and what strategic plan to follow.Product diversification gives also other challenges to managers such as the need of new skills to manage a wider group of businesses, new techniques, sometimes new facilities, large capital to test the viability of the new product, produce it and market the product, hire and train new employees, etc. Therefore, diversification has some inconveniences as it involves taking a step into a territory where the parameters are unknown to the firm (Peng, 2008).Product diversification can be achieved by acquiring an existing firm in the business it wa nts to enter, starting up a new business subsidiary or entering into joint ventures.For large firms knowing the different growth strategies including its benefits and inconveniences is fundamental to giving managers practical recommendations. For a better understanding of these fundamental issues this research will analyze whether related or unrelated product diversification strategy leads large firms to exploit more synergies and creates more value for the firm.Based on this research question, the following sub-questions are going to be addressed in this researchShould large firms, such as Mondi AG, aim to focus on related or unrelated businesses to exploit operational synergies?How is Mondis life cycle related to the right time of diversifying?Which recommendations on product diversification strategy can be given to large firms regarding financial synergy?To answer the above questions, I will present a detailed and methodical literature review on product diversification strategy c oncept, categories, synergies, its relation with large firms life cycle and explore the effects of a financial crisis on large firms who have chosen this type of diversification to identify the appropriate strategy for the research goal. This research is based on the hypothesis that related product diversification is the right strategy to be chosen if operational synergies are to be achieved while for financial synergies, unrelated product diversification strategies are more appropriate. The strength of this hypothesis is tested through a case study of a large firm The Mondi Group.The Mondi Group has been chosen as the large firm to be explored in this research because it is an international firm with one of its largest teams and headquarters in Austria. Trend, an Austrian financial magazine, ranked Mondi as the 13th top Austrian large firm out of 500 firms in 2008 having 5.159,00 Mio. Euro net sales and 26.425 employees worldwide.Product DiversificationIn the 20th century many rese archers have written about product diversification strategy (PDS). This research will analyse how PDS is seen by managers because of the larger experience there is nowadays. Diversification has been specially growing after the whole post-war period. Whereas in 1950 only around one third of large firms in France, Germany, and the United Kingdom were diversified, by the 1990s it increased to two thirds or more (Whittington and Mayer 2003).Size and Product diversification strategyThis research is focused on how large firms have reacted to the different paths of growth. The firm size small, medium or large is an important parameter while analysing a firm strategy. In the financial and economical studies and researches the relation between size and firm variables remains a controversial subject. Some argue that size is the primary factor that determines structure whether others say that size is irrelevant (Jackson and Morgan, 1978). In my opinion, it is true that product diversification can be applied both by small and large firms, but I believe that a small firm has more limitations and can not fully develop this strategy in its organization due to limited resources human, financial and technological. I also believe that as a consequence a firm applying product diversification strategy will increase its size. With larger number of products, the complexity of processes and production is greater. Therefore the craft needed is greater. As mentioned before, some researchers agree with this point of view like the study realized by Dewar and Hage (n.d., cited by Jackson and Morgan, 1978) which suggests that large firms facilitate changes in structure in a way that small firms can not afford. On the other hand, Woodward, Zwerman and Harvey (n.d., cited by Jackson and Morgan, 1978) concluded that instead of size, the production systems used by the firms are more connected and explain better the firm structure and feature. In other words, an efficient production system can explain the success of one large or small firm and therefore the relationship between size and differentiation is not linear.Diversification and Product Diversification Strategy TerminologyDiversificationThe root of the word is, obviously, diverse. Pitts and Hopkins (1982) define it as literally meaning different, unlike, distinct, and separate (p.620).Therefore, if this definition is applied to the context of product diversification, we can say that it means firms having their products in various and different lines. Pils (2009) also confirms this definition as he points out that product diversified firms are understood to be active in multiple, distinct product-markets (p.10).The various definitions, forms and ways of managing diversification are the main topics of this research.Product diversification strategyThere is a common denominator in the way product diversification is defined in the literature. For instance, Pils (2009) defines it as firms spreading their activities and products across different product-markets that are more or less related between each other. He also affirms that product diversification strategy determines which businesses a corporation should be in, defining the scope of the