Leadership in Criminal Justice Organizations Essay

The criminal justice organization is composed of law enforcement, courts, and corrections. Law enforcement, courts, and correction each have a significant role within law enforcement. It takes a great leader to manage and deal with all of the issues within the criminal justice organization. This paper will describe the challenges currently faced by leaders of criminal justice organizations. It will also provide steps that one can take as a criminal justice or security professional to affect change for the future. The leaders of criminal justice organizations are faced with many challenges on a daily basis. Some of these challenges include noble cause corruption, communication skills, conflict and power, legal and political challenges, and shortage of help. According to â€Å"Ethics in Policing† (n.d.), noble cause corruption in policing is defined as â€Å"corruption committed in the name of good ends, corruption that happens when police officers care too much about their wor k. It is corruption committed in order to get the bad guys off the streets†¦the corruption of police power, when officers do bad things because they believe that the outcomes will be good† (Noble Cause Corruption). Some examples of noble cause corruption include falsifying or planting evidence, committing perjury court, writing incorrect information on police reports, and abusing police authority. Ensuring that employees are trained properly can help prevent corruption. The court system, police and corrections have a special language or dialect that they use within that specific organization. Different jargon amongst these criminal justice organizations can create miscommunication between the manager and the employee. Duelin (n.d.), â€Å"leaders need to be effective communicators to handle these challenges† (para. What are the Challenges with Leading Groups in Criminal Justice Organizations?) Management needs to make sure that their employees know what their job is an d what is expected of them (Duelin, n.d.). Police officers are in charge for investigating and arresting persons charged with crime, while the court system decides whether or not a punishment should be imposed. If a person is convicted, the court system also decides what that punishment it. Punishment can come in the form of community service probation, jail, or prison. The court system and law enforcement do not always agree on the type of punishment that should be carried out. Duelin (n.d.), â€Å"For example, the police often seek to remove offenders from the streets, while the courts may feel it is best to rehabilitate the offender within the community. The police, courts, and prisons wield a substantial amount of power with these responsibilities. Leadership for these criminal justice agencies must balance this power with fairness† (para. What are the Challenges with Leading Groups in Criminal Justice Organizations?). Police are required to enforce laws and arrest anyone who breaks them. The court system role is to make sure that the individual’s rights are not violated in any way. Politics can have a major effect on criminal cases. An election year can lead to a number of changes in the criminal justice organization. Different judges, sheriffs, or district attorneys may be elected. All leaders and employees of law enforcement and judicial system need to stay informed of any laws that may have changed. One must be aware of political alliances at all times. Political alliances can jeopardize the outcome of a trial (Duelin, n.d.). Many organizations across the United States have been dealing with the issue of budget cuts. Budget cuts can be the result of financial cuts from the city or state or if a citizen is elected into a new position. As the population increases, so does crime. Budget cuts can eliminate necessary jobs that are needed to help keep society safe. Eliminating jobs causes an increase in the amount of work for the remaining employees left. Increasing the workload, in turn can create fatigue and stress. Employees are not able to do their job efficiently if they are overwhelmed with work. With new employees taking over their positions, comes new budgets to adhere to. One has to remain knowledgeable of all new rules, regulations, and budget cuts when someone new is elected into office. As times change, so should the way we manage the criminal justice system. The Criminal justice system must stay advance in order to prevent crime and protect society. There are many steps that  one can take as a criminal justice or security professional to affect change for the future. Over the past decade, technology has advanced greatly in the criminal justice system. Every organization should have the same technology. Different versions of computer programs make it difficult for states and federal organizations to communicate effectively. Sometimes information is not up to date or it may take a while for a different organization to retrieve the information. It would be beneficial to all if every organization had access to the same computer software. For example, criminal justice organizations can improve sex offender communication. Often times, sex offenders fall between the cracks of the system. They are not monitored correctly and fail to register on the sex offenders list. Sometimes, these offenders work for jobs that are a clear violation