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FACULTATEA DE ŞTIINŢE ECONOMICE Universitatea TRANSILVANIA din Braşov Revista ASPECKT Platforma / Laborator de Analize Statistice şi Previziune a fenomenelor Economico – sociale şi Cercetări de marKeTing Nr. 3 – 2009 Editura Universităţii TRANSILVANIA din Braşov CUPRINS EVOLUTION OF NOMINAL WAGES IN SWITZERLAND BETWEEN 19902007 Otilia ANTOCI …………………………………………………...………………………. 7 BUSINESS GAMES. CASE STUDY: GMC ROMANIA Cristina ANTONOAIE………………………………………………...……..………… 13 SELLING POINT MARKETING Simona BĂLĂŞESCU………………………………………………….………………… 17 THE INEQUALITY OF INCOMES DISTRIBUTION IN BELGIUM DURING 1996 – 2006 Axenia Bianca BOITOR .…………………………………………….…………………... 23 MASS MEDIA MARKET IN BRAŞOV Tamara BRĂTUCU …………………………………………………………………….. 29 SOME ASPECTS REGARDING BRAND EQUITY Ioana CHIŢU ………………….…………………………………………………………. 37 ROMANIAN AUTOMOBILE MARKET Gheorghe CRUCERU ………..……………………..……………………………………. 41 THE ACTUAL STAGE OF HIGH TECH INDUSTRY AT INTERNATIONAL LEVEL -SOME EXAMPLES OF CRISIS EFFECTS IN EUROPE AND ASIALavinia DOVLEAC ………………………………………..……………………………... 49 DRAWING THE SAMPLE SIZE FOR ANALYZING THE QUALITY OF UNIVERSITY EDUCATIONAL PROCESS Liliana DUGULEANĂ, Constantin DUGULEANĂ …………………………………..… 55 CORPORATE VALUE CREATION THROUGH MERGERS AND ACQUISITIONS Lucia DUGULEANĂ, Iulia DUMITRACHE ………………………..………………….. 61 THE SEARCHING ENGINES’ SITES FOR ONLINE MARKETING Mihai DUGULEANĂ ………………………….………………………………………… 65 TOURISTS OPINION REGRADING ACCOMMODATION SERVICES – APLICATION IN CLEMENTINE Maria ENEA, Eugen VRĂJITORU ………….…………………………………………... 69 TOURISM DEVELOPMENT IN THE ONLINE MEDIUM Anamaria HUMELNICU – SEVERIN …………………………………..……………… 75 EUROPEAN APPROACH FOR EVALUATING KNOWLEDGE MANAGEMENT Dana Adriana LUPŞA-TĂTARU, Sanda CONSTANTIN ..…………………………….. 79 POSITIVE IMPLICATIONS OF CHOCOLATE ON THE CONSUMERS’ HEALTH Anca MADAR .. ..………………………………………………………………………… 85 PROGRAMS FOR SUPPORTING THE ACCESS OF ROMANIAN SMALL AND MEDIUM SIZED ENTERPRISES TO MANAGEMENT CONSULTING SERVICES Daniela MIHAI……………………… …………….…………………………………….. 91 COMMODITIES LIKE INVESTMENTS – URANIUM, COOPER AND ZINC Carmen MORANDAU………….………….……………………………….…………….. 97 HOW TO USE PORTFOLIO THEORY IN STOCK EXCHANGE NVESTMENTS Iulia MURARIU ………………………………………………………………………… 107 THE ROLE OF PACKING IN PRODUCT SELLING Andreea NEACŞU ………………..………...……………………………………………. 113 THE PROXIMITIES OF THE MEDIUM NOMINAL WAGES ON THE ACTIVITIES OF THE NATIONAL ECONOMY Nicoleta PETCU ..………………………………………………………………………... 117 THE ROLE OF THE SMALL AND MIDDLE SIZE ENTERPRISES IN THE EU Ramona POP ……………………………………………………………………………... 121 THE PURPOSE OF INTERNATIONAL CODIFICATION OF FINANCIAL INSTRUMENTS Ioana RADU ……………………………………………………………………………… 125 MARKETING RESEARCH FOR UNIVERSITY LIBRARY RESOURSES ASSESSMENT Angela REPANOVICI …………………………...………………………………………. 129 PRICING STRATEGIES Titus SUCIU...………………………………….…………………………………………. 135 PODCASTING AS A POLITICAL MARKETING TOOL Ovidiu ŢIEREAN …………………………....……………………...…………………… 141 CORRELATIONS BETWEEN THE NETHERLANDS’ GDP, WAGE LEVELS, INFLATION AND UNEMPLOYMENT DURING 1988 – 2007 Silviu ŢIEREAN …..……………………………………..……………………………… 147 DECISION INTO A TRAVEL AGENCY – APLICATION IN SPSS CLEMENTINE Manuela VICOL, Alecsandru BLÂNDU ……………...…………………………………. 153 ELECTORAL MARKETING STRATEGIES USED IN ROMANIA Timotei VIERAŞU ………………………....…………………...…...…………………… 159 INTERNATIONAL AND MULTINATIONAL BANKING Mirela VINT …..………………………………….……..……………………………… 165 EVOLUTION OF NOMINAL WAGES IN SWITZERLAND BETWEEN 1990-2007 Otilia ANTOCI , Student at Master of Scientific Research Coord. Prof. Dr. Liliana DUGULEANĂ Transilvania University from Braşov, Faculty of Economic Sciences Abstract: This document contains an overview of the evolution of nominal wages and real wages in Switzerland between 1990 and 2007. Since 1990 wages have increased in Switzerland, with an upward trend. In the second part of the work we talked about the correlation between gross domestic product, exports, imports, and built in Microsoft Excel, table regression GDP depending on exports and imports. Keywords: Nominal wages, Real wages, Consumer price index, Table of regression 1. Analysis wage in Switzerland The Swiss labour market is performing very well compared with other countries. Switzerland has one of the highest activity rates in Europe, thanks to the large number of women participating in the labour force, as well as to the fact that workers are generally entering the labour market earlier and leaving it later. Part-time work is far more widespread in Switzerland than in most other European countries. The unemployment rate in Switzerland is half the average unemployment rate in the European Union. Salaries, when converted to euros, are very high in Switzerland and the workweek for full-time employees is very long. When the level of prices and purchasing power are taken into account, the situation looks slightly less favourable in Switzerland. Even if there is still a distinction in the level of indicators between the Scandinavian countries and the southern countries in the EU and new EU Member States, the differences between the three groups of countries have lessened to some extent. Years 1990 1991 1992 1993 CPI CPIt/t-1 82.52 87.35 90.88 93.87 average wage Wt 1595 1706 1788 1836 % CPIt/90 100 87 79 75 7 real wages Wt(90) 1595 1953 2252 2464 W it/t-1% 100 122.45 115.33 109.39 W it/90 % 100 122.45 141.22 154.48 1994 94.67 1862 71 2640 107.13 165.49 1995 96.37 1887 68 2776 105.16 174.03 1996 97.16 1910 66 2892 104.18 181.31 1997 97.66 1919 65 2975 102.88 186.53 1998 97.68 1932 63 3066 103.07 192.25 1999 98.47 1938 62 3124 101.87 195.86 2000 100.00 1963 62 3164 101.29 198.38 2001 100.99 2011 63 3210 101.44 201.24 2002 101.64 2047 64 3215 100.15 201.55 2003 102.29 2076 65 3187 99.15 199.83 2004 103.11 2095 67 3120 97.87 195.58 2005 104.33 2115 70 3019 96.77 189.26 2006 105.42 2140 74 2897 95.98 181.64 2007 106.19 2175 78 2773 95.71 173.85 Table 1. Evolution of nominal and real wages in Switzerland between 1990-2007 The evolution of the consumer price index in Switzerland between 1990-2007 110 105 % 100 95 90 85 80 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 Years In the early 90s, the international environment unstable (war and invasion of Kuwait, dissolved the Soviet Union, soaring oil prices, construction European) leads to slower growth World with negative consequences on the economy Switzerland. From 1990 to 1996, Switzerland saw seven years of stagnation economy. From 1990 to 1993, the recession that is characterized by high inflation will lead to a loss of purchasing power of wages while in 1994 in 1996, inflation is under control and the GDP shows a slight rise. Nominal wages are the lowest since early 50 years and real wages fluctuate around the value zero. In 1997, Switzerland comes out of this period of economic gloom. The cyclical upturn continues into 1998 but at a slower pace in part because of the Asian crisis began in 1997 that affected Western economies through the financial markets. The year 1999 saw a slowdown in growth economy with a GDP growth of 1.3% against 2.6% in 1998 and higher inflation especially due to higher energy prices and the increase of 1% of the value added tax. Of 1997 to 1999, the rise in nominal wages is less 1% and real wages have stagnated. The first implementation of the economic boom began in 1997 only take effect in 2000 (Charts 1 and 2). 8 The evolution of wages in Switzerland between 1990-2007 3500 swiss francs 3000 2500 average w age 2000 real w ages 1500 1000 500 20 06 20 04 20 02 20 00 19 98 19 96 19 94 19 92 19 90 0 Yers The year 2000 has a significant momentum of the economy. The real GDP reached its growth rate the highest in ten years (3.6%). In this context, nominal wages rose 1.3% while 0.5% posted in 1997, 0.7% in 1998 and 0.3% in 1999. However, the nominal wage growth of 1.3% failed to halt the decline in real wages (-0.3) due to inflation of 1.6%. During 2001, the first declines in growth are already visible (drop in GDP growth to 1.2%), but wages will benefit from the favorable economic developments witnessed in 1999 and was confirmed in 2000. Thus, in 2001 shows outstanding values, compared with previous years, with an increase in nominal wages of 2.5% and an increase in real wages by 1.5%. The increase in nominal wages continued in 2002 (1.8%), 1.4% in 2003) and 2004 (0.9%) but with some slowing in the context of a cyclical downturn over the period 2001 to 2003. Given the low rate of inflation, real wages grew by 1.1%, 0.8% and 0.1%. In 2005, nominal wages grew by 1.0% and real wages fell by 0.2%. In 2006 and 2007, nominal wages have rates of growth of 1.2% and 1.6% and real wages by 0.1% and 0.7%. Despite an economic rather favorable as in 2004 which has enabled Switzerland to resume with growth thanks to strong growth its exports, the average wage adjustment was based on the general price increases so that the increase in the purchasing power of wages, from 2004 to 2007, approach zero (0.2%). GDP growth was 2.5% in 2004 and 2005, 3.4% in 2006 and 3.3% in 2007 when it posted 0.4% in 2002 and -0.2% in 2003. (Table 1.and Charts 1). 2. Table of regression of gross domestic product based on exports and imports One of the most commonly used methods of analysis in the countries of marketing research, analysis regresional study aims to estimate the links between variables. In this direction, she has a great utility for research in achieving the expected travel but its applicability is involved in areas such as market segmentation or construction marketing models. Multiple regression aim is to highlight the relationship between a dependent variable (explained, endogenous outcome) and a lot of independent variables (explanatory factor, exogenous, predictor). Using multiple regression attempts often obtain a response to questions of "who is the best prediction for ..." "Who is the best predictor for ...?". 9 Estimated coefficients of linear model using the method of least squares and calculate the statistics needed associated statistical tests are performed procedure Regression, one of the most complex package of statistical processing Excel. Graphics and building permits necessary to evaluate the model. Linear model that we optinem is to form: y = a0+αx1+αx2+ ε; y - dependent variable x0, x1, – independent variables In the example below are trying to GDP in theory, if you know the data on unemployment, nominal wages, the value of imports and exports in Switzerland between 1990 and 2007, and also if the gross domestic product is the influence of independent variables. Real gross domestic product GDPt/(90) GDP it/t-1 it/90 Wt(90) it/t-1 it/90 1990 330.9 100 100 1595 100 1991 376.0 113.6 113.6 1953 1992 409.5 108.9 123.7 1993 435.9 106.4 1994 459.4 1995 GDP lei '90 wages wages Unemployment rate Nominal wages 100 0.456 1595 122.4 122.4 0.963 2252 115.3 141.2 131.7 2464 109.4 105.4 138.8 2640 474.3 103.2 143.3 1996 487.3 102.8 1997 507.0 1998 Imports GDP theory 120404 114718 416.63 1706 122294 113770 426.45 2.245 1788 127391 112176 450.06 154.5 3.932 1836 131835 110499 471.50 107.1 165.5 4.141 1862 133738 113718 468.90 2776 105.2 174.0 3.727 1887 134168 115159 466.18 147.3 2892 104.2 181.3 4.083 1910 137589 119365 466.23 104.0 153.2 2975 102.9 186.5 4.536 1919 154197 133837 484.29 531.0 104.7 160.5 3066 103.1 192.3 3.359 1932 160413 141353 484.77 1999 547.4 103.1 165.4 3124 101.9 195.9 2.376 1938 169409 147090 500.84 2000 573.4 104.8 173.3 3164 101.3 198.4 1.728 1963 196168 171621 526.31 2001 580.0 101.2 175.3 3210 101.4 201.2 1.59 2011 197666 176407 517.52 2002 578.0 99.7 174.7 3215 100.1 201.5 2.349 2047 192641 164177 535.56 2003 569.6 98.6 172.1 3187 99.1 199.8 3.375 2076 192802 164040 536.56 2004 571.0 100.2 172.5 3120 97.9 195.6 3.531 2095 209119 178021 555.02 2005 569.0 99.6 171.9 3019 96.8 189.3 3.426 2115 226250 196074 564.29 2006 571.3 100.4 172.6 2897 96.0 181.6 3.019 2140 255272 217864 606.33 2007 563.6 98.7 170.3 2773 95.7 173.8 2.494 2175 286191 239067 657.13 Years Exports Table 2. Data destre GDP, exports, imports, unemployment, wage The table above we built chart 2 and 3, to determine the correlation between gross domestic product based on imports and exports. 10 Corre lation be twe e n GDP and imports in Switze rland be twe e n 1900-2007 600 550 500 450 400 350 300 100000 120000 140000 160000 180000 200000 sw edis francs 220000 240000 260000 Correlation between GDP and exports in Switzerland during 1900 2007 600 550 swiss francs 500 450 400 350 300 250 200 100000 150000 200000 sw iss francs 250000 300000 Note in the graph as a cloud of points made in the values of imports and exports are not parallel to the axis Ox, which shows the existence of a strong correlation between gross domestic product of Switzerland and the values of exports and imports. After identifying the correlation, build regression table in Microsoft Excel. Regression Statistics Multiple R 0.7967369 R Square 0.6347896 Adjusted R Square 0.5860949 Standard Error 49.987273 Observations 18 ANOVA df Regression SS MS F Significance F 13.036108 0.000523689 2 65147.36265 32574 Residual 15 37480.91234 2498.7 Total 17 102628.275 11 Coefficients Intercept Standard Error t Stat P-value Lower 95% Upper 95% 432.95376 315.02657 55.32722238 5.6939 4.256E-05 197.0993905 X Variable 1 0.003696 0.002696486 1.3707 0.1906409 -0.00205143 0.0094434 X Variable 2 -0.0029935 0.003303982 -0.906 0.3792406 -0.0100358 0.0040487 Table 3. Tables regression of gross domestic product based on exports and imports. Linear model identified is y =315.026+0.0036x1-0.00299x2. Determinatie high coefficient of 0.63, shows that linear model explaining the variation in gross domestic product rate of 63%. Linear correlation coefficient between GDP and the exports and imports denominated in Swiss francs, 0,79, shows a strong intensity between the three indicators. The three coefficients of the model are significantly different from 0 (Pvalue), Fisher test showed that regression is significant starting at a threshold of significance of 0,052. Standard Error - the standard error of the coefficient (standard deviation of distribution coefficient). State t - t statistics for checking hypothesis H0: αi = 0 against the alternative hypothesis H1: αi ≠ 0. In the null hypothesis is shown that the ratio of coefficient and error standard rate is a division of Student (n - p) degrees of freedom. This report is the amount reported as t Stat. Results 5.6939=315.02657/55.32722238; 1.3707=0.003696/0.002696486; -0.906=-0.0029935/0.003303982. Using statistics is the usual. Lower 95% Upper 95% - lower and upper limits of the confidence interval for parameter respectively. Limits are calculated automatically, regardless of initialization procedure regression. With the linear model, we identified the gross domestic product calculated teotetic in Table 2. REFERENCES: [1] http://www.bfs.admin.ch [2] http://www.imf.org [3] http://www.cia.gov 12 BUSINESS GAMES. CASE STUDY: GMC ROMANIA Cristina ANTONOAIE, “Transilvania” University of Braşov Abstract : A case study has been applied to the Small and Medium-Sized businesses which have implemented the Global Management Challenge and the inputs and outputs have been recorded. Key words: business games, simulation, Global Management Challenge 1. INTRODUCTION Because the business game is considered to be a complex and modern training method, to quantify the attitudes, opinions and behaviour of the people involved and the results of their participation in the Global Management Challenge, which from now on will be called GMC, I have created a form, which I have applied to 100 companies out of the 450 participating businesses in the four editions of the competitions. 2. INFORMATION The main aim of the research was to establish the degree to which the respondents agree or disagree to certain current matters of the business in which they work. Also, a quantification of the obtained results at a personal level, aiming at the new skills gained through the business games. To create a quantification of the economic efficiency, I have created four basic markers for each item and four derived markers. The aim was to obtain the desired effects with minimum effort, more accurately with minimum resources, for the first three markers of each category and to obtain the bests results compared to the number of entries in the game (it was considered that a higher number of participations would be beneficial). Thus I have taken into account the following inputs: 13 Time spent for reading the competition manual Time spent for reading other necessary decision-making materials Time spent for the actual decision making • The number of stages played during the years Moreover, as obtained results and effects I have considered the following elements, representing the skills gained after participating in the business games: • I am better organised • I have gained more knowledge • I’m a better team player • I better understand my current tasks • I better understand the functions of management • I make decisions faster • I plan my current activities more efficiently • I better understand the organisational processes • My role in the organisations is better defined • • • Every statement has been accompanied by the following scale: Totally disagree Disagree Neither agree, nor disagree Agree Totally agree For the time scheduled for reading the manual, the time required to read other materials and the time for decision making I have devised the following intervals: Under 0,5 h 0,5 h - 1 h 1 h – 1,5 h 1,5 h – 2 h Over 2 h As far as the number of stages played, the quantification has been made in the following manner: Under 5 5 - 10 10 – 15 15 – 20 Over 20 We mention the fact that each stage is composed of 5 sub-stages, and the total number of stages in a year is 15, the competition taking place in Romania for 4 years. Furthermore I have given scores for each possible combination between degree of agreement/disagreement and resource, the least favourable score being 0,000 points and the best result 1,000 points. 14 For each item the following results were obtained: Medium score per item = ∑ points number of responding businesses (100) The 4 derived markers have been obtained after the following formula: Medium score per marker = ∑ Medium score per item number of items To the final obtained scores, a scaled scorecard for the results has been added, with the formula: Very poor results (maximum inefficiency): [ -2, -1 ] Poor results (inefficiency): ( -1, 0 ) Neutral results (neutral results): 0 Good results (efficiency): ( 0, +1 ) Very good results (maximum efficiency): [ +1, +2 ] The results for the 4 basic markers grouped for each item: Marker 1: item_response time_for_reading_the_manual Marker 2: item_response time to read other materials Marker 3: item_response time for making decisions Marker 4: item_response numer of played stages The medium score for the first marker is 0.638 so the activity is efficient. The medium score for the second marker is 0.656 so the activity is efficient. The medium score for the third marker is 0.664 so the activity is efficient. The medium score for the fourth marker is 0.624 so the activity is efficient. 15 REFERENCE 1. Antonoaie, C., Eficienţa economică a perfecţionării managementului folosind jocurile de întreprindere, referat doctorat, Universitatea “Babeş-Bolyai” ClujNapoca, 2008 2. Bonini, Ch.P., Hausman, W., Bierman, H., Quantitative Analysis for Management, Irwin Mc Graw Hill, 9th Edition, 1997 3. Cristache, S., Şerban, D., Evaluarea opiniei manageriale privind eficienţa firmelor comerciale pe baza unei anchete prin sondaj, Revista ASE „Economia”nr. 3 (43), Bucureşti, 2007 4. Farrell, M.J., The Measurment of Productive Efficiency, Journal of Royal Statistical Society, A120, 1957, pag. 253-290 5. www.gmc.com 16 SELLING POINT MARKETING Drd. Simona BĂLĂŞESCU Coord. Prof. Dr. Costantin LEFTER Transilvania University Braşov, Faculty of Economics Sciences Abstract: In our days it’s getting harder and harder to sell goods instead of products, so the concern about the application of the distribution and selling strategies should be higher, also the strategies of choosing those indispensable characteristics of the selling places, in order to adapt the sellers offer to the buyers expectations, which are always changing. There are a few elements like color, music, and space which count a lot from the costumer’s perspective, in the process of choosing the store. These elements composing the atmosphere become much more complex than a simple problem of aesthetics. Key words: position, the customer’ behavior, music, agglomeration, colors. 1. INTRODUCTION The costumer’s attitude has been studied for many years, and the results are always amazing. People have different reasons in choosing one good, or one store, and these reasons depend on some factors which influence the buyer. Trade developed in the last years and all the firms are competing in order to find a market, customers and a capable selling formula so that it can assure the economic development. So, about this problem, which means also a good knowing of the customer and of his behavior, the following theme which treats this subject is untitled “SELLING POINT MARKETING” and it will be structured on the next aspects: the position of the store, the firm’s identity, the customers’ relation with the selling point. 2. THE POSITION OF THE STORE The position of the store has its origin in the specific perception of the customers about the products and the services that it offers. Instead of pointing out the differences between the products taking into account their characteristics or the differences about the image pointed out by the publicity, the position tries to create “in the customer’s spirit”, which is a position strong enough in order to outrun the competitors. 17 So, the position emphasizes the motivation of being of the products. It is about a new strategic philosophy. The choosing of a position means the imagination of the way in which the offer will be presented on the market apart from the competitors and the evolution of a suitable marketing. Today, the position is imposing to the merchants, because it is about the finding of a position of a firm, which regroups more stores, or the position of a simple selling point in a geo-commercial given place. 3. THE STRATEGIC VALUE OF THE APPLICATED POSITION IN DISTRIBUTION It is obvious that a store can’t address to all the customers of its market area. The merchant is interested in finding an attractive under-market, compatible with his objectives and resources. For this, he will identify the criteria of being chosen by the customers and he will evaluate the combinations of reasons of a possible selling. A position’s strategy consists in creating one place, which is liked by the customers, and it is against the competitors. None of the stores can resist endless with the system: all sorts of products for everybody. It is required in this way the choosing of a position related to the internal and external bounds and objectives. In the opinion of J. N. Kapferer [1], the choosing of the place depends on a number of criteria, such as: compatibility (do the objective and subjective characteristics of the store authorize this position?); objectives (do the market parts, which could be interested in the position, represent a source of enough profit?); exhaustivity (does the position analyze as well as possible the physical and symbolical benefits of the firm?); specificity (is the position typical in relation with the competitors?); possibilities (do we dispose of financial and human possibilities in order to proceed with the position?); resistance (is the position lasting in time?); reorientation (does the position allow a post modification, if the first direction is proved to be unsatisfactory?). The position in distribution can concentrate, in the following years, upon four major directions: a) The anticipation of the products value – the customers insist much more on the quality than on the price; b) The anticipation of the low prices – there is a problem which is generalizing at the level of commonplace products where the personal implication is low; c) The anticipation of gaining time – there is the tendency of refusing the waste of time for the roads travel. The attention is concerned upon the transactions efficiency. d) The anticipation of the contract – it is about the intercourse performances of the store. It is getting more and more an integrant part of the offered services. 4. THE IDENTITY OF THE FIRM The concept of the store’s image should be seen not only at the level of the sale place but, in the same time, at the level of the firm. The firm’s image is the result of the positioning strategy, while the sale place can be seen as a punctual appreciation of the consumer. Some works allowed the stand out of the differences between the firm’s image and the selling place’s image. 18 The firm is the commercial name of the store. It can identify with a mark of a product. There are three types of firms: the ones that describe the assortments proposed by the store; the ones that show the location of the store and the ones that are fanciful (most of them). The firm’s identity is the representation, in the customer spirit, of its image. J. N. Kapferer suggests the study of this identity in this way: the physic (the way of “knowing how to do it” of the store); the personality (it corresponds to the firm’s character); the relations (the nature of the transactions between the client and distributor); the culture (the ensemble of symbols, myths, believes, attached to a firm); the reflection (the image of a customer that he thinks about himself by visiting more a firm); the thinking (the comparison between a client and himself by buying from certain store to the prejudice of others). The commercial strategy of one distributor is pointed on the firm’s selling places which can be assimilated to the mark of one product that is widely used. But, in the same time, the firm is attached to one form of sale: a big store, a hyper store, a boutique etc. This dichotomy firm/form of sale has a considerable importance concerning the position strategy of the distributor. In fact, the distributor has to establish, first, to which form of sale he will associate the firm, plus the position of the firm comparable with the rival firms that are practicing the same form of sale. If the distributor creates a new form of sale, his firm will dispose by a sensitive rival advantage. The model of competition between the firms developed by Hirschman identifies two forms of competition between firms: - competition inter- type, it is developing between different forms of sale; - competition intra- type, it is developing between the same forms of sale by detail; 5. THE CONSUMERS’ RELATION WITH THE SELLING PLACE First of all, the store is a place where you go shopping and the consumer is doing a lot of mental activities of processing the information. As we will see, the behavior in the store is considered to be as a field specific to the human behaviors and it is the subject of many analyses. In the last decade, the attention was concentrated upon the commercial, controllable factors by the merchants, that establish the performing of studies of the buyers’ behavior concerning the price, the clearing off the products, promotions, services, etc. Today, the store is seen not only as a commercial area but also as a physical and social one, where fluctuations like the lightness and the atmosphere have an important role in the customer behavior. Other examples may be the visual dimensions (color, dimension, arrangement of the selling area), auditory dimensions (music volume), etc., and the ways which influence the behavior inside the store. a) The study of the store’s atmosphere and the mechanisms of influence The relationships between the environment and the behavior were studied by psychologists, but these are taking into consideration very rarely, a store or a buying area. Actually, after a few years, because of a Ph. Kotler’s article, the concept of “atmosphere” began to impose into the marketing literature and some people thought 19 that the atmosphere of the selling place can be much more important than the product in its process of buying. The commercial studies, sometimes, limited this concept to a simple characteristic of the commercial proposal of the merchant describing “the perceived quality” of the environment by the buyer [2]. In this way it can be determined if the store’s atmosphere is good, nice, agreeable, or on the contrary, disagreeable. The concept seems reduced to a unique dimension that can be taken into consideration in the investigations related to the store’s image together with other internal fluctuations: the width of the circulation passages, the intensity of lighting or the cleaning of the store. But, the concept of atmosphere is an “whole” with multiple sides – music, lighting, sets, temperature, smell – and each of these elements can affect the buying behavior not only when it is about the decision of visiting or not the store, but also the behavior from inside the store. • Ph. Kotler estimates that the atmosphere challenges effects in three directions: - At the beginning it is “a creator of attention” through the sensorial stimulations that they produce with the help of the color, the noise, the occupied space and allow in this way a perceptible difference between the store and its competitors. - It is a “ creator of messages” that speaks about one characteristic of the store - It is “a creator of feelings” through colors, sound, shapes, it challenges reactions to the buyer, reactions that can help the growing of the buying probability. In this way, the atmosphere has the role of a situational factor capable of changing the intentions of buying into an effective buying behavior. • Mehrabian and Russel [3] present a more elaborated model addressed to the explication of the environment’s effects upon the customer. 1. The answer to the environment’s stimulus Mehrabian and Russel consider that all answers related to an environment can be treated according to the behavior of satisfaction or dissatisfaction Four behaviors are possible: - the desire of remaining physically in that area (satisfaction) or to leave that place (dissatisfaction); - the will of exploring the area (satisfaction) or a tendency of remaining inert (dissatisfaction); - the wish of communicating with the others (satisfaction) opposite to one tendency of avoiding the others or to ignore the tentative of communication to the others (dissatisfaction); - research (satisfaction) or a wish of avoiding (dissatisfaction) the participation to the activities present in the area; 2. The emotional dispositions Mehrabian and Russel established that there are three major emotional dispositions that act as intermediary for the behaviors of satisfaction or frustration. These emotional answers are: pleasure – displeasure; stimulation – non-stimulation; dominating – obedience. A stimulative music will be very well received into an 20 agreeable space (a confectionary) while a relaxed music is preferable into a dentist’s consulting room. Greenland and McGoldrick [4] created a model of the indirect effects of the atmosphere that covers the entire ensemble of the relations environment – behavior. This model presents the advantage of a wide applicability in the following years for all kinds of stores. b) The analysis of the effects of the environment music The background music is, a priori, considered to be an element of entertaining and as a factor of motivation at work or as one of liveliness in stores [5]. Music is given the strength to make the workers happier when it comes to their work and the customers more pleased about their shopping. However, the researches concerning the music’s effects are limited and the results are contradictory. So we are not amazed by noticing that the administrator’s decision of spreading or not the music in his store is based on intuition and on being fashionable, and it is not based on a scientific fact. Most of the analysis is concerning about the appreciation of the music effects upon the individual’s attitude or upon his ideas, than upon his behavior. A research upon 52 directors of American distribution firms showed that 76% of them think that the environment music stimulates, in the customers side supplementary shopping, and 82% of them consider that music has a positive effect upon the customer’s spirit. Another research [6] made on two hundred people showed that 77% of them consider the presence of environmental music as nice. However, these two studies didn’t answer to an essential question: does the music affect the customer’s behavior? Studies upon how music influence consumer’s behavior referred to the music’s tempo and the familiarity of the music style. The music’s tempo was studied as follows: The first study was made in two superstores and it pointed out the strength of music. The broadcasting of the music varies from “very loud” to “pleasant” on eight levels, tested after a certain plan. The authors observed that the customers are spending a little time in the store in which the music is loud or very loud; but there are no differences concerning the registered business or the level of customer’s satisfaction. The second research [7] tested three possibilities of environment upon the store: no music, music with a slow tempo and music with a fast tempo. The behaviors that were taken into consideration for the appreciation of the effects were the speed of the flood’s circulation into the store, the medium value of the customer’s shopping. The results were meaningful to all levels: the speed of circulation of the customers into the store is going down if the tempo is slow; a higher volume of sales is associated to a slower tempo. In conclusion, it seems possible to influence clients’ behavior by the means of the music. c) The agglomeration influence upon the buying behavior The two components of the agglomeration: on one hand is the physical density of the people that are in the same place, and on the other hand, a particular disposition of perception coming from the individual. 21 If we look to Harrel and Hutt’s work [9], there are three elements that interfere for creating the situation of agglomeration: the physical density of the place, the perception of this density and the personal factors. Thanks to these elements, in a certain situation, certain individuals feel O.K. and some don’t. It is obvious that the impression of agglomeration is a relative concept in a strong relation with the cultural environment (the European one versus the Oriental one). Mill Gram, in 1970, established that there are adapting strategies used by the buyer under the pressure of the agglomeration: at the beginning he takes refugee in an automatic buying behavior - he chooses ordinary products and marks that he knows; the hurry of finishing as fast as possible is breaking the usual circuit of buying; the buyer reduces considerably the volume of necessary information, telling himself that he will take care of this aspect some other time; the agglomeration determines the buyer to loose his self-confidence. On the other hand, the agglomeration can offer a “personality” to one store, nice or hateful, agreeable or disagreeable, kind or violent, besides others commercial elements of the store (assortment, quality, snugness etc.) all of them are helping to the creation of “the store’s image”. The clients see the agglomeration in a fast food as a guarantee that the store is attractive. REFERENCES 1. Kapferer, J. N., How to chose a position? Le Guide de Marketing-mix, 1988, p.44-45. 2. Kotler, Ph., The atmosphere as an instrument of marketing, Journal of Retailing, vol.49, nr.4, winter1973-1974 p.40-64. 3. Mehrabian, A., Russel, J. A., An analisys to the environment psychology, Cambridge, Mass: MIT Press, 1974. 4. Greenland, S. J., McGoldrick, P. J., Atmosphere, attitude and behavior: the modelling of impact of the planned space, The International Review of Retail, Distribution and Consumer Research, vol.4, nr.1, jan.1994, p.1-16. 5. Serraf, G., The psychological effects of the sound in the working area and in the sale places, Revue francais de Marketing, nr.9, 1964, p.31-42. 6. Linsen, R., Do you, Mr. Customer, like the music from our days?, Progressive Grocer, vol.56, nr.10, 1977. 7. Milliman, R.E., The use of underground music in influencing the customer’s behavior in supermarket, Journal of Marketing, vol.46, summer 1982, p.86-91. 8. Yalch R.F., Spangenberg, E., A psychological study of underground music as a factor of atmosphere, AMA Educator’s Conference Proceedings, Alf W. Walle, Chicago: American Marketing Association, nr.54, 1988, p.106-110. 10. Bellizzi J.A., Crowley A.E., Hasty, R.W., The colours’ effects in the designing of the store, Journal of Retailing, vol.59, nr.1, spring 1983, p.21-45. 22 THE INEQUALITY OF INCOMES DISTRIBUTION IN BELGIUM DURING 1996 – 2006 Axenia Bianca BOITOR Student at the Master of Scientific Research Coord. Prof. Dr. Liliana DUGULEANĂ Transilvania University from Braşov, Faculty of Economic Sciences Abstract: In different industrial nations the difference between incomes has grown up. Factors like: growth of the inequality of wages, demographic changes, changes of the dimension of the households and their members determined this change. Also, the role of the national institutes and politics, the politics with the focus on the free market, the globalization process and its effects made the inequality between incomes to grow, etc. Key words: incomes, Gini coefficient, distribution of incomes, correlation. 1. THE INEQUALITY BELGIUM OF DISTRIBUTION FOR INCOMES IN The inequality between incomes is measured by the Gini coefficient calculated based on the Lorenz curve. The differences between the incomes are determined by the proportion of the incomes made by the equal segments of a collectivity. The method of determination is the fragmentation of the population, taken in to acount, in quintiles or deciles of income. Then, the population is segmental based on the incomes of every quintile or decile. In Belgium, in the 1996 – 2006 period, the Gini coefficient recorded the values from the table number 1. The evolution of these values is presented also in the first chart. The biggest value of the Gini coefficient was recorded in 1996, when the inequality of incomes was at the highest point. The lowest value of the Gini coefficient was recorded in 2004. In table no. 2 is presented the method of calculation of the Gini coefficient for the year 2004, and in the next table for the year 2005. For the other years the computation method is the same. 23 Table 1. The values of the Gini coefficient for Belgium (1995 – 2006) Year 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Gini Coefficient 29.8 29.9 28.0 27.3 29.3 29.6 29.3 28.6 28.0 26.0 28.0 28.0 In the first part of the period ( years 1995 – 1997), the Gini coefficient recorded the biggest values of the analysis period, reporting a growth of the difference between the incomes of the social classes which forms the population of Belgium. Though, in the year 1996, the value of this coefficient started to come down, fact which reported a drop of the inequality of the incomes, from the year of 1999, these differeces between population’s incomes started to grow again. So, the lowest value of the Gini coefficient was recorded in 2004, a value of 26%, in the next years, this value started to grow again, achieving a value of 28% in the last two years of the analysisperiod. Figure 1. Gini index values in Belgium during 1995 – 2006 31.0 30.0 29.0 28.0 27.0 26.0 25.0 24.0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 V Values a 24 of the Gini index 2. THE DISTRIBUTION OF THE INCOMES BETWEEN SOCIAL CLASSES IN BELGIUM The data source for this analysis of the incomes distribution, for social categories, in Belgium is the EU_SILC 2005 report. Based on the data from the report, the segmentation of all households in Belgium, which formed the analysis sample, includes: emplyers, emplyees, unemployed persons, pensioners and inactive persons. The data is registered in ascending mode of the annul income/household, deflated by the IPC, with chained base in january 2004. First and second tables contain data refering to the total annual medium incomes per household, for each social category, sort in a descending mode and to the annul medium income for all the households. Using this information the Gini coefficient can be determined. Table 2. Calculation of the Gini coefficient for year 2004 18101,99 7183,093 40141,17 51060,07 55434,19 49266,36 195901,8 18101,99 40141,17 0,00 10918,90 15293,02 9125,19 75478,28 51060,07 10918,89 0 2808,97 55434,19 8976,8 49266,36 15293,02 4374,12 9125,19 1793,7 Employees Unemployed pers. 7183,09 Pensioners Inactives 2808,97 8976,8 Sums Social category Euros/lmonth/household 58243,16 0 Emplyeers 58243,16 4374,123 1793,707 68146,8 0 6167,83 81269,17 6167,83 0 66353,09 487149,1 Mean Ginny coeffcient 37016,55 0,26 Table 3. Calculation of the Gini coefficient for year 2005 Social category Euros/lmonth/household 69224,36 Emplyeers 0 69224,35 Employees 20028,24 49196,11 Unemployed pers. 7847,51 61376,847 Pensioners 7156 62068,357 Inactives 9553,66 59670,697 Mean Ginny coeffcient 39431,33 0,28 25 20028,24 49196,11 0 7847,51 61376,84 12180,73 7156 9553,66 Sums 62068,36 59670,7 232312 12872,24 10474,58 84723,67 12180,73 12872,24 10474,58 0 691,51 1706,15 691,51 1706,15 75955,24 0 2397,66 78029,77 2397,66 0 74249,09 545269,8 The method an formula used for the calculation of the Gini coefficient is: n n ∑∑ x G= i − xj i =1 j =1 2n 2 ⋅ x where - i and j represents any two different social categories; - n=5 represents the number of the social categories; - xi – the annul medium income of a household in category i; - x , represents the annual medium income of one household. In the next calculations it’s recorded an increase not so significant of this indicator, from a relative value of 0.26 in 2004 to a relative value of 0.28 in 2005. These values of the Gini coefficient are showing the fact that, in Belgium, exists significant differences between the incomes of the different social categories of the population. In correlation with the Gross Domestic product/habitant, the Gini coefficient and the differences between incomes are stated in the next chart. The correlation between the two indicators, the Gross Domestic Product/habitant and the Gini coefficient, is a relation of medium intensity, relation based on the value of the correlation coefficient of 0.51. Values of the Gini index ( % ) Figure 2. The correlation between the real GDP/capita and the Gini index in Belgium ( 1995 – 2006 ) 31,0 30,0 29,0 28,0 27,0 26,0 25,0 20000 22000 24000 26000 28000 30000 Real GDP/capita ( 2006 mil. of euros ) 26 32000 3. COMPARATION BETWEEN EVOLUTIONS OF THE COEFFICIENT FOR EUROPEAN INDUSTRIAL COUNTRIES GINI Figure 3. Evolution of the Gini index in the eastern - european countries ( 1995 – 20007 ) 45,0 40,0 Gini index (%) 35,0 30,0 25,0 20,0 15,0 10,0 5,0 0,0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Years Austria Danmark France Germany Luxemburg Nederland UK Belgium In the next chart, we have the evolution of the Gini coefficient in countries like: Luxemburg, Nederland, Denmark, Belgium, Germany, UK, France and Italy. It can be observed the fact that the values of the Ginny coefficient in all of these countries is recorded between the upper limit of 38,1% (Denmark in 1995) and the lower limit of 20% ( Denmark – 1999 and 2000). The country with the biggest inequality between the incomes of the population is UK. The country with the lowest recorded values of the Gini coefficient is Denmark, country which had the highest drop of the inequality between the incomes of the population. The country that recorded the most constant values of the analysis coefficient in this period is France ( with upper and lower limit like 30,2% and 27% of the Gini coefficient). Comparing with the other countries from the analysis group, Belgium recorded a smoother evolution of the Gini coefficient, the difference between the incomes of the social categories being more constant then the values of the other countries like: UK, Nederland or Luxemburg. 