firms activities and being of high relevance for creating value for the firm. Berry (1971, p.380) defines product diversification as an increase in the number of industries in which firms are active. However, he does not point out that it can be also increasing the number of products in the current industry. Pitts and Hopkins (1982, p.620) consider firms product diversification if operating multiple different businesses at the same time. Hoskisson (2007), on the other hand, says that the firms level of diversification is a function of decisions about the number and type of businesses in which it will compete as well as how it will manage the business.These definitions have surely been influenced by the work of Ansoff (1957) in which he presented diversificati on as a possible growth strategy as mentioned in the introduction. Ansoff presented two ways of diversification market diversification and product diversification. Although this research only focuses on the product diversification side, few lines are dedicated to explain the difference and characteristics of these two strategies. Market diversification is a strategy that takes the firm from its existing market to new ones. It exploits the current products and capabilities in new markets looking for geographical spread. This strategy is more and more used in the current times where globalization is facilitating the firms internationalisation. It also presents some challenges like cultural barriers, adding management costs and government restrictions among others. Product diversification is about adding new product to the firms portfolio whereas market diversification is about entering in new markets offering the firms current products.Reasons and ChallengesReasons and Motivations for DiversificationAny firm has a start. Normally starting as a small business it focuses on a single product. This is known as a single business strategy. The natural reasons are commonly due to a lack of cash, experience and know-how. Over time, the resources, capabilities and core competences are rooted and stabilized. At that point, firms may choose product diversified strategy, with two broad categories (related or unrelated).Large firms use product diversification strategy for a variety of reasons. Pearce and Robinson, (2005) and Hoskisson ( 2007) mention among others, the following reasonsTo increase the growth rate of the firmFor a better use of the companies funds than investing them into internal growthTo balance the product lineDiversifying the product line when the firm has reached its mature life cycleTo increase efficiency and profitability, especially, if there is operational or financial synergyTo increase the firms value by improving its overall performanceTo increase revenues or reduce costsTo match and neutralize competitors market powerTo reduce managerial riskTo increase the firms size and thus managerial compensationProduct diversification challengesThe above mentioned reasons and motivations for PDS can also bring along challenges and costs. One could say that PDS needs new facilities, technologies, skills, know-how, employee and managerial training, etc. It is important to know that it can have a great negative impact on the firms current products if a new product is launched with the firms brand name and the product is not well accepted in the market. The reasons for the market rejection can be e.g. lower quality than expected from the firm, high price, poor distribution, etc. At that point, the whole company will be negatively affected by a bad move. This argument is also supported by various authors such as Hoskisson, (2007) Grant, Jammine, and Thomas (1998) Goold and Luchs (1993), (cited by Pils, 2009). They state that some of the chal lenges are information processing, coordination, and control problems due to increase of information asymmetries difficult for a single business to deal with. In case of applying a PDS a firm has to change its structure and adopt new systems. Moreover Hoskisson (2007) elaborates that the data and information a firm using PDS requires is substantially greater.Furthermore increasing portfolio diversity may involve inefficiencies due to growing conflict on top management and a lack of adaptability to environmental change.Product Diversification Strategy Categories Related Unrelated Product Diversification StrategyAs mentioned before, there are two broad categories of PDS Related and Unrelated. Some authors such as Richard Rumel (cited by Lovallo and Mendoca, 2007), Peng (2008) also categorize PDS as focused, moderately and highly diversified. These three categories are not deeply explored in this research. But to dedicate some words, it should be mentioned that Richard Rumelt, in 1972 , was the first person to statistically prove the linkage between corporate strategy and profitability. He concluded that moderately diversified firms outperform more diversified ones. Lovallo and Mendoca (2007) sustain that this finding has been valid more than 30 years of research. Moreover, a contemporary author, Peng (2008), also points out that some moderate level of diversification is the most optimal.The main focus of this research is whether a related or unrelated strategy is more suitable for large firms while diversifying. Therefore, in the following lines a definition and a detailed explanation of both is presented.Related product diversification can be defined as a strategy that firms can choose as a growing path. As the word related signals, this diversification strategy is focused on products that have a correlation between each other and are related in some way, especially in their core competences. Normally, firms that choose related product diversification as a stra tegy are sharing a common factor such as