of their release. If every state and organization had the same software or technology available these offenders can be monitored closely. It is important that all employees and leaders undergo training every year. Ethics and moral standards should be the main focus of team workshops and classes. It is important that all employees maintain a certain level of respect for the law and society. Employees should also undergo psychological examines. Sometimes in the line of duty an officer may see something traumatic or have some type of trauma. This can have a detrimental effect on an officers’ mind. The officer may not feel comfortable asking for help; therefore, psychological examines can show what areas are of major concern for that particular individual. There should be a balance between private and public security. Public and private security partnerships are vital resources for law enforcement today. â€Å"Law enforcement agencies posses the legal authority and training to enforce the law. Carter (2007), â€Å"Private industry, with approximately triple the personnel resources of the law enforcement community, is more advanced in the use of technology to prevent and detect crime and is uniquely able to address certain crimes, such as workplace violence or computer crimes (para. Public-Private Partnerships: Vital Resources for Law Enforcement).† By combining public and private security, the security of the United States will be heightened. Protecting our borders is a main concern for the United States particularly when it pertains to drug trafficking. Drugs are a major problem in the United States. In 2010, 51 percent of federal inmates were  in prison for a drug offense (Klein, 2013). Drugs are often times the main reason people rob or kill others. Prisons should focus more on rehabilitation than punishment. By placing more emphasis on rehab programs, daily support groups, and work placement programs, offenders can overcome their addiction. The United States may not be able to eliminate drugs from entering the country; however, the amount of drugs entering the country can be significantly reduced. A few ways that can help prevent drug trafficking include increasing the amount of border control agents, creating a task force whose main priority is to locate underground tunnels that cartels use for trafficking drugs, and build a wall to divide Mexico and the United States. Many critics will argue that legalizing marijuana can also decrease drug trafficking into the U.S. While other critics argue that even if marijuana is legalized it only creates an opportunity for other drugs such as cocaine, heroin, and prescription drugs to enter the country. Even though California allowed the prescription of marijuana to some of its citizens, it had no effect on drug trafficking from Mexico because the majority of marijuana is entered through Texas and Arizona. Overall, there is not any scientific evidence that would conclude that it will either increase nor decrease the amount of drug trafficking. McKinney (2008), â€Å"in a criminal justice organization, leadership is essential to the success of the goals of the organization† (para. Modern Leadership Theories in Criminal Justice). To be a great leader one must acknowledge the issue and create ways to solve the problem at hand. Effective communication, training, and advance technology can help overcome some of the major challenges that leadership often deals with on a daily basis. References Ethics in Policing. (n.d.). Retrieved from http://www.ethicsinpolicing.com/noble-cause- corruption.asp Klein, E.. (2013, August 13). Wonkbook: 11 Facts about America’s Prison Population. The Washington Post . Retrieved from http://www.washingtonpost.com/blogs/wonkblog/wp/2013/08/13/wonkbook-11-facts-about-americas-prison-population/ Duelin, D. (n.d.). Ehow. Retrieved from http://www.ehow.com/list_6883806_challenges-groups-criminal-justice-organizations_.html Carter, J.C. (2007). The Police Chief . Retrieved from http://www.policechiefmagazine.org/magazine/index.cfm?fuseaction=display_arch&article_id=1257&issue_id=92007 McKinney, C. (2008). Yahoo Voices. Retrieved from http://voices.yahoo.com/modern- leadership-theories-criminal-justice-1338251.html

Strategies to Fight Low-Cost Rivals by Nirmalya Kumar

HP’s restructuring has shrunk Dell’s cost adv from 20% to 10%. Customers have appreciated added benefits like instant deliver, ability to seeYour traditional operation will become more competitive.Your low cost venture will make more money that it would have made as an independent unit. You can allocate adequate resources to the low cost unit. Dow Corning’s Xiameter unit – low cost provider of silicone products sells only 350 of Dow’s 7000 offerings, doesn’t cannibalize the its parents sales. From 28 M loss in 2001 to 500 M profit in 2005 Switch to selling solutionsNo synergies possible between existing enterprise and low cost unit. Integration of your products and services offer unique vale to customers. Australian mining company Orica – sold explosives to stone quarries. New service laser profiling rock faces to identify best places to drill holes. Become exclusively low customer cost providerNo synergies possible between existing en terprise and low cost unit. A major portion of customer segment is price sensitive. You are willing to acquire new business capabilities.RyanairFirms can either attack, co-exist