27 These values, between the upper and lower limits mentioned before, indicate the fact that in the analysis countries, exists differences between the incomes of the social classes of the populations, but these differences are lower then other countries from all the world. REFERENCES: 1. Duguleana L., Coures of statistics in business , University Transilvania, Braşov, 2008 2.http://www.wider.unu.edu/research/Database/en_GB/wiid/_files/797898346731 92984/default/WIID2C.xls 3. www.imf.gov 28 MASS MEDIA MARKET IN BRAŞOV Drd. Brătucu Tamara-Oana Coord. prof. dr. Duguleană Liliana Transilvania University of Braşov, Faculty of Sciences Economic Abstract: The present article is based on a “Public Opinion” survey and tries to quantize the opinions and atitudes of Brasov inhabitants (at least 18 years old) in a comparative analysis regarding aspects divided into three sections: “Public Administration”, “Mass media market” and “Politic/election market”. The data form the “Mass media market” section reflects the evolution of Brasov’s media market all throughout 2008. Key words: panel, opinion survey, mass media, comparative analysis, special enquary. 1. INTRODUCTION Within enquaries through survey that use a sample base, we can distinguish a series of special enquaries. One of these is the enquary based on a panel. Enquaring an panel distinguishes itself from other kinds of enquaries because the same social units (individuals, families, designated groups) are observed (measured) with the help of the same methods (techniques and instruments) in at least two separate moments. The marketing dictionary defines the panel as being „a representative sample of observing statistical units, unusally stable and listed, from a large scale area, made of consumers (individuals), users (families, households), industrial customers, en-detail customers and comercials entities or other economic agents that periodically provide information meant to ensure the ongoing characteristics of the evoulution of behaviour and opinions of those who answered or other market phenomenons ” The sample used within the panel type of enquary is usually constant, kept unchanged as number of units, research centres and even observing units (individuals, families etc) for a long time, with the expection of times when fortuitous changes within the sample occur, changes that impose integrating new members with equivalents characteristics into the sample. Also a partial intervention needs to take place when the „conditioning” phenomenon occurs, that is when members of the panel become unrepresentative, deviating the results of the research. The sample is designed through the usual sampling methods, to be representative for the general consumers of the observed area. 2. INFORMATION 29 The mass media market in Brasov is very competitive. Along with the wrtitten media, national radio stations and TV stations, there is also local mass media. The media companies in Brasov are interested to get their hands on data concerning the consumption of media and for this they turn to market research. One of the agenties that develop media surveys is Multi Consulting Group. MCG designs trimestrial surveys with the evolution of national and local mass media and the obtained data is capitalized by the media companies in Brasov. The „Public Opinion” survey type of enquary wants to quantify once every three months the opinions and atitudes of Brasov inhabitants (at least 18 years old) in a comparative analysis regarding aspects divided into three sections: “Public Administration”, “Mass media market” and “Politic/election market”. The gather of information from the field was performed between March and September 2008. The main objectives that lied at the base of the analysis for the “Mass media market” section were: Determining the market share of local newspapers, radio stations and TV stations Measuring the concern intensity of adult Brasov inhabitants towards the local TV shows Quantifying the popularity of journalists, TV show hosts and news anchors from Brasov among its inhabitans Identifying the level of trust in the profesionalims of journalists, TV show hosts and news anchors of local radio and TV stations Quantifying the popularity of TV shows on local stations. During the three stages of the enquary for the „Mass media market” section, a questionaire of 45 questions was used to interview a panel of 1100 inhabitants from Brasov, the sample being representative for the population of the city in respect with the structure on age and sex. The sample remained unchanged during the whole time the enquary lasted. The panel was chosen as a research base because it best emphesize a representative and statisticaly semnificative sample for the population accounted for that is the adults in Brasov. The sample was validated upon the latest data obtained from the National Institute for Statistics, Brasov branch. This validation offers the posibility of knowing the evolution in time of consumers behaviour towards the local mass media market and assures with greater precision the measurment of marketing phenomena compared to enquaries that use as a survey base many distinct samples. The parameters of the market research: Research population: official residential population in the city of Brasov, 18 years old and over The size of the sample: 1100 individuals (interview subjects) Maximum admited error: ±2,9% The sampling method: random, probability based and several stages sampling Used personel: 30 interview operators, 6 specialists in verifying the correctness of filling in the questionaries, introducing the data on computers, analyzing and interpreting data. The method of gathering data: face to face interview 30 Semnification level of the research: 95% Conclusions of the research: Data reflects the evolution of the mass media market in Brasov between March and September 2008. If 35.8% of 1100 individuals interviewed were reading the local newspapers in March 2008, this number went down 4.4 procentual points in June 2008 and another 0.9 procentual points in September 2008. Figure 1: The evolution of local press readers in Brasov from March to September 2008 35,2% 30,8% 29,9% March June September In March last year, 62.3% were reading most often Transilvania Expres, 17.2% were reading Monitorul Expres and 11.4% prefered Gateza de Transilvania. Only 9.1% were reading Buna Ziua Brasov. In September the most read local daily newspaper was Transilvania Expres, being mentioned by 183 interview subjects (53.7%). Monitorul Expres counted 17.3% and Gazeta de Transilvania 16.1% 31 Figure 2: The market shares of local daily publications in Brasov from March to September 2008 70% 60% 50% 40% March June 30% September 20% 10% 0% Buna ziua Brasov Gazeta de Transilvania Monitorul Expres Transilvania Expres At the last survey, the one in September, the most trusted journalist in Brasov was Alexandru Ganea with 3.30 points from a scale of 1 to 5. Alexandru Ghiza got a medium score of 3.21 points, the interview subjects trusting the prefesionalism of this journalist. Marius Stoianovici was awarded 3.16 points, close enough to level 3 al the scale that means not much but neither low trust. In respect to June, Marius Stoianovici has a lower medium score with 0.39 points losing two positions in the top. Cornelius Popa has a lower score with 0.49 points losing seven positions in the top and Adrian Teacă has a lower score of 0.32 points but he gains one position. In September 52.8% were listening to local radio stations. The percentage obtained in this month is lower with one procentual point than the survey in March and with 5.2 procentual points than the one in June. 32 Figure 3: The evolution of local radio stations listeners in Brasov from March to September 2008 53,8% 52,8% 47,6% March June September In March the most trusfull radio show host was Claudia Popa. She still is in the first position at the last survey, but having a lower score with 0.17 points. From March to September Claudiu Ciobanu lost 0.3 points and Nora lost 0.42 points. The comparative analysis between the surveys in June and the one in September shows the following changes: Claudia Popa still holds the first position with 0.12 points less, Nora loses three positions with a lower medium score with 0.42 points, Claudiu Ciobanu holds the same position but has 0.27 points less and Ionut Costin, holding the same position, loses 0.39 points to the calculated medium score. The first survey indicated the fact that Radio Brasov is, in the opinion of the 1100 interview subjects, the most listened to local radio station, being pointed out by 202 answers, respectevely 34.5%. Radio 21 is listened by 13.3% of interviewed subjects and Super FM by 11.1%. Radio Brasov holds its leader position to all three surveys, although it lost 3 procentual points from March to June but it gained 5.7 procentual points from June to September. Radio 21 lost the second position that it held in previous surveys, decreasing with 0.7 procentual points from March and another 2.4 procentual points from June. Super FM gained the second position in the top, after winning 6.7 procentual points compared to March and another 6.5 procentual points compared to June. PRO FM gained 0.5 procentual points in respect to March, but lost 2.2 procentual points in respect to June. 33 Figure 4: The market shares of local radio stations in Brasov from March to september 2008 40,0% 35,0% 30,0% 25,0% March 20,0% June 15,0% September 10,0% Super FM Romantic FM Radio 21 Radio Brasov PRO FM Nova FM National FM Magic FM KISS FM Doctor FM DJ Radio Antena Brasovului 0,0% Impuls 5,0% The number of those who watch local television stations is 56% of interviewed subjects in September 2008. The percentage shrinked with 9.5 procentual points compared to March and 6.2 procentual points compared to June. Figure 5: The evolution of local TV stations' audience in Brasov from March to September 2008 65,5% 62,2% 56,0% March June 34 September The local television station most wathed by interview subjects was in March 2008, RTT, which was pointed out by 143 subjects, respectively 19.9%. In June the most watched local television station was PRO TV brasov with 20.8% of answers, but in September the most watched local TV station was RTT again, with 19.7%, respectively 116 answers. Figure 6: The market shares of local TV stations in Brasov from March to September 2008 25% 20% 15% 10% March June 5% TVS RTT Realitatea TV Panoramic TV Nova TV MIX 2 TV MIX TV PRO TV Brasov Antena 1 Brasov 0% September In March the subjects used to frequently watch the Mix TV Brasov News (169 nominations, 23.6%), the RTT Brasov News (132 nominations, 18.4%) and TVS Brasov News (128 nominations, 17.9%). In June the PRO TV Brasov News rose in the preferences of interviewed subjects with 11.3 procentual points , the number of those who frequently watch the RTT Brasov News shrinked with 1.3 procentual points and those who watch the TVS Brasov News decreased with 2.4 procentual points. In September the PRO TV Brasov News was the show most watched by the subjects, being mentioned by 123 individuals, representing 20.6% of the total sample. The RTT Brasov News was the show prefered by 19.2% of subjects. The TVS Brasov News was frequently watched by 17.1% of those interviewed. 35 Figure 7. The market shares of national TV stations in Brasov from March to September 2008 45% 40% 35% 30% 25% 20% March 15% June 10% September TVR 2 TVR 1 Realitatea TV Prima TV PRO TV OTV National TV B1 TV Acasa TV 0% Antena 1 5% PRO TV hold the first position as the most watched TV station at national level during all of the three surveys, loosing 0.6 procentual points in nominations from March 2008 and 1.4 procentual points from the survey in June 2008. Antena 1 holds the second position, having 4.5 procentual points less nominations from March and 4.6 procentual points less nominations from June. TVR 1 gained one procentual point in respect to March, but lost 0.7 procentual points in nominations in respect to June. REFERENCES 1. CĂTOIU, I. (coord.) – „Cercetări de marketing”, Editura Uranus, Bucureşti, 2002 2. DATCULESCU, P. – „Cercetări de marketing”, Editura Brandbuilders Grup, Bucureşti, 2006 3. FLORESCU, C., MÂLCOMETE, P., POP, N. – „Marketing – Dicţionar explicativ”, Editura Economică, Bucureşti, 2003 4. LEFTER, C. – „Cercetarea de marketing – Teorie şi aplicaţii”, Editura Infomarket, Braşov, 2004 5. xxx – „Barometrul de opinie publică” – Multi Consulting Group, Braşov, 2008 36 SOME ASPECTS REGARDING BRAND EQUITY Ioana Bianca CHITU, Transilvania University of Brasov Abstract: The purpose of this paper is to explore the key strategy for building and managing strong brands. Specialists consider brands as a major enduring asset of a company, outlasting the company’s specific products and facilities. Key words: brand, branding, brand equity 1. INTRODUCTION Everybody knows or things that he knows what is a brand, a name, term, sign, symbol, design or a combination of these, that identifies the maker or seller of a product or service. Consumer view brand as an important part of a product and branding can add value to a product. Branding has become strongly, day by day, thus in our days hardly anything goes unbranded. Buildings and managing brands are perhaps the marketer’s most important tasks. 2. SOME ASPECTS REGARDING BRAND AND BRANDING Branding is a task that requires a significant contribution from marketing communications and is a log time practice. Even today, in a crisis period, organizations do not cut their brand advertising because they know that they can reduce the significance and the power of their brands. Specialists claim that the weaker brands are those that reduce or cut their advertising in times of recession. Brands consist in two main types of characteristics: intrinsic and extrinsic. Intrinsic attributes refer to the functional characteristics of the product such as its shape, performance and physical capacity. Extrinsic attributes refer to those elements that if changed don’t altered the material functioning and performance of the product itself, like, brand name, marketing communications, packaging, price and mechanism witch enable consumers to form associations which give meaning to the brand. There are opinions that suggest that there are two main types of brands, passionate and pseudo. Passionate brands have a strong positioning, are recognisable, have a core ideology and a set of values that engages an entire community of stakeholders (Orange, Vodafone, 37 Nike a.s.o.), in the other hand, pseudo brand lack core values and have experience positioning drift, they might have once such values but these have been lost, forgotten or just abused or copied by competitors. Pseudo brands rely on advertising, redesigned logos, public relations campaign to disguise the lack of brand depth. Specialists refer to brands being composed of a number of elements, like functional abilities (brand skills) that a brand claims and can deliver; the second is the personality of the brand and its fundamental traits concerning lifestyle and perceived values such as being bland, adventurous, exciting or caring. The third branding element is about building a relationship with individual buyers (in terms of levels of intimacy, partner quality, attachment, interdependence and commitment). These three elements combine to form “brand magic”, which underpin added value. In Romania, there are some brands that gain the romanian public trust, the first two most popular brands –Dacia and Arctic- there are brands with a long history, but there are some relatively new brands that succeed and become popular. (figure no 1) Figure 1. The most popular Romanian brands in 2008 Dacia Arctic 31 34 Ursus BCR Altex CEC Dorna Murfatlar 6 3 3 Petrom Eugenia 3 3 3 3 6 5 Altele In 2008, the most popular and trustful Romanian brands were Dacia, Arctic and Ursus, according to The second edition of Leading Brands by Romanian Internet Users 2009, made by Gemius research company in partnership with Evensys. Dacia is the leader, 31% of answerers, follows by Arctic (6%), Ursus (6%), BCR (5%), Altex, CEC, Dorna, Murfatlar, Petrom si Eugenia, each of them with 3% popularity rate. 2. BRAND EQUITY AND THE STRATEGIC ROLE OF BRANDING In the promotional mix, brand can plays an important role; it can be used as a means of defending market share or group brands, protecting established positions, used to attack competitor brands and provide a means of deterring market entry by others. So, the strategic dimensions of branding consist in namely integration, differentiation, and added-value. Part of the essence of integrated marketing communications is that the tools used to support a brand and the messages that are used to convey brands value 38 must be consistent and uniform. Value is added to brands through three main components: perceived performance (derived from consumer perceptions of relative quality and perceived associations concerning key attributes), psychosocial meaning (refers to the immaterial associations consumers make about brands from which they deduce meanings about personality and expressions of individuality) and the extend of brand name awareness (the level of name awareness can provide feelings of familiarity and reduce risk or uncertainty). There are a lot of cases in which the opportunity to use above–the–line promotional techniques (advertising) is restricted and many firms and business-tobusiness organizations need to reply on a below-the-line communication like branding. Therefore, the brand name is very important as it needs to symbolize meaning about the functionality of the brand and other below-the-line communication, like merchandising, packaging, point-of-purchase elements will be prominent in brand development. Brand represents a strategic element of marketing communications, not only for the products are used by the final consumer but it is used in business-to-business organizations as a means of differentiation and added value. The concept of brand equity has arisen from the increasing recognition that brands represent a value to both organizations and shareholders. Specialists identify two main perspectives of brand equity – financial perspective and marketing perspectives. The financial perspective is based on a consideration of a brand value as a definable asset, based upon the net present values of discounted future cash flows. The marketing perspective is grounded in the beliefs, images and core associations consumers have about particular brands. Other authors used a three part definition to bring these two approaches together, so the brand equity is a composite of: brand value (based on a financial and accounting base), brand strength (measuring the strength of a consumer’s attachment to brand and brand description (represented by the specific attitudes customers have towards a brand). Another significant point of view is that brand equity is considered so important because of the increasing interest in trying to measure the return on promotional investments. A brand has positive brand equity when consumers react more favorably to it then to a generic or unbranded version of the same product, in the same time a brand has negative brand equity if consumers react less favorably than to an unbranded version. There are brands which maintain their power through years like Coca-Cola, Mc Donald’s, Ford, Pepsi a.s.o. and other brands create fresh consumer excitement and loyalty such as Google, YouTube, eBay a.s.o. A manufacturer has some possibilities for brands sponsorship, it can launch a manufacturer’s brand, sell to resellers who use a private brand, market licensed brand or join forces with another company to cobrand a product. In the case that company decision is to developing brand it has four choices: line extension, brand extension, multibrands or new brands. Advertising agency Young&Rubicam (one of the bigger advertising agency of the world and the first agency which offered integrated marketing services to the clients) measures brand strength along four consumer perception dimensions: differentiations (what makes the brand stand out), relevance (how consumer feel it meets their needs), knowledge (how much consumer know about the brand) and esteem (how highly consumers regard and respect the brand). 39 When ranking the value of the Best Global Brands, Interbrand evaluates brand value in the same way any other corporate asset is valued - on the basis of how much it is likely to earn for the company in the future. Interbrand uses a combination of analysts’ projections, company financial documents, and its own qualitative and quantitative analysis to arrive at a net present value of those earnings. The brand values are based on data collected during the 12 months prior to June 30, 2008. This means that more recent developments, including the troubles at Merrill Lynch and AIG, are not factored into the brand valuations. Table no 1 – Top ten most valuable brands 2008 Nr crt 1 2 3 4 5 6 7 8 9 10 Name Brand Value (millions) Coca-Cola 66.667 IBM 59.031 Microsoft 59.007 GE 53.086 Nokia 35.942 Toyota 34.050 Intel 31.261 McDonald’s 31.049 Disney 29.251 Google 25.590 The figure shows that, besides old brands like Coca-Cola, IBM and other, brands with a long history and practices, there are some new brands named “breakaway brands” like Google, for example, which seems to understand not only the need to connect with their customers and instill trust, they also understand that brand is one the most powerful tools available for making those a high brand equity. In the conclusion, the fundamental asset underlying brand equity is customer’s equity, respectively, the value of the customer relationships that the brand creates. Therefore, the organizations must focus on creating customers equity and thinking about themselves not like a portfolios of products but portfolios of customers. REFERENCES 1. Aaker, D, Biel A, Brand Equity & Advertising, New York, 2004 2. Fill, C Marketing Communications-engagement, strategies and practice–Fourth Editions, Prentice Hall, 2006 3. Kotler Ph, Armstrong G, Principles of marketing Thirteen edition, Pearson Prentice Hall, 2009 4. Lasser W, Mittal B, Sharma A, Measuring customers based brand equity, Journal of consumer Marketing, 2000 5. Riezebos, R, Brand Management- A Theoretical and Practical Approach, Harlow, Pearson, 2003 6. http://top10.romportal.ro/2009/02/top-marci-romanesti-pe-internet/ 7. http://images.businessweek.com/ss/08/09/0918_best_brands/3.htm 40 Romanian Automobile Market Drd. CRUCERU Gheorghe Coord. prof. dr. Liliana DUGULEANĂ Transilvania University from Braşov, Faculty of Economic Sciences Abstract: The auto market is defining the economy of many countries. Romania has a dynamic and diversified auto market. The goods that are in this market came either from imports or from local producers. What is specific to this market is that along with new cars there are those that sometimes run over the volume traded on the first. Key words: market share, the enterprise market, market area, car park 1. Introduction: Automobile market is one of the most important markets of the Romanian economy, but also among the most dynamic. In this space the local and outside producers are operating, the competition being very fierce. Range of products, diverse prices and different characteristics of these products which include high technology has never reached the levels attained. The car is a long necessity and the number in circulation increases every year. Market Analysis of these products from several angles provides useful information to producers and importers of automobiles to determine future strategies. Market trends, consumer preferences of individuals or organizations, influent factors of demand are equally important information which manufacturers and importers must take into account to adapt permanently. 2. Definitions, classifications In the specific literature the market is defined in several acceptances. The economic theory defines market as the space that meets supply with demand for goods and services. The market consists of all buyers and sellers in transactions that take place for goods and services. The market is a place where a wide circle of companies 41 are trying to capitalize a more effective outcome of work by taking a position as the best overall market1. The market of a firm or enterprise is that geographical-economical space in which the company markets its products. This economic and geographic space can be local, national, regional or global. Markets can be classified by several criteria. After the organizational arrangements: a) Free markets, which is characterized by free agents acting on the market because of laws that is objective, mechanisms that involve free initiative, free movement of labor and capital, free competition and free price formation. This market is a characteristic of market economies, in democratic states; b) The planned or controlled market, which is characterized by the existence of control mechanisms at the administrative state. Prices are set at the central level as well as quantity and assortment planning; After market size: a) The actual size determined by actual market transactions completed in a period of time; b) The potential maximum which expresses the possibilities of the market at a time; After the concentration of market relations: a) The dense and concentrated when there is an agglomeration of supply and demand on a fixed territorial area; b) dispersed market where supply and demand are spread over a large area but the acts of sale is low; After the number of suppliers on the market: a) Polipol - many applicants. None of the applicants have a particularly large share of the market, which is beneficial for the freedom of competition; b) Oligopol - few suppliers. Oligopolistic positions can influence the price, which cause a restriction of competition; c) Monopoly - only one bidder. It is characterized by the absence of competition and the exclusive control of the price; After transactions subject: a) The assets; b) Market services; Market means of production and market consumer goods are the two major components of the assets, distinguishing between them is not only subject to acts of market but also the shape and extent of acts of sale, the nature of the seller and buyer2. The meaning of the term market is different depending on the aggregation level: 1. 2. Pistol Gheorghe (co ord), Marketing, Economy Independence Publishing, Pitesti, 2001, pg. 66 BALAURE Virgil (coord) Marketing, Uranus Publishing, Bucharest, 2002, pg 94 42 micro-level, including the market-economic geographical area in which the company is present in goods or services; macroeconomic-level, the national market; Product market is defined by its share in consumption. Company can address a multitude of categories of consumers: individuals, distributors, intermediaries, traders, public or private bodies, or international customers. 3. Scale and market dynamics To define market size use concepts such as market capacity, scope and structure.I. The capacity market may be actual or potential. When referring to the actual capacity of the market volume of transactions is carried in a given period of time reflecting the demand, the supply volume of market transactions. Actual capacity depends on the number of buyers for company products, size, the average size and frequency of purchase. Acm = Nb x K x Fc (1.1) Where: Acm - Actual capacity of the market Nb - Number of buyers K - Average of purchases Fc - Frequency of purchase The volume of supply and demand, transactions, the export or import are used as indicators. The capacity of the market potential is expressed by the maximum volume of transactions that a company can achieve in a certain period, esteeming the possibilities of increasing transactions. The indicators used are: the potential acquisition of market potential export, relative number and structure of non-consumers. II. Market area reflects the territorial dimension and may be internal and external. - Internal market- based relations to be geographically concentrated in the rural or urban level there are differences between them from the environment. -External markets refer to those markets located outside the geographical boundaries of a state. Their total forms the international market. When the international markets add to the national market the global market is formed. III. Market share reflects the share of an economic production of goods or services have in the size of the market. Determine a rule for one year but may also refer to periods shorter than one month Msa= Tca/Vt × 100 (1.2) Where: Msa - market share of company A Tca - turnover of the company Vt - volume of transactions on the reference 43 Market share is a relative size of the market. The relative market share can be determined when reporting to the market share of more powerful competitor on the market. IV. Market structure is achieved through the segmentation imposed by the heterogeneity of products and services. It is necessary that organizations present on the market to address in different ways to various categories of consumers, to achieve an efficient, optimal conditions to meet consumer needs.3. In Romania we can talk about the cars at the county level, area development, macro zone development and also the automobile market. Automobile market in Romania has experienced significant increases since 1990 but really important were noted after 2000. Romanian car market consists of two components: a) market of run cars; b) market for new cars; a). Market of run cars or "second hand" refers to that part of the market which trades cars already registered in Romania and on the other hand cars from import and registered for the first time in the country. The first category of cars does not affect the number of cars in circulation, they are changing only the owner, but the cars run from import largely affect the number of cars in circulation. b). New cars market consists of all unused cars from local production, plus those from imports. Sales estimated initially before the financial crisis, were in the absorption of 375,000 cars per year. These estimates were made in a normal economic climate, an economic growth above 5% and a disposal fee for cars older than 12 years in order to encourage fleet renewal. The car rolled Cars rolled are attractive because they run much lower prices and buyers are required to be the main criteria are price and brand. Generally young people are attracted by the prestige brands in particular German conferring a certain image and status. In 2006 there were 116,752 cars registered, in 2007 were registered 123,842 units, in 2008 were 300,981 units according to the Scheme Permits and License Vehicle Registration (DRPCIV) of Ministry of Interior Administration (MIA). In Diagram 3.1 are presented the evolution of the automobile registration versus the car in November 2008. With the suspension of tax registration of run cars imported they broke heavily the Romanian market since July. 3 ANGHEL Laurenţiu-Dan, PETRESCU Eva-Cristina, Business to business marketing, Uranus Publishing, Bucharest, 2001, p 42 44 Chart no. 1 Evolution of passenger cars registered in 2008 800 700 Hundreds units 600 500 400 Rolled 300 New 200 100 0 jan feb mar apr may jun jul aug sep oct nov dec The data source: http://www.drpciv.mai.gov.ro/ Registration of vehicles run saw decreases in 2007 but the following year it rose as a share exceeds the number of motor vehicles in November. 2007 was the year with the fewest registered cars run 28.4%. In 2009 growth continues in the first two months as shown in diagram no. 2.2 Share Chart no.2 Registration of vehicles run and new 2006 2007 57,2% 42,8% 2009 2008 71,6% 51,3% 28,4% 48,7% 53,2% New 46,8% Rolled The data source: http://www.drpciv.mai.gov.ro/ An important factor which facilitated the growth of automobile registration was suspended roll tax registration in July 2008 by the Government of Romania. The new cars Cars are complex products that incorporate the highest technology in areas such as mechanics, metallurgy, electronics, chemistry, thermodynamics, and their characteristics are improved permanently, so that the speed of innovation is increasing. New cars market experienced increases permanent. Threshold exceeded 100,000 units in 2003. In 2005 the volumes were doubled. 2005 is also the year that recorded the biggest increases in sales volume in the reference period, it being 48.5% higher compared to the previous period. This remarkable growth is due to massive imports of cars (75% compared to the previous period). Table no. 1 Sales of cars on the Romanian market in the period 2000-2008 Total Increase from previous period Imports the 2000 66.276 2001 72.157 2002 88.802 2003 106.673 2004 145.120 2005 215.532 2006 256.364 2007 315.621 - 8,9% 23,1% 20,1% 36,0% 48,5% 18,9% 23,1% 14.430 23.828 34.275 42.054 58.165 102.043 137.252 204.719 45 2008 270.995 -14,1% 189.050 Increase from previous period Autohtone Increase from previous period the - 65% 44% 23% 38% 75% 35% 49% -8% 51.846 48.329 54.527 64.619 86.955 113.489 119.112 110.902 81.945 - -7% 13% 19% 35% 31% 5% -7% -26% the The data source: Statistical Journal APIA 2008 During 2000-2002 the number of cars sold on the Romanian market saw continued growth, since 2003 the number exceeded 100,000 units per year. 2007 is the year that was a record sales (315,621 units) increase was due to the massive import (204,719 units). Chart no. 3 Evolution car sales in Romania during 2000-2008 350 Thousands units 300 250 200 Imports Local 150 100 50 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 Diagram is presented in the following information: a) Sales volume from one year to another has been an increase in growing with the exception of 2008 when the volume of sales contract, particularly in the last quarter of the year because of the financial crisis. b) By the year 2005 domestic cars had the largest share in sales volume, the 2006 gap is growing in favor of imported cars. Chart no. 4 Dynamics of car sales over the previous year 2001-2008 80,00% 60,00% 40,00% 20,00% 0,00% -20,00% Growth from the previous period (imports) Growth from the previous (local) -40,00% 2000 2001 2002 2003 2004 46 2005 2006 2007 2008 The dynamics of car sales reveals interesting dates. In 2001 sales of imported cars have experienced explosive growth and a contraction of domestic ones. Analyzing the sales of local cars for the 2000-2008 finds that January, February and August are the periods of lower sales. The months with the highest rates are sold May, June, July and October. In 2008 the share of development zones in descending order is shown in Table. 2.2 It has been found that the share of the fleet is not proportional to population share. Table no.2 Share Zone car park development in 2008 Share Zone BUCUREŞTI NORD-VEST Of car park* Of the population** 25,9% 10,3% 12,3% 12,6% SUD CENTRU 12,2% 15,3% 11,4% 11,7% SUD-EST NORD-EST 10,5% 13,1% 10,1% 17,3% VEST SUD-VEST 9,2% 8,9% 8,4% 10,6% ** The data source: http://www.drpciv.mai.gov.ro/ * Share of the population was determined using data of 2006 The car park permanently increased reaching 3,220,682 units in 2006. In Table 2.3 is shown increasing car park area of development. In 2007 there was a car park to increase by 10% over the previous year and in 2008 it increased by 13% over the previous period. Fleet has increased to the country on differentiated areas. Area with the greatest increase is Bucharest, Ilfov County, achieving an increase in the park to 56% in 2007, being also the highest of all counties in the reference period. Table no.3 Evolution fleet over the previous period BUCUREŞTI 2007/2006 2008/2007 12,8% 14,2% SUD SUD-VEST VEST NORD-VEST CENTRU NORD-EST SUD-EST 10,8% 12,5% 9,3% 11,5% 8,8% 14,0% 8,4% 14,1% 7,5% 13,5% 9,4% 13,8% 9,0% 11,4% The data source: http://www.drpciv.mai.gov.ro/ Undoubtedly the increase of the car park would have been greater if not contraction would demand financial crisis fund. Falling sales over the same period the previous was in some cases by 70%. The players operating on the Romanian market Local car manufacturers and from import are operating together on the Romanian market. Local producers covering only part of the range of classes. The main autochthon manufacturer of cars is SC Automobile Dacia SA, which produces models of the average compact class C (Logan and Sandero) and Class L minivan (MCV). Until recently SC Automobile Craiova has produced models of the average compact class C (Cielo, Espero, Nubira, Leganza) so the two companies were in direct competition. He also produced and models of Class A mini (Tico and Matiz) To these are added the cars imported in the same class but other classes of models that satisfy the needs adjacent similar. Major competitors of the domestic manufacturers are German companies, French, Italian and others in Europe who added six American producers who have 47 factories in Europe, such as Ford and Chevrolet. There are also cars manufactured under Japanese brands like Nissan, Toyota, Suzuki, Honda and the Korean and more. Customers Customers of the auto market are represented as individuals, clients, and economic agents or other economic entities, non-economic agencies, foundations, etc., composed as legal persons. Behavior of the two categories of customers is different. Clients purchase a car with the generally subjective criteria based on information gathered from various sources: radio, television, publications, and show-rooms and in discussions with other car owners. Customer’s individuals have benefited since 2007 from the renewal fleet providing a premium for each vehicle disposal as waste taught amount was part of the advance to purchase a new car. Organizational clients are based on less subjective criteria, the choice being based on a documented study and meet certain requirements contained in specifications. Demand carriers operating in this market can be classified into three major categories: commercial, governmental organizations, national or local and institutional clients and NGOs. Conclusion: Automobile market in Romania was a market transaction volumes dynamic knowledge increases that sometimes exceed the forecasts. On this market find all major car manufacturers across their diversity, from low cost cars in the luxury sport, land or limousines. The largest share of cars has a category of average price, which is dominated by models produced at Dacia. There is a growing demand of cars in its class mini SMART especially as the trend of fuel consumption as low. Lending was the main driver of sales of cars to which is added and the fleet of renewal initiated by the Government. The Market which has dealt with most used cars is the center and western regions while the rest of the country has a greater inclination towards new cars. The share of domestic cars in November saw a decline since 2006, the largest producer in Romania, Automobile Dacia, and directing sales to other markets in Europe. Areas with the biggest sales are in fact the most economically developed. The effects of financial crisis have been advertised in Romania is felt to the end of 2008. Purchases of automobiles fell due the rise of loans and insecure situation of workers which has made potential buyers to be more circumspection, in anticipation of economic recovery. REFERENCES: 1. ANGHEL Laurenţiu-Dan, PETRESCU Eva-Cristina, Business to business marketing, Uranus Publishing, Bucharest, 2001 2. BALAURE Virgil (coord) Marketing, Uranus Publishing, Bucharest, 2002 3. Pistol Gheorghe (coord), Marketing, Economy Independence Publishing, Piteşti, 2001 48 THE ACTUAL STAGE OF HIGH TECH INDUSTRY AT INTERNATIONAL LEVEL -SOME EXAMPLES OF CRISIS EFFECTS IN EUROPE AND ASIA- Drd. Lavinia DOVLEAC Coord. Prof. Dr. Constantin LEFTER Transilvania University from Braşov, Faculty of Economic Sciences Abstract: Because the high-tech sector of the economy develops or uses the most advanced technology known, it is often seen as having the most potential for future growth. This perception has led to high investment in high-tech sectors of the economy. High-tech startup enterprises receive a large portion of venture capital. However, if, as has happened in the past, investment exceeds actual potential, then investors can lose all or most of their investment. High tech is often viewed as high risk, but offering the opportunity for high profits. The actual economic and financial crisis affects all the sectors of economy and the high tech sector, too. Each country in the world fights through all methods to avoid the dangerous effects of this phenomenon. Key words: high tech, industry, economic crisis, turndown, strategy 1. INTRODUCTION The most affected economies in the world are those which functioning is based on a strong process of industrialization. All the growth ups are slow down at this time, and each company try to find the best solution for escaping from this collapse. The global growth of high-tech sector has slow down too.4 According the Survey Cabinet Gartner, PC sales had grown up with only 1,1% in the world, the smallest growth rate from 2002. Laptop sales, the most dynamic sector in the last years, are going down too. The CEO of Microsoft, Steve Ballmer, considered that the appearance of “netbook”- a very cheap mini PC, was a bad idea for the company. Netbook is equipped with the old operation system Windows XP, on which Microsoft take only 20$, meanwhile Vista from the new generation of computers bring to Microsoft 50$, but it’s less sold. 4 Le Monde - High-Tech, affected by crisis, January 27, 2009 - http://www.fabricadebani.ro/news.aspx?iid=16102 49 The big groups are in competition with new products, often cheaper, whish attract the consumers who wants to make economies. All these affect the rentability, according Le Monde, which expect fusions inside the sector. 