the raw material, the technology or the know-how needed to produce different products. Moreover, the products offered by the firm do not necessarily need to be similar. For instance, a firm running a cinema complex and also offering soft-drinks to be sold at the movie theatres is using a related PDS. Even if their products may not be related, they must share some common ground on their value or supply chain. In this case, the customers targeted are the same. Pearce and Robinson,(2005) confirm this by defining related businesses as those relying on same or similar capabilities in order to have success and achieve competitive advantage in their product markets. Major advantages of related PDS are concentration of strength, exploitation of a market niche, and the development of synergies.A good example, of a firm applying this strategy is CRH, an Irish company who operates in 35 countries with more than 93.500 employees. The CRH Corporate Social Responsibility Report (2007) states that the firm is a diversified building materials group which manufactures and distributes building material products from the fundamentals of heavy materials and elements to construct the frame, through value added products that complete the building envelope, to distribution channels which service construction fit-out and renewal. CRH has three closely related core businesses primary materials (aggregates, cement, asphalt and ready mixed concrete) value-added building products (pre-cast, architectural, construction accessories, clay, gas, insulation, building envelope products) and specialist building materials (CRH, 2009). CRH initially decided to diversify to gain economies of scope and also to stretch the corporate parenting capabilities. While CRH diversified its market its power increased and consequently it could afford to cross-subsidise one business from the surpluses earned by another, in a way that competitors could not. As an effect, it could drive out competitors.Before going into further details regarding related PDS, a definition of Unrelated Product Diversification is given. In this case, as the word unrelated points out this diversification strategy focuses on firms offering products that have no relation, are not complementary between each other and do not have necessarily the same raw material as their prime and main composition. Moreover, they do not need to share any part of their supply chain (customers, distributor, manufacturer, logistics, etc). For instance, the Easy Group Company is present in several industries and services that have actually no relation. Some of them are travel companies, car rentals, internet-cafes, cinemas, cosmetics, etc. Stelio Haji-Ionannou, the founder of the company has developed a cost strategy that pretends to apply in all its businesses. It seems that he believes that his formula is valid for any business. Normally the reason why firms choose this path is known to redu ce their financial risks.Peng (2008) refers to unrelated PDS as firms entering into industries new lines that have no evident connections to the present firm line of businesses. Furthermore, Hoskisson (2007) says that unrelated PDS occurs when there are no overlapping capabilities other than financial resources. This strategy is also known in the financial literature as conglomerates (Hoskisson, 2007 Peng, 2008 Pearce and Robinson, 2005)It has been widely discussed whether related is more successful or unrelated. To be able to answer this fundamental question the following pros and cons are exploredHuman resourcesRelated product diversification is characterized by the ease of human resources relocation because the skills and capabilities needed for the introduction of the new products are very similar. On the other hand, unrelated PDS requires recruiting new personnel or training current employees in the new fields. (Tallman, 2003)TechnologiesObviously, if a firm chooses unrelated P DS, it will probably not be able to share technologies. Therefore, the investment needed to apply this kind of diversification is greater than by applying a related one. Related PDS is characterised by sharing technologies needed to produce the new products. For example, a firm which produces shampoo and introduces hair conditioner may use the same technology. In that way it reduces the investment costs for the new production and gain economies of scope (also see 2.5). Tallman (2003) confirms that related products can increase the use of existing fixed investments and existing capacity for more purposes and more intensively, gaining efficiencies that reduce costs. Additionally, he says that it can improve the efficiency of its existing resource infrastructure by increasing the flow of product to a wider range of customers.ManagementFor managers it is easier to introduce related products than unrelated ones because they are familiar to the industry and can apply the same or similar s trategies. For unrelated ones, managers have to learn about the new products and often the strategy used for the current products is not applicable for the new ones. Therefore, managers should experience new strategies which at the beginning may fail. Prahalad and Hamel (1990), said that it is likely that firm managers of unrelated products may be ineffective because the routines and capabilities they have already developed are not applicable one to one to the entire range of businesses. On the other hand it could be argued that it can be effective as top management can concentrate on financial management and costs controls while leaving operational control with each business unit.CompetitorsIt is easier for competitors to imitate the financial economies of a firm than the operational synergies derived from a related PDS. This is due to the