uneasily or become low cost plays themselves. It is easy to fight traditional rivals due to similarities in their game plans and prowess but most companies overlook the threats from disruptive, low cost competitors. Coke fights Pepsi, sony with Phillips, avis with Hertz, P$G with Unilever. Amazon with Ebay etc.Businesses that sell at very low prices as compared to the incumbents might go to bankruptcy (US Airlines) but the point worth considering is that, they quickly reemerge. They slash fares and cut thrills and eventually grab a chunk of market. E.g. Southwest airlines, JetBlue, Aldi supermarket in Germany and other parts. The financial calculations of low cost players are different from the established ones. They earn smaller gross margins but their business models turn those into higher operating margin s.Higher than avng asset turnover ratio, impressive return on assets, because of returns and high growth rates, market capitalization is higher than industry leaders despite larger equity base. Framework for responding to low cost rivals.ASK – will this company take away my present or future customers? NO – watch but don’t take on the new rival. YES – don’t launch price war, instead try and increase product differentiation.ASK – are sufficient number of customers willing to pay more for the benefits my product offer? YES – Intensify differentiation by offering more benefits and over time restructure your company to reduce the price of benefits you offer. NO – Learn to live with the smaller company. If possible merge or take over rivals.ASK – if I set up a low cost business, will it generate synergies with my existing business? NO – Switch to selling solutions or transform into a low cost player. YES – Attac k your low cost rival by setting up a low cost business.Low cost players stay ahead in the market because consumer behavior work in their favor, new low cost entrant pose stiffer challenge compared to the traditional ones. e.g. – JetBlue’s entry is a concern for Southwest.The Futility of Price Wars. Even when market leaders copy the critical elements of the low cost rivals’ business models, they are unable to match their prices. e.g. – Internet booking for airlines doesn’t deliver the kind of cost reductions to traditional airlines that they do to low cost carriers. Slashing prices lowers the profit for leaders without driving the low cost rivals out of market.When Differentiation works: When leaders realize, they cannot win the price war, they opt for differentiation.Differentiation approaches: Design cool products. e.g. – Apple Continually innovate. e.g. – Gillette, 3M Offer a unique product mix. e.g. – Sharper Image, whole f oods. Brand a community. e.g. – Harley Davidson Sell experiences. e.g. – Starbucks, Nordstrom.Differentiation works when: Smart business don’t use this tactics in isolation. Companies must be able to persuade customers to pay for benefits. Companies must bring cost and benefits in line before implementing it.Dealing with dual strategies. Companies should set up low cost operations only when the traditional ones will become competitive as a result and new business will derive some benefits that that it would not have enjoyed as an independent unit. E.g. – First Direct, ING Direct. Low cost business unit should use a unique brand name like HSBC’s First Direct. Subsidiary should be housed separately.A two-pronged strategy delivers results only when the low cost operation is launched offensively to make money and not as a purely defensive ploy to hurt low cost rivals. Eh – Dow Corning’s creation of Xiameter.Switching to Conquer If there i s no synergy between traditional and low cost businesses, there are two other options to deal with the low cost rivals. Start selling solutions. E.g. – Orica’s blasting solutions Convert into low cost player. E.g. – Ryanair.Original Article by NIrmalya Kumar

E Payment

Chapter 1. Introduction 1. 1 Electronic payment systems and their place in electronic commerce 1. 1. 1 E-commerce and electronic payment systems 1. 1. 2 Limitations of traditional payment systems in the context of online payments 1. 1. 3 The need for new payment systems designed for e-commerce 1. 2 User acceptance: understanding and issues 1. 3 Research objectives 1. 4 Research scope 1. 4. The role of electronic payments in customer e-commerce activities 1. 4. 2 Approach and methodology Chapter 2. Classification and characteristics of electronic payment systems 2. 1 Classification of payment systems 2. 1. 1 Introduction 2. 1. 2 Primary classification of payment systems 2. 1. 3 Further classification of account-based systems 2. 1. 4 Further classification of electronic cash systems 2. 1. Payment mediation services vs. payment systems 2. 2 Identifying the characteristics of payment systems 2. 3 Advantages and limitations of payment models 2. 3. 1 Advantages and limitations of the elect ronic cash model 2. 3. 2 Advantages and limitations of the acount-based model 2. 5 Conclusions Chapter 3. User survey of electronic payment systems 3. 1 User acceptance of electronic payment systems 3. 2 Survey of users’ attitudes towards characteristics of payment systems 3. 2. 1 Survey participants . 2. 2 Questionnaire design and analysis 3. 2. 3 Survey results and discussion 3. 2. 4 Implications for user acceptanc Introduction 1. 