2. THE CRISIS EFFECTS IN EUROPE We knew the economic and financial crisis was coming to Europe, and that it was just a matter of time. No one has been surprised about the dire state of affairs in the automotive sector, where overcapacity has long been a problem in Europe. But, secretly perhaps many had hoped that Europe's high-tech champions SAP, the German business management software group, and STMicroelectronics, the Franco-Italian chipmaker, might be able to hold out just a little longer. After all, SAP from Germany is the third-biggest software group in the world after Microsoft and Oracle. It even went on a hiring spree last year and was voted the country's best employer in 2006. Now it has to think about things such as how to keep margins going in slow growth markets at a time when price competition is mounting and the costs of innovation are high. The crisis in Germany Turnover in information technology, telecommunications and digital consumer electronics will hold steady at about 145 billion Euros (183 billion dollars), the BITKOM industry organization said in the northern city of Hanover. For the time being, the high-tech industry is holding its own in the crisis. The sector looks pretty good compared to other industries. Despite the industry's brave face, the CeBIT is starting under a cloud this year. Some 4,300 firms from 69 countries are to display the latest gadgets and innovations at the CeBIT - a quarter fewer than last year due to the global economic slump, organizers said. BITKOM said the German high-tech industry would perform worse than the global sector as a whole, which is expected to boost sales about three percent to 2.416 trillion Euros. Taken alone, the German computer industry5 can expect a 1.5-percent increase in sales to about 67 billion Euros, thanks in part to heavy state investment as part of two government stimulus packages worth more than 80 billion euros launched in the last three months. Merkel's government has earmarked 500 million euros for information technology, in addition to spending on computers for schools and a major expansion of broadband networks in cooperation with Germany's 16 states. Scheer said new computer equipment was also a crucial tool for companies restructuring in the crisis or trying to slash energy costs with "greener" hardware. The telecommunications sector, however, will see a 1.2-percent decline in sales to about 65 billion Euros. BITKOM blamed EU initiatives to cut costs for consumers as well as stiff price competition. It said calling fees sank 3.3 percent last year in Germany, Europe's biggest economy. 5 Deborah Cole – “German high-tech sector holds up: trade group” – March 2, 2009 [ on line ] http://www.physorg.com/news155202926.html 50 BITKOM said things were also looking bleak in the consumer electronics field after several boom years, with sales expected to slip 2.5 percent to about 12 billion Euros. It said it was looking for a boost next year from online television, known as IP-TV, as well as home entertainment systems, in which devices are inter-connected via a local network, and high-definition television, which is to launch in 2010 in Germany with the broadcast of the Winter Olympics. The crisis in France Speaking of high-tech markets, there can be no better example of how far the mighty can tumble than Thomson, the French media services group6. Being once a proud symbol of innovation in image technology, Thomson looks dangerously vulnerable unless creditors agree to the latest restructuring plan. The group has no more financial flexibility, having drawn down the last of its credit lines in the past few months. Buyers will be scarce and Thomson's ability to pay down debt looks pretty slim. 3. THE CRISIS EFFECTS IN ASIA The crisis in China In 2007, the scale of China's high-tech manufacturing industry ranked second in the world, with its high-tech and new technology products make up around 20% of the international market. Since 2008, production and exports in China's high-tech industry have registered rapid growth, greatly increasing economic benefits, while attaining new achievements in industrial development. On the export front, China's high and new technology products performed very well. China's foreign trade growth is slowing this year due to the US sub-prime mortgage crisis, the rising RMB exchange rates, the domestic credit crunch and mounting costs in raw material and labor. Strengthening independent innovation capabilities is a crucial step for China's high-tech industry to have a head start in the international market. The High-tech Industry Development Program of the 11th Five-Year Plan7 released by NDRC in 2007, emphasized that China must speed up its high-tech industry's transformation from focusing on processing and assembling to independent research, development and manufacturing. The program requires that by 2010 the number of patents issued to China's hightech enterprises double and the value added by independently developed high-tech manufacturing reach over 50%. 6 Peggy Hollinger – “Europe’s high-tech sector suffering from midlife crisis” – 30.01.2009, [ on line ], http://www.ft.com/cms/s/0/30ff5240-ee6f-11dd-b791-0000779fd2ac.html?nclick_check=1 7 People’s Daily Online – “High-tech industry becomes new highlight in China’s economy” – 04.12.2008, http://english.peopledaily.com.cn/90001/90780/91344/6546684.html 51 The formation of industrial clusters is an inevitable trend in global high-tech industrial development. It is also a strategic path for high-tech industrial development. The crisis in Japan Japan's industrial output fell for the fifth straight month in February, down by 9.4 month-on-month on a seasonally adjusted basis as the global economic recession took a heavy toll on the world's second largest economy, said the Ministry of Economy, Trade and Industry said in a preliminary report on Monday. Further shrinking demand for Japan's automobiles and high-tech products worldwide remains a key factor behind the output decrease. The index of inventories registered a record fall, down by 4.2 percent to 103.7 while that of production at mines and factories read 68.7, compared with 100 for the base year of 2005, showed the report8. The ministry, however, predicted a robust growth in production at factories for transport equipment, electrical machinery, chemical products, and electronic parts and devices. 4. CONCLUSIONS AN DPROPOSALS McKinsey9 analyzed the performance of nearly 700 companies during contractions in markets around the world over the past two decades. It found that the turmoil accompanying downturns significantly reconfigures the high-tech landscape. About half of the companies that entered these downturns as leaders—the top 20 percent—ended up as laggards when the economy regained momentum. The research underscores three essential findings for executives. One in four high-tech companies will probably need to tap into a credit line or refinance their debt in the downturn. First, they should fully understand the dynamics and probable impact of the contraction. Executives should know how liquidity issues may affect operations. As compared with other industries, the credit situation is stable in high tech. Problems are mounting along the supply chain, however — particularly among distributors and contract manufacturers — and in overseas markets. These developments could ultimately affect the operations of many companies. Third, high-tech executives should play offense, acting to strengthen the balance sheet and improve the competitive position. The economic crisis has shaken up the start-up and hi-tech community, with the credit crunch squeezing the life out of many small companies. While real estate and finance were the first to be hit, the crisis has hit hi-tech and retail with immense and obvious force. Most experts believe that this will only get worse as the next wave of retail slumps, debt defaults, bankruptcies and layoffs approaches. 8 Xinhua – “Japan’s industrial output down 9,4% in February” – 30.03.2009, [online], http://english.people.com.cn/90001/90778/90858/90863/6625463.html 9 Andrew Cheung, Eric Kutcher, and Dilip Wagle – “High Tech: Finding opportunity in the downturn” http://www.mckinseyquarterly.com/High_Tech/Strategy_Analysis/High_tech_Finding_opportunity_in_the_downturn_2310# 52 To make it through the downturn, hi-tech companies should concentrate on the following rules of survival10: Innovate The limited resources characteristic of down economies in certain ways creates a more competitive environment. Larger companies that would otherwise be trying to dominate the market are focused on mere survival, leaving room for smaller companies to edge in. Past recessions have caused companies like IBM, Sun Microsystems and Montgomery Ward to step back and make way for companies like Microsoft and eBay. Smaller companies that can survive, pick up a small market share and refine their product will be poised for fast growth when their target market rebounds. Lower costs without sacrificing quality Whether the company is self funding or searching for financing, this is a time to lower the company's costs as much as possible without sacrificing quality. But cutting costs doesn't mean cutting corners. If it’s reduced the company's value, fail to protect the intellectual property or make the valuable employees feel their jobs are not secure, the company will simply be unable to compete. Reduce reliance on outside financing Securing financing, whether through equity or debt, is extremely difficult. In this time of high uncertainty, banks and venture capitalists are holding on to their cash until they feel confident that the worst is behind them. For many businesses, this means depending solely on their own revenue to fund future growth. Consider focusing on a sector of the company’s business that is particularly profitable or that generates the most value, and hold off on expanding peripheral sectors until the companies are in a more stable position. Take advantage of opportunities An economic crisis brings new economic opportunities, including new demands in the market and government spending. In the market, businesses need solutions that will help them survive, and companies that best provide those solutions will be very successful. So, although it seems that we hear nothing but bad news about the economy, hitech companies will find there is still plenty of opportunity. By reducing wasteful costs and focusing on what the company does best while also increasing innovation and protecting it’s assets, the company can position itself well for the next economic upswing. 10 Michael Moradzahed – “How hi-tech start-ups can survive the economic crisis” – 14.03.2009, [on line] http://www.jpost.com/servlet/Satellite?pagename=JPost%2FJPArticle%2FShowFull&cid=1236764182712 53 REFERENCES 1. Le Monde - High-Tech, affected by crisis, January 27, 2009 http://www.fabricadebani.ro/news.aspx?iid=16102 2. Deborah Cole – German high-tech sector holds up: trade group – March,2 2009 [on line] http://www.physorg.com/news155202926.html 3. Peggy Hollinger – Europe’s high-tech sector suffering from midlife crisis – January 30 2009, [on line], http://www.ft.com/cms/s/0/30ff5240-ee6f-11ddb791-0000779fd2ac.html?nclick_check=1 4. People’s Daily Online – High-tech industry becomes new highlight in China’s economy – December, 4 2008, http://english.peopledaily.com.cn/90001/90780/91344/6546684.html 5. Xinhua – Japan’s industrial output down 9,4% in February – March, 30 2009, [online], http://english.people.com.cn/90001/90778/90858/90863/6625463.html 6. Andrew Cheung, Eric Kutcher, and Dilip Wagle – High Tech: Finding opportunity in the downturnhttp://www.mckinseyquarterly.com/High_Tech/Strategy_Analysis/High_tech_Fi nding_opportunity_in_the_downturn_2310# 7. Michael Moradzahed – “How hi-tech start-ups can survive the economic crisis– March, 14 2009, [on line] http://www.jpost.com/servlet/Satellite?pagename=JPost%2FJPArticle%2FShow Full&cid=1236764182712 54 DRAWING THE SAMPLE SIZE FOR ANALYZING THE QUALITY OF UNIVERSITY EDUCATIONAL PROCESS Liliana DUGULEANĂ, Constantin DUGULEANĂ University TRANSILVANIA from Brasov Abstract: The quality of educational process is analyzed by evaluating the perceptions of students about the different aspects concerning the content and the unfolding of educational process. To establish the sample of students is important for extending the results and to formulate conclusions with a certain probability to the whole educational process. Key words: university educational process, questionnaire, sample, confidence level 1. THE QUALITY OF UNIVERSITY EDUCATIONAL PROCESS In the context of integration in European Union it became obviously the greater importance of educational process quality for ensuring the compatibility of qualifications. To analyze the quality of educational process, often there are used questionnaires to evaluate the perceptions of students about the different aspects concerning the content and the unfolding of educational process. The conceiving of the questionnaire is a dynamic process, adapting the questions to the specific of specializations and to the objectives of analyses. After having the questionnaire, it is important to establish the sample of students. The sample will be without replacement and its volume depends on the volume of the entire collectivity from which it is extracted. Aspects as: the average percentage of participation at disciplines’ activities, testing the significance of the difference between the specializations, estimating the proportions of participation at activities, the allocated time for studying the discipline themes, analyzing the general aspects of the disciplines, analyzing the specific aspects of the courses and those of the seminars, and also global analyses of the disciplines – are the aspects which have to be approach in analyzing the quality of university educational process. 55 2. THE COMPATIBILITY OF EUROPEAN QUALIFICATIONS The European educational politics have as a purpose forming the university staff in the spirit of quality culture in higher education. Through the Bologna Process the university studies were restructured in the phases: license, master and doctoral studies, but also there were established the differentiation between the qualification levels depending on the exigencies and the complexity of some components formulated in close correlation with the needs of the labor market. The European Qualifications Framework (EQF) was established at Maastricht, in December 2004, when it was mentioned that EQF must facilitate the voluntary development of European competences standards. EQF is conceived to facilitate to the qualified staff at national and sector level, from each European country, to communicate and to make connections, contributing to a transparency at European level. EQF will make easier the transfer, the transparency and the recognition of qualifications. At the Ministerial Conference in Bergen from May 2005 it was proposed a Framework for Qualifications of the European Higher Education Area – EHEA. The compatibility between the two initiatives will be realized by the development of a European framework for qualifications from the perspective of learning during all life. The national frameworks of qualifications are in process of being established in many countries and sectors, in Europe and at international level. These frameworks have different forms in according with the specific of national and sector level and they are concerning: the more developing problematic of complexity, the modern systems of education, formation, learning and establishing the professional ways, the possible transfer of learning results and the decisions criteria concerning the recognition of qualifications. The globalization phenomenon, the internationalizing of commerce and technologies and the accelerate dynamics of changes in the information and communication technology field determine new challenges of education and professional formation. The educational process must be constantly adapted to face the changes of the professional requirements. In this context, ensuring the quality of educational process becomes very important in the European Qualifications Framework. The engagement face to a common set of principles is a precondition for cooperation between the partners at different decisional levels. 3. THE QUESTIONNAIRE FOR EVALUATING THE UNIVERSITY EDUCATIONAL PROCESS The Department of Quality Management in every higher educational institute has the mission to evaluate the quality of educational process. The analysis of the educational process quality is mainly based on students’ surveys. The used questionnaire is the result of a creative process combining the experience of analysts with the purpose of analyses. The conception of the questionnaire 56 can be improved after analyzing the results in its applying. The questionnaire was divided in three parts, each of it, is treating the following aspects: - the proportion of students’ participation at the courses, seminars, laboratories and projects – for considering in a differentiated way, the opinion of those who are really present at courses, seminars or laboratories; - the weekly allocated time for study at the analyzed discipline (learning, homework, preparing the laboratories) – for knowing the students’ interest for the discipline; - the evaluated aspects, which are grouped in: o 9 general aspects concerning the perception of the importance of studying the discipline, o 8 specific aspects concerning the evaluation of the course and of the professor, o 2 specific aspects for seminar, o 2 specific aspects for laboratory or project, if it exists. For each aspect there are five steps on an evaluation scale, from 1 to 5: 1 – meaning the discontent, disagreement, 2 – in a little measure, 3 – partially agreement, 4 – in great measure and 5 – in a high measure. After testing the questionnaire, it can be revised by rearranging the questions or modifying them, adding new questions or deleting others which receive the same answer for almost all of interviewers. 4. THE SAMPLE ERRORS The procedure for drawing a sample distribution is assigning, depending on a criteria, the ranks in an increasing order: 1, 2, … to the units of the collectivity and randomly deciding which elements are included in the sample. The sample is drawn without replacement because the same element, here the statistic unit is the student, can not be selected more than once. The usual convention in sampling is that lower case letters are used to designate the sample characteristics, with capital letters being used for the collectivity, the parent population. Thus if the sample size is n, its observed values for a characteristic, called x, are designated as: x1, x2, …, xn; its mean is x with its variance, σ 2 . The collectivity has the volume of N students, and the parameter to be estimated for the analyzed characteristic is the mean x0 with its variance σ 02 , which sometimes is already known, and it is used to calculate the sample volume. The sample elements are either measurements of some characteristics, (the analyzed aspects about the course, seminars and professor) either value 1 or 0 (to be or not to be present at teaching hours, agree/ no-not-agree). The sampling uses, either, an attribute, a sampling characteristic, or a proportion for sampling. The sample average x and the sample proportion w are synonymous, just as the mean x0 and proportion p for the population, are. The specific errors for surveys are those of representative meaning, which can be reduced only by respecting a probabilistic scheme of extracting the students from their collectivity. This kind of error refers to the fact that the sample cannot reproduce exactly the structure and the characteristics of entire collectivity. The average representative error: µ x (for the non alternative characteristic) or µ w (for the 57 alternative characteristic) and the limit error, ∆ x or ∆ w are the representative errors of surveys. There are also recording errors which are common for all types of observations and which can be reduced by a well instruction of reviewers or using specialized staff. In this case the students write their answers on the questionnaires and the recording errors can appear at introduction of data into the computer software. The limit error for the analyzed numeric characteristic (here, the average point of an answer, a score), ∆ x – is the average deviation from the average score of an answer and it is calculated applying a probability coefficient, z or t, to the average representative error, µ x . The probability coefficient of the Gauss-Laplace function ϕ(z), is used when the selection has a normal volume n, greater than 30 students, n > 30. The small sampling theory establishes the Student function S(t), to be used when the selection has a volume less than 30 students, n < 30. The probability coefficient is determined depending on the guarantee probability for extending the survey results upon the entire collectivity. When the probability is higher, close to 1, the probability coefficient is higher, close to 4. For z=3 the probability ϕ(z) = 99.87%, for z=3.5 the probability ϕ(z) = 99.98%, for z=4 the probability ϕ(z) = 100%. 5. DETERMINING THE SAMPLE VOLUME The extraction scheme is the unrepeated one, because the opinion of one student is considered once, so a statistical unit appears only one time in the sample. In this case it is used the finite population correction factor (N-n)/(N-1). Usually, when N is sufficiently great, it can be renounced at “-1” from the denominator and it is used as (1n/N), where n/N is the selection fraction. For the unrepeated scheme, the limit error for the analyzed numeric characteristic ∆ x is: σ 02 σ2 σ2 n n n (1) 1 − ≈ z ⋅ 1 − ≈ z ⋅ 1 − ; n N n −1 N n N Starting from this formula the interest is to obtain the volume of sample: z 2 ⋅ σ 02 , where: (2) n= z 2 ⋅ σ 02 2 ∆x + N - σ 02 is the variance of characteristic at the collectivity level, which when it is unknown, ∆x = z ⋅ µx = z ⋅ it can be approximated with the sample variance σ 2 ; - N is the volume of the collectivity (the number of students who participated at courses, seminars, laboratories and projects of the analyzed discipline); - n is the volume of the sample (the number of the students who are present to the evaluation and which form the sample); - z is the probability coefficient for the sample volume n, n > 30, which is the unknown and it must be determined, for ensuring the guarantee probability of the results of ϕ(z). 58 For an alternative characteristic (here, the proportion of participating to the activities of the discipline), the average representative error, µ w and the limit error can be calculated, for the unrepeated scheme: p (1 − p ) n w(1 − w) n w(1 − w) n 1 − ≈ z ⋅ 1 − ≈ z ⋅ 1 − .(3) n n −1 N n N N 2 z ⋅ p (1 − p ) , (4) Starting from this formula the volume of the sample is: n = z 2 ⋅ p (1 − p ) 2 ∆w + N where: p(1-p) is the variance of proportion at the collectivity level, which when it is unknown it can be approximated with that of the sample variance of proportion, w(1-w). The other symbols have the same significance as in the case of the numeric characteristic. For both types of the characteristics the accepted significance limit, α is 0.05, the guarantee probability of the results’ extension is about 95%. This value of probability conducts to the established values for theoretical Student value, t, of tα/2 = 2.064, in case of a small volume of sample and the theoretical value of normal distribution argument, z, of zα/2 = 1.96, in case of normal volume of sample. In Table 1, there are presented the calculus for the situations when the volume of collectivity, N, has different values, as: 25, 50, 75 or 100 students and more. It is important to know the minimum number of students to form the sample for ensuring the guarantee probability of the results. For the alternative characteristic the accepted limit error ∆ w is 0.05 meaning that the proportion of the students having one opinion or doing something has an average deviation from the average proportion of maximum 5%. In the most unfavorable case the proportion of the units which have the characteristic (possessing an attribute of having one opinion or doing something) and being considered the favorable case is of 50% and the unfavorable proportion (of those who have no the attribute) is also 50%. So the variance of the alternative characteristic is maximum p(1-p)= 0.5·0.5=0.25. Applying the formula (4) there will be obtained the values of volume, n for the different values of N. For the non alternative characteristic the central value of the scale from 1 to 5 is 3 and the amplitude of variance is 4. The frequencies of answers will be known for each evaluated aspect and the average score is the weighted arithmetic mean. The variance of the answers’ marks has the maximum value 4 and the average score of the evaluated aspects is 3, when all the frequencies are equally distributed for the extreme modalities of the mark: 1 and 5, in the most unexpected way. Accepting as an average deviation, the limit error of ∆ x = 0.1 from the average score of the whole collectivity of students, there are obtained using the formula (2) the different volumes of sample, calculated in Table 1. In the case of ∆ x = 0.1 , in Table 1, there are obtained the values of the minim values for n, the volume of the sample, for each type of characteristics. In the end of Table 1, the established final volume of sample is the maximum value of them. Because the statistical units are students, the values of the sample volume must be entire numbers. 59 ∆ w = z ⋅ µw = z ⋅ Table 1. Choosing the Sample Size The minim volume for proportions (w) ∆ w =0.05 Variance = 0.25 N 25 n<30 23.6 N 50 n>30 44.2 N 75 n>30 62.7 N 100 n>30 79.3 proportions N n minim 24 25 44 50 63 75 79 100 t = 2.064 z = 1.96 scores n minim 25 48 72 94 The minim volume for average score (x) ∆ x = 0.1 Variance = 4 N 25 n<30 24.6 N 50 n>30 48.4 N 75 n>30 71.5 N 100 n>30 93.9 established n 25 48 72 94 For the non alternative characteristic the volume values are higher than that for proportions, so this will be the final choosing for the minim sample volume that will guarantee the results with a probability of 95%. For an accepted error limit of ∆ x = 0.2 , the calculated values of the sample volume are exactly the values of the volumes obtained for the corresponding N, for the alternative characteristic. For a guarantee probability of results’ extension of 95%, the sample must have 25 students for a class of 25 persons. If the collectivity has 50 students then the sample would be consist of 48 students. For a population of 75 students, 72 of them will be included in the sample. For a higher volume of population, of 100 students, 94 of them must complete the questionnaire. The estimation of the confidence intervals for the analyzed characteristics depends on the nature of samples: small or normal volume of sample. REFERENCES 1. Duguleană L., “Intelectual Capital in the Knowledge Based Society”, International Symposium “Regional Development Directions in the Context of European Integration”, Commercial Academy, Satu Mare, June 22 – 23, 2007 2. Duguleană L., Duguleană C., "The Students’ Attitudes Concerning the Learning Process", The 4th WSEAS/IASME International Conference on Educational Technologies (EDUTE'08), Corfu, Greece, October 26-28, 2008, WSEAS Press, ISBN 978-960-474-013-0, ISSN: 1790-5109, pg. 112-116, www.wseas.org/conferences/2008/corfu/edute 60 CORPORATE VALUE CREATION THROUGH MERGERS AND ACQUISITIONS Lucia DUGULEANĂ, Master in Finances, Lund University, Sweeden Iulia DUMITRACHE, Master in Finances, Lund University, Sweeden Abstract: This paper provides a background for studying international mergers and acquisitions; it presents the research topic and gives delimitation for a study purpose. The aim of the study can be to determine whether cross-border mergers and acquisitions in related industries initiated by European companies with US targets are value-enhancing. Further, the study can be extended to establish if excess wealth is gained by foreign target shareholders. Key words: mergers, acquisitions, shareholders, corporate value 1. INTRODUCTION On May 7th 1998, Chrysler announced a $37 bn. merger with Daimler-Benz. The stock swap deal was the largest transatlantic transaction at the time and was considered a “marriage made in heaven” of two equal companies that would change the face of the industry. Chrysler was the 3rd largest US car maker and the most profitable in the mid 1990’s. Chrysler management forecasted the need of large amounts of cash to keep the products up to date and to expand to new and emerging markets in order to secure its position as one of the most important automaker company in the rapidly changing industry. The long term strategy was a merger that would help the company to reach this goal. Daimler-Benz was a premium engineering automaker with strong brands that tried to find ways of improving efficiency and the economies of scale a merger offered seemed appealing. The merger appeared promising combining the German engineering and the American marketing expertise into the new company, the 5th largest automaker in the world. The benefits stated at the time are among the most cited benefits of mergers: growth possibilities, increased market opportunities, increased purchasing power, synergies coming from shared distribution logistics, sharing know-how. 61 The premiere global automotive company was supposed to be of great strength, with combined presence around the world and limited product-overlap (Daimler-Benz focusing on premium segment and Chrysler on medium and economic segments). Centralized purchasing, distribution and administrative structure, shared R&D and the possibility of exchanging components would have brought about annual savings of $3 bn. in 3 years. Exploiting all these benefits and the new market opportunities would, in the end, have lead to increased shareholder value. However, the market capitalization of the combined company, which was immediately after the merger around $100 bn. dropped in just 3 years to $44 bn., a value lower than the value of Daimler alone before merger. The synergies failed to appear; the distribution systems remained separated due to brand bias, Mercedes distributors refusing to include the less fancy Chrysler. The cultural differences had a strong impact leading to discontent between employees and small scandals. Chrysler Group began to lose money. By last quarter of 2000 Daimler-Chrysler registered its first quarterly loss of about $269 mil. as a result of $1.4 bn. loss registered by Chrysler. The situation has not changed much with time. In 2006 Chrysler registered a $1.5 bn. loss and it was finally sold in 2007 to a private equity firm for 7.4 bn. This is just one example of many failures in the merger activity. A merger that was very promising proved to be value destroying in the end. Shareholders of both companies saw their stake in Daimler-Chrysler shrink in value. One would think that managers had learned their lesson from value destroying mergers in the past. But have they? 2. STUDYING CORPORATE VALUE MERGERS AND ACQUISITIONS CREATION THROUGH It is well known that failures and mistakes are a taboo topic for practitioners and that few lessons were learnt by managers from past value destroying mergers and acquisitions. To shed further light on this important aspect of today’s corporate activity, the current paper aims to reveal whether and to what extent corporate international diversification through mergers and acquisitions creates value for the acquiring and target firm’s shareholders. The poor reputation of mergers and acquisitions has its heredity in a number of spectacular failures in the 1990’s, as well as in research papers that show value destruction for acquiring shareholders in up to 80% of deals (see, for example, Datta & Puia (1995), Christophe (1997) and Denis, Denis & Yost (2002)). On the other hand, another group of scholars reached different conclusions, providing empirical evidence that, in fact, cross-border mergers and acquisitions create value for both acquirer and target firm’s shareholders (see Errunza & Senbert (1981, 1984), Markides & Ittner (1994) and Bodnar, Tang & Weintrop (2003)). In addition to this “good news” provided by researchers, reasons why companies choose to engage in international merging activities include one or more of the following factors: improved operating margin through reduction of operating costs, diversification of product and service offerings in order to stay competitive, larger 62 market share, reduction of financial risk, increased plant capacity, utilization of operational expertise and research and development. Additionally, a large number of mergers in the mid-1990’s occurred as a response to the integration of global markets or due to deregulation, changes in technology and industry consolidation. Receptivity of both the equity and debt markets to large strategic transactions is another incentive for companies engaging in mergers and acquisitions, and so is the pressure to increase shareholder value. Some argue that management aggrandizement is also a reason why companies continue to pursue mergers and studies proved that hubris-based M&A-s are usually the ones that are found to be value-destroying, as opposed to synergy-oriented M&A-s (see Seth et al (2002)). In spite of the vast amount of research in the field of corporate value creation through mergers and acquisitions, there are few, if any papers that focus on developed European companies acquiring targets from countries outside the European Union. 3. MERGERS AND ACQUISITIONS - A GLOBAL PHENOMENON In the last two decades, mergers and acquisitions have become a truly global phenomenon and Europe begun experiencing a rapid growth in merger activity. European developed countries are chosen as acquirers as expecting them to have more harmonized legislation as a result of European Union steps towards a more integrated market and therefore to offer representative results. The focus is on US targets as US is one of the major market that European companies invest in. Table 1 presents the number of Mergers and Acquisitions (M&A) by country made by Western European companies in other markets than Europe during 1999 – 2007. Table 1. Number of M&A initiated by European countries with non-European targets between 1999 -2007 Country United States Australia Canada Brazil Russian Federation South Africa India Argentina Turkey Mexico China Japan Chile Singapore Hong Kong Indonesia Thailand Egypt New Zealand Israel Number of M&A 1999- 2007 3135 301 291 212 174 163 148 146 131 118 116 95 80 78 71 36 34 33 32 31 Data source: Reuters Database 63 There is a high concentration of mergers and acquisitions made by Western European companies during 1999 – 2007, in only one country, United States of America. The proportion of the number of US mergers and acquisitions made by Western European companies during 1999 – 2007 is 57.8%, being more than half. 4. CONCLUSION The aim of a study can be to determine whether cross-border mergers and acquisitions in related industries initiated by European companies with US targets are value-enhancing. Further, the study can be intended to establish if excess wealth is gained by foreign target shareholders. The delimitations of the study can be that it does not investigate the effects of industrial diversification as it is largely accepted that they are value destroying. There can be looking at the effects on shareholder value following mergers and acquisitions where both acquirer and target are publicly traded firms. Due to lack of data there is also disregard whether the company establishes operations abroad for the first time or not. It can be argued that this will not impact the results as there is week evidence that premiere cross-border acquisitions add or destroy value, but rather the foreign targets are not fairly valued. REFERENCES 1. Marcelo B. Dos Santos, Vihang R. Errunza and Darius P. Miller, 2008, “Does Corporate International Diversification Destroy Value? Evidence from CrossBorder Mergers and Acquisitions”, Journal of Banking & Finance, 32, 27162724. 2. Berger, Philip, Eli, Ofek, 1995, “Diversification’s Effect on Firm Value”, Journal of Financial Economics, 37, 39-65. 3. Bodnar, Gordon, Charles Tang, and Joseph Weintrop, 1999, “Both Sides of Corporate Diversification: The Value Impacts of Geographic and Industrial Diversification”, Working Paper, Paul H. Nitze School of Advanced International Studies, Johns Hopkins University, 35p. 4. Denis, David, Diane Denis, and Keven Yost, 2002, “Global Diversification, Industrial Diversification, and Firm Value”, Journal of Finance, 57, 1951-1979. 5. Datastream and Reuters databases 64 THE SEARCHING ENGINES’ SITES FOR ONLINE MARKETING Mihai DUGULEANĂ, student at Doctoral School at Transilvania University Braşov Abstract: The web sites, built as searghing engines, are important for online marketing. Optimizing the searching engines’ sites enssures the success of the web applications. A marking system of these searching engines creates the concurence in this field of Internet marketing. Key words: web sites, searching engines, online marketing, marking system 5. INTRODUCTION The present times are called the information era. The information is important to live. For ancient times the information is collected in books, from some decades, from television and from few years, using the Internet to satisfy the informational needs. In only twenty years, the phenomenon called www, the Internet knew a remarkable development. The Internet transformed itself from a simple theoretical model in an university, into a powerful system, deeply linked with the economic world. In only ten years of function, firms as Google Inc. or Yahoo!, became the great world companies oriented to this field. Young firms succeeded to become the dominant giants of this sector of communication technologies. 