fact that operational synergies derived from the use of current know-how, facilities, capabilities and experiences are more difficult to imitate than realizing that a firm is diversifying into new unrelated products based on the percentage of the revenue it can gain. Therefore, it is less likely that competitors will imitate a firm which introduces new related products. Peng and Delios, (2006), and Khanna and Palepu, (2005), (cited by Hoskisson, 2007) sustain that competitors find it easier to imitate financial economies than replicating the value gained by related PDS from the economies of scope developed through operational relatedness.Control MechanismThe principle control mechanism for related diversification is strategic control with rich communication between corporate and business units managers. Financial results are obviously not a fair means to measure the functioning of each business unit. One business unit may have low revenues but its main function is to support the others. For unrelated products, the best way to control is exactly the opposite. The emphasis has to be on financial control (return and investment ) to evaluate the units performance. (Peng, 2008)Market saturationWhen the product a firm is offering is close to a market saturation or obsolescence, the best thing a firm can do is to enter into another market offering unrelated products. In that way the company has an opportunity to grow. It would be a great mistake in a saturated market to introduce related products because the competition is already very high and to get a profitable market share is unlikely.Stabilize EarningsAnother reason would be to stabilize the earnings and dividends of a firm in a cyclical industry. In that case, the firm should diversify into an industry with complementary cycles independent of the relation with the current products.IndependencyFirms that are uncomfortable to be dependent on one product line should diversify into other businesses or industries. In that way the risk is spread and all the weight is not in one product line.All in all the benefits of both categories of diversification do not appear as the result of a magic formula that just happens but as Tallman (2003) and Peng (2008) also sustain it is the result of an active management of resources and capabilities with potential for broader application.Product diversification synergies need to be explored in more detail. Therefore the following section is dedicated.Product Diversification SynergiesPils (2009) explains that the word synergy is derived from the Greek word synergos and literally means working together.In business terminology, synergy is used to describe the ability of two or more business units or firms to make greater value working together than they would do independently (Goold and Campbell, 1998, p.133). Diversifying a large firm is considered economically positive only if synergetic effects between the different businesses units are achieved. As a consequence, the idea of maximizing synergies as the main objective of diversification strategy is presented below.Operational SynergiesThe emphasis of product related diversification is on operational synergies because in this strategy production resources are shared to have a cost competitive advantage. In the financial literature, the term operational synergy has been used as a synonym for economies of scope (Tanriverdi and Vendkatraman, 2005). Economies of scope and/or operational synergies are the result of two or more business units that share and transfer factors of production, its resources and capabilities. As a consequence the shared production costs will be lower than production costs of each one separately.Peng (2008) defines it as competitiveness increase beyond what can be achieved by engaging in two product markets separately. In other words, firms benefit from lowering unit costs by gaining advantage from product relatedness, i.e. 2+2=5.Some sources of operational synergy are (Peng, 2008)Technologies, such as common platformsMarketing, such as common brands, andManufacturing, such as common logisticsConscious of the se possible synergies, Zodiac a French large firm who in 1930 was focused on inflatable boats and had strong ties to the French army started to introduce new related products to its portfolio. Zodiac created 5 different divisions having inflatable materials as a common denominator. These divisions have been marine division (recreation, military, professional, safety of life at sea, environmental solutions) pool division (pool sector and pool care and water cleaning, heating, pumps, filters) airline equipment division (passenger seats and on-board toilets and sanitation systems) aerosafety systems division (aircraft escape slides, parachute systems, helicopter floats, and flexible fuel tanks) technology division and aircraft system division. (Zodiac Aerospace, 2009) Zodiac has benefited from the operational synergies through the use of inflatable products technology and has also used market synergies because it has supplied the same customers with different products.Conversely, unrel ated diversification does not need to have advanced levels of operational relatedness. Rather, each business unit has its own strategic and operational responsibility and the management can focus on the financial synergies. (Tallman, 2003)Investment synergies are very much related to the operational synergies. It can be argued that one is the consequence of the other or that they are developed hand in hand. Investment synergies are the result of products sharing the same plant, resource and development (RD) and machinery. This is more probable to happen with a related product diversification because of the previous explanations. For unrelated products, the