1 Electronic payment systems and their place in electronic commerce In the early 1990s the business and consumer world encountered a new way of conducting trade business, which was named electronic commerce (e-commerce). Over the years electronic commerce has evolved into a popular and acknowledged way of conducting business.While researchers are still trying to understand it and gauge its importance and turnover, e-commerce is changing and growing incredibly quickly, producing such extraordinary results from both business and customer perspective that its phenomenon cannot be overlooked by anyone who has ever thought of conducting business, whether in online or offline environments. With many organisations and people labouring in the field of e-commerce it has become very clear that ecommerce is here to stay and organisations and customers are trying to get maximum benefit from it.E-commerce has become especially important in two interrelated dimensions, namely business-to-consumer (B2C) and business-to-business (B2B) e-commerce. Business to-consumer e-commerce is enabling customers to have an increasing influence on products created, how products are customised, and how services are delivered. Ecommerce offers customers convenient shopping methods for products, information and services, electronic banking, and personal finance management.It is making it easier for consumers to find the desired products and services, match them more precisely to their requirements, and compare prices, (Vulkan, 2003). Several business models have been developed to support various customers’ needs, among them are online portals, content providers, transaction brokers and community creators. For business-to-business relations e-commerce facilitates the form of organisation where companies rely on suppliers and product distribution to respond more effectively to the changing market and customers demand and to achieve more efficient operation.This type of e-commerce relationships offers organisations the possibility to work in the direct contact with producers, giving more room for customization and control over business activities. This helps to reduce the costs significantly by removing ‘middlemen’ from the supply chain. Good examples of companies that employ this business model are Dell and Cisco, (Guttmann, 2003; Laudon & Traver, 2002). Consequences that e-commerce brings for business-to-business relationships are eliminating inventory, and operational and distributional costs that indirectly provid e customers with lower prices.E-commerce can help businesses to increase production flexibility by ensuring timely availability of components from suppliers, to improve quality of the products by increasing cooperation between buyers and sellers and reducing quality issues, to increase opportunities for collaborating with suppliers and distributors, and to create greater price transparency — the ability to see the actual prices on the market, (Laudon & Traver, 2002). In this way e-commerce responses to the customer demand of lower prices and greater convenience. 1. 1. 1E-commerce and electronic payment systemsThe most popular definition of e-commerce is based on the online perspective of the conducted business. E-commerce provides the capability of buying and selling products, information and services on the Internet and other online environments. As for any trading activity, the issue of safe and reliable money exchange between transacting parties is essential. In an e-comme rce environment, payments take the form of money exchange in an electronic form, and are therefore called electronic payments. Electronic payments are an integral part of e-commerce and are one of its most critical as pects.Generally defined, electronic payment is a form of a financial exchange that takes place between the buyer and seller facilitated by means of electronic communications. An e-commerce electronic payment is a financial exchange that takes place in an online environment, (Kalakota & Whinston, 1997). Electronic payment systems (EPSs) are summoned to facilitate the most important action after the customer’s decision to pay for a product or service – to deliver payments from customers to vendors in a most effective, efficient and problem-free way.The role of e-commerce electronic payment systems is pivotal for future of ecommerce, whose further growth depends on the timely development of EPSs. The development of new types of e-commerce purchasing relation ships and business models has created the need for new ways of money exchange and new EPSs. For instance, online auctions, (Ribbers & Heck, 2004), has spurred the necessity for personto- person payment systems to allow online money exchange between individuals. Certain types of information products and services require small payments and micropayments.Businesses would like to sell information content that costs very little, accumulating revenues with high turnover. E-commerce EPSs can be designed for selling specific types of products, for example for trading copyrighted online content, such as music. Another unforeseen earlier requirement is conducting e-commerce using wireless mobile devices, such as mobile phones or personal digital assistants (PDA). The need for paying with mobile devices has urged the development of payment systems for mobile electronic commerce, (Laudon & Traver, 2002).In addition, ecommerce provides the possibility to enhance current payment systems or substi tute them with online variants. The need for online payments was first addressed by using extant payment methods of the offline world for online payments. For example credit cards, originally intended as an offline credit instrument, have become the major payment instrument for ecommerce. As e-commerce and online purchasing grows, the weaknesses of credit and debit cards, and cheques are becoming more apparent. These limitations are discussed in section 1. . 