6. DEVELOPING WEB SITES Thousands of people oriented themselves to develop the virtual properties of web-sites, becoming real success contractors, building affairs of millions of dollars and euros. A famous case is that of a young boy of twenty-four years, Mark Elliot Zuckerberg, the founder of the site Facebook.com. His company was evaluated at the most discussed value of 15 billions of U.S. dollars. Microsoft bought in 2007, 1.6% from the stocks of this company for the fabulous sum of 246 millions of U.S. dollars. The site facebook.com completed five years of living, in February 2009. The evolution of the web sites is based mainly on some essential characteristics: the facility of usage, the high scale and the development possibilities of the application, 65 easily social interaction, multiple opportunities for personalization, rich content and simple design, free access for everyone. Randall Munroe built in 2007, a map of Internet communications, on his personal blog, xkcd.com, looking as in Figure 1. Figure 1. The Ironic Map of Internet Communications of Randall Munroe It can be easily noticed the estimated size of Myspace, Youtube, Facebook or Wikipedia, all the relationships betweem them in an ironic way. 7. BUILDING SEARCHING MARKETING ENGINES’ SITES FOR ONLINE Starting the idea of obtaining profits by online marketing and entering on this type of market is difficult, because there are already big players. 66 Using the virtual qualities of Internet, a lot searching engines’ sites developed, like Google, blog platforms as Blogger or Wordpress, social sites like hi5, vote system based sites like del.icio.us, digg, interconnection real time like Twitter, or sites which offer statistics as Technorati or Alexa. Building a searching engine supposes to have an interdisciplinary approaching of a good knowledge in programming languages, object-oriented programming, communication protocols, elements of computer graphics, strategic marketing, online marketing, databases’ systems, local networks of computers, projecting the data bases, advanced interfaces for a good management of all processes. There are also penalization aspects for the searching engines over all the sites, using a structure of index, for the reason of results manipulation of the key words searching. A searching engine can bring high incomes in marketing purposes. The income sources can be the selling of links with options. The option ”featured” at the recording the sites, make them to beneficiate of a shorter time of review and a higher tolerance degree from the part of editor. The links which choose the paid option, they appear in index structure, ahead of those which are normal recorded. They enjoy a higher online traffic and a better relative position in the opinion of searching engines. The recording rhythm increases with featured new links per day. The offered optimization services represent another income source for the searching engines’ web designers. After marketing analyses of the buyers’ behavior, the sites can offer packages of multiple services, options, discounts, which will attract the visitors interested by that field. The buyers return periodically with new projects, and the income increases simultaneously with the continuation of trusting process. The success of a web application is ensured by optimizing the searching engines. The sites’ owners offer free information, games and entertainment systems or their contact information, but the expected results are the increasing of the income through this media chanel, Internet, to promote the affairs, the products and services, finding new collaborators, clients, externalizing and outsourcing the services amd maximizing the market quotas. The great non-profit organizations create sites to attract new sponsors and new acting adepts. An example is Wikipedia.org; though it is an information site (there is no kind of advertising), it belongs to a non-profit foundation Wikimedia, which regularly organizes campaigns to attract sponsors, having special financial results. Internationalization of searching engines creation process was until 1998, followed by a period of about 4-5 years, characterized by a formal popularity of optimizing process for searching engines. The increasing of investments in the communication technologies conducted to an increasing interest for the web industry simultaneously with evidence for one more important role of searching engines in terms of traffic for the other existing sites. The market studies show that 95% of the Internet clients use the searching engines to find the information they need. More than 50% of a sample of Internet users on a specialty forum recognized that they use the site Google.com to verify the functionality of their Internet connection. 67 The universities having faculties with computing profile, from England, Switzerland – EGS from Saas-Fe and United States – University DePaul from Chicago, include in curricula, courses for analyses the strategies to optimize the searching engines. There are only few specialists and a high demand on the market for this kind of courses. Most of these specialists obtained their capabilities in this field using their own means, without books or famous courses for specialization in this field. The searching engines represent a primary source of Internet. The extremely volatile character makes difficult the information to be attended online. The searching result for every search operation is a list of links, presented in the order of their importance or their relevance. The searches are based on strong sorting algorithms for classifying the sites in their importance order for every key word for which a demand exists. 8. PAGE RANK - THE MARKING SYSTEM OF SITES For marking the web pages there is used an indicator called Page Rank, which was patented by University Stanford and used as trademark by Google Inc. Page Rank is a private method, based on the algorithms developed by Google for marking and evaluating the web pages, by marking their popularity on a scale from 1 to 10, establishing their relevance from the point of view of searching engines’ sites. A huge structure of links indicates the value of a certain page. A link of page A to a page B, is considered as a vote of page A for page B. There can be considered the volume of votes or links which a page receives and also other analyses of the page which receives the votes. The pages which collect votes are important themselves but they have a greater consideration, helping other pages to be “important”. REFERENCES 1. Duguleană M., ”Web Application for the Online Marketing of Sites. Optimization Strategies for Searching Engines’ Sites”, graduate paper, Faculty of Automatic Control and Computers, Computer Science and Engineering, 2008 2. Duguleană L., Duguleană M., “New Communication Technologies Used for Online Sites’ Marketing”, Bulletin of the Transilvania University of Braşov • Vol. 15(50), Seria B, ISSN 1223-964X, 2008, pag 21-26 3. Duguleană L., “The Coming Disaster of Marketing Industry in Digital Era”, Bulletin of the Transilvania University of Braşov • Vol. 14(49), Seria B, ISSN 1223-964X, 2007 4. Duguleană L., Duguleană C., "Marketing Industry in the Digital Era", Proceedings of the 6th WSEAS International Conference on ENVIRONMENT, ECOSYSTEMS and DEVELOPMENT (EED'08), Cairo, Egypt, December 2931, 2008, Energy and Environmental Engineering Series, A Series of Reference Books and Textbooks, published by WSEAS Press, ISBN: 978-960-474-045-1, ISSN: 1790-5095, pg. 28-31, CD, ISBN: 978-960-474-044-4. 68 TOURISTS OPINION REGRADING ACCOMMODATION SERVICES – APLICATION IN CLEMENTINE Maria-Sînziana ENEA , Student at Master Management and Business Strategy Eugen-Silviu VRAJITORU, Student at Master Management and Business Strategy Coord. Prof. Dr. Nicoleta PETCU Transilvania University from Braşov, Faculty of Economic Sciences Abstract: The paper aims to analyze the views of tourist accommodation services at the four stars hotels by applying the techniques of decision trees that allow the definition of decision rules necessary to purchase these services. Key words: descriptive Statistics, graphic web, decision trees. 1. INTRODUCTION C&RT stands for Classification and Regression Trees, originally described in the book by the same name (Breiman, Friedman, Olshen, and Stone, 1984). C&RT partitions the data into two subsets so that the records within each subset are more homogeneous than in the previous subset. It is a recursive process—each of those two subsets is then split again, and the process repeats until the homogeneity criterion is reached or until some other stopping criterion is satisfied (as do all of the tree-growing methods). 2. CONSTRUCTION OF DECISION TREE Data necessary for this analysis have been imported form an EXCEL file. The Excel Import node imports data from any version of Microsoft Excel. The Table node displays the data in table format, which can also be written to a file. The Statistics node provides basic summary information about numeric fields. It calculates summary statistics for individual fields and correlations between fields. 69 The Select node selects or discards a subset of records from the data stream based on a specific condition. With this node we can select the tourists who prefer a charge for accommodation between 300-400 lei. 70 The Sort node sorts records into ascending or descending order based on the values of one or more fields. The Web node illustrates the strength of the relationship between values of two or more symbolic (categorical) fields. The graph uses lines of various widths to indicate connection strength. 71 From the results above the conclusion is that tourists accomodate if there is heliport and housing conditions are very good or excellent. Decision tree will be built taking as a dependent variable accommodation according to price, service quality, the existence or non-existence of helioport. 72 Conclusions: 83.33% (5 of 6) are not houses if there is not a helioport, which is why this variable was not selected in achieving the tree; of the 4 people who answered Yes to accommodation variable, 2 houses if the price is more than 555 lei and the other 2 if the price is less than 385 lei and service quality is very good. 73 REFERENCES 1. Petcu, N., Statistică – teorie şi aplicaţii în SPSS/Statistics – theory and applications in SPSS, Ed. Infomarket, Braşov, 2003 2. Clementine 10.0 Node Reference 3. Clementine Algorithms Guide 74 TOURISM DEVELOPMENT IN THE ONLINE MEDIUM Drd. Anamaria HUMELNICU – SEVERIN Coord. Prof. Dr. Gabriel BRĂTUCU Transilvania University of Brasov, Faculty of Economic Sciences Abstract : The Internet became in the recent years a mass medium. Nobody can deny its existence or even its importance. Tourism is an information intensive sector, what makes tourism products to fulfill the prerequisites for the ideal sales on the Internet. Romania's online tourism is quite small, compared with other tourism countries. Romanian online tourism industry does not stop here, but it will develop further. Key words: online tourism, Romania, online medium, Internet 1. INTRODUCTION The Internet has increasingly become a popular medium for marketing, offering enormous potential. It is therefore ideal for marketing tourism. More and more consumers inform themselves for their holiday planning through the online medium. The Internet became in the recent years a mass medium. Nobody can deny its existence or even its importance. We use e-mail, search engines and web sites in order to gather the desired information. There are many people loving to travel, visiting new places. They also like meeting people who they may have little to nothing in common with. Or just trying out new food…The phrase “I want to see the world” became very popular and frequently used. There is another category – people who tend to know the destination through friends, relatives or through booklets. There are people who do not know the destinations where to travel, but they know and learn about the destination mainly through the Internet. Some of the online users use to book their holidays on the websites of the travel agencies, while some of them are going directly to the web sites of the hotels or destinations. And another part of Internet users inform themselves online for the travel, but they make bookings offline. “Recent trends in the use of ICTs in general and particularly for travel and tourism show that the more online experience consumers have, the more likely they are to look for tourism information and buy tourism products online.”11 11 http://www.unctad.org/en/docs/c3em25d3_en.pdf 75 Different studies carried out on tourists and on potential tourists, reveal that important elements for making online reservations are the following: easy, uncomplicated booking, updated information, advantages of price, safety certificates, confidence in the website, known tourism operator and full details of the desired destination, including pictures and movies. “The Internet and alternate access devices are increasing the number of electronic connections between customers and the tourism industry. These new technologies will continue to provide an environment for creating relationships, allowing consumers to access information more efficiently, conducting transactions, and interacting electronically with businesses and suppliers.”12 In the report of the expert meeting on ICT and tourism for development, held in Geneva, in December 2005 is mentioned: “(…)In light of the contribution of tourism to the economies of many developing countries, ICTs and e-business can play a key role in helping destination management organizations and tourism suppliers in developing countries to promote their products and services worldwide.“13 "We firmly believe in the potential of integrating tourism and ICT. This fruitful combination can help reduce poverty, promote growth and assist developing countries in moving up the value chain and assuming their rightful place in the global arena…" (Dr. Supachai Panitchpakdi, UNCTAD SG, Malaysia, March 2007)14. More and more people inform before their trip or their holiday in the Internet and the number of those booking directly online is also increasing. Not only young people use it, but also the older one, which gave rise to the following definition: Internet is described as „the worlds largest selling machine”. 2. ROMANIA’S ONLINE TOURISM In Romania, only 7,430,000 people have access to the Internet, that means 33,4% of the population, which is only the half of the percent registered in the best ranked European country by Internet users – Germany with 67.0 % of population.15 Internet is used by travel agencies in Romania mostly for promotion. It is still a long way till the majority of population will complete a transaction on the Internet. One might say that it would be natural and simple to convince someone to pay online and to complete a transaction through the web. But things are not really so. Many potential customers have sometimes unexplained fear that they will not reserve the right trip or that they will make a mistake in the booking process and loose the money. Reservations for tickets to various shows, events or airline tickets are becoming more frequent. Do not forget however that the value of a ticket is often less than the value of a trip and do not require advice from experienced staff. Especially when booking expensive trips, customer who doesn’t not know how to make an online reservation, will prefer not to do it. Thus it becomes very important to explain to the consumer in detail, but clear and easy to understand, how to book and how to break this process if he no longer wishes to complete the transaction. 12 Weiermair K., Mathies Ch., The tourism and leisure industry. Shaping the future, Haworth Press, 2004, p 296 http://www.unctad.org/en/docs/c3em25d3_en.pdf 14 http://learn.unctad.org/file.php/1/Events/2007/Activityreport2007v1.pdf 15 http://www.internetworldstats.com/stats.htm, dates for December 2008 13 76 It is not enough for having success when a tourism agency has a fully functional web site to address potential tourists on the Romanian market. Sales will not be as expected. In Romania there is a good market for online tourism, but there are expected more favourable results in future. Internet access in Romania begins to grow, but it cannot be compared with other developed countries in Europe. Romanian population has not yet developed the habit of buying tickets for different trips via the Internet. There is often lack of confidence, and people need a travel agent with whom to converse. Direct delivery of tickets is the most frequently chosen possibility by the customers. On the other hand, some travel agencies do not present updated information on the site. If someone wants to inquire about an offer, he can still find offers from the previous year, but not current, updated offers. Online tourism meets with an obstacle that still discourages its development is the mistrust in online paying methods. Although there are many people who have a credit card, not all types of cards can be used to pay online. In most cases, bank cards are used to receive the salary from the company where working. Problems still exist regarding the lack of confidence in making online payments. People are in generally very careful about what data and personal information they divulge on different websites. It is a safety issue, people fear that their private information could be used for malicious purposes by third parties. Bidgoli stated about the future behavior in travel in generally: “Travel will continue to be one of the most popular online interests to consumers. This trend will increase in magnitude as travel providers create more effective means with which to communicate the nature of their offerings.16 Nowadays in Romania, a telephone booking for a hotel room or a face-to-face booking is still more preferable than an online booking. Travelmaker.ro is the first Romanian travel services provider selling exclusively online, that offers online accommodation bookings, transfers, car rentals as well as custom made tours and special itineraries for individuals, families or groups. On www.ILoveRomania.ro you can book accommodation in whole Romania, rent a car, book a local or countrywide tour of Romania or plan a trip to Danube Delta. The agency has an online offer also for those who want to travel abroad and the possibility to choose your desired hotel. For this agency, Internet plays a crucial role, because the online medium is the only place where to find the offer and where the customers inform themselves. It is also necessary to mention CaptainGo, a hotel booking system specialized in Romanian market, gathering more than 350 hotels from more 100 cities. At CaptainGo one can make real time bookings or reservation requests.17 A travel agency exclusively online is “Oferte-lastminute.ro”, which provides a complete online package, including online payment. The European online tourism in 2006 was at 15.5% of the total tourism market, reaching a record level of 38.3 billion euro, but much less compared to the online tourism from the United States, which had had a rate of 31% of the total tourism market. 16 17 H. Bidgoli,The Internet encyclopedia, vol 3, John Wiley and Sons, 2004, p 472 http://www.captaingo.com/en/desprecaptaingo 77 In Romania there is no official estimate of the online travel market, but estimates lead to a maximum percent of 1% of the market currently, but with very optimistic forecasts for the next period.18 According to PhoCusWright’s European Online Travel Overview (Fourth Edition 2008), Europe’s travel sector posted sales of almost 246 billion Euros in 2008 – the largest travel market in the world. In 2007, the sector grew twice as fast as the remainder of Europe’s economy. Almost one third of capacity was ultimately due to Internet sales. The unique feature was that online travel business showed double-digit growth rates (2008: 19 %) and was considerably faster than offline business and the European travel market as a whole (2008: 3 %) (PhoCusWright’s European Online Travel Overview).19 The Internet provides a large amount of information which was previously unavailable. It is also the most efficient mean in exchanging information worldwide. Tourism is an information-intensive industry, what makes tourism products to fulfill the prerequisites for the ideal sales on the Internet. Even with recognition of the advantages of the Internet in marketing, many companies do not exploit Internets full potential. Many tour operators exclude the possibilities online tools offer, because they are used with the classical media – television, radio, magazines and newspapers. Especially in tourism is increasingly important to deal with the new instruments of the online marketing. Travel agencies, tour operators have to do this sooner or later. REFERENCES 1. H. Bidgoli, The Internet encyclopedia, ,vol. 3., John Wiley and Sons, 2004 2. Weiermair K., Mathies Ch., The tourism and leisure industry. Shaping the future, Haworth Press, 2004. 3. Bommer I., ITB Berlin 2009 Special Press Release: Online Travel -Online Travel: The Internet is the key sales channel for tour operators, http://www1.messeberlin.de/vip8_1/website/Internet/Internet/www.itb-berlin/pdf/Spezialpressedienst/ 09_ITB_spezial_Online_Travel_englisch_08.pdf 4. United Nations Conference on Trade and Development, Report of the expert meeting on ICT and tourism for development, December 2005, http://www.unctad.org/en/docs/c3em25d3_en.pdf 5. The Use of Training, Research and Tools for Development in UNCTAD, http://learn.unctad.org/file.php/1/Events/2007/Activityreport2007v1.pdf 6. Internet Usage statistics, http://www.internetworldstats.com/stats.htm 7. CaptainGo, Hotel bookings in Romania, http://www.captaingo.com/ en/desprecaptaingo 8. Turismul online castiga teren in Romania , http://www.wall-street.ro/articol/Turism /36104/Turismul-online-castiga-teren-in-Romania.html 18 http://www.wall-street.ro/articol/Turism /36104/Turismul-online-castiga-teren-in-Romania.html http://www1.messe-berlin.de/vip8_1/website/Internet/Internet/www.itb-berlin/pdf/Spezialpressedienst/09_ITB_spezial_Online_ Travel_englisch_08.pdf 19 78 EUROPEAN APPROACH FOR EVALUATING KNOWLEDGE MANAGEMENT Dana Adriana, LUPŞA-TĂTARU, Transilvania University of Braşov Sanda, CONSTANTIN, Transilvania University of Braşov Abstract: The paper aims to present the European approach in evaluation of knowledge management processes and systems, based on a case study regarding the development of knowledge management processes and knowledge management system within a multinational corporation, which goal is to increase the use of knowledge, considering the context of the knowledge-based economy development. The paper is focused on synthesizing the main aspects of applying a well-known model, McKinsey model, operational made by European Committee for Standardization. Key words: knowledge management, McKinsey, process, system 1. INTRODUCTION Knowledge management is a debatable subject for at least 15 years, some researchers and specialists considering it to be a fad, others a mean of development [Metcalfe, 2006; Nicolescu, 2005; Rao, 2005]. Considering the large number of organizations – public or private – that have applied successfully the processes and principles of knowledge management, many of them becoming case studies, we consider that knowledge management is a concept of which application is essential in order to win competitive battle. Even considering scientific aspect of knowledge management, its development is a boom within last five years, consisting mostly in the interest for the development of instruments to measure the impact of knowledge management processes and knowledge management systems over the firms [Van Der Westhuizen and Fitzgerald, 2005]. Over the years, many known and recognized organisms have established such instruments [APQC, 2004; CWA, 2004; CIKM, 2003]. The present paper is aimed to underline the importance of using such instruments in order to eliminate the subjectivism and qualitative feature of knowledge management evaluation. It consists of presenting and applying a quantitative instrument, McKinsey model in order to evaluate the knowledge management processes and knowledge management system for a multinational company. The instrument consists in a questionnaire applied on the employees of the multinational corporation for a representative sample, the questionnaire being proposed 79 by the European Committee for Standardization. The conclusions consist in straights and weaknesses, at the organization and individual level, regarding the processes of knowledge management. 2. THE MCKINSEY MODEL The model (figure 1) was developed by Tom Peters and Robert Waterman, consultants for McKinsey & Co. They have published an article called “Structure Is Not Organization” (1980) [Waterman, Peters, Phillips, 1980] and also few chapters in the following books: “The Art of Japanese Management” (1981) [[Pascale şi Athos, 1981]] and “In Search of Excellence” (1982) [Peters şi Waterman, 1982], all of them regarding this model. Figure 1. McKinsey model Structure Strategy System Shared values Skills Style Staff The authors consider that the organizations consists of seven elements, from which, three are called “hard S” and the other four, “soft S”. The “hard S” may be found within the documents of the organization, and the “soft S” are determined mostly by human resource, this meaning that they are much more difficult to be planned or influenced, having a strong impact over the “hard S”. Hard elements are easy to be identified and consists of structure, strategy and system within the organization, meanwhile soft elements are difficult to be described are represented by skills, style, staff and shared values, their characteristics being presented in table 1. Regarding the application of this model for evaluation in the knowledge management field of study, the CWA 14924-4 resolution of European Committee for Standardization presents an instrument, a questionnaire that made this model ready to be applied, in order to evaluate the development of the knowledge management 80 processes. The questionnaire consists of 42 questions evaluated by the respondents with a scale between 1 and 5. In the end, the important aspects are those regarding the questions that have obtained the highest or the lowest score, consisting in straights and weaknesses in development of a knowledge management system and/or knowledge management processes. Table 1.McKinsey model - characteristics of the elements Hard S Strategy Structure System Actions that the organization plan in order to respond or anticipate the changes from external environment The basis for specializations and coordination, determined by the strategy and the dimensions of the organization. Formal and informal procedures for making operational the structure and the strategy. Soft S Style Managerial style: the way in which the manager motivates, coordinates, control and lead the employees. Skills Distinctive competencies that determine the success and strategic differentiation of an organization. Staff Human resources management: selection process, socialization, integration of new employees, career management. Shared Organizational culture: values, beliefs, development norms along with the values organization’s life. [source: Peters, T., Waterman, R., In search of excellence, New York, London: Harper and Row, 1982, pg.113] The authors say that the efficient organizations benefice from the capacity to harmonize all the elements, this criteria generating in time the other name of the model: organizational efficiency diagnosis model. 3. THE METHODOLOGY OF THE STUDY In order to apply the questionnaire, it was first established the size of the representative sample, formed by 384 employees. The sample was established using aleatory and systematic aleatory sampling techniques [Lefter et al, 2006] at the level of the whole population represented by the employees of the multinational company from Romania – the name of the company remains unknown because of the agreement with the organization’s management. Base on the aleatory sampling, the sample was chosen from a list – the list of employees’ name, then it was established the length of the interval – of the mechanical step – used for the process of selection. The length calculated was 2, the, aleatory, it was chosen a component from the collectivity – the starting point for the others – considering the length of the interval. The starting point was, in this case, an employee having the surname starting with A, from a division chosen aleatory, then choosing the 81 other elements for the sample from all the 8 divisions of the company. The level of trust was 95%, the accepted error was +/- 5%, the value of z factor was 1.96. The preliminary check of the questionnaire, the pilot study and the viability of the questionnaire were considered implicit because of the reputation of the Committee that has promoted the questionnaire. From the total of 384 distributed questionnaires, there were collected 347, the rate of respond being 90%. The responses were analyzed by using software, SPSS for Windows, the results being the following. 4. THE RESULTS OF THE STUDY After collecting the questionnaires and synthesizing the main results, for each process of knowledge management, it was then calculated the balanced average of the results for each of the variables of the questionnaire, presented in table 2. 3. Store knowledge 4. Share knowledge 5. Use knowledge 5.000 A 4.528 4.528 5.000 4.081 5.000 4.690 5.000 5.000 4.576 5.000 5.000 4.543 B C D E F G 5.000 3.491 3.491 4.579 5.000 1.400 5.000 3.491 3.491 4.589 1.000 5.000 5.000 3.491 1.410 5.000 5.000 5.000 4.081 3.478 1.400 4.579 5.000 1.400 4.130 3.491 4.169 5.000 4.674 4.674 4.702 3.740 3.090 4.791 4.279 3.670 0General situation 2. Create knowledge 1. Identify knowledge Table 2. Synthetically situation of knowledge management processes development at the level of the company 3.927 H 3.871 4.272 3.431 4.448 3.927 Xxx I 3.527 3.527 3.527 3.615 3.530 Xxx J 4.149 4.553 4.553 4.149 3.488 Xxx K 3.838 4.040 4.040 3.882 [source: http://www.knocom.com./scan/scan.htm] 3.509 82 Total 3.545 4.178 Where A, B, C, D, E, F, G, H, I, J, K stand for: strategy, shared values, style, staff, skills, structure, system, total organization, attitude, performances, total individual. The results are presented for the general situation of the company regarding the general situation and the knowledge management processes, for each of the seven elements of the model and also for other two elements – attitude and performances – in using the processes of knowledge management. Also in the table one can find the average for composing the results for every line and column. From the point of view of McKinsey model, considering the development and the improvement of the knowledge management processes, the straights are represented by strategy (4.690), skills (4.791) and shared values (4.702). These figures attest the fact that the organization has a strong strategy regarding knowledge management processes and the organizational culture is favorable to the development of these processes. Also the distinctive competencies have determined the success of the development of knowledge management processes. The weaknesses consist of staff (3.090), meaning their implication for the development of the processes, which can be correlated with the managerial style (3.740), mainly the neutral perception regarding the stimulants, offered for the employees in order to improve the knowledge management processes. From the point of view of knowledge management processes, the straights regard sharing knowledge (4.448) and creation of knowledge (4.272), the results being justified considering the characteristics of the main processes conducted within the organization, centered on tacit knowledge. The weakness, more correctly called aspects that need improvement, consists of knowledge storage (3.431). Considering individual level, from the point of view of knowledge management processes, the straights are represented by the creation and storage of knowledge (4.040), because of the attitude and the performances of the employees. Also, the perception regarding the individual performance concerning the development of the processes, namely personal contributions to this development, is favorable (4.178). 5. CONCLUSIONS After applying the McKinsey model the conclusions are that the corporation evolves favorably towards the development and improvement of the knowledge management processes at the level of the basic processes. Organizational aspects, that necessitate future special attention consists of more implication of the employees for the improvement of the attitude for the knowledge management as a phenomena, aiming to the development of storage knowledge. The general conclusion of the paper is that, by providing a quantitative instrument for evaluating knowledge management processes from the point of view of development and improvement, both the science field and the practice in knowledge management matters is improved, the questionnaire and the model being one of the most used and cited over the literature from now on. 83 REFERENCES 1. Canadian Institute of Knowledge Management, A Common KM Framework for the Government of Canada, Frid Framework for Enterprise Knowledge Management, Version 3.0, Ottawa, Knowledge-Enabled Business Management, 2003 2. Lefter, C. Brătucu, G., Răuţă, C., Chiţu, I., Bălăşescu, M., Marketing, vol. II, Braşov, Transilvania University Publishing house, 2006. 3. Metcalfe, A. S., Knowledge management and higher education. A critical analysis, London, Information Science Publishing, 2006. 4. Nicolescu, O., Nicolescu, L., Economia, firma si managementul bazate pe cunostinte, Bucuresti, Economica Publishing house, 2005. 5. Pascale, R., Athos, A., The art of Japanese Management, London, Penguin Books, 1981. 6. Peters, T., Waterman, R., In search of excellence, New York, London, Harper and Row, 1982. 7. Rao, M., Knowledge management tools and techniques. Practitioners and experts evaluate KM sollutions, Oxford, Butterworth-Heinemen, 2005. 8. Waterman, R. Jr., Peters, T., Phillips, J.R., Structure is not organization, Business Horizons, no. 23, pg. 14-26. 9. APQC: APQC's roadmap to knowledge management, http://www.apqc.org/portal/apqc/ksn?paf_gear_id=contentgearhome&paf_dm=f ull&pageselect=detail&docid=114710&topics=%20Knowledge%20Managemen t&process=%20Manage%20Improvement%20and%20Change 10. Van Der Westhuizen, D., Fitzgerald, E. P.: Defining and measuring project success http://eprints.usq.edu.au/346/ 84 POSITIVE IMPLICATIONS OF CHOCOLATE ON THE CONSUMERS’ HEALTH Dr. Anca MADAR Transilvania University from Braşov, Faculty of Economic Sciences Abstract: This tasty aliment is over 2,500 years old. From the Mayas to the most finical consumers, it has offered its irrefutable taste and qualities. The bitter chocolate is benefic, recent researches show, because of the antioxidants content, which have very good effects in fight against cancer, heart maladies, teeth degradation and can even lead the organism to a healthy diet. The privileged place of chocolate in the modern civilizations is due to it’s inimitable flavour and to a magical halo transmitted from old times. For a total benefit it is recommended to consume products with a minimum of 70% cocoa, without synthetic sweeteners. Key words: consumer health, cocoa powder, chocolate, theobromin 1. INTRODUCTION In Puerto Escondido Honduras, Central America, archeological discoveries have revealed pots with theobromin which date from year 1100 B.C., the substance being an extract of cocoa seeds which was used in brewing some alcoholic beverages. The Aztecs have known the cocoa tree, considered sacred (the gift of god Quetzalcoatl) since the XIVth century. The alcoholic beverage made from fermented cocoa seeds was actually a mixture of water, cocoa, corn, vanilla and pepper. In 1519, conquistador Hernando Cortez discovered that Montezuma, the Aztec king, used to drink a beverage made from cocoa seeds, called „chocolatl”. Montezuma used to drink almost fifty cups a day. He served Hernando Cortez this royal beverage, which he found a bit too bitter for his taste. The Spanish added sugarcane and improved its aroma with vanilla and cinnamon. Additionally, they discovered that the drink is tastier if served hot. The Spanish people gradually began to appreciate the miraculous beverage, served especially by the aristocrats. They hadn’t revealed the secret of this drink to the rest of Europe for a century. The spanish monks were the ones that made the recipe public and it was rapidly appreciated at the Royal Court of France and then Great Britain. The privileged place of chocolate in modern civilizations is due to it’s inimitable flavour, but also due to a magical halo transmitted over time. Indeed cacohuaquatl in the inca language means „the paradise gardener’s gift for the first 85 a fruit people”, or god Quetzalcoatl’s gift. The cocoa seeds served as currency, and the cocoa pulp was used in brewing the gods’ beverage, „tchocolatl”, the chocolate with stimulating effects against fatigue and with a very pleasant taste. The cocoa tree can reach 8 meters of height in 12 years, it blooms all over theyear, having almost 100,000 flours in bouquets, but of which only 0,2% render fruit. In the XIX century two major changes appeared in the history of chocolate. In 1847 an english company created a technological process of solidification of chocolate and two years later, the swedish Daniel Peter thought of adding a new ingredient: milk. Short after, a new invention marked the history of chocolate: melting temperature lower than the human body temperature. Thus, chocolate melts in one’s mouth both literally and metaphorically. Black chocolate melts at 34-35 degrees Celcius, while milk chocolate requires a slightly lower temperature to melt. Presently, milk chocolate is the most requested choice, black chocolate being appreciated by onle 5-10% of this product’s consumers. Chocolate contains approximately 50-60% sugar to which cocoa butter and other substances add. The flavor and taste of chocolate are given by the breed of the cocoa beans. Cocoa powder is a product obtained from the seeds of the tree with the same name, „Theobroma cacao”, originary from Central America. Cocoa beans represent, actually, its seeds, and a characteristic is theobromin – a substance found around 2.5% in cocoa powder. Nowadays, the tree is cultivated in the whole tropical and equatorial region of Latin America until the Far Orient. The best cocoa quality is obtained from seeds of varieties Ceylon, Jawa, Puerta, Cabalo, Caracas and Ecuador, that have a very pleasant taste and aroma. Hierarchical order of the producers of cocoa in 2006: Table nr.1The hierarchical order of the producers of cocoa in 2006 Country production in tons Indonesia 450.000 Ghana 380.000 Brazil 175.000 Ecuador 88.000 Dominican Republic 50.000 Malaysia 48.000 Colombia 48.000 Sours : [5] Also, the quantity of milk used in the chocolate manufacture plays an important role in improving the nutritional value and characteristics of this product, and added 86 aromas and emulsifiers have the role to homogenize the mixture and improve the texture, the aroma. The quality of the chocolate is the best when the weight of the substance based on milk, the quantity of cocoa and cocoa butter are higher. [2] 2. THE CONSUMPTION BENEFICIAL ASPECTS OF CHOCOLATE Cocoa seeds contain theobromine, caffeine and salsolinol (a derivative of dopamine). Theobromine is a moderated stimulant but durable of the central nervous system. Caffeine is a stronger stimulant but it is found in a lower amount. The action of the salsonil is not yet clarified. Is already clear that the consumption in small quantities of cocoa is an effect of elation, euphoria mental concentration explained by the increase of blood serotonin. The Swiss and American cardiologists name the bitter chocolate the chocolate that has a 70% cocoa as “sweet aspirin"which reduces heart diseases and the thrombosis incidency. Scientists appreciate the positive antioxidant effect of the substance. Also, they are establishing the positive effect of the flavonoids from the cocoa are decreasing the deposits on the walls of blood vessels. At healthy people that consume cocoa was observed a slow of the premature skin aging phenomenon and a clear reduction of the cardiovascular disease incidency. New research suggests that the bitter chocolate is good also confirming previous studies that demonstrate positive effects of the flavonoids. An independent study has found that natural flavonoids from food improve blood vessel function, considered to be an important indicator of the cardiovascular health, also like cholesterol or tension. Marguerite M Engler, professor of the University of California San Francisco, communicated these results in the annual scientific session of the American Association of Cardiology. The university researchers compared the effects produced on blood vessel function after consuming a bar of bitter chocolate rich in flavonoids. The participants at the study consumed 46 grams of chocolate, a part of chocolate rich in flavonoids (259 mg) and another part with the same chocolate content poor in the same substance. The survey was held every day, for two weeks. Researchers have measured the flavonoids level from the participants blood and found out that the flavonoids from the chocolate rich in this substance have been absorbed in the blood stream. It was also tested the degree and speed of the blood vessels expansion, to pursue their elasticity. The research team found out that the participants who consumed chocolate rich in flavonoids have shown an expansion of blood vessels two hours after they consumed chocolate. "The great news is that the dilation of blood vessels at the people that consumed bitter chocolate was bigger" said Dr. Engler. Antioxidants in bitter chocolate are the secrect that allows it to fight cancer, heart diseases, against the degradation and even teeth and can lead the body to a healthy diet. This is the reason that has prompted many researchers to conduct studies that show the benefits of chocolate. Among the first that confirmed the therapeutic characteristics of of chocolate was the National Institute of Public Health in Holland. They discovered that chocolate contains the antioxidants named phenols and cathecine. Studies revealed that both substances are very efficient in preventing heart maladies and cancer. 