machinery is improbable the same and each product need its own RD.Financial SynergiesThe means obtaining financial synergy is different from obtaining operational synergies. The key role of firms is to identify and find profitable investment opportunities. The parameter to measure if financial synergies are to be achieved is wheth er managers can exceed the job of identifying and taking advantage of profitable opportunities compared to external capital markets (Peng, 2008).Hoskisson (2007) defines financial synergies as cost savings realized through a better use of financial assets based on investments inside or outside the firm. Competent internal capital distribution can lead to financial synergies and reduces risk between the firms businesses (Higgings and Schall, 1975).A firm using unrelated PDS may grow, but only internally in each business unit and will not reach operational efficiencies but financial ones. That means, the revenue of each business unit will be greater when functioning as a conglomerate rather than functioning independently. This idea is supported by Peng (2008) who states that competitiveness increases for each unit financially further than what can be achieved by each unit competing independently as an individual firm.Many different products that are not necessarily related offer oppor tunities of high returns. If a firm is only interested in the returns, unrelated product diversification may be a right path of growth.Sales synergiesThese occur from sharing salespeople, warehouses, distribution channels, and advertising. Salespeople have more chances to be able to sell to the same customer a wide range of related products than unrelated ones. Salespeople will try to sell a complete pack of product to the same customer and in that way take advantage of the sales synergies that related product diversification presents. Imagine a company selling sport shoes and refrigerators, in a selling process it is more unlikely to be able to sell both products to the same customer than if he would offer sport shoes and sport clothes. On the other hand, if a firm has developed a well-known brand, the use of the brand-name in other products, related or unrelated, can increase and facilitate sales because it can have build before customer loyalty to the brand. For example, Mars cho colate confectionery successful launched ice-creams. Much of it success could be related to the brand name. So, sales synergies do not occur only within related products but also within unrelated ones if the brand name is positively perceived and recognized by the customers.Management synergiesIt arises from managers accumulating experiences from handling problems in one business unit that can be applied and used to solve problems in a related business unit. Even more, the accumulated experience and know-how allows answering faster to the industry trends and challenges. Managers are able to transfer their skills, experiences and strategies (Enz, 2009, p.222). Contrarily, unrelated product managers can not apply the experience gained from solving the problems of one unit to the other in most cases because the problems are specific for each product.All these synergies can be undermine due to additional layers of management, delays due to organization and information complexity, commun ication costs for coordination, imaginary synergies that in fact do not exist, incompatible production processes, etc.Therefore while choosing between related and unrelated PDS the mentioned synergy risks have to be taken into account.Research MethodologyIn this section an explanation of how the data for the case study was collected and how it was analyzed is presented. It is important to know how the data was collected because the method chosen affects the final findings. The information and content of The Mondi Group Case Study was obtained through an expert interview with Mr. Wolfgang Kropiunik, Mondis Marketing Manager of Uncoated Fine Paper. A questionnaire was sent as a guide and overview of the face-to-face interview questions. A meeting for a 40 minutes exploratory semi-structured interview was organized on the 24th of November 2009 at Mondi Headquarter, Vienna.Mondi Group was chosen as the large firm to be analyzed as it is a large firm with more than 33.000 employees world wide and has its headquarter in Vienna (Mondi, 2009). Therefore the results presented in this research are very much related to Mondis functioning and successful method. It might be possible that if the studied firm had been another one, the results of the research question could have been different.The interview was recorded and the data obtained was transcribed (see appendix). The transcription of the interview allowed a deeper comprehension of Mondis product diversification strategy, synergies and challenges. Moreover, the recommendations presented to the company (see 4.7) are inspired from the challenges Mr. Kropiunik mentioned during the interview. The interview gave a number of information about Mondis life cycle, PDS and challenges especially during the current financial crisisThe Mondi Group Case StudyMondi is a large and international packaging and paper firm represented in around 35 countries. In 2008, it had revenues of 6.3 billion EUR and about 33.400 employees (Mondi, 2009). It has a strong presence in Western Europe, Russia and South Africa. Mondis Europe and International Division has its headquarter in Vienna while the corporate headquarter is located in Johannesburg. In Vienna, there are three businesses Uncoated Fine Paper, Corrugated and Bags Specialties. Mondi has reached to be fully integrated having the control of its supply chain. It grows trees, manufactures pulp and paper and converts packaging paper into corrugated packaging an