2. The lack of the fit-for purpose payment mechanisms and infrastructure is one of the main restricting factors that hold back the growth and evolution of ecommerce, (Guttmann, 2003; Laudon & Traver, 2002; O'Mahony, Peirce, & Tewari, 1997). 1. 1. 2 Limitations of traditional payment systems in the context of online payments Three factors are stimulating the development of electronic payment systems: reduced operational and payments processing costs, growing online commerce and decreasing the costs of technology, (Kalakota & Whin ston, 1997).Reduction of costs is one of the major reasons for research and development of EPSs. The central impetus for ecommerce and e-business is to provide a more efficient service, primarily in terms of costs. In this light, paying online with traditional payment systems such as credit cards is rather paradoxical, given that credit cards are one of the most expensive of all available mainstream payment means for both end consumers and merchants, defeated perhaps only by paper checks, (Lietaer, 2002; Laudon & Traver, 2002). Several limitations of traditional payment systems in the context of e-commerce can be outlined.Existing payment systems, such as credit cards, are inadequate for retail customer digital business from the following viewpoints: Lack of usability. Existing payment systems for the Internet require from the end user to provide a large amount of information, or make payments using complex elaborated web site interfaces. E. g. credit card payments via a web site ar e not the easiest way to pay, as these require entering extensive amounts of personal data and contact details in a web form, (Kalakota & Whinston, 1997). Lack of security.Existing payment systems for the Internet are an easy target for stealing money and personal information. Customers have to provide credit card or payment account details and other personal information online. This data is sometimes transmitted in an un-secured way, (Kalakota & Whinston, 1997). In practice this happens even in spite of introduction of secure transactions mechanisms, such as Secured Socket Layer. Providing these details by mail or over the telephone also entails security risks, (Guttmann, 2003; Laudon & Traver, 2002). Lack of trust.Users tend not to trust existing systems with the long history of fraud, misuse or low reliability, as well as novel systems without established positive reputation. In the present situation, money loss by customers is quite possible when using existing payment systems, such as credit cards, for Internet payments. Potential customers often mention this risk as the key reason why they do not trust a payment service and therefore do not make Internet purchases, (Lietaer, 2002). Lack of applicability. Not all web sites support a particular payment method, thus limiting customers’ ability to pay.Credit cards work only with merchants who have signed-up to the services of the corresponding credit card company, and do not support direct business-to-business or interpersonal payments, (Kalakota & Whinston, 1997). Lack of eligibility. Not every potential customer with money and intention to pay can make use of certain payment methods. Not all potential buyers can obtain credit cards due to credit history limitations, low income or other reasons, (ibid). Lack of efficiency. Some payments over the Internet can be too small to be handled by existing payment systems, because of overheads included in the processing of payments and transaction.Credit cards are too expensive for effecting small payments and are unsuited for small transactions. The minimum fixed fee charged to the retailer for processing a transaction could even surpass the value of the goods sold, (Guttmann, 2003). High usage costs for customers and merchants. Existing payment systems use a rather expensive infrastructure to facilitate the payment process. Credit cards are very expensive for end users, not in the least because of the enormous and growing size of fraud, which amounts to billions dollars per year.This loss is invisibly re-financed by users by the higher costs of credit card services. In addition, credit card payments are still heavily paper-dependent. Most credit card bills are sent in a paper form to customers by post, and the bills are mostly settled by posting paper documents, like checks of giro payments, which makes the whole cycle rather expensive. As mentioned above, this means that resources employed in processing of credit cards transactions re nder them rather ineffective for small payments, because the high overhead of credit cards, (Laudon & Traver, 2002; Guttmann, 2003).In online credit card payments credit cards are not physically available for inspection by the payee, (this situation is referred as ‘card not present’). This imposes higher charges for merchants, because the chance of fraud is higher; see section 2. 1. 