87 Researchers discovered that chocolate contains four times more cathecine than tea. Additionally, other studies show that chocolate, and especially the cocoa plant of which chocolate is made, has the property to suppress the organism’s capacity to produce bad cholesterol, which affects the heart. A study has revealed another benefit brought by chocolate. According to researchers from the Cologne University of Germany, the consumption of dark chocolate can lower blood pressure. For two weeks, researchers gave some volunteers 100 grams of chocolate per day. After this time, the six men and seven women had their blood pressure lower by 5 points on the systolic scale and by 2 points on the diastolic scale. At the same time, another group of volunteers had to consume white chocolate. They didn’t show any change in blood pressure. Another team of researchers tells us that the road to a healthy smile consists of brushing our teeth between meals, using dental floss and eating as much chocolate as possible. As a result for the study conducted by the University of Tulane, it’s been concluded that an extract from cocoa which is also found in chocolate is a healthier alternative and as efficient as fluoride from tooth paste. Researches showed that this cocoa extract is actually more efficient against cavities than tooth paste. The extract synthetized by researchers is a white colored crystalline powder. This powder strengthens tooth enamel and prevents cavities, yet one of the major benefits that chocolate offer is prevention of cancer. Researches of the Harvard University took a trip to Panama, where they studied the customs of the native people. The tribes in this area have ancient customs of drinking 5 cups of hot chocolate every day. Researchers reached the amazing conclusion according to which the population in this area is 63% more protected from cancer than the rest of the people on our planet. The results of this study were published in the National Science Academy paper works – 24 january 2006. At the same time, doctor Docent Harold Schmitz thinks that „ detecting certain nutritional substances from cocoa that have a positive effect on the cardiovascular system opens a path to new pharmaceutic potentials or alimentary regime, which treat heart maladies. However, Carl Keen, the manager of the Nutrition Department of California University, admits that „people often forget that cocoa powder is obtained from a plant and they don’t realize that this powder contains the healthy compunds that we find in fruit or vegetables”. Doctors recommend a moderate consumption of chocolate. „In order for chocolate to have a benefic effect on the organism, we need to consume a maximum of 50 grams (the equivalent of half a tablet) per day”, says doctor Gheorghe Mencinicopschi, manager of the Institute of Nutritional Research. But we’re not allowed any kind of chocolate – we need to be careful to buy only the quality ones, with at least 70% cocoa and with as less sugar as possible. „The real chocolate is the dark one, with cocoa butter and cocoa table. Replacements for cocoa butter like margarine are very dangerous because they’re rich in fat”, adds Mencinicopschi. Chocolate is a good remedy for pressure conditions, because it has relaxing effects, but in combination with lots of sugar and nutritional additives can affect the organism. Dark chocolate flavored with orange or mint is not harmful. 88 At the Harvard University, California University and several research laboratories from European universities, medicines from cocoa could help in trating diabetes, dementia and other diseases. Some studies indicate actual mitigation effects and reducing persistent coughing. The active ingredient in treating coughing, theobromin is three times more efficient than codeine, the main medicine used against coughing. Also, chocolate has a local action of calmness and rehydration of neck mucus. Flavonoinds also have inhibatory anti-diarrhea action, which suggests antidiarrhea benefits as a result of chocolate consumption. Recently, researches have discovered a new quality of dark chocolate: it cuts our appetite and thus helps us not to accumulate excessive fat. Additionally, on holidays, when we’re tempted to eat more than usual, we should regularly eat a few dark chocolate tablets, beacuse it gives us the sensation of satiation, claim researches from the University of Copenhaga in a study published by thedailymail.com.uk. In order to analyze the effects of dark chocolate on the appetite, researches have included in an experiment 16 youngsters without health problems and a normal weight value. They tested, one by one, dark chocolate and milk chocolate. Few hours later when the youngsters had dark or milk chocolate, researches offered trhem sweet foods, salty foods and fat foods, taking notes for each of them about the quantities consumed and the calory share. From this experiment it has been determined that the number of consumed calories was 15% lower in the case of the youngsters that had dark chocolate. They calimed that they had less appetite for sweet foods, salty foods or fat foods after they had dark chocolate. Dark chocolate contains approximately the same number of calories like milk chocolate: 531 calories / 100 grams, respectively 564 calories / 100 grams. But only dark chocolate diminishes appetite, according to specialists. As for milk chocolate, it has reduced benefic properties, because milk proteins stop the absorption of vitamins and minerals from chocolate. Although this aliment does good to the organism, it must not be forgotten that chocolate, in the form that it is marketed, contains a lot of sugar and saturated fats to make it tastier. If these auxiliary ingredients are found in large proportions, they cancel the benefic effect of antioxidants, and the chocolate becomes useless. In order to take advantage from this aliment, it is good to consume products with a cocoa mass of at least 70% and if possible, without containing artificial sweeteners. 3.CONCLUSIONS: The consumption of sweets may have beneficial effects on body, if it is kept in the normal range, without excesses. Especially chocolate, which is known, due to the magnesium content, that contributes substantially to the smooth functioning of the muscular system, helping restore muscles after making sustained exercises and to avoid muscle cramps. Also, chocolate has a positive effect in the functioning of the cardio-vascular system and the circulation, contributing to the regeneration of heart rhythm. The proper functioning of the nervous system is, in turn, influenced by the consumption of chocolate in moderate quantities. This has the effect to balance the nervous system, the contribution in neurosis treatment and depressive states being recognized by specialists 89 in the field. The digestive system can be favorably influenced by the consumption of chocolate, which aims to promote the transit of food and digestion, being an effective method to combat diarrhea. Finally, the list of favorable effects on consumption of sweets that the human body may have can not be complete unless we mention the important energy contribution, with influences in terms the general tone and vitality of each. REFERENCES 1.Licsandru G., Cacao against fat, the National Official 07/06/2008 2. Pamfil R., Science and experience goods food export - import, Editura Oscar Print, Bucharest, 1996 3. Poncu R., Luxury Chocolate, quick and foam. History of chocolate, www.news.spftpedia.com 4. Vlasceanu G., Cocoa powder reduce deaths caused by heart disease, Curierul National, 18 February 2006 5. http://ro.wikipedia.org/wiki/Cocoa 6. NewsIn 90 PROGRAMS FOR SUPPORTING THE ACCESS OF ROMANIAN SMALL AND MEDIUM SIZED ENTERPRISES TO MANAGEMENT CONSULTING SERVICES Daniela Roxana MIHAI, Coord.Prof.univ.dr. Gabriel BRĂTUCU University of Transylvania from Brasov Abstract: It is widely accepted the idea that the SME`s represents the majority share in the private sector, reason why it can be affirmed that this sector has absorbed most of the available workforce, contributing also to the formation of a new generation of patrons and employees. Undoubtedly, SME`s are the most important beneficiary of the business consulting services. Given these issues, this article may be considered a study case which analyses the instruments created in order to stimulate the demand for consulting services among the Romanian SME`s, facilitating their access to such services. Key words: consultancy, management consulting, grants, advisory services, SME`s 1. INTRODUCTION In Romania, like other countries in Central and Eastern Europe, transition to market economy consisted, in essence, in the evolution of two components: transfer of ownership of enterprises from state to private-law persons, resulted in the privatization process, and the emergence of private enterprises, as a result of private, independent initiatives, which arose as a result of perceived changes in the units which were still in the state ownership. Manifestation of the two trends has pursued a series of visible repercussions on the labor market. While the privatization process has significantly reduced the number of jobs, contributing to rising of unemployment, the birth of the new private sector has generated most of the new jobs. 2. PROGRAMS TO SUPPORT THE MARKET DEVELOPMENT OF MANAGEMENT CONSULTING SERVICES The results of a survey conducted in 2005, by the National Agency for Small and Medium Sized Enterprises and Cooperatives (NASMSEC), subordinated to the 91 Ministry of Small and Medium Sized Enterprises and Co-operatives, have shown that the Romanian SME`s show little interest in the use of advisory services. As main causes for this situation were identified the poor quality of services provided by Romanian consultancy companies as well as the extremely low desire on the part of the SME`s to allocate its financial resources, in order to buy management consultancy services. As a consequence of this investigation it has been rethought the government policy to support business development services, whose main objective was to improve the SME`s performances by addressing to their operational needs. Directions of the new intervention policy aimed on the one hand, improvement of skills and abilities among existing service providers on the Romanian market, and, on the other hand, promoting a culture within the SME`s, towards the use of consultancy and training services. The foundation of the policy to support business development services was set in 2004, when NASMSEC launched and implemented a program called "Consultancy and training services for small and micro - enterprises". The objectives of the Programme were the development of entrepreneurship, efficiency improvement for business development services sector and to increase competitiveness of the SME`s sector. In essence, the funding could cover up to 60% of the value of services purchased with a maximum amount that could exceed 100 million lei. Subsequent steps in order to improve the government programme continued by testing a new project consisted in the implementation of vouchers advice system (Voucher Counseling System – VCS). As a subsidized program, the VCS was aimed to facilitate access to advisory services for SME`s and potential business people. Basically, this system offered beneficiaries the opportunity to purchase a particular consultancy service, using a voucher worth a certain amount, covering the equivalent number of hours of consulting over a certain period of time. Improving the quality of consultancy and training was considered an important objective also for the European Commission, and its efforts in this regard created a project meant to strength the capacity of business services providers at the regional level, known under the PHARE 2003 Programme for Economic and Social Cohesion. Some of its objectives were: Improve the capacity of business service providers to provide consultancy services of the highest quality and developing a national network of such providers, with transnational links. The result of this objective was the creation of the Network of Affairs Consulting Organizations. Increased competitiveness of micro, small and medium enterprises in Romania as a result of contracting consultancy services of the highest quality. Stimulating the Romanian SME`s demand for consulting services. Continuing the approach initiated by the European Commission it was launched the PHARE Program Funding 2004 - 2006, Economic and Social Cohesion component, for this purpose being allocated 15 million Euros in order to support a widespread access of the SME`s to proper information, consultancy and training services. 92 Other programs designed to contribute to the support of the SME`s' access to business advisory services, financed from European and Government funds, are the PHARE 2006 Programme "SME`s assistance for the purchase of business advisory services", PHARE 2005 ESC "Support for SME`s in order to purchase business consulting services", “Business Advisory Services Programme” or National multiannual program for the period 2006-2009 for supporting the access of small and medium sized enterprises to training and consulting services. Details on these programs are set out below. 2.1 BUSINESS ADVISORY SERVICES PROGRAMME The Business Advisory Services Programme was launched in Romania in 2006, but it is working since 1995, in 18 countries. Funds allocated came for each country separately, from various institutional donors. In Romania, the budget of 1.5 million Euros has been donated by the Austrian Federal Ministry of Finance.20 In our country, the programme is set to run until 2009, with the possibility of extension, depending on the number of requests and the amounts of institutional donors. The objective of the programme is to support the companies that need specialist advice but also the local consultancy companies, taking into account the fact that the financing is only provide for consultancy projects carried out by Romanian consultants. Through the BAS Programme, eligible Romanian companies can obtain grants of up to EUR 10,000 but no more than 50% of the total net cost of a consultancy project (excluding taxes). The minimum amount of the grant is 1000 euros. Moreover, companies receive assistance in defining their needs for business advice and support, in selecting consultants to work with and this was one of the differentiations from other European funding programs. Consultancy projects co-financed through this programme cover a wide range of services, some examples in this regard are: implementation of quality, environmental, occupational safety and food safety management systems, feasibility studies, development planning, marketing consultancy, engineering studies, computerized manufacturing systems and other similar services. The following types of consultancy services are not eligible for BAS financing: legal advice, tax planning and audit. Funding recipients must meet a series of eligibility criteria, such as: To be part of the SME sector (between 10 and 250 employees, except that even up to 500 employees, turnover of up to 40 million); Majority Romanian owned; Available only for private companies; 20 http://www.basromania.ro/about-bas-programme.html 93 To be active in the market for at least two years; Have a real potential for development; Have need of consulting services and possess the ability to follow the recommendations proposed; Eligible companies can be active in all business sectors (both services and manufacturing). Since launching the program in Romania, most of the funds were directed to draft advice which endorsed the implementation of management systems and marketing advice. Nearly half of the money spent went to companies in Bucharest and the rest to companies from outside the Capital. The average value of grants awarded by BAS in Romania was around 6400 euros by one project. Companies which have contracted this programme come from various fields such as HORECA, retail, telecommunications, media and communications, law firms, IT, tourism, pharmacy distribution, production of furniture etc. The highest share in terms of absorbed amount of funds is held by media and communications (18% of the total amount absorbed), followed by HORECA (16%), electrical, electronic and IT (13%) and chemical industry (12%). (Figure 1). Figure 1 Industries that benefited from BAS Romania Programme Glass/Rubber/ Plastic Machines/ 3% Equipment 3% Health 2% Tourism/Travel 1% Media& Communication 18% Wood Processing 5% Printing& Publishing 6% Others 10% Constructions& Engineering 11% Food&Beverages 16% Chemical 12% Electrical/ Electronics/IT 13% Source: http://www.basromania.ro/en/statistics.html 2.2 PHARE 2006 PROGRAMME "SME`S ASSISTANCE FOR THE PURCHASE OF BUSINESS ADVISORY SERVICES" With a forecast budget of 11.20 million euros, the Programme is financed by the PHARE contribution and co-financed by funds from the National Budget. This is the 94 latest PHARE scheme for financing, facilitating the SME`s' access to advisory business services, with a period of operation 2008 – 2010.21 The Programme objective is to improve the SME`s access to business development services, offered by consultancy services suppliers. This objective will be met by reducing costs incurred by SME`s when purchasing consultancy services. One of the particularities of this programme is that beneficiaries can be both SME`s constituted under the Romanian laws in force, as well as NGOs aimed at writing instruments in promoting the SME sector and also have SME`s as members or founding members. 2.3 PHARE 2005 ESC "SUPPORT FOR SME`S IN ORDER TO PURCHASE BUSINESS CONSULTING SERVICES" Funded by the PHARE 2005 Economic and Social Cohesion, this component was allocated a forecast budget for 1157 thousand Euros and the deployment is two years, respectively from 2007 to 2009. Stated aim of the Program is to improve the SME`s' access to business development services, offered by suppliers of consultancy services.22 This programme was developed strictly for the South Muntenia Region, represented by the counties of Arges, Călăraşi, Dâmboviţa, Ialomiţa, Giurgiu, Prahova and Teleorman, having as beneficiaries the SME`s and NGO`s in the area mentioned above. Assistance through this program materializes in grant funding to support the following business development services, such as: General Management Consultancy- reorientation and business restructuring; Management support and training; Human Resources support and training; Marketing consultancy and market research; Assistance in production - productivity, product development, innovation, quality systems, ISO certification; Export Assistance; Information services - IT systems, partnerships, sales promotion, technology transfer, innovative services; Specialized sectors / industries; Assistance in obtaining financing; Support for laws knowledge and compliance, particularly those related to the European internal market, applicable in Romania, as EU Member State. 21 Guide to sources of financing for SME`s. Document prepared by the Ministry for Small and Medium Enterprises, Commerce, Tourism and Liberal Professions in 2007 and published on line at:: http://www.mimmc.ro/imm/aces_finantare/, p. 31 22 22 Guide to sources of financing for SME`s. Ibidem, p. 32 95 2.4 NATIONAL MULTI-ANNUAL PROGRAM FOR 2006-2009, FOR SUPPORTING THE ACCESS OF SMALL AND MEDIUM SIZED ENTERPRISES TO TRAINING AND CONSULTING SERVICES It is funded by the Ministry for Small and Medium Enterprises, Commerce, Tourism and Liberal Professions, with a budget forecast for 6000 thousand lei. Stated aim of the Program is the affirmation and unlocking the potential of production and services of small and medium enterprises, by training their staff in positions of decision and/ or execution and facilitating access to consultancy services, to successfully integrate into the European Union.23 The registration consists of filling and sending to MIMMCTPL or to its territorial offices, a request type of principle agreement for funding, accompanied by the documents required in the procedure of implementing the Program. It should be noted that supporting the SME`s' access to business advisory services is also achieved through the structural funds, respectively through the Sectorial Operational Programs, the Regional Operational Program, the Sectorial Operational Program for Human Resources Development, the National Program for Rural Development and through the Operational Program from 2007 to 2013. REFERENCES 1. Guide to sources of financing for SME`s. Document prepared by the Ministry for Small and Medium Enterprises, Commerce, Tourism and Liberal Professions in 2007 and published on line at: http://www.mimmc.ro/imm/aces_finantare/ 2. Business Advisory Services Programme: http://www.basromania.ro/about-bas-programme.html 23 Guide to sources of financing for SME`s.Op. cit., p. 20 96 COMMODITIES LIKE INVESTMENTS – URANIUM, COOPER AND ZINC - Drd. Carmen Roxana MORANDAU Coord. Prof.Univ. Liliana Duguleana Abstract: Lately there were a lot of articles about commodities in various international newspapers. The reason is that over the past few years, commodities have certainly been under the spotlight and have gone from lacklustre performer to the talk of the investment town. Key words: Investment, Commodity, Uranium, Cooper, Zinc A commodity is a fungible good, or one that is interchangeable with other commodities of the same type. There are some 20 exchange around the world where commodities can be traded, the most well-known ones are in Chicago and London. All sorts of commodities can be traded. They can be metals such as gold, platinium and titanium, or oil, or agricultural commodities such as soy, wheat, cocoa, coffe and sugar. These exchanges, however, do not trade the physical commodities on site – let us imagine the chaos of trading millions of tonnes of commodities across the trading floor every day! Instead, a buyer will negotiate with a seller and secure a contract agreeing to buy a specific amount of a commodity on a certain date at a specified price. The buyer typically only needs to put down a 5 per cent deposit to secure the deal. The investment is therefore very leveraged or geared. The are five reasons24 to invest in commodities: 1. It is a inflationary hedge. Inflation has become so widespread (although it is not accurately reported by official statistics) that it has eaten away at the purchasing power of our hard-earned money. Commodity prices will hold up against inflation as they are linked to real, physical assets that have a limited supply, unlike cash – central banks can print as much cash as they need to fund governments shopping lists and to cover any shortfalls in tax revenue. 2. Demand for comodities will continue to increase. The economic awakening af the BRIC (Brazil, Russia, India, China), particularly China and India, which are home to almost 60 per cent of the world's population, will continue to drive 24 Mellon Jim, Chalabi Al, „Top 10 Investments for the next 10 years”, Edit. Capstone, Marea Britanie, 2008, pag. 130 97 demand for commodities. China has almost no commodities of its own and must rely on imports to allow it to develop its country's infrastructure and economy. For example, China is already the world's largest importer of steel and the second largest importer of oil, after the United States. 3. It's an investment hedge/diversification strategy. There is no correlation between the price of commodities and other investments, such as equities, bonds and real estate so if these other asset classes came under pressure, we will at least have part of ower investment in something that will not be affected. 4. Twenty-five per cent of global trade is in commodities so they have been around for a while and will continue to be the backbone of the global economy. 5. It's a new investment class that most retail investors like us have not had access to until recently. There are now effective ways to access what has traditionally been an asset class that has had substantial barriers to entry. After these ilustration of the incredible returns that some commodities have had, we will continue with a case study for one particular commodity that has had a truly remarkable return on investment since 2005 – uranium. Uranium Uranium is a somewhat controversial element – it can be used for good or evil, for example: to generate efficient, clean and cheap energy, or it can be used to make nuclear weapons. As an aside, this is what the political stand-off between Iran and the rest of the world is all about – Iran claims it is seeking to generate energy from nuclear power, while the rest of the world believes it is just an excuse to produce nuclear weapons, especially given the fact that Iran is home to the world's third largest proven oil reserves so it doesn't really need an alternative source of energy. Uranium is an incredibly efficient way of generating clean energy. To date, nuclear power generates 16 per cent of the world's energy supply and the specialist believe this will increase substantially in the coming decade25. Some countries are bigger fans of nuclear energy than others. France, for example, is a big proponent of nuclear energy and has 59 nuclear power stations that generate around 80 per cent of its energy. To do this, France needs around 10.000 tonnes of uranium and it acquires this from the lucky few countries who have uranium deposits, namely Canada, Australia, Niger, Russia, Namibia and Kazakhstan. But the world's largest producer of nucleargenerated electricity is United States, France is second followed by Japan. According to the IAEA (the International Atomic Energy Agency), there were 435 nuclear power stations in the world by 2007 across 31 countries. Current global annual uranium production is around 50.000 tonnes per year, which barely meets 60 per cent of the demand. The balance remaining has been obtained through the recycling of spent fuel rods, depleting stockpiles and by using up the weapons-grade uranium left over from the cold war. These alternative sources are running out. 25 Mellon Jim, Chalabi Al, „Top 10 Investments for the next 10 years”, Edit. Capstone, Marea Britanie, 2008, pag. 132 98 It is important to mention that uranium generates almost two and a half MILLION times more energy than coal – and with no carbon dioxide emissions. There really isn't anything else than can even come close to rivalling uranium as an efficient and clean energy source. It is important too that nuclear power is an extremely dangerous source of energy with radioactive waste that lasts tens of thousands of years. Granted, nuclear energy tends to have negative connotations but that is primarily due to the world 'nuclear', which is immediately associated with death and destruction because of the nuclear bomb, but nuclear power is an entirely different application. There was also the infamous Chernobyl nuclear power plant accident in 1986, but that power station had a flowed design and an ineffective emergency shutdown procedure. Today's nuclear power stations have technologies and processes in place that would render a repeat of that incident an extremely unlikely event. It is true that nuclear waste in the form of plutonium is an undesirable by-product of nuclear power and its disposal is a serious concern. Because it is highly radio-active and has a half-life of around 25.000 years (it takes this long for its radiation levels to fall by 50 per cent), the common way to dispose of it is to secure it in a container that prevents any of the radiation from leaking and to bury it deep in the ground or the ocean. The world's biggest producers of Uranium are Canada, Australia and Kazakhstan. These three countries alone account for 58 per cent of the uranium that was mined in the world in 2006. Below is a list of the largest companies that mine uranium. Table1: The largest companies that mine uranium Company Cameco Rio Tinto Areva KazAtomProm TVEL BHP Billiton Navoi Uranium One TOTAL Country North America, Australia North America, UK, Australia France Kazakhstan Russia Australia, UK, South America Russia Canada, South Africa, Australia, Kazakhstan USA Tonnes of Uranium 8249 7094 Percentage 5272 3699 3262 2868 13 9 8 7 2260 1000 6 3 33704 86 21 18 Source: Mellon Jim, Chalabi Al, „Top 10 Investments for the next 10 years”, Edit. Capstone, Marea Britanie, 2008, pag. 133; www.cameco.com; www.riotinto.com; www.arevo.com; www.kazatomprom.kz, www.tvel.ru, www.bhpbilliton.com, www.navoi.ru, www.uranium1.com 99 Table2: The evolution of uranium price is emphasized in the figure bellow: Year Month Uranium price ($/baril) 2004 March April May June July August September October November December January February March April May June July August September October November December January February March April May June July 17,63 17,68 17,80 18,50 18,50 19,63 20,00 20,23 20,50 20,60 21,10 21,75 22,55 25,00 29,00 29,00 29,50 30,10 31,63 33,25 34,75 36,38 37,50 38,63 40,75 41,50 43,00 45,75 47,38 2005 2006 100 Medium of uranium price on long term published by Ux Consulting and TradeTech ($/baril) 17,50 17,50 18,00 18,75 19,00 23,00 23,00 24,00 25,00 25,00 26,00 26,50 27,25 28,50 30,00 30,00 31,00 31,50 32,50 33,75 34,75 36,13 37,00 39,50 41,50 43,75 46,25 46,75 47,50 2007 2008 2009 August September October November December January February March April May June July August September October November December January February March April May June July August September October November December January 50,25 54,88 60,13 63,50 72,00 75,00 85,00 95,00 113,00 125,00 136,00 120,00 90,00 85,00 85,00 93,00 90,00 78,00 73,00 71,00 65,00 60,00 59,00 64,50 53,00 45,00 55,00 52,50 47,50 44,50 Source: www.cameco.com 101 52,00 54,50 59,00 59,00 72,00 75,00 85,00 85,00 85,00 95,00 95,00 95,00 95,00 95,00 95,00 95,00 95,00 95,00 95,00 95,00 90,00 87,50 82,50 80,00 80,00 75,00 70,00 70,00 69,50 69,50 Figure1: Uranium price 160 110 60 10 March April May June July August September October November December January February March April May June July August September October November December January February March April May June July August September October November December January February March April May June July August September October November December January February March April May June July August September October November December January Uranium price ($/baril) 2004 2005 2006 2007 2008 2009 Uranium price perceived by Cameco Medium of uranium price on long term published by Ux Consulting and TradeTechMedium of uranium price on long term published by Ux Consulting and TradeTech We can notice that the highest price of uranium was collected by Cameco in June 2007. Copper Unlike certain other commodities, copper is not rare so it is not purchased for a store of value in the same way that gold or platinium is. In fact, quite the opposite: according to the Copper Development Association, global copper resources are estimated to be almost 5,8 trillion pounds and about 12 per cent of it has already been mined. Figure 2: World mine production copper losses from „plan” Source: www.lme.com 102 Copper used to make so many things - it's the third most widely used metal. Examples of its uses include electrical and electronic products, transportation equipment, telecommunication. Although there are quite a few countries that produce copper, by far the world's largest producer is Chile, accounting for over a third of global production. Chile is to copper what Saudi Arabia is to oil. Other copper-producing countries include the US, Canada, Russia, Peru and Australia. The consultants don't recomend to buy by yourself copper futures, even you are an expert of that. The recommendation is to invest in a fund specializing in metals/extractive metals or to invest in a large, stable mining company – an American, Canadian or Australian one, or even a South African one for the braver investors. The reason is that the further industrialization of commodity – poor China and, to a lesser extent, the other emerging markets of India, South America and South East Asia will continue to drive demand for these metals for the next decade and their supply is very limited. Figure 3: Copper demand growth by region Source: www.lme.com An important trader on metal exchange is LME (London Metal Exchange). 103 Figure 4: The volume of metal exchange trade by LME Million tons 600 500 400 Other 300 LME 200 100 Zi nc S el en iu m Le ad N ic ke l C op pe r A lu m in iu m 0 Nonferrous metals Source: www.lme.com Figure 5: Share of the total volume of non-ferrous metals market LME (%) Zinc 91 Selenium 99 Lead 95 Nickel 99 Copper 79 Aluminium 97 0 20 40 60 80 100 120 % Source: CRU 13th World Aluminium Conference, 21-24 September 2008, Hilton Chongqing, China In this figure we can see that the most trade non-ferrous metals, by LME, are Nickel and Selenium with 99 per cent. 104 Zinc Zinc is another extractive metal that it is expected to become more expensive as a result of the continued development of the emerging countries, particularly the BRIC economies. The largest and most important application of zinc is in galvanization of iron and steel. Zinc is also used as the anode (the positive end) of batteries as well as for making die castings which are used in manufacturing, such as the automobile industry. The volatility of Aluminium, Copper and Zinc (cash) is presented in the figure below: Figure 6: Volatility – LME Aluminium, Copper and Zinc (cash) Source: London Metal Exchange (www.lme.com) 105 REFERENCES 1. Gavrila, Carmen, Iran: istoria unei noi puteri nucleare vechi, Cotidianul, 20.11.2007 2. Mellon, Jim; Chalabi, Al, The top 10 investments for the next 10 years, Capstone Publishing, UK, 2008 3. Stutz, Frederic P.; Warf, Barney, The world economy – fifth edition, Prentice Hall, 2007 4. www.iaea.com 5. www.lme.com 6. www.wikipedia.org 106 HOW TO USE PORTFOLIO THEORY IN STOCK EXCHANGE INVESTMENTS Iulia, MURARIU, Master Student Coord. Prof. Dr. Liliana DUGULEANĂ Transilvania University from Brasov, Faculty of Economic Sciences Abstract: Could the decision of investment be taken by using modern portfolio theory? Or this is more an empirical decision taken by an inspired manager? If we decide to invest our money to the Bucharest Stock Exchange, can we find statistical models to help us? Key words: portfolio, stocks, beta, CAPM 1. INTRODUCTION Rational investors are using portfolio theory to optimize their portfolios. The basic concepts of the theory are Markowitz diversification, the efficient frontier, capital asset pricing model, the alpha and beta coefficients, the Capital Market Line. 2. PRELIMINARY DATA We choose to invest in 2 different domains: we buy stock from Antibiotice Iasi S.A. (ATB) and Policolor S.A. (PCL). We take the closing price in the last day of each month between 1999 and 2007. Figure 1. The evolution of the stocks’ prices between 1999 and 2007 2,5 ATB - closing price 5 2 1,5 4 1 2 0,5 1 0 0 PCL - closing price 107 01 .0 1. 19 99 29 .1 0. 19 99 31 .0 8. 20 00 29 .0 6. 20 01 30 .0 4. 20 02 28 .0 2. 20 03 19 .1 2. 20 03 29 .1 0. 20 04 31 .0 8. 20 05 30 .0 6. 20 06 24 .0 4. 20 07 01 .0 1. 19 99 29 .1 0. 19 99 31 .0 8. 20 00 29 .0 6. 20 01 30 .0 4. 20 02 28 .0 2. 20 03 19 .1 2. 20 03 29 .1 0. 20 04 31 .0 8. 20 05 30 .0 6. 20 06 24 .0 4. 20 07 3 It is not indicated to use directly these prices, but to convert them in series of p − p t −1 ×100% , where: returns: R t = t R t = rate of return at t moment; p t = price p t −1 at t moment; t = the last day of each month. Figure 2. The evolution of the stocks’ rate of return between 1999 and 2007 ATB PCL 1,5 0,8 1 0,6 0,4 0,5 0,2 0 0 -0,5 -0,2 -1 -0,4 We compute the following: n • average monthly return : R = ∑ p t ⋅ R t , where p t = i =1 1 1 = n 108 R ATB = 4,11% , R PCL = 2,95% • risk, measured by the standard deviation: σ = σ2 = n ∑ p × R t t =1 t − R t 2 TLV = 17,79% , σ PCL = 14,28% ; Between the 2 indicators there is a direct relation: the more risky share, ATB, brings also a bigger return 4,11%, comparing with the 2,95% PCL return. • covariation – the trend of variance between the 2 stocks: cov ATB,PCL = ∑ pi × R ATB − R ATB × R PCL − R PCL = 0,00661 cov ATB,PCL = 0,26 • correlation coefficient: µ ATB,PCL = σ ATB × σ PCL σ ( ) ( ) This value is less than 1, which means that the stock are only faintly correlated (as we can see in Figure 2) and the portfolio formed by the 2 shares has a lower risk. 108 Figure 3. The portfolio’s risk and return compared with the 2 stocks Correl=0,26 rentabilitate 0,05 ATB 0,04 portofoliu 0,03 ATB PCL PCL 0,02 portofoliu 0,01 0 0 0,05 0,1 0,15 0,2 risc 3. THE PORTFOLIO – RISK, RETURN, EFFICIENT FRONTIER n rp = ∑ ωi × R i = ωATB × R ATB + ωPCL × R PCL Expected return: • i =1 Risk portfolio: • 2 2 2 2 σp = σp2 = ωATB ⋅ σATB + ωPCL ⋅ σPCL + 2 ⋅ ωATB ⋅ ωPCL ⋅ σATB,PCL 2 2 2 = ω2ATB ⋅ σATB + ωPCL ⋅ σ PCL + 2 ⋅ ωATB ⋅ ωPCL ⋅ σATB ⋅ σPCL ⋅µ ATB,PCL The portfolio with minim risk represents that combination of the 2 stock, which offers the minimum risk. ∂σp We should find the ω* for which = 0 , where ω* = the weight of ATB in * ∂ω the portfolio and (1- ω* ) = the weight of PCL in the portfolio; ∂σ p ∂ω * ∂ = ( 2 *2 2 *2 ω *2 ⋅ σ AT ⋅ (1 − ω *2 ) ⋅ σ AT B ,PC L B + (1 − ω ) ⋅ σ PC L + 2 ⋅ ω ∂ω ( *2 2 AT B *2 + (1 − ω ) ⋅ σ 2 PC L * + 2 ⋅ ω *2 ⋅ (1 − ω *2 ) ⋅ σ AT B ,PC L = 1 ∂ ω ⋅σ ⋅ 2σ p = 1 ⋅ 2 σ 2AT B ω * − 2 σ 2PC L (1 − ω * ) + 2 σ AT B ,PCL − 4 σ AT B ,PC L ω * 2σ p = 1 2 ⋅ 2 σ 2AT B ω * − 2 σ 2PC L + 2 σ PCL ω * + 2 σ A T B ,PCL − 4 σ AT B ,PC L ω * 2σ p ∂ω * 2 2 2 ⇒ ω * ⋅ 2 σ AT B + 2 σ PC L − 4 σ AT B ,PCL = 2 σ PCL − 2 σ AT B ,PC L ⇒ ω* = σ 2PC L − σ AT B ,PC L 2 σ 2AT B + σ PCL − 2 σ AT B ,PC L 109 ) ) ω * =0,3551=35,51% Table 1. Different Portfolios Weight of ATB 0% 10% 20% 35,51% 60% 80% 90% 100% Weight of PCL 100% 90% 80% 64,49% 40% 20% 10% 0% PORTOFOLIO Risk Return 14,28% 2,95% 13,43% 3,06% 12,82% 3,18% 12,45% 3,36% 13,35% 3,65% 15,23% 3,88% 16,44% 4,00% 17,79% 4,11% Explanations Unprofitable Portfolio Minimum risk portfolio Chosen portfolio return Figure 4. Different portfolios and the efficiency frontier 0,045 0,04 0,035 0,03 0,025 0,02 0,015 0,01 0,005 0 P.m axim renturn. ATB=100% PCL=0% P.m inim risk ATB=35,51% PCL=64,49% 0 0,05 0,1 0,15 0,2 risk Giving different values to the weights of the stocks in the portfolio, we notice: • • • minimum risk portfolio has a 3,36% rate of return, which is a medium value; the portfolio with smaller rate of return than the rate of return of the minimum risk portfolio cannot be accepted because the have a higher risk compared to the rate of return; these are represented by empty bullets; the maxim rate of return is made by 100% stock of ATB and is equal with its rate of return, 4.11%. The efficiency frontier represents the totality of efficient combinations of portfolios, situated between the minimum risk portfolio and the portfolio with the maxim rate of return. 4. BETA COEFFICIENT The beta coefficient describes how the expected return of a stock or portfolio is correlated to the return of the financial market as a whole. 110 n βp = σp,M σ 2 M = covariance ( p, M ) dispersion M ∑(R = p )( − Rp ⋅ RM − RM p =1 n ∑(R M − RM p =1 ) 2 ) = σportfolio,BET σ 2 BET = 0,00616 = 0,7051 0,00874 Our portfolio is only faintly correlated with the capital market. These kinds of stocks are recommended to be invested in when the economy is in regression. 5. SECURITY CHARACTERISTIC LINE The security characteristic line (SCL) represents the relationship between the market return and the return of a given asset i. In general can be illustrated as a statistical equation: • rate of return: R i = α + βi ⋅ R M + ε , • 2 2 2 2 variance: σ i = β i ⋅ σ M + σ ε • risk: σ = σ 2 , where R i =estimated rate of return for share i; R M = rate of return for market portfolio; ε = measures individual risk; α = alpha coefficient and β = beta coefficient βi2 ⋅ σ2M = market risk; σε2 = individual risk; We made the regression between the average monthly return of the portfolio and the average monthly return of BET, capital market index and we obtain the same βp =0,7051 : Table 2. The ANOVA Regression Intercept X Variable 1 Coefficients 0,0155 0,7051 Standard Error 0,01560 0,15644 t Stat 0,99358 4,50712 We obtained the following statistical equation: RP = α + β⋅ RM + ε R P = 0,0155 + 0,7051 ⋅ R M + 3,52085E-17 R P = 0,0155 + 0,7051 ⋅ 3,47% + 3,52085E-17 R P =0,4=4% 111 P-value 0,32269 0,00002 Lower 95% -0,01543 0,39494 Upper 95% 0,04644 1,01525 σ2P = βP 2 ⋅ σ2M + σε2 σ2P = (0,7051) 2 ⋅ 0,0087 + 0,02267 σ2P = 0,027 σ = σ 2 =16,44% 5. CAPM MODEL The model takes into account the asset's sensitivity to non-diversifiable risk (also known as systemic risk or market risk), represented by the quantity beta (β), as well as the expected return of the market and the expected return of a theoretical risk-free asset. ri = rf + βi ⋅ ( rM − rf ) , where: rf = risk-free asset and it was calculated as an average rate of ROBID 3M between; this value was divided by 12, because we need monthly value; rM = expected return of the market , expected return of BET Index. rportofoliu = rf + βp ⋅ ( rM − rf ) rportofoliu = 2,07% + 0,7051 ⋅ ( 3,47% − 2,07% ) rportofoliu = 3,06% We can write: ri = rf + βi ⋅ ( rM − rf ) , ri = rf + βi ⋅ λ , and ( ri − rf ) individual risk premium • • = βi ⋅ ( rM − rf ) market risk premium individual risk premium = 3,06% - 2,07%=0,99% market risk premium = 3,47% - 2,07%= 1,40% REFERENCES 1. McLaney, E.J., Business Finance – Theory and Practice, Pitman Publishing, 1997, London, pg.159-189 2. Stancu, Ion, Finante – vol.I – Piete financiare si gestiunea portofoliului, Editura Economica, 2007. 3. Modern portfolio theory: http://en.wikipedia.org/wiki/Modern_portfolio_theory 4. Beta (finance): http://en.wikipedia.org/wiki/Beta_coefficient 5. Capital asset pricing model: http://en.wikipedia.org/wiki/Capital_asset_pricing_model 6. www.bvb.ro 112 THE ROLE OF PACKING IN PRODUCT SELLING Nicoleta Andreea NEACŞU, “Transilvania” University of Brasov Abstract: The packing of products represents an important part of our social life, influencing the way we live in a consumer society. Because the life style keeps evolving, it is also necessary that the packing of products evolve, in such a manner as to satisfy the continuously changing needs and to respond to existent and potential needs. This evolution is supported by the changes in the social structure and by the technological advance that creates more and more possibilities for the manufacturer of packing. The packing does not just have to look good on the shelf of a store, but it must protect the content and be efficient in distribution and utilization by the consumer. Key words: packing, products, protection. 1. INTRODUCTION The packing is a physical-chemical system with complex functions, destined to assure temporary protection of products, in the purpose of quality and integrity maintenance during manipulation, storage, transportation and selling or until the warranty expires. At the beginning, the functions of packing were limited only to preserving and safe keeping products, but when the production started to develop and the products diversified, the functions of packing multiplied. The main functions of packing: Conservation and protection of product – main function that assures the integrity of product on the circuit manufacturer-consumer. This assumes the protection of content by the external environment, when there is a perfect correlation between the packing-product-method of preservation. From this point of view, the packing protects the product against cold, moisture, solar radiations, dust, sulfuric dioxide, microorganisms, bugs, etc. Manipulation, storage and transportation is related to the first function, because along the way of these operations, the packed products are subjected to mechanical efforts that may deteriorate them [2]. Manipulation function – by shape, volume, mass, etc. the packing facilitates the manipulation of products Storage function – during the storage, the packing takes over a part of the pressure resulted after the products were stored. To accomplish this function, it must be 113 easy to arrange the packing in pile, it should resist at temperature variations and humidity and exhibit the inscription of possible precautions during manipulation. Transport function – can be made if the packing is adapted to transportation norms, if the volume/weight ratio is optimum and if the dimensions and shape of packing are adapted to loading units in product transportation The function of promoting the products – by shape, color, graphics, the packing must present the product, contributing to its sale, also known as “the mute salesman” of products. With the help of packing, the buyer must be able to identify the product, to give information about different characteristics of the product. 2. THE PACKING AND COMMUNICATION This function of the packing is very complex because it includes information that is based on the consumer and helps at the creation of an image of the product. The primary role of packing in communication is to inform the consumer over the product [1]. Even in its early shape, packing reflects this concern. By reading the label of the product, the consumer must obtain information about the composition of the product, recommended methods of preservation and utilization. The requests in this domain have grown in the last few years as a result of the pressures made by the Consumer Protection Association. The law stipulates that the packing contain a various range of information about the product. 3. THE PACKING AND TRADE MARK IDENTITY The packing represents the interface between the product and the consumer. It is the expression of the trade mark identity of the product, the criteria according to which the product is chosen. It represents the first contact of the consumer with the product, being a key factor in positioning the product on the market. The physical proximity of the packing brings it closer to the consumer, which looks at it, takes it from the shelf to look it closer and reads what it is written on it, feels it, takes it home and uses it. The shape, color and texture of the packing produce different sensations to the consumer. In a few words, the packing is the mute salesman of the products. Advertising agencies use packing as an important point in sales and also as a modality to create the trade mark image [2]. A well made packing can send the product on the top of the chart of sales, allowing some products to be associated with an almost mythical quality (e.g. the bottles of Coca-Cola and Perrier). The communication through packing brings a new world of signs and symbols to surface. 4. THE PACKING AND COLORS Women can be attracted by the bargains in the style category, but they are also more receptive to beautiful colors and packing. The companies that make the brands with the most loyal consumers (Revlon, Maybelline and Cover Girl) are very precocious 114 in what concerns the packing of their products [3]. All these lines make the packing jump into sight from the shelf and their product managers make excellent campaigns with the promotional packing. For each attractiveness domain, specialists recommend the use of certain colors: White – recommended in the medical and scientific areas Black – recommended in the financial, fashion, construction, cosmetic, mining, oil, marketing and commerce areas Red – recommended in the food, confections, fashion, cosmetic, real estate, entertainment, health care and urgency services areas Green – recommended in the medical, scientific, governmental, recruiting, human resource, tourism and ecological areas Blue – recommended in the medical, dental care, scientific, utilities, governmental, health care, IT, technology, commerce and judicial system areas Orange – recommended in the baby care field, entertainment, education, recruitment and sports Yellow – recommended in the baby care field, food, entertainment, electronics and auto commerce Purple – recommended in astrology, aroma therapy, massage and yoga classes Brown – recommended in mining, construction, veterinarian, financial, real estate, hospital, marketing, sports and PR. Blue is the greatest example. For the products destined to home use bought by women, the color blue of the packing generates high sales. The worlds most distributed tea, Lipton, represents a small part of the Unilever company, a leader in all that means commodity goods and one of the most powerful corporations of the world. Unilever holds one of the newest lines of tea with a great capacity of changing the consumers’ habits. The piece of resistance of this trade mark is represented by the color blue combined with a banner of intense red. The main color of the lateral and front backgrounds is light yellow. Red and yellow attract the consumer’s attention, helping this trade mark to be noticed from the multitude of other brands of tea from the shelf. Blue is a color that does not intimidate, rarely generating a negative impression, also giving positive emotions like security or relaxation. In order to anchor the brand name, the word Lipton appears 21 times, in different sizes, on a card board box with 48 cm width. These occurrences of the name “strike” the mind of the consumer and represent the most modern way through which the packing can anchor a brand name. Lipton knows that a card board box represents more than a simple packing in which the tea is kept, having a double role because it can be considered a way of promoting the product. The packing is not only meant to attract the consumer’s attention, but also for other tea commercializing companies, bringing to their attention the trade mark, slogans, design and texts, warning the contestants about duplication. In 2003 McDonalds announced that the same packing will be adopted in all their stores for all their commercialized products. The new packing shows regular people doing things they like, such as listening to music, playing football, reading bed time stories. 115 Taking into account the way the global firms tend to adapt different requests from the world, world wide packing may tend to go on the same path, especially regarding that consumers taste becomes more and more homogeneous. The PC manufacturer HP is working on sending the personality of the brand through packing, which means that they will edit the packing in 8 different languages of international circulation. The companies of commodity goods, in return, barely have more success for their needs in what concerns the packing. Unilever, for example, standardizes some products and adapts to local needs with others. P&G promotes their products under the brand name of the company, but in the USA or Europe these are not aggressively promoted as belonging to P&G. 5. CONCLUSIONS The fact that the packing sells the merchandise is no longer a secret to anyone, but what can be lost from sight is that the packing is merchandise itself. In this context, a well made packing can spectacularly increase the number of sales of a product. The growth of the people’s own interest in health and well being triggers changes in the request for products and packings, for the guaranty of the product quality. The growth of the extent to which the population travels offers new occasions for changing the consumption habits, that is why the products and their packings must be conceived in a manner in accordance to these opportunities. The changes which concern life styles, demographic changes and changes in consumption habits influence the packing and consumption, in general. The innovations brought to products and packings lead to the growth of the four big market categories of commodity goods: food, drinks, cosmetics and pharmaceutics. We can say that if the packing cannot be distinguished from that of the competitors, there are reasons of concern. The product will be forgotten on the shelf. A non-differentiating product in a common packing represents a safe way to disaster. REFERENCES 1. Bureau, G., Multon, G., Embalaje de los alimentos de gran consumo, Ed. Acribia, Zaragoza, 2006, pg. 244 -341. 2. Cawthray, R., Denison, E., Packaging, Ed. Index, Barcelona, 2005, pg. 12 - 18. 3. Purcarea, A., Ambalajul – atitudine pentru calitate, Ed. Expert, Bucuresti, 2007, pg. 28 – 34. 116 THE PROXIMITIES OF THE MEDIUM NOMINAL WAGES ON THE ACTIVITIES OF THE NATIONAL ECONOMY Nicoleta PETCU Transilvania University of Braşov Abstract: this procedure attempts to identify relatively homogeneous groups of cases (or variables) based on selected characteristics, using an algorithm that starts with each case (or variable) in a separate cluster and combines clusters until only one is left. Key words: cluster analysis, Euclidian distance, dendograme. In many fields, there is a great interest for developing the methods of classifying objects. The target is to group statistic units into level groups large enough to be analyzed, using classification methods such as segmentation and typology. 1. DEFINING PROXIMITIES To create groups, the links between the studied objects must be defined. Several methods can be used according to the nature of the data. For the data of quantity a first possibility is the use of the Euclidian distance. The distance dij between the objects i and j is: d ij = ∑ (X ik − X ) 2 jk where Xjk is the value taken by the object i on the attribute k. Another distance used is the rectangular distance, measured by the sum of the absolute values of the deviation noticed between individuals: d ij = ∑ X ik − X jk The use of these distances forces the variables to be standardized and separated between them. In the specific conception of proximities: two objects are close when there is little deviation between them on the group of dimensions taken into account. When the data of quality are taken into account, the following are considered: - positive coincidences (P), the number that indicates the fact that a given characteristic is present for the two individuals - negative coincidences (N), the number that indicates the fact that a given characteristic is absent for the two individuals 117 - non-coincidences (U), the number that indicates the fact that a given characteristic is presents for one of the individual and absent for the other. - the association coefficient can be calculated: P / (P + U + N ) . Some of the methods used in evaluating proximities between groups are: the method of the nearest neighbor – the distance between two groups is assimilated to a distance between the nearest elements, one belonging to one group and the other to the second group. the method of the farthest neighbor – the distance between two groups is assimilated to a distance between the furthest elements, one belonging to one group and the other to the second group. 2. THE METHODS OF AGGLOMERATIVE GROUPING The initial date creates an individual-variable picture. The creation of groups is made by two large categories of methods that use hierarchic or non-hierarchic methods. we start from a matrix of proximities (similarities or distances) between all the pairs to be classified. The measurements used to identify proximities can be either one of those mentioned above in the similarity matrix, the units i and j are identified to be the closest and are attributed to the same cluster k the proximity matrix is recalculated to determine the differences or similarities between the new cluster k and the groups before. In the new matrix there is a search for the pair of groups with maximum similarity the grouping cycles continue to a point of stopping or cutting the clusters, according to rules used for this. In Romania, after joining EOROSTAT, but also from internal considerations, administrative-territorial units have been structured in 8 statistic regions and 4 Macroregion. For example, the monthly nominal medium wage is considered, on the activities of the national economy, in the year 2007. The creation of groups that point out the resemblance between wages on activities of the national economy is targeted. Figure 1. The monthly nominal medium wage on the activities of the national economy 4000 3500 3000 2500 2000 1500 1000 500 0 Nort h W est Cent er Nort h East Sout h East 118 Bucharest - Ilfov Sout h Munt enia Sout h W est Olt enia W est The processing of data has been accomplished using the SPSS program, specialized in statistic calculation, the hierarchical classification method with the option „the nearest neighbor”. To graphically represent the grouping process a dendrograme is constructed, which is a tree plot. The level at which two clusters or two units are united is marked by a vertical line which unites the horizontal lines called branches, corresponding to the united groups. The branches which start at the base of the figure correspond to the initial situation in which a cluster was equivalent to a unit. In the end, the dendrograme below result and also the list of the grouping cycles. • Cluster cases - From the point of view of territorial units, the situation is the following: 119 Obtaining real groups is made by cutting the dendrograme at a certain level. Three is no unanimous accepted rule, but the pattern of the uniting horizontal lines can suggest the level of cutting. The area in which the horizontal lines start to distance considerably between them is that in which the cutting can be adequate. Another method would be to produce a considerable rupture in the series of coefficients that express the level of mixing of the groups. From the dendrograme above a relatively compact group formed of the development region : (South – East, South – Muntenia), (North – West, Center, South – West, West), (North – East), (Bucharest – Ilfov). • Cluster variables REFERENCES 1. Voineagu V., Furtună F., Voineagu E., Ştefănescu C., Analiza factorială a fenomenelor social-economice în profil teritorial / Factorial analysis of socialeconomic phenomena in territorial profile/, Bucureşti, 2002 2. Petcu, N., Statistică – teorie şi aplicaţii în SPSS/Statistics – theory and applications in SPSS, Ed. Infomarket, Braşov, 2003 3. www.insse.ro 120 THE ROLE OF THE SMALL AND MIDDLE SIZE ENTERPRISES IN THE EU Drd. ec. Ramona POP, Transilvania University of Brasov Coord. Prof. Dr. Constantin LEFTER Transilvania University from Braşov, Faculty of Economic Sciences Abstract: The small and middle size companies represent an important but neglected source of the 21st century. In spite of the difficult economic situation and of the competitiveness of the countries outside Europe, the SMEs represent the back-bone of the European economy and offer jobs for about 70% of the Europe’s working power. SMEs currently need to upgrade their knowledge and skills in order to respond to complex market need, with a view to enhancing their position and competitiveness on the market. Key words: economic growth, job creation, internationalization, SMEs development, integrated communication 1.INTRODUCTION Since its foundation the European Union considered the development of the Small and Middle Size –sector a living strategy for the accomplishment of developing in its countries, such as - the economic growth - job creation - the strengthening of the industrial basis and of the structure of the local production - the development of the sectors in stagnation - reaching other social and political objectives In this context the consolidation of the capacity of the SMEs and the implementation of the marketing strategies for the growth of competitiveness in a global market is utmost important. The presence of the SMC on the international market, although larger than in the past years, isn’t enough yet. Only 8 % of the SMEs have an international size and the greatest part of export is unfolded inside the EU. The small number of SMC which make exports outside the EU tend to concentrate on the developed and almost saturated markets, as the USA, Canada and Switzerland, while the presence of the SMEs in the emerging countries is weak. 121 2. SMEs in the European Union context The influence of the SMC, having in view their large number, their limited resources and a relative fragmentation, is smaller than that of the large enterprises, which have always had a greater political attention granted at national as well as community level. Although the EU has recently tried to compensate this huge disleveling, allowing policies in the favour of the SMEs, such as the « Small Business Act ». It is also true that there is still a lot to be done for the European enterprises to get to a truly international size. One should mention the fact that the perils that seem to endanger the large size enterprises are most of the time unmanageable for the SMEs and are discouraging for the exporting companies. The internationalization of the SMEs probably represents one of the most difficult and delicate challenges of the Lisbon strategy. The market opening of the third countries means the creation of new jobs and the protection of the existing ones, the preserving of the know-how and the specific character of the European industry as well as a guarantee offer for the growth of a solid and durable economy for all the countries in the EU. The European Commission must have in view the support of competitiveness increase in case of the small and middle size enterprises on the external markets for the following reasons: - the SMEs in the European Union , defined as enterprises with less than 250 employees and a turnover that does not exceed 50 million Euro, represent 23 million enterprises ( 99% of the total number) and 75 million jobs (70%) in the EU. More than 96% of the SMEs in the EU have lass than 50 employees and an annual turnover that is lower than 10 million Euro, fact that impedes them to export goods and services outside their national borders, because of the high fix costs of the international trade. - their results on international level are thus weak from a structural point of view, as 8% out of the SMEs of the 27 countries of the EU export outside their national borders and 3 % of the SMEs consider the export outside the EU as a priority. – as by comparison the European enterprises out of the first 10 in the top list achieve – by themselves - 96% of the exports and of the direct investments outside the UE. - the economic growth provisioned in the third countries is expected to be bigger than that in the inner market, fact that will create new opportunities for the SMEs with export activities. - the SMEs will face a greater competition in the European Union from the competitors in the third countries. - the free economies and the loyal competitiveness is the best guarantee for the opportunities the SMEs can offer on a global economy. - the multinational enterprises have proved a bigger innovation ability. – as the internationalization and the innovation represent key factors for competition stimulating and economy growth , which have an essential role in the fulfilment of the Lisbon strategy in the matter of economic increase and jobs. 122 -the internationalization generates growth and competition contributing to the development of enterprises and creating, thus new jobs as the SMEs create 80% of the new jobs in the European Union. - the SMEs must face some specific problems when they start the aspects of internalization, such as the lack of experience on international level, the difficulty in obtaining the access for financing, the lack of experienced human resources and a complete international law frame, these problems discourage them to make the necessary structural changes to take advantage of the internationalization. - the SME’ s anchored in international trade have a role in the reconfiguring of the European economic landscape and may become a second generation of large enterprises the European Union needs in order to achieve the 3% of the NBI allotted for research and development. -the competitiveness also depends of the ability to guarantee the SMEs a proper protection against the non-loyal trading practices, as the manufacturing process in Europe is an important niche for the economic growth and the employment. On the 25th of June 2008 the European Commission has adopted the “Small Business Act for Europe”, document by which the SMEs become the main point of interest in the formation of national and European policies, a document which: - greets the initiative of the Commission entitled “Small Business Act” , as an important chance to efficiently concentrate the EU policies on the SMEs – this way it considers necessary that all the member state and EU institutions be dedicated in order to be able to apply the principles according to which : “ start with small degree thinking”. - establishes that there are very competitive level SMEs on European level which are world leaders on extremely small but specialized economic niches and which thus represent a force that contributes to the implementation of the Lisbon strategy. - considers that the internationalization of the SMEs is a major objective of the trading policies and that it should form the basis of the European “Small Business Act”, which should be the unitary, legal, compulsory and global frame of the Commission policies regarding the SMEs - considers that, in order to favour the presence of the SMEs on the markets of the third part countries, the SMEs should have fully responsible employees specialized on the internationalization, which rarely happens; it invites the Commission and member states, that in order to pass this obstacle, to set up some consortiums of services that support the SMEs in the process of internationalization. - encourages the consolidation of all the policies supporting the innovation and setting up of new SMEs; it supports the setting up of new European centers for competitiveness open to the SMEs which could reach the necessary minimal mass of survival in the context of international competition. It also supports the updating and extension of the programs that offers the SMEs access to international funds of development, as well as the measures that apply for the operational fixed cost reduction of the SMEs; it underlines that the Unique European License as well as the Statute of the European society should be adopted as soon as possible –in order to promote the transition towards the commerce outside the Community. - considers that the most effective means to increase the productivity of the SMEs – essential factor of any successful strategy of its internationalization – are the 123 political and financial support for the stimulation of product and processing innovation, facilitating the access to financial and fiscal information as well as cooperation in the field of research and technological transfer. - considers that the policies referring to the inner market should have in view the improvement of the situation of the SMEs in Europe, through the setting up of a favourable business atmosphere and by assuring the fact that the SMEs can fully benefit of the opportunities offered on the internal market; what more, it considers that if necessary, these policies should strengthen the international role of the SMEs as well. - invites the Commission to examine the way in which the internal market is able to help to a higher degree the enterprises in the EU to face the international competition. - greets the organization of a “European Week of the SMEs” on May 2009 and proposes that this event be used in order to offer information to the SMEs over the possibilities de develop their export activities outside the EU. 3. CONCLUSION All in all the role of the small and middle size enterprises in the European Union needs to be granted a special attention and support in the frame of defining the trading policies of the EU, the fully granted support of the SMEs in the present-day financial crisis, assuring that these have permanently credits to consolidate their development. The Commission and the member states must cooperate for the definition of a coherent and thorough policy in order to allow the SMEs in the EU to develop harmoniously and with a higher growth degree, to be granted access to new markets and generally increase their exports and intensify their internationalization. Also, the Commission as well as the member states must guarantee, by a political and adequate financial support, the development of the SMEs in the EU, in what their modernization is concerned, the development of their vocational training of the personnel and leading staff, for the increase of their competitiveness over the borders. REFERENCES 1. Carter, S., Jones Evans D. Enterprise and small business, Prentice Hall, London, 2000 2. Borza, A., Managementul intreprinderilor mici si mijlocii, Editura Risoprint, ClujNapoca, 1996 3. European Agency for Reconstruction and the Ministry of Economy, Analysis of SME competitiveness and efficiency, 4. Business Times November 4, 2008. 5. Niculescu, E., Marketing modern. Concepte, tehnici, strategii. Editura Polirom, 2000 124 THE PURPOSE OF INTERNATIONAL CODIFICATION OF FINANCIAL INSTRUMENTS Drd. Ioana RADU „Transilvania” University of Brasov, Romania Abstract: Financial instruments codification has a reasonable purpose in making easier all the transactions that are operated on the market. Because the financial market is a very dinamic market (you can win or loss lots of money just in a few seconds), this standardisation of these instruments have the key role on improving the identification process regarding various data intormation about certain instruments traded in all over the world. Key words: international codification, unique, ISIN, SEDOL, codes, identifiers With the rapid expansion of international securities business, it has appeared the need of a universally applicable international securities identification number.This International Standard provides a uniform structure for international securities identification numbers (ISINs). It is intended for use in any application in the trading and administration of securities and other financial instruments. Countries with highly developed securities business identify issues of securities by means of code numbers, which are without any significance outside the country concerned. Securities of the same issue, in other words, are identified by means of different numbers in the country where they are physically held and/or booked. As a result, the national numbers cannot be applied in cross-border transactions. Investment Houses and Stockbrokers can now access a global coding database online. i.e The Codefile is an Internet-based SEDOL/ISIN verification database covering all traded and defunct securities traded on stock exchanges worldwide. The service covers more than 500,000 securities from over 100 countries, and is primarily for use in portfolio and securities management. The data is sourced from the London Stock Exchange (LSE) SEDOL Masterfile, and is automatically updated on a daily basis. Codefile enhances the performance of all back office departments. This online service allows the swift identification of securities using SEDOL, ISIN, Issuer Name or a host of other search criteria, including Security Type (Warrants, Bond etc.) and Country of Register. The International Securities Identifying Number (ISIN) is defined in ISO 6166 Securities for which ISINs are issued include bonds, commercial paper, equities and warrants. 125 The ISIN code is a 12-character alpha-numerical code that does not contain information characterizing financial instruments but serves for uniform identification of a security at trading and settlement. Securities with which ISINs can be used include debt securities, shares, options, derivatives and futures. The ISIN identifies the security, not the exchange (if any) on which it trades; it is not a ticker symbol. For example, Daimler AG stock trades on twenty-two different stock exchanges worldwide, and is priced in five different currencies; it has the same ISIN on each, though not the same ticker symbol. ISIN cannot specify a particular trade in this case, and another identifier, typically the threeletter exchange code, will have to be specified in addition to the ISIN. The SEDOL board of the London Stock Exchange is currently revising their own standards to address this issue. For these reasons, ISO 6166, stipulates the main principles that ISIN codification shall consist of, such as: a) a prefix which is the alpha-2 country-code specified in ISO 3166 - for the country of issue, which is not necessarily the country in which the issuing company is domiciled. International securities cleared through Clearstream or Euroclear, which are Europe-wide, use "XS" as the country code. b) the basic number, which is nine characters (letters and/or digits) in length. Where the existing national number consists of nine characters, this number shall be used; where the existing national number consists of fewer than nine characters, this also shall be used, but zeros shall be inserted in front of the national number. Where a national check digit exists, it shall be regarded as part of the basic number within the nine characters; The nine-digit security identifier is the National Securities Identifying Number, or NSIN, assigned by governing bodies in each country, known as the national numbering agency (NNA). In North America the NNA is the CUSIP organization, meaning that CUSIPs can easily be converted into ISINs by adding the US or CA country code to the beginning of the existing CUSIP code and adding an additional check digit at the end. In the United Kingdom and Ireland the NNA is the London Stock Exchange and the NSIN is the SEDOL, converted in a similar fashion after padding the SEDOL number out with leading zeros. Most other countries use similar conversions, but if no country NNA exists then regional NNAs are used instead. c) a check digit, computed using the modulus 10 "Double-Add Double" formula as described in annex A of the ISO standard codification The procedure for calculating ISIN check digits is similar to the "Modulus 10 Double Add Double" technique used in CUSIPs. To calculate the check digit, first convert any letters to numbers by adding their ordinal position in the alphabet to 9, such that A = 10 and M = 22. Starting with the right most digit, every other digit is multiplied by two. (For CUSIP check digits, these two steps are reversed.) The resulting string of digits (numbers greater than 9 becoming two separate digits) are added up. Subtract this sum from the smallest number ending with zero that is greater than or equal to it: this gives the check digit which is also known as the ten's complement of the sum modulo 10. That is, the resulting sum, including the check-digit, is a multiple of 10. ISINs are slowly being introduced worldwide. At present, many countries have adopted ISINs as a secondary measure of identifying securities, but as of yet only some 126 of those countries have moved to using ISINs as their primary means of identifying securities. For stocks, beside this ISIN and SEDOL numbers, there are used various international identifiers in all over the world, such as: BIC, CEDOL, CUSIP, EPIC (only in United Kingdom) etc. States like USA and Canada, are the only ones who use both ISIN and CUSIP codification for financial instruments.We can assume that CUSIP code is proper for the stocks issued in the american teritories. European countries have adopted ISIN codification that has been attached to the existing identifiers: national identifiers (SEDOL codes), and market codes (MIC codes). A special case in identifying a share, is the case of irish stocks and belgian stocks, these can be easily confused with the ones from UK or the ones from France. To avoid any of these problems, is indicated to observe both ISIN and SEDOL codes for these. To resume, the difference between the most used codes, please follow the structure below: Identification Code Description ISIN - international code - 12 character code (see the structure of ISIN) - includes an ISO code and for this code it’s attached the stock exchange place SEDOL (Stock Exchange Daily Official - national identifier List) - 6 characters - identifies one instrument in a country MIC - market identifier - identifies one instrument on a stock exchange market (because an instrument can be traded on different markets at the same time) Ex. Stocks traded on the german market, have a special code for the shares traded on XFRA and a different one for the ones traded on XETR. All these codes presented are public, they are exposed public on each financial market. In practice, the investment companies and specialized companies in providing financial informations have promoted the neccesity of a private identification to form a private database. For their internal utilisation, to these instruments defined by international codes had been attached internal identifiers. For example, each instrument has attached a distinct numeric identificator (ID) and a unique name attached called TICKER or MNEMONIC. Financial data providers such as Bloomberg and Datastream, use different identification codes. Even they identify your instrument by the ISIN code, or SEDOL code for the special case of Irish 127 and Belgian instruments, they are going to recognize the instrument by their proper identification – Bloomberg after Ticker and Datastream from Thomson Financial after their DS Mnemonic. THE BENEFITS OF INTERNATIONAL CODIFICATION The benefits for all users are plenty. Using this identification in the securities intrustry allows transactions to be made with a higher speed and better data accuracy. In this way, managers receive vital data in a much more timely manner, thus keeping them on the cutting edge of the securities world. Codefile allows you to search for all traded, coded and defunct securities, archived name changes and deletions. The system also allows the user to search for securities via a combination of search criteria. Beside these, we can add also: - Codefile allows searches for traded, coded, defunct securities and archived Name Changes and Deletions. - The system allows a combination of search criteria. - Resolves securities identification problems. - Cost savings by reducing the number of processing errors, and a reduction in internal costs by eliminating manual processing and stockfile updating by automating back-office operations. . - Improves cross-border communication with banks, custodians and clearing organisations by use of an international ISIN identifier. REFERENCES 1. 2. 3. 4. Alpstar Database Tutorial 2007 – Mignon Geneve, Switzerland International Standard ISO 6166/2001.03.15 – The Sixth edition http://en.wikipedia.org/wiki/International_Securities_Identifying_Number www.iso15022.org/MIC/homepageMIC.html 128 MARKETING RESEARCH FOR UNIVERSITY LIBRARY RESOURSES ASSESSMENT Drd.Angela REPANOVICI, Coordinator:prof.dr.Liliana DUGULEANA Transilvania University of Brasov Abstract: The article presents the following research: attitudes, opinions and behaviors that Braşov students have regarding the use of informational resources that Transilvania University Library has to offer.Qualitative research: difficulties, obstacles, limits and opportunities, regarding the access to bibliographical research services. Main points of the presentation: ● the formulation of general and statistical hypothesis ● the determination of the research goals ● the presentation of the survey in its final shape Keywords: marketing, university library, electronic resources, library assessment 1. INTRODUCTION On the background of the information explosion and the apparition of electronic information resources, the university library has the difficult task of answering its students’ information needs. The access to the new resources involves training the students in how to access information, in how to build a search strategy and in knowing these informational sources. A descriptive research regarding the following theme is imposed: attitudes, opinions and behaviours that Braşov students have regarding the use of informational resources Transilvania University Library has to offer. This research has the aim to identify the difficulties and the limits that students face and also identify the offer of informational resources for the improvement of the acquisition strategy, the dissemination of the informational offer and the proposal of initiatory courses in the field of information, performed by the library staff. 2. THE FORMULATION OF GENERAL AND STATISTICAL HYPOTHESIS General hypothesis 1. The knowledge they have regarding the informational resources and the services offered by the university library 129 are insufficiently promoted. 2. The quality of informational resources, the covering of all the research fields using the informational resources offered by the university library is good. 3. The connection between library frequentation, individual study and increase of the preparation level is very strong. 