3 for more discussion. Credit cards have low finality of payments because users can refute or repudiate credit cards payments in certain situations. Moreover, financial regulations in certain countries, e. g. in the USA and the UK, place the risks of repudiation, fraud, or non-payment largely on the merchant and issuing banks, (Laudon & Traver, 2002; APACS, 2002).These issues make credit cards less attractive to merchants. Certain authentication schemes, e. g. Verified by Visa and SecureCode from MasterCard allow to shit fraud liability from merchant to credit cards issuing banks, and can ea se this burden for merchants, (see www. verifiedbyvisa. com and www. mastercard. com). However, end users can found themselves paying more for the cards issued by the banks to refinance bank’s losses due to fraud. There are more concerns related to the credit card use in online e-commerce that are responsible for reluctant users acceptance of credit cards and e-commerce.According to the report published by marketing research firm IDC, (Asmussen, Raschke, & Arend, 2002), almost half of European users of the Internet do not buy goods online because they either do not trust the Web merchants or fear their credit card details will not be secure. According to analysts, total credit card fraud rose to $4 billion in 2002 (i. e. $2 for every card issued). Industry estimates that the amount of online credit card fraud could be in the $5oo million range, (Laudon & Traver, 2002).Authorities believe that hackers have stolen more than one million credit card numbers from E-commerce sites. It would not be a surprise that many customers use their credit cards with reservations. A survey by Visa of 15 Banks from 12 EU countries in 2002 found that online credit card payments account for nearly half of all complaints. More than one in five of these came from people who had not even shopped on the Internet, but were billed for online transactions, (Philippsohn & Thomas, 2003). Privacy issues are also associated with the use of existing payment systems.There are cases when users’ identities (i. e. personal data such as credit card numbers, names and addresses) were stolen when hackers break into websites’ databases and obtain personal information of the customers. Fraudsters then attempt to use this information to open new credit and bank accounts using the stolen identity, (Philippsohn & Thomas, 2003). These and other issues with existing payment systems such as credit cards render them not very suitable for online payments. 1. 1. 3 The need for new payment systems designed or e-commerce Despite that electronic commerce is a growing phenomenon, its future development is, to a large extent, hampered by the lack of appropriate payment systems. Since most of business-to-consumer payments over the Internet are performed currently via credit cards, an admittedly problematic payment medium due to costs, security and trust problems, the need for new payment systems clearly emerges from the existing situation, (Lynch & Lundquist, 1996; Wayner, 1997; Laudon & Traver, 2002; Guttmann, 2003).Research and development in Internet-based payments tried to resolve this situation by conjuring numerous online EPSs, a good proportion of which has been put to use. This was possible due to the stimulating factors listed above, and in the first place due to the availability and reduced costs of the enabling technology. However, the new payment systems, purposely crafted for the Internet, also could not avoid their own share of problems. This has led to the r eluctant use of new online electronic payment systems, i. e. esulted in low user acceptance of newly introduced payment systems by customers, (see section 1. 2). User acceptance of electronic payment systems At this stage the situation with the development of online EPSs is far from ideal. A survey on electronic money developments by the Bank for International Settlement reports a rather low level of EPSs use, even in the most advanced countries, (BIS, 2000). According to the European Central Bank, the proportion of online payments among cashless payment instruments in the European Union is rather low.The report admits that although there has been a lot of discussion on the use of EPSs and their importance â€Å"it is still not a widely used medium†, (ECB, 2001). The lack of customer demand, the diversity of technological standards and the lack of support by financial institutions are mentioned among the reasons preventing the development of electronic payment systems, (ECB, 2003). Some experts estimate that about 85% of all Internet transactions are done with credit cards that were not originally designed for the Internet, (Philippsohn & Thomas, 2003).According to a survey by marketing research firm Jupiter Research, credit cards are still the dominant payment method for online purchases, accounting up to 95% of online transactions in the United States, (Jupiter Media Metrix, 2000). This demonstrates still low user acceptance of alternative electronic payment systems, designed specifically for e-commerce. 1. 