4. The access rate to informational electronic resources, among the Braşov students, is very low. 5. The students’ attitude regarding the informational society and informational demands is favourable. Statistical hypothesis: H0: At most 60% of the Braşov students made use of the informational resources and services offered by the University Library in the last 12 months. H1: More than 60% of the Braşov students made use of the informational resources and services offered by the University Library in the last 12 months. H0: The average satisfaction level that Braşov students have regarding the informational resources and services they used from the University Library is of at most 3 points on a scale from 1 to 5. H1: The average satisfaction level that Braşov students have regarding the informational resources and services they used from the University Library exceeds 3 points on a scale from 1 to 5. H0: 75% of the Braşov students made use of traditional resorces offered by the University Library in the last 12 months. H1: A procent different from 75% of the Braşov students made use of traditional resorces offered by the University Library in the last 12 months. H0: At least 20% of the Braşov students made use of the electronic resources offered by the University Library in the last 12 months. H1: Less than 20% of the Braşov students made use of the electronic resources offered by the University Library in the last 12 months. H0: The average satisfaction level that Braşov students have regarding the services offered by the University Library is of at least 4 points on a scale from 1 to 5. H1: The average satisfaction level that Braşov students have regarding the services offered by the University Library exceeds 4 points on a scale from 1 to 5. H0: The average importance level that Braşov students give to the tipe of educationrelated informational resources is of 4 points on a scale from 1 to 5. H1: The average satisfaction level that Braşov students give to the tipe of education related informational resources for study is different from 4 points on a scale from 1 to 5. 130 2. THE DETERMINATION OF RESEARCH GOAL Basic aspects 1. The level of knowledge that Braşov students have regarding the informational resources and the services offered by the library 2. Quality and coverage of the research fields of informational resources offered by the University Library Researchers’ questions 1. What is the information level of the Braşov students regarding library frequentation, resources and services offered by the library. The research goals 1. Identification of the knowledge level that Braşov students have regarding the library services. 2. What are the sources for obtaining necessary information regarding the informational resources that are available for the users. 2. Identification of sources and the quality of the received information. 3. What is the utility of the information obtained about the information sources. 3. Measure of students’ attitude regarding the usage of informational resources 1. Identification of the reason why they access resources 1. To what extent are the students frequenting the library 2. Do the students have the necessary abilities to access all the informational resources 2. Identification of the reason why they access resources 3. Students’ attitudes and opinions regarding the library offer. 3. Measure of students’ attitude. 4. Factors that influence customer satisfaction 4. Identification of the factors that influence customer satisfaction. 5. Students’ preferences regarding resource access 5. Identification of the preferences, referring to the informational needs, the studied area 6. What are the factors, the elements that influence the visit at the library. 3. Students’ attitudes regarding the development 1. What are the documents with the largest search 131 Braşov 6. Identification of the elements that attract in the University Library 1. Identification of the extent to which we are able of the society, demands informational information 4. Identification of the connection between library frequentation, individual study and increase of the preparation level 5. The way Braşov students access electronic information resources 6. Respondents characterization interest. to satisfy the researched documents and fields. 2. What are the solutions that Braşov students propose for transforming the library into an attractive study centre. 1. What is the interest given by Braşov students to individual study at the library 2. Identification of the solutions proposed by Braşov students in order to make the University library an attractive centre. 1. Identification of the student category that increase the preparation level by individual study 2. What is the preparation level 1. What data bases they access 2. Measure of the preparation level 1. The knowledge of the most used electronic resources 2. How much time they spend for individual study at the library 2. Measuring time 3. What are the library deficiencies. Which one of the informational resources it provides does not manage to cover the information demand. 1. What are the main characteristics 3. Determination of the critical resources areas 2. What are the connections between the variables and the characteristics of the respondents 2. Determination of the connections between the respondents and the different measured variables allocated 1. The classification, the grouping of the students in accordance with their sex, age, level of preparation. Scale types used for the questions The survey is available online: http://www.uib.no/people/afsal/Qnaire.pdf NOMINAL SCALE ● Binary scale: 1, 2, 6,11, 12, 13, 19, 20, 23, 31, 33, 34, 40 ● Nominal scale: 3,4,10,18 ● Nominal scale with exclusive choice from a set of proposed alternatives: 7,8,9,16,38 132 ● Nominal scale with multiple choice from more proposed variants: 14 ● Nominal classification scale: 41, 42 ORDINAL SCALE ● Ordering based on a certain criteia: 5 ● Bipolar adjective number scale ● Likert scale: 26, 27 ● Stopel scale: 24 ● Unbalanced scale: 17, 22, 28 ● Equal measure interval set scale: 29 ● Nominal scale of frequency identification: 30, 37 ● Proportional scale: 32 ● Continuous scale: 36 ● Interval scale with equal measure interval sets: 39 Pre-test of the survey: the new demands that came out as a result The survey, as an instrument designed for data collection, is a logical sequence of questions that guarantee a question-answer type of dialog, until the researched problems are played-out. The survey with the theme: attitudes, opinions and behaviors that Braşov students have regarding the use of informational resources that Transilvania University Library has to offer, had been conceived in base of the goals and the hypothesis formulated at the beginning of the descriptive research. The survey had been tested on 5 persons in order to eliminate ambiguous wording or any other type of mistakes. After making the pretest of the survey, we did not find any new requirement. CONCLUSIONS After the analysis of the information obtained from both the focus-group and the projective method (the test of position completion) it have been identified and clarified the main aspects connected to the attitudes opinions and behaviors that Braşov students have. These results are extremely important because they consolidate a starting point for the future descriptive research. It’s ascertained that the Internet and the library are the most important informational resources. The students rather make use of electronic informational resources. The library services are well organized, but the students prefer booklets containing instructions regarding the use of resources. They consider the library as an important informational point. Online subscriptions, electronic informational data bases are a strong point of the library. The information retrieval system is suitable. Students’ discontent regards the low operational rhythm of the IT system, the scant number of e-books, the small space, they wish for a separate reading room, just for lecture and study, the micro-climatic conditions (high 133 temperature) and electrical installations. Solutions proposed by the students: • Improvement of the Internet connection • Air conditioning • E-book acquisitions • Booklets for dissemination of information about the available informational resources • Printed instructions on how to make use of the resources REFERENCES 1. Constantin,LEFTER: Cercetarea de marketing. Teorie si practică. Editura Lux Libris, Braşov, 1998. 2. Constantin,LEFTER: Cercetarea de marketing. Teorie si practică. Editura Infomarket, Braşov, 2004. 3. REPANOVICI, Angela; BARBU,Ion; CRISTEA, Luciana: Information Literacy Learning Model for Engineering Students In New Aspects of Engineering Education, Proceedings of 5th WSEAS/IASME International Conference on Engineering Education ( EE’08),Heraklion, Greece, July 2224,2008, ISBN 978-960-6766-86-2,ISSN 1790-2769, pag.73-78. 4. REPANOVICI, Angela: Marketing research for promoting the products and services of the university library. Case study at Transilvania University Library of Brasov, 17th Greek Academic Libraries Conference, 24 September 2008,Ioanina, INVITED SPEAKER,pag.13, www.17conf.lib.uoi.gr/files/a7.Repanovici.ppt 5. REPANOVICI, Angela, LANDOY,Ane: Marketing research in internet resources: user need analyses, CONFERENCE SPEAKER Internet librarian International, Translating 2.0 technologies for tangible benefits & transparency, 16-17 October 2008, London, Information Today, Inc. ,ISBN 978-1-57387-364-2,Pag.143151.http://www.internetlibrarian.com/2008/speakers.php?speaker=AngelaRepa novici 6. REPANOVICI,Angela: Information Technology implication in Student Behaviour for Information Literacy skills, in Education and New Educational Technologies, Proceedings of the 4th WSEAS/IASME International Conference on educational Technologies ( EDUTE'08) Corfu, Greece, October 26-28,2008,PLENARY LECTURE,pag.9-10,pag.81-86 ISBN 978-960-474-013-0; ISSN 1790-5109 134 PRICING STRATEGIES Titus SUCIU, Transilvania University of Brasov Abstract: A strategy dictates the directive lines of the attitude and conduct of a company in order to attain a series of objectives. The features that characterize a pricing strategy are: price level, price variety and price mobility over time. To follow-up, the author presents four types of strategies, namely: the cost-oriented, the demand-oriented, the competition-oriented and the quality oriented pricing strategies. The present paper ends with a presentation of the pricing strategies used by Gillette Company in order to enter and stay on the market. Keywords: pricing strategies, costs, demand, competition. INTRODUCTION A strategy designates the defining lines of the attitude and conduct of a company, which aims to attain a set of objectives. The pricing strategy is a concrete way of approaching prices, the behavior of an economic agent regarding the prices of his product for a longer period of time. The features that characterize a pricing strategy are: the level of prices, the diversity of prices and their mutability over time. a) The level of prices is the key element and the main criterion of the pricing strategies, because it is the hardest to overcome obstacle in the buying and selling activity. b) The degree of variability of the market prices is another criterion, in close connection with the first one. Thus, a company can set a highly elastic gamut of prices, depending on how diverse is the range of products they manufacture and on the degree of homogeneity of the market they are addressed to. c) The mutability (durability) of the prices is used by a company only if the circumstances allow it to determine or influence the stability or the mutability of the prices. 135 1. COST-ORIENTED PRICING STRATEGIES Cost-oriented pricing strategies are the most rational strategies, if we take into account the high weight of the costs in pricing. Such an orientation starts from the premises that the finite prices must cover the costs and ensure the net profits that correspond to the efforts and the risks of the enterprise. The price cannot go down beyond a certain level, called deadlock. For all the markets, a strategy can use as foundations certain total cost (fixed), to which are added margins, which vary from one market to another, depending on the conjunctures of each market, and of certain agreements that were reached. For investments with important export activities, objective pricing strategies can be used, that is, average prices determined on longer periods of time, with the purpose to insure the fast amortization of the investments in production destined to export and the attenuation of certain fluctuations due to the economic context. The division of costs into variable costs and fixed costs is linked with the “dead point” situation, which corresponds to the point in which revenues from sales covers all the costs, but the profit is zero. Knowing the “dead point” close to the market potential allows the future of the product to be assessed, and the time when a product can become profitable to be estimated. 2. DEMAND-ORIENTED PRICING STRATEGIES These types of strategies are used more rarely. When there is no or very little competition, prices can act like an instrument to balance the demand with the offer, by forcing their level as much as the market can take it. Companies use those quantity– price combinations which insure them maximization of profit. Companies that use such strategies count on different demand flexibilities according to prices, and on the possibility of substituting products on the market. Setting demand-oriented pricing strategies involves the assessment of the demand pressure in its various forms. Thus they can set differentiated prices according to the various market buying powers, to the versions of the product, to the time and place where it is sold. Orienting prices according to the demand raises a series of problems in connection with the fact that price variations happen both as consequences of the demand change and as causes of this change. Thus, a high and increasing demand can determine price rises, and a decreasing demand can result in price cuts. At the same time, some companies which wish to enter new markets practice low prices on purpose, thus increasing the demand for their products. As a result, the rapport demand – price is a complex rapport of mutual inter-conditioning. There is also a difficulty when setting a pricing strategy as a result of the fact that the relation demand – price is not only a bilateral rapport, as each of the two components are influenced by other factors as well. For example, demand is also influenced by: the appearance of some substitutes, the difficulty of meeting certain needs, the urgency of the demands, the pressure coming from the competition, the level of product promotion, the nature of the products, the saturation of the physical needs. 136 The flexibility of the demand in relation to price can be estimated by soundings made on a representative sample of potential consumers of a certain product, who are asked to indicate the maximum price they would accept to buy a product for and the minimum price below which they would never buy the product, for fear it should be low quality. Starting from these answers, based on the processed data, there can be set an area for price acceptability by the market, as well as a psychological price. The flexibility of demand in relation to price ranges according to the stages of the product life cycle, that is, it decreases after the product is launched on the market, goes through a minimum in the maturity stage and then rises again. The optional price for a company is a function of flexibility. P = F/(1+e) * f(Cm) where: F – the flexibility of demand in relation to price; Cm – marginal cost; e/(1+e) – corresponds to the marginal profit of the company Pricing strategies according to flexibility of demand can be different from one market to another, and even within the same market. Different demand flexibility on different markets creates the possibility of practicing higher prices on some markets and lower prices on others. Thus, high-price strategies and low-price strategies can be used. 3. COMPETITION-ORIENTED PRICING STRATEGIES Price orientation according to competition is the most frequently used strategy in countries with market economy and especially in the case of exports. The companies that use this type of strategy aim to keep a price level correlated to that used by other competitors, counting on the supposition that the medium price level of the market is a reasonable ground to cover costs. But the actual way of orientation towards and relating to the competition, in each pricing strategy will be determined by the company’s position on the market, by the power and the prestige it has got, by the objectives and its market share perspectives. At the same time, there is the possibility for certain agreements between competitors regarding prices (if the legislation of a country does not forbid them). Companies with more modest market positions have to take into consideration their stronger competitors and the prices imposed by them, and they have to adopt either a purely imitative or a differentiated pricing strategy. A differentiated pricing strategy is better, but needs a lot of skill. Assessing distribution and marketing costs can be a problem, as these costs are added to the proper export price, thus resulting into the final price. 137 4. QUALITY-PRICE STRATEGIES Any company that sells a product faces the issue of the position the product will fill on the market from the quality and price points of view. It can position the product on a medium level or on various levels above or below the medium level. The highest positions are filled by luxury and high-performance products, and lowest positions are filled by those products that are attractive only due to their low price. The strongest competition is between products on the same quality level. But there can also be a cross price-quality competition between products of different quality as shown in the following scheme: Product quality Price High High 1. Exceptional strategy Medium 2. High value strategy Medium 4. High price strategy Low 7. Rip-off strategy 5. Medium value strategy 8. False-saving strategy Low 3. Superior value strategy 6. Acceptable value strategy 9. Saving strategy By combining the three quality and price levels we have obtained nine strategies that can be used in different situations. Thus, strategies on the diagonal with numbers 1, 5 and 9 can be applicable at the same time by different companies on the same market, one company offering a high-quality product at a high price (exceptional strategy), another offering a medium-quality product at a medium price (medium value strategy), and a third company can offer a low-quality product at a low price (saving strategy). The condition for the three companies to activate on the market simultaneously is the existence of three buyer categories: some interested in quality, others in price, and others interested in both quality and price that put the two elements in balance. Strategies placed above the diagonal, with numbers 2, 3 and 6, are a threat to strategies placed on the diagonal as products of the same high quality are offered at a medium (2), or even low (3) price, or medium quality products at a low price (6). Strategies below the diagonal, with numbers 4, 7 and 8, show a much too high price as compared to the product quality, determining a negative reaction of the buyers who will feel deceived. That is why these strategies should be avoided or used for a short period of time. 138 Cross-competition can happen between companies that use one of the quality – price strategies 2 and 4 or 3, 5 and 7, or 6 and 8; the companies which offer better quality products at the same prices or at lower prices have a lot to gain. (Beju, 2000, pp 496-540). There are four important entrepreneurial strategies in marketing: i) Use all resources that you’ve got in the battle; ii) Hit where there’s nothing; iii) Find and occupy an ecological breech; iv) Change the value and features of a product. The first strategy is the less predictable one, is ruthless and does not leave room for mistakes. With this strategy there is no second chance, but if it is successful, the rewards are high. In the second strategy the enterpriser makes something someone else has already made, but improves it by innovating. This strategy starts with the clients, not with producers and markets, nor with the product. The third strategy aspires to take control in a limited area. It tends to make those who use it immune to competition and impossible to challenge. The fourth strategy turns old products or services into something new, changes their utility, value and economic features. The most interesting example of a company that applied this strategy is Gillette, the famous razor blade and razor machine company. Today, this company is the bestknown and most important company in the field. But what is its history? King Gillette did not invent the razor machine. In the last decades of the 19th century there were many patented devices. At the time, the traders and sellers had to look respectably. Few of them knew how to use the … brici … and a visit to the barbershop was too expensive and time-consuming. Many inventors had designed razor machines; however, none could sell them, as a session at the barber’s cost 10 cents and the price of the cheapest machine was 5 dollars. Gillette didn’t sell the razor machine either, but offered it for 55 cents in retail and 20 cents in wholesale, 1/5 of the production costs. And here comes the trick: they designed it so that it could not be used but with the blades produced by them. They cost one cent per piece, and they sold it for 5 cents. Thus, they lost at the sale of the device but they gained at the sale of the blades. (Bălăşescu, 2006, p.55) This last strategy combined the initiation of the price cut for the basic product (the razor machine) and the rise of the consumer goods price (the blades). Conclusions: As far as the four types of strategies are concerned, I propose the following share: 0.35 for cost-oriented pricing strategies; 0.15 for demand-oriented pricing strategies; 0.3 for quality-price pricing strategies and 0.2 for competition-oriented pricing strategies. At the same time, for a company that wants to grow I propose a mixing of the above mentioned pricing strategies with entrepreneurial marketing strategies. 139 REFERENCES 1. Bălăşescu, M., Marketing-ID, Universitatea Transilvania, Facultatea de Ştiinţe Economice, Braşov, 2006 2. Beju V., Preţuri, Ed. Economică, Bucureşti, 2000 140 PODCASTING AS A POLITICAL MARKETING TOOL Drd. ec. Ovidiu ŢIEREAN, Transilvania University of Brasov Prof. dr. ec. Gabriel BRĂTUCU, Transilvania University of Brasov Abstract: Politicians are joining the world of the subscribed media file, although cautiously, and their messages are meeting with success and new challenges. This article looks at how the podcasting medium can drive social networks and vice versa. A snapshot of podcasting in Romania concludes the article. Key words: podcast consumer, politicians, digital media 1. INTRODUCTION A podcast is a series of audio or video digital media files which are distributed over the Internet by syndicated26 download, through web feeds27, to portable media players and personal computers. Though the same content is also made available by direct download or streaming, a podcast is distinguished from most other digital media formats by its ability to be syndicated, subscribed to, and downloaded automatically when new content is added. Like the term broadcast, podcast refers either to the series of content itself or to the method by which it is syndicated, also known as podcasting. The host or author of a podcast is called a podcaster. Podcasting or the delivery of scheduled audio and video digital media, consumable on the computer or a portable media device like an iPod or an MP3 player, is a natural environment for political discourse. Apple, credited with bringing mainstream media to podcasting through its release of a podcast-enabled iTunes in mid 2005 (the dominant media delivery service is available in both Windows and Mac operating systems), currently provides a rich platform for issues-oriented audio and video programming that is free to users and rich in content. While Apple’s support brought mainstream media to podcasting and helped to establish podcasting as a popular, legitimate media distribution platform, it also helped increased independent and alternative programming options. Approximately 50,000 free shows are available through this system and several other podcast directories, including Yahoo, exist outside of iTunes that provide even more access to podcast websites and content. 26 In broadcasting, syndication is the sale of the right to broadcast radio shows and television shows to multiple individual stations, without going through a broadcast network. It is common in countries where television is scheduled by networks with local affiliates. Web syndication is a form of syndication in which website material is made available to multiple other sites. 27 A web feed (or news feed) is a data format used for providing users with frequently updated content. Content distributors syndicate a web feed, allowing users to subscribe to it 141 This is not to say that all the programming possesses outstanding quality and production value. As with blogs, the natural consequence of providing everyone with the means to produce a broadcast is a wide mix of releases, some of which is by most measures uninspiring. The outputs by politicians who have rushed to the medium are no different. 2. THE POLITICAL FACTOR Research has to demonstrate that user-generated content such as blogs and podcasts will help turn out voters to the polls. Nonetheless, those who work in this field cannot deny the positive bias toward Internet-enabled media and they might overaccentuate the impact of this new phenomenon. But one thing is true and demonstrated: the user generated content is known to already have changed political agendas and influenced undecided voters. All indications point to the fact that media distribution in general and podcasting in particular, in their evolving states, are undergoing rapid changes. An analogy with global climate change is appropriate in that mounting evidence and intuitive judgment simply cannot be denied: we are facing important upgrades in the way we interact and consume as a global community. The TV sensibility is no longer a fad but has become an imbedded practice. Adopting personal schedules to accommodate the prime time television line-up has given way to getting it when you want it and how you want it. Recent polls indicate a precipitous drop in television viewership. Television is still powerful, but we are beginning to see the stress fractures on the walls of the terrestrial and cable television infrastructure. Does this mean the end of television? Of course it does not. The myth of a mass audience is simply fading away to provide a much richer, more diverse environment of choice and, most importantly, audience. Specialists in TV audience predicted that the days when the whole family was watching the same show at prime time TV on weekdays and after noon shows on weekends are a golden era that we are unlikely to see again. It was not a matter of mass audiences electing what to put in prime time TV, it was simply the best we had available at the time. To then make extrapolations about the mass media viewing population was also big mistakes these days. If certain portions of the population want to hear more about the fine details of the political agenda, politicians should be using these niche vehicles to expand on their subject matter position. This will feel very boring to some. But to the group where the discussion is primary, it could be the difference between a vote and a pass. Niche content by design is not consumable by everyone, just by the right person. Leaving these categorical messages within a static webpage is short sighted because chances are that most people will fail to look foreword and find the information. Multimedia presentations that appear fresh and relevant and therefore subscribed are much more likely to penetrate the masses. And if you are not participating, you can be sure that someone in the pod sphere28 is talking about you, probably negatively. 28 Pod sphere refers to all content found in podcasts 142 From a political standpoint, depending on where you sit in the political spectrum, the diversity of content choice with podcasting is a welcome movement that gets us closer to a truly democratic system. By not seeing all through the lines between content creator and consumer, we collectively take on a higher burden of accountability of accessing what’s available to hear and read. Listeners become participants and many become contributors and content creators themselves. More, new social networking tools, like call-back features, audio comments and tagging, lend to the necessary debates that help formulate policy and public discourse. 3. PODCAST DEMOGRAPHICS We are learning through research and practice that this new emerging creation class is an extremely influential segment of the population, especially in the United States, the European Union (especially Western Europe), Japan, Canada and Australia. Politicians that dismiss this group, as being nerdy and out of touch with the mainstream, make big and costly mistakes in their attempts to run for office. Arbitron and Edison Research recently released some interesting data on the audio podcast consumer in the United States. There were 1,885 telephone interviews held in January 2007 on a national random sample: Figure 1. Persons who ever heard of podcasting • 13 percent of the population listens to podcasts. • Listeners include 51 percent men and 49 percent women. • Ages are more spread than you might first imagine: 12 to 17 – 12 percent 18 to 24 – 12 percent 25 to 34 – 20 percent 35 to 44 – 22 percent 45 to 54 – 17 percent 55 and up – 8 percent • They are more likely to be students and/or full-time employees than the average population. 143 • They are more likely to live in higher income households. • They spend less time watching TV and more time on the Internet, consuming alternative forms of media. • They purchase significantly more music, movies and video games than the average person. • They spend more both online and offline, and they spend a tremendous share of their income locally. • Podcasters are above average consumers of news and get their news via Internet video. • Given the choice of having to give up TV or the Internet, 62 percent voted to drop their TV.14 Figure 2. What are podcast consumers interested in? It’s easy to see from the chart that nearly 50% of podcast consumers are very interested or at least somewhat interested in political news and comment. If 13 percent of population listens to podcasts and almost 50 percent of these show a certain degree of interest to politics, that’s 6 percent of total population that can directly be approached through podcasts shows and interviews. Any politician when asked if he or she is interested in ignoring 10 percent of his or her constituency will answer not answer “yes”. Yet this is precisely what is happening in today’s political campaigns that have chosen to ignore this large mass of voters. Television ads are less likely to penetrate this group. Sound bites are less likely to make a significant dent in their voting impulses. These are bright, accomplished, culturally invested, Internet literate consumers who may very well become the most important undecided population over the next decade due to their habits and their influence. Podcast creators, in turn, tend to be highly networked and leveraged influencers. The average audience per podcaster is around 100 and superstars are able to touch as many as a half million per download. Simple math argues that politicians should adjust their communications mix, even slightly, to make an impact within this environment of voters. Whether it’s creating one’s own feed, or being available to provide content for other shows, they could reach those who are tuning out of traditional media. 144 4. BUILDING A RELAVANT PODCAST Recent low-sample research suggests that some common elements make for great political podcasting: • Don’t be uptight: podcasting is an intimate medium. Podcasts are experienced by listeners in very personal places, such as your computer at home or work or during a work out or a stroll or on a commuting means of transportation. As such, audiences are receptive to a casual, up-front environment where candour and getting to the point score highly. • Meet acceptable levels of production value: high fidelity sound acts as proxy for personal presence. Just edit with an ear toward listening enjoyment. Appropriately tag the metadata of the podcast so that searching your content is easy in directories. • Stop selling and be yourself: the force of personality plays heavily in podcasting, and politicians who respect the medium can create a special bond with their constituents, which is very hard to replicate in other communication mediums. If you come off like a press release, then you’re dead to the listener. 5. PODCASTING IN ROMANIA At a random search of “podcast” or “podcasting” on engines that can select Romanian language, I found on the first page of results podcasts on news (realitatea.net, europafm.ro and hotnews.ro – the student section). The other results were some podcasts on science and technology on very specialized and high targeted sites. I found the only portrait of the Romanian podcast listener on a wireless technology research and development online shop called c*free (cfree.ro). It describes the Romanian podcast listener as 20 to 45 years old, commuter (underground tube, train or car) that has at least an hour a day lost in traffic. He/she is well educated (at least a university degree) and is looking for very precise targeted and selected information, that is listened to on the way or back from work. The lack of correct information on who, when and how long do Romanians listen to podcasts makes it difficult for politicians to engage themselves in delivering political messages on the web in podcast formats (iPod, MP3 or 3gp video). Even so, this means of communication is almost free and the large cities subsidiaries of major parties that want to target the student population and graduates until the age of 30 may very easily come up with ingenious podcasts that might catch the ears of young voters. These podcasts don’t have to be purely electorally driven and launched only in campaigns, but throughout the office of elected politicians to stay in touch with the population that voted for them. And with internet developing so fast in urban areas, both geographically and demographically (the medium age of the internet consumer is rising and the ratio of male/female internet consumers descends to 1) we might see podcasts making a small difference on national elections (Parliament, European Parliament and President) in the years to come. Podcasts may contain messages beginning with the importance of a high attendance to voting (it is widely known that the students and the young population in 145 large cities – the largest consumers of internet - don’t bother themselves to vote) to short podcasts that might offend in a funny way the opposition. 6. CONCLUSION Podcasts are one of the newest and most innovative ways to deliver niche content, and they will change communication habits just as surely as fax machines and e-mail did. Politicians who get out ahead of the others will find a receptive audience of educated, influential and intellectually curious people, just the kind of voters that a long term politician should cultivate. This is a world-wide truth and involves countries with a developing internet industry like Romania. REFERENCES 1. The Oxford University Press [Online] available at http://www.oup.com/elt/catalogue/teachersites/oald7/wotm/wotm_archive/podca st?cc=global 2. Colligan, P., Podcast statistics [Online] available at http://www.paulcolligan.com/podcast-statistics/ 3. Edison Research, New podcast statistics, [Online] available at http://www.edisonresearch.com/home/archives/2007/03/2007_podcast_statistics _analysis.php 4. Webster, T., The Podcast Consumer Revealed: An Exclusive Early Look at the Growing Podcast Audience, Arbitron/Edison Media Research Internet and Multimedia [Online] available at http://www.edisonresearch.com/home/archives/2006/07/the_podcast_con.php 5. Realitatea.net [Online] available at http://www.realitatea.net/podcast.html 6. c*free [Online] available at http://www.cfree.cyanad.ro/blog/2006/12/weeklyrandom-im-marketing-podcasting_18.html 146 CORRELATIONS BETWEEN THE NETHERLANDS’ GDP, WAGE LEVELS, INFLATION AND UNEMPLOYMENT DURING 1988 – 2007 Silviu Horia ŢIEREAN, Student at Master of Scientific Research Coord. Prof. Dr. Liliana DUGULEANĂ Transilvania University from Braşov, Faculty of Economic Sciences Abstract: The paper contains an analysis of the main macroeconomic indicators, with an emphasis on the correlations between them. There are shown the effects of other factors on the average wage in the Netherlands. The multiple regression model is used to see the differences between the predicted values and the actual values of the average wage between 1988 and 2007. Key words: Unemployment rate, Inflation, Wage, Correlation, Regression 1. INTRODUCTION The Netherlands (Holland) is a constitutional monarchy and founding member of the European Union. The Dutch economy is one of the most advanced on Earth. The Netherlands has the 16th largest economy in the world, and ranks 10th in GDP (nominal) per capita. The most important industries are the food processing sector (Unilever and Heineken International), chemicals (DSM), oil refining (Royal Dutch Shell), electric machinery and electronic equipment (Philips). The agriculture is highly mechanized and employs a low percentage of the active population. The services sector is very developed and still growing. About 27 per cent of GDP is produced by manufacturing, construction, and energy-related activities, while agriculture contributes about 3 per cent. However, the service sector, including the financial and public sectors, is the dominant contributor to the economy, accounting for 73.6 per cent (2005) of GDP. The main activity is trade, being one of the most active countries in the world, as participation to world trade. Rotterdam is the largest harbor in Europe. The Dutch Gulden was replaced by the Euro in 1st of January 1999, but the actual money entered the circulation only in 2002. 147 2. EVOLUTION OF GDP, AVERAGE WAGE, UNEMPLOYMENT RATE AND INFLATION Table 1: GDP, average monthly wage, unemployment rate and inflation in Holland Year 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 GDP current prices (bln Euro) 216,0 229,0 243,6 256,6 266,5 273,2 287,5 305,3 319,8 342,2 362,5 386,2 418,0 447,7 465,2 477,0 491,2 513,4 539,9 567,1 GDP constant prices (bln Euro) 283,5 297,1 309,2 316,6 321,3 323,4 332,7 342,8 354,5 369,6 384,1 402,1 418,0 426,0 426,3 427,8 437,3 446,3 461,4 477,3 Deflator (%) Average nominal wage (Euro) 76,2 77,1 78,8 81,0 82,9 84,5 86,4 89,1 90,2 92,6 94,4 96,0 100,0 105,1 109,1 111,5 112,3 115,0 117,0 118,8 1175 1214 1257 1301 1400 1467 1523 1592 1633 1768 1802 1842 1963 2103 2201 2270 2319 2410 2469 2501 Average real wage (Euro) 1542 1575 1595 1606 1688 1736 1762 1787 1810 1909 1910 1918 1963 2001 2017 2036 2065 2095 2110 2105 Unemploy ment rate (%) 7,1 6,2 5,9 5,5 5,3 6,2 6,8 6,6 6,0 4,9 3,8 3,2 2,9 2,2 2,8 3,7 4,6 4,7 3,9 3,2 Inflation (%) 0,5 1,1 2,5 3,1 3,2 2,6 2,7 2,0 1,4 1,9 1,8 2,0 2,3 5,1 3,8 2,2 1,4 1,5 1,7 1,6 In the table above there can be seen a continuous growth of both real and nominal average monthly wage. The lowest level of the nominal average monthly wage is recorded in 1988, 1175 euros, the highest level being reached in 2007 when its value was 2501 euros. The real average monthly wage, calculated with the deflator (compared to 2000), has grown from its lowest level, 1524, in year 1988, to 2110 which is the maximum level, recorded in 2006. The single time when the real average monthly wage has decreased was in 2007, when its value was with 5 euros lower than in the previous year. The unemployment rate had an irregular evolution, the lowest value being recorded in 2001, 2,2%, and the highest value observed was in the year 1988 when unemployment rate was 7,7%. The annual inflation didn’t follow a precise trend. The maximum level was recorded in 2001, the year before the euro currency was adopted, and the minimum value was reached in 1988 when the annual inflation bottomed at 0,5 percent. 148 2600 2400 2200 2000 1800 1600 1400 1200 1000 Average nominal w age 20 06 20 04 20 02 20 00 19 98 19 96 19 94 19 92 Average real w age 19 90 19 88 euro Chart 1: Evolution of average nominal monthly wage and average real monthly wage in the Netherlands between 1988 and 2007 years In the chart above we can observe the ascending trends of both indicators, although average real monthly wage had an inferior growth rate, even a slight decrease in 2007. 8 7 6 5 4 3 2 1 0 Unemployment 20 06 20 04 20 02 20 00 19 98 19 96 19 94 19 92 Inflation 19 90 19 88 % Chart 2: Evolution of unemployment rate and annual inflation in the Netherlands between 1988 and 2007 years In the chart above we can easily see the irregular trends the two macroeconomic indicators have had during the 20 year period. We can also observe that minimum value of the unemployment rate in at the same time with the maximum value of the annual inflation (2001) and vice versa (1988). 149 3. CORRELATIONS BETWEEN INDICATORS Chart 3: Correlation between GDP constant prices and average real monthly wage in the Netherlands during 1988 – 2007 2200 2100 euro 2000 1900 1800 1700 1600 1500 200 250 300 350 400 450 500 bln euro The correlation coefficient between the GDP measured in constant prices and average real monthly wage is 0,98 which indicates a very strong bond. Chart 4: Correlation between GDP constant prices and unemployment rate in the Netherlands during 1988 – 2007 8 7 6 % 5 4 3 2 1 0 250 300 350 400 450 500 bln euro The correlation coefficient between the GDP measured in constant prices and unemployment rate is -0,82 which indicates inverse bond of medium intensity. Between the GDP measured in constant prices and annual inflation there is no bond, the value of the correlation coefficient being 0,1. 150 % Chart 5: Correlation between GDP average real monthly wage unemployment rate in the Netherlands during 1988 – 2007 8 7 6 5 4 3 2 1 0 1400 1500 1600 1700 1800 1900 2000 2100 2200 euro The bond between the real monthly wage and the unemployment rate is inverse and of medium intensity, the correlation coefficient being -0,76. Between the real monthly wage and the inflation rate there is no bond, the correlation coefficient being 0,09. Chart 6: Correlation between unemployment rate and inflation in the Netherlands during 1988 – 2007 6 5 % 4 3 2 1 0 0 1 2 3 4 5 6 7 8 % The bond between the unemployment rate and inflation is inverse and very weak, the correlation coefficient having the value of -0,42. Table 2: Regression between real GDP, unemployment rate, inflation and average real monthly wage in the Netherlands during 1988 – 2007 Regression Statistics Multiple R 0,983176995 R Square Adjusted R Square Standard Error 0,966637003 Observations 0,960381441 38,02987414 20 151 ANOVA df SS Regression Residual Total MS F 3 670452,6588 223484,21958 16 23140,34124 1446 19 Coefficients 154,52441 Significance F 5,04813E-12 693593 Standard Error t Stat P-value Lower 95% Upper 95% Intercept 410,1133865 176,6476696 2,32 0,0337751 35,63705817 X Variable 1 3,524083865 0,285547477 12,3 1,369E-09 2,91875026 784,5897149 4,12941747 X Variable 2 20,69817303 12,66118307 1,63 0,1216147 -6,14233589 47,53868194 X Variable 3 9,445226766 10,56990748 0,89 0,3847824 -12,96197596 31,8524295 Table 3: Predicted real monthly wage calculated with the multiple regression model Real wage Predicted real wage 1542 1575 1595 1606 1688 1736 1762 1787 1810 1909 1910 1918 1963 2001 2017 2036 2065 2095 2110 2105 1567 1609 1647 1670 1685 1692 1720 1752 1788 1836 1881 1937 1987 2012 2013 2017 2047 2075 2122 2172 Chart 7: Comparison between real average wage and predicted average wage 2300 2200 2100 2000 1900 1800 1700 1600 1500 19 88 19 90 19 92 19 94 19 96 19 98 20 00 20 02 20 04 20 06 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 euro Year years Real monthly w age Predicted real monthly w age The predicted average real wage was calculated with the following formula: 410,11 + 3,52*Real GDP + 20,69*Unemployment rate + 9,44*Inflation The determination coefficient is 96% which means that the evolution of real GDP, inflation and unemployment rate explain in a very large propotion the variation of the average real monthly wages in Netherlands during 1988 – 2007. But the model is not valid because P-value is not always under 0,05 and the Lower 95% - Upper 95% intervals contain 0 for two variables, the unemployment rate and inflation. The only valid variable that can be taken into account in the calculation of the regression is the real GDP. REFERENCES 1. http://en.wikipedia.org/wiki/Netherlands#Economy 2. www.imf.com 3. www.cia.gov 152 DECISION INTO A TRAVEL AGENCY – APLICATION IN SPSS CLEMENTINE Manuela VICOL, Student at Master Management and Business Strategy Alecsandru-Ionuţ BLÂNDU, Student at Master Management and Business Strategy Coord. Prof. Dr. Nicoleta PETCU Transilvania University from Braşov, Faculty of Economic Sciences Abstract: Decision Tree is a useful tool for helping us to choose between several courses of action. It provides an effective structure within which you can explore options and can investigate the possible outcomes of choosing those options. It helps us to form an image from all the characteristics and chose what is best for us. Key words: decision tree, C&RT, database, node. 1. INTRODUCTION C&RT, for Classification & Regression Trees, is an exploratory method used to study the relationship between a dependent variable and a series of predictor variables. C&RT modeling selects a set of predictors and their interactions that optimally predict the dependent measure. The C&RT method has certain advantages as a way of looking for patterns in complicated datasets. The level of measurement for the dependent variable and predictor variables can be nominal, ordinal or interval. C&RT is a useful method of summarizing data, and can show major natural divisions of the clients by various defining variables. 2. DECISION TREE Starting from our database we filtered from all the informations that one that we need: tourist acomodation, area, confort and type of servies. After filtering we introduced a derive node where we put some conditions like: tourist acomodation > 3 stars and area = 'Bucharest' and 'hotel capacity' >= 20 and 'type of service all-inclusive' = 1. 153 Figure 1. The globally image of decision treee Figure 2. Database table 154 Figure 3. The globally image of C&RT In this part of study we will itemize the decision tree on his branches: Figure 4. The top and the first branch of the tree 155 On first branch the node is distributing after capacity of hotel between 0 - 74 places and more than 74 places. The next branch speaks about the areas and looks like this: Figure 5. The second branch of the tree In this image all the hotels are divided in Bucharest area and Danube, mountain and seaside area. We need all the hotels that are in Bucharest. We will go on the second node. Figure 6. The third branch of the tree 156 For the next branch we will make reference again at capacity. Figure 7. The forth (the last) branch of the tree Also we can see that the capacity is distributed between less than 44 places and mare than 44 places. In the forth node we see that is a hotel that actualize all the conditions. The last branch is used for another option and this is the kind of services. We need just hotels that have all-inclusive services. We can see that is just a hotel which can complete all the options: accommodation mare than 3 stars, a capacity more than 20 places, in Bucharest area and with all-inclusive services. To see which is that hotel generate a select node. Figure 8. The select node after build 157 SPSS Clementine makes it easy to discover insights in our database. Its simple graphical interface puts the power of data mining, not just in the hands of business users and high-performance increases analyst productivity, it can be used for everyone who want to make easy his work. At the end of our example we could see that is very efficient for a travel agency with a big database. We can discover quickly patterns and trends in our database more easily and faster. REFERENCES 4. Petcu, N., Statistică – teorie şi aplicaţii în SPSS/Statistics – theory and applications in SPSS, Ed. Infomarket, Braşov, 2003 5. http://www.mindtools.com/dectree.html 6. http://www.autonlab.org/tutorials/dtree.html 158 ELECTORAL MARKETING STRATEGIES USED IN ROMANIA Timotei VIERAŞU, student at Master of Scientific Research Coord. Prof. Dr. Gabriel BRATUCU Transylvania University from Braşov, Faculty of Economic Sciences Abstract: In this paper I made an analysis of what strategy can be use on electoral marketing in Romania . This analysis is made by looking at the main means of communications and by looking at what objectives should a candidate propose to himself, what are the guidelines of his campaign (land, major themes and tone) and who his targets are. Key words: Elections, electoral marketing, candidates, media channels Introduction Open your TV, computer, radio, newspaper and all over the first thing you hear or see is politics. Political issues, scandals, malicious statements, analysis, comments, etc.. Everyone gives their opinion and to all have something to say when it comes to politic. Regardless on what side they are, it seems that everyone is unhappy, and they all expect future elections to do something, to change something. In January 2007 we entered into the European Union and this should influence the political thinking of Romanian politicians, but this does not seem to have happened. I decided to choose this topic of research to find out what is the truth behind the beautiful words we hear every day. The marketing issue raised here is finding what marketing strategies can be applied in the political strategies of those that are most effective and can influence opinions, attitudes and voting intentions of electors. Marketing strategies that can be used The "product" to be "sold” to the public, in turn regarded as a consumer policy, is a program, a candidate etc.. This way, in political marketing a "firm" is presented as a political party and as a "product" - the candidate who is packaged in an attractive cover (clothing, promotional material, political and social programs, etc..) to be " sold profitably " to voters (to obtain the required number of votes to win). "Price" paid by the voter for his choice is his vote. "Marketplace" on which the transaction is conducted is electoral campaign. 159 A good campaign involves two major components namely, developing a campaign strategy and putting it into practice. Develop a strategy therefore includes, first studying the election and on the other hand, inventory and human resource materials available to the candidate or party. Are necessary four categories of decisions: • setting explicit and specific goals for campaign • Choice of "targets" on witch the campaign communication of the candidate (party) effort should be focused • Choice of "guidelines" of the campaign, including choosing the 'land "," ton ", and “major issues” • Choice of communication vectors can be used depending on available resources. Choosing campaign objectives Theoretically the greatest target that a candidate or a party would be able to propose is to make the most possible votes, but how we de not live in a communist society, that objective is no longer possible because of the emergence of competition. Realistic goal involves setting a limit depending on the audience that the candidate or political party had before the election, according to financial and human resource available and depending on the competition on the market. We can distinguish three main objectives that it may be proposed: • Dissemination of the candidate (party) ideas • Obtaining a "good score" • Obtaining a majority of votes.This step involves establishing goals and measurable objectives that they can use to assess the campaign, both in the intermediate phase and at the end of campaign. Selecting election campaign targets It is clear that a political idea can not accommodate the whole population and no candidate is not popular consensus. In any country there are well-defined social categories that will not change opinions. However, certain characteristics of the electorate may remain unchanged for a long time, while others may change from one campaign to another, which means that the market must be continually investigated to see these changes. Romanian sociologists have shown that social group composed of persons with a lower education level, living in disadvantaged areas and have limited incomes tend to opt for conservative parties or candidates, reform and change is perceived by this group as a danger. So, the candidate must not set the target audience the electorate who already has political preferences, that will go with other parties! Voters will be targeted, especially people who haven’t take a decision yet, those who have a low interest in policy, those who have not yet formed an opinion, those who have weak or oscillates sympathies for one party or another Segmentation is done according to different criteria: • Demographic factors: gender, age, etc. 160 • The geographical area in the light of cities, regions, districts of a city, etc • Life style • Socio-professional: farmers, students, teachers, etc. • Religions: Orthodox, Catholic, Protestant, etc. • Political attraction to one or another political family (the right, left, center, etc.) • Ethnicity: Romanian, Hungarian, German, etc. Depending on the criteria chosen for segmentation, they can identify the target groups, which can be represented by: • Urban electorate; • Young voters; • Pensioners; • Ethnic minorities; • Students; • Young people who voted for the first time; • Women aged 25 and 40 years; • Army etc... To justify an investment, a share of the electorate must meet three conditions: • A number of important and sufficiently voters • The differentiation according to voters' interests and concerns of specific • Possibility of access to a channel or means of communication which can selectively provide the party (or candidate) A particular segment of the population is the "opinion leaders" that are manifested on large categories of the electorate. Opinion leaders can be identified by the personality characteristics or socio-demographic variables, but rather in relation to its area of influence. These leaders have a major influence in their circle of friends and once convinced a leader brings with it a significant share of people. For example in rural areas know that to win elections at City Hall for a candidate must have his share of support of at least one opinion leader (priest, doctor, school principal etc.). Choosing the guidelines of the campaign (land, major themes and tone) During an election campaign a candidate or political party will face many problems; the candidate should support the speeches, interviews and answer questions of other candidates and voters. All these will focus on several themes and each of these issues will be addressed separately. Therefore candidate or political party should know how to address these problems. Particular land can be defined in part as the geographical area where the campaign will be conducted according to the criteria for selection of electors, the preferences and the benefits obtained. Electoral choice criterion, the ideology and political program will be made of three large families of criteria: ideological, propaganda and the image of the candidate before the electorate. The last criterion is particularly important and here arose the socalled election campaign focused on the candidate's personality. Marketing strategies for leaders are based on the study system optimized main characteristics of the 161 candidate (looks, manners, programs) and the influence on the public information, mainly aimed at obtaining the maximum number of votes of electors for that candidate or leader. The tone. In this sense there are two extreme solutions: choosing a tone "polemical" tone or a "neutral". Polemical tone means attacking your opponent in any occasion; they should not lose any opportunity to respond to adversaries or to attack first. This tone is usually adopted by candidates who have fewer opportunities because this way they will be more visible during the election campaign. Choosing the tone implies taking into account several factors such as the tone adopted by the principal adversaries, type of target voters, candidate person or political leader. A neutral tone, in contrast, consists of largely ignoring the opponent; he brought attention to the problems and proposed solutions through its electoral program. Major themes of the campaign. The main topics that will be the discussion. Thus the candidate has chosen an integrated strategy of going on a single topic for discussion or a broader theme. Inevitable for any candidate or political party are time limitations, space and materials and thus he can not talk about things they would like. In addition longer appear and the limitations of attention, understanding and assimilation of targeted voters, so the idea of going on a single theme or a thematic issue very limited seems to be the best idea. In presidential elections in 2004 Traian Băsescu has presented before the electorate with a single topic discussion, namely corruption. He won the election with this issue although early campaign was ranked the second chance. Topics that will be used can be: • For ideological land: order and authority, liberalism, social justice, family, human rights, facing Right - Left, the condition of women, etc.. • For land propaganda: taxes, school, nationalism, flexibility, fighting poverty, fighting corruption, increasing prices, economic growth etc... • On a field of personality: a stroke of (smart, honor, humanity, etc.) aptitudes (economic competence, knowledge of international issues, etc.), all those qualities that he benefit compared to the opponent. Types of communication media that can be used: a. Public meetings planned and organized with care, whether a community meeting, visit or work meeting. At such meetings, participants expected a speech from the candidate. Dialogue, however, is welcome, because people should meet with the candidate, and that to take an interest for voters. An important role they have volunteers who may be scattered through the crowd where they can spread favorable comments and applause for the candidate. b. Meetings on the street are important for the message to reach out for that offer good visibility, generate excitement around the campaign and are an opportunity to present the candidate or party as friendly and open. It's not necessarily need a political message then exit the street. He can chat with people about ordinary things. People want to talk about their problems, but also want to have fun. 162 c. Cars with amplifiers decorated beautiful, they should not miss the campaign in the days of rest. It is good to make noise around each event! d. Stands on the street. Stands located in crowded areas are very effective when the candidate wants to meet voters. They keep the party and candidate to the public, bringing them into the street, next voter. e. Leaflets short and penetrating, concentrated on a single topic, leaflets are indispensable in the campaign. Ideal would be for them to be targeted by a group target. f. Posters. A simple poster with a short message can be most effective. The poster must seduce the eye. Although it is an expensive media is very efficient. The most important parts of a poster are the illustration and text. Illustration is able to convey a message one by symbols, therefore the illustration should be understood to be a pleasant view from which to draw and color must be very carefully chosen. Slogan or text message is the essence of elections. g. Advertising spots. These may be on radio or television media. Advertising spots have the advantage of reaching a large number of people who would not know the message if a politician would not be interested in him. The disadvantage is the very high price and that the public will look with restraint, because the message is subjective. h. Letters direct campaign letters have been use with much success during previous elections. Personal letters sent to voters and passed by individual volunteers may send message better than any other means of communication. Once identified the target (may be voters who have reached 18 years or residents of a block, for example), can devise a specific message. It is important that each letter should look different (it is embarrassing that two members of a family to receive the same letter), but the main campaign theme should be reflected in each. The letter should be short and simple. i. Canvassing. Includes personal visits made by election volunteers on behalf of candidates. The main problems that may arise are the selection of persons to be visited and the selection and training canvassers. j. Phone contact. It can be done by playing a recorded message or by direct contact with a volunteer. An innovative method of using the phone is to send short messages like SMS. This method has been used successfully in the presidential campaign of 2004 when Traian Băsescu won many votes with the SMS: ‘Şi dacă ramuri bat în geam/Şi tu votezi cu Bombo/Eu îmi bag p***-n el de neam/Şi emigrez în Congo ", which has sent millions of people to vote before the first ballot. k. Press relation "a necessary evil”, a good press, however, counts more than a ton of promotional material, some experts consider. Media creates the image. Contacts with journalists must be permanent, is a big mistake for them to be established only during the election campaign. Quite right that the campaign press relations are privileged, but we know that whoever has good links with the press has the best chances on the field of battle. l. Internet. In recent years became one of the main means of mass communication and whether 4 years ago has been marginalized by candidates and political parties, today is mostly used by everyone. Explanations of this growth are simple and relate to quantitative and qualitative aspects. First is the natural development of Romania and Internet penetration in more and more institutions, businesses and homes. Internet access is not only larger but also better quality (especially in big cities, where cable 163 access tends to replace dial-up access) and most often cheaper. Secondly may notice increased quality of information provided by Romanian Internet, especially on the web. There are many portals, specialist forums, publications, blogs; most newspapers have electronic editions and better indexing to make search engines more efficient. The complexity of the Internet allows candidates and political parties to interact with any voters in almost unlimited ways. One way is to use own official website which can be customized as they pleased. The newest and most effective way to use the Internet for political communication is the blog. The blog is an online journal in which the author posted his personal or public items. Since blogs have caught well in Romania, some have traffic of tens of thousands of visitors daily, more and more politicians and their own on-line journals, and some of them even have great success. Compared to the usual media channels, the Internet has many advantages as possible to reach very many people even from people outside Romania, is unlimited, it is not censored, allows multimedia content thus combines with the radio and television media, allow interaction voters with any such communication policy is transformed from a monologue into a true dialogue and source of information in both directions. m. Other environments. This may include promotional materials distributed free as calendars, pens, key rings, caps, shirts etc... They may be particularly useful as a practical issue but it also recalls both users and those who see them with them, who had made the gift. REFERENCES 1. Brătucu, G., Marketing electoral, Editura Aula, Braşov, 1998 2. Kotler, P., Mangementul marketingului, Editura Teora, Bucureşti, 1997 164 INTERNATIONAL AND MULTINATIONAL BANKING Drd.Mirela Catalina VINT (TURKES) Coord. Prof. Dr. Constantin LEFTER Transilvania University from Braşov, Faculty of Economic Sciences Abstract : This article has explored the global dimensions of banking, presenting the detailed aspects of international banking, international trade in banking services, increasing the number of multinational banks and performance analysis of international banks in the2008s. Key words: international bank, multinational bank, international trade, banking system, global interbank markets. Introduction International banking is not a new phenomenon; international bank activity can be traced back to as early as the 13th century. What is new is the scale of international bank activity. For example, in the period 2005 to 2008, the stock of international bank lending averaged $21.7 trillion. This article is organised as follows. The following section looks at the theory of international banking; there is then a consideration of the trade in international banking services and of the growth of multinational banking. The theme is that banking is like any other sector made up of protit-maximising firms; it is important to consider both international trade in banking services, and foreign direct investment by banks. The article then reviews the welfare costs and benefits of international banking, and examines the performance of international banks in the 2008s. The international banking According to the economist Aliber there are at least three different deftinitions of an international bank. First, a bank may be said to be international if it uses branches or subsidiaries in foreign countries to conduct business. For example, the sale of US dollar-denominated deposits in Toronto by American banks with Canadian subsidiaries would constitute international banking; the sale of the same deposits by Canadian banks would be classified as domestic banking. A second definition of international banking relates to the currency denomination of the loan or deposit, independent of the location of the bank. Any 165 sterling transaction undertaken by a bank headquartered in the UK would be part of British domestic banking, irrespective of whether this transaction is carried out in a British branch or a subsidiary located outside the UK. But transactions in currencies other than sterling will be part of international banking, independent of the actual location of the British branch. A third way of defining international banking is by the nationality of the customer and the bank. If the headquarters of the bank and customer have the same national identity, then any banking operation done for this customer is a domestic activity, independent of the location of the branch or the currency denomination of the transaction. For example, all Japanese banking carried out on behalf of Japanese corporate customers would be part of the domestic banking system in Japan, even if both the branch and the firm are subsidiaries located in Wales. Noting these different definitions, Aliber opted for one close to the second definition, relating international banking activities to the association between national currency of the transaction and the country which has chartered the bank. A bank is said to be engaging in international banking when it sells deposits and buys loans in currencies other than the home currency - that is, the currency of the country in which it is chartered. Other authors have advocated the use of the other definitions. The problem with all of the above definitions is that they are trying to give one answer to two separate questions in international banking. In formulating a definition, it is important to distinguish between the international activities of a home-based bank, and the establishment of cross-border branches and subsidiaries. The existence of international bank service activity is explained by the traditional theory of international trade, while multinational banking is consistent with the economic theory of the multinational enterprise. Thus, to gain a full understanding of the determinants of international banking, it is important to address two questions: • Why do banks engage in international banking activities such as the trade in foreign currencies? • What are the economic determinants of the multinational bank, that is, a bank with cross-border branches or subsidiaries? International Trade in Banking Services International trade theory may be used to address the issue of why banks engage in the trade of international bank services. Comparative advantage is the basic principle behind the international trade of goods and services. A country is said to have comparative advantage in the production of a good (or service) if it is produced more efficiently in this country than anywhere else in the world. The economic welfare of a country increases if the country exports the goods in which it has a comparative advantage and imports goods and services from countries which are relatively more efficient in their production. At firm level, firms engage in international trade because of competitive advantage. They exploit arbitrage opportunities. A firm will export a good or service from one country and sell it in another because there is an opportunity to profit from arbitrage. The phenomenon of trade in international banking services is best explained by appealing to the theories of comparative and competitive advantage. In banking, the 166 traditional core product is an intermediary service, accepting deposits from some customers and lending funds to others. The intermediary function involves portfolio diversification and asset evaluation. A bank which diversifies its assets can offer a risk/return combination of financial assets to individual investors/depositors at a lower transactions cost than would be possible if the individual investor were to attempt the same diversification. Banks also offer the evaluation of credit and other risks for the initiated depositor or investor. The bank acts as a filter to evaluate signals in a financial environment where the amount of information available is limited. If banks offer international portfolio diversification and/or credit evaluation services on a global basis, they are engaging in the international trade of their intermediary service. For example, a bank may possess a competitive advantage in the evaluation of the riskiness of international assets, and therefore, its optimal portfolio of assets will include foreign currency denominated assets. A by-product of intermediation is bank participation in the payments system, including settlement, direct debit, and chequing facilities. If some of its corporate or retail customers engage in international trade activity, they will require global money transmission services. The simplest example is the provision of foreign exchange facilities for the international traveller. The use of credit card facilities across national frontiers is now well developed. In parts of Europe, it is possible to use a debit card from one state (for example, the UK) to obtain local currency in another state (for example, Spain). If a bank offers its intermediary or payments services across national boundaries, it is engaging in international trade activities and is like any other global firm which seeks to boost its profitability through international trade. The Multinational Bank To complete the theoretical picture of global banking, the second question should be addressed-that is, why do banks set up branches or subsidiaries and therefore become multinational banks? The question is best answered by drawing on the theory of the determinants of the multinational enterprise. A multinational enterprise (MNE) is normally defined as any firm with plants extending across national boundaries. Modifying this deifinition for banking, a bank with cross-border branches or subsidiaries29 is a multinational bank. It is important to stress from the outset that locational efficiency conditions in a given country are necessary, but not sufficient to explain the existence of MNEs.30 Locational efficiency refers to the choice of a plant location-comparatively, there is an advantage in being the lowest cost producer of a good or service. However, to explain the existence of the MNE, other factors are at work-otherwise, one would observe a domestically domiciled firm producing and exporting the good or service. Thus, one has to look beyond locational efficiency to explain why a plant is owned by non-resident shareholders. There are two important reasons why an MNE rather than a domestic firm produces and exports a good or service. Barriers to free trade, due to government policy 29 30 A bank branch is not legally independent from the parent, while a subsidiary is separate legal entity. Multinational enterprise 167 or monopoly power in supply markets, is the first explanation for the existence of MNEs. For example, Japanese manufacturers have set up European subsidiaries, hoping to escape some of the harsh European trade barriers an the import of Japanese manufactured goods. The second is imperfections in the market place, often in the form of a knowledge advantage possessed by a certain type of firm which cannot be easily traded. American fast food conglomerates have been very successful in global expansion through franchises, which profit from managerial and food know-how originally developed in the USA. The same framework can be applied to explain the presence of multinational banks (MNBs). Banks may opt to set up branches or subsidiaries overseas because of barriers to free trade and/or market imperfections. For example, US regulations effectively stopped foreigners from issuing bonds in the USA and American companies from using dollars to finance foreign direct investment. US banks got round these restrictions by using their overseas branches, especially in London, because it was a key centre for global finance. Later, these banks used their London subsidiaries to offer clients investment banking services, prohibited under US law. Additionally, the nature of banking means banks possess a number of intangible assets which cannot be traded in the market place. For example, a bank may wish to profit from the employment of superior management skills in a foreign country, provided locational efficiency conditions are met. Thus, US banks with management expertise in securitisation may transfer these experts ta their London subsidiaries, as the securitisation business in Europe grows. Japanese banks have established subsidiaries in London and New York, where the markets are subject to fewer regulations than in Japan. This move was partly motivated by a belief that experience gained in other markets would give bankers a competitive edge in the event that Japanese financial markets are deregulated. Reputation is an important intangible asset possessed by banks. Many of the London merchant banks have established offices in other countries, to exploit their reputation for expertise in corporate finance, and other investment banking services. It is not possible to sell reputation on an open market. Provided locational efficiency conditions are met, reputation may be a profitable reason for a bank expanding across national borders. Many authors have argued that MNBs exist because banks need to follow their corporate customers overseas. The theory outlined above is not inconsistent with this traditional explanation. Suppose the customer of a bank decides to set up a subsidiary in a foreign country. The lending bank may follow the customer to meet the service demands of the client. In the days of colonial trade, when banking systems were underdeveloped, this factor was more important than today, when firms are expanding into countries, which, in most cases, already have well developed banking systems. But even if the multinational has operations in a developed economy with an extensive banking system, it may wish to employ the services of a home country bank because the cost of local bank credit, with no local knowledge of the firm, is likely to be higher. Additionally, the bank may follow the corporate customer overseas to protect its own assets. If the bank is going to lend funds to a multinational firm, it will require information on the foreign operations to properly assess the creditworthiness of the client. The optimal way of gathering information may be the establishment of a branch 168 or subsidiary in the foreign country. Effectively, the bank internalises the implicit market for this information. To summarise, the term international banking should be defined to include two different activities: trade in international banking services, consistent with the traditional theory of competitive advantage for why firms trade, and MNBs, consistent with the economic determinants of the multinational enterprise. Having classified international banking in this way, attention will now turn to developments in international banking services and multinational banking. BRIC banks profit as European and US grip on Top 1000 loosens The global financial landscape is changing, reflected in US and European dominance of the Top 1000 banks beginning to wane. If evidence is needed that the global banking landscape is shifting, a glance at The Banker’s 2008 Top 1000 World Banks ranking is illuminating. The US banks are a pale shadow of their former selves on the global stage. Profits for the 169 US banks in the 2008 listing (fiscal 2007 figures) at $112.8 billion accounted for just 14% of the Top 1000 aggregate, compared with 24% the previous year; and going back five years to the 2003 ranking, they provided a whopping 49% of the total. Also the US core bank presence is diminishing, falling to 169 banks from 185 last year and 210 in the 2003 ranking. As the US grip is slipping, Europe is not faring much better. Profits at the 266 EU banks, down from 279 last year, managed to maintain the EU 27 share of Top 1000 profits at 41% but the bleak economic outlook for Europe does not auger well. While the US subprime crisis and its aftermath continue to affect developed markets, many emerging economies, especially Brazil, Russia, India and China (the BRIC countries), are motoring on relatively unaffected. And the banks from these countries and other emerging economies are slowly but surely asserting their influence and growing strength. Table 1. Number of International banking, by Country, in the „Top 1000” Country % of banks in the Number of banks in top 1000 top 1000, 2008____ Canada 113.23 12 France 8.19 33 Germany 4.8 83 Italy 32.7 89 Japan 125 142 Switzerland 17.97 39 United Kingdom 83.33 56 United States 33 254 China 19 150________ 169 Source : The Banker, July 2008, The global financial landscape is changing, reflected in US and European dominance of the Top 1000 banks beginning to wane, www.thebanker.com. BRIC rise. The BRIC31 bloc in the 2008 ranking accounts for 119 banks in the Top 1000, almost more than double the 61 banks in the 2003 ranking. And this year, China’s two biggest, ICBC and Bank of China, are in the Top 10 World Banks, whereas five years ago they were only 16th and 15th, respectively. Also, Chinese banks now account for three of the top four banks in the world by market capitalisation, this is a massive change from 2003, when none of them were even in the Top 25 by market capitalisation. Global shift. The financial dynamics of the world are shifting and the 184 Asian banks in the Top 1000 now account for 19% of aggregate profits compared with 12% last year. The Middle East and Latin America remain relatively small but their banks are expanding, and banks in the Gulf are destined to increase their global role on the back of massive oil wealth. Banks from the US and Europe still dominate the Top 1000 World Banks but they are on the wane, a new global financial landscape is emerging and banks from a new range of countries are making their presence felt. Conclusion This article has explored the global dimensions of banking. It was argued that international banking is best understood in terms of international trade in banking services and the growth of multinational banks (MNBs). Like any other firm, a bank will seek to boost its profitability through trade if it has a competitive advantage in the provision of at least one banking service. The growth of an international payments system, the development of global interbank markets demonstrate how banks rely on a global network to profit from trade in international banking services. Multinational banking activity, it was stressed, is consistent with the economic determinants of foreign direct investment and the multinational enterprise. Today, all the countries have MNBs, which engage, principally, in wholesale banking activities. Today all banks, like any other firms, use international trade and foreign direct investment to boost the profitability of their operations. REFERENCES 1. Aharony, J., A Saunders,(2008),”The effects of the International Banking Act on Domestic Bank Profitability and Risk”, Journal of Money Credit and Banking,No17,4 (november, part1), pg. 493-511. 2. Aliber, R.Z.(2009), International banking: A Survey Journal of Money Credit and Banking, No16,4 (part2), pg. 661-695. 31 BRIC - In economics, BRIC or BRICs is an acronym that refers to the fast growing developing economies of Brazil, Russia, India, and China. The acronym was first coined and prominently used by the bank holding company Goldman Sachs in 2001. Goldman Sachs argued that, since they are developing rapidly, by 2050 the combined economies of the BRICs could eclipse the combined economies of the current richest countries of the world. 170 3. Cameron, R.,(2008), Global Banking Stategy, New York: Oxford University Press. 4. http://www.thebanker.com/news/fullstory.php/aid/5834/BRICbanks_profit_as_E uropean_and_US_grip_on_Top_1000_loosens.html 171