2User acceptance: understanding and issues End user acceptance of such sensitive technology as money-circulating payment systems is the critical key aspect of the whole path of payment systems’ establishment.Without such acceptance no technology can successfully exist on the market, and payment systems are not an exception. According to Dillon & Morris (1996) user acceptance is â€Å"the demonstrable willingness within a user group to emplo y information technology for the tasks it is designed to support†. This definition can be enhanced with the understanding that the user perception of information technology (IT) can be influenced by objective characteristics of technology, as well as by human factors and interaction with other users and related parties.For example, the social information processing model (SIPM), (Salancik & Pfeffer, 1978), suggests that attitudes towards technology are influenced by opinions, information, and behaviour of others. User acceptance is a pivotal factor determining the success or failure of any information system project, (Davis, 1993). Many studies on information technology report that user attitudes and human factors are important aspects affecting the success of an information system, (Davis, 1989, Burkhardt, 1994, Rice & Adyn, 1991). The arguments in section 1. and in the following paragraphs suggest that this is the case also with EPSs. Besides SIPM, a well-known approach to e xplaining and modelling user acceptance is the Technology Acceptance Model (TAM), (Davis, 1989). TAM suggests that users formulate attitudes toward the technology that depends on whether they perceive the IT to be useful and easy to use. However, TAM does not take into account other factors that may be critical to user acceptance or rejection of such specific technology as EPSs, such as security, trust, privacy and involved risks.Extending the SIPM assumption, user acceptance of online EPSs could be affected by a number of factors and parties, creating a broader sense of the social context of EPSs in the Internet environment. User experience with an EPS can be influenced or manipulated by various aspects, such as marketing, publicity, the reputation of the bank behind the system, trust towards the company operating the system and technology behind the system, and convenience of the user interface, see also Guttmann (2003), Kalakota & Whinston (1997), Egger (2003). Figure 1. attempts to illustrate the social context in which parties and factors could possibly influence user perception and experience with electronic payment systems. These parties and factors should be taken into consideration when exploring issues of user acceptance of online EPSs. They are either required for a successful operation of a payment system (banks), its promotion (marketing organisations), or monitor and regulate its operation (government). For example, the company operating the payment service will have to address users’ concerns about security, privacy and trust.Users can be influenced in their experience by other parties than the operator itself, e. g. the bank or financial institution that facilitates the payment transactions, see Figure 1. 1. Customers can be influenced by the user interface, or by other parties involved in the payment service, such as technical partners. Since e-commerce EPSs operate in the Internet environment, the reputation and impression of the syste m can be easily communicated to other users via online communities, creating yet another social impact on the system.Therefore, social influences, e. g. opinions and behaviour of other users, like family and friends, and reputation of banks and the parties involved, should be taken into account for user acceptance of EPSs. This argument can be supported by above-mentioned SIPM, (Salancik & Pfeffer, 1978). Issues such as trust, usability, applicability, security, and convertibility are extremely important because they can influence subsequent decisions of people whether to use a payment system or not.There are several obstacles to user acceptance of EPSs: developers not only have to sell the service to potential users, they also have to convince the users to entrust their money to a third party institution, to rely on the payment system in their business and personal finance, and to use it frequently for convenience, reliability, specific applications, services and for a variety of o ther reasons. To achieve this high standard of user acceptance, the creators of a payment system should bear in mind user-related factors from the very beginning of the conception of the payment system.Designing for user acceptance of online electronic payment systems is thus the main issue put forward by research described in this thesis. An open challenge remains for designers and developers of novel Internet-based payment systems to meet user expectations, requirements, preferences and needs in design and operation of the systems. Resolving these issues is critical for the development and operation of new payment systems and future growth of e-commerce. 1. 2. 1User factors in payment technology The importance of user-related factors can be demonstrated in the example of the notorious problem of security of information systems.There are thousands of security mechanisms, matched with a growing number of hacks and security breaches, (Flynn, 2001, p. 61). However, the nature of secur ity issues is changing with the constant improvement of information technology. While security technology is becoming increasingly sophisticated and tamper-proof, experts in information security admit that user factors are the most important issues for security problems. The vast majority of all security issues in IT environments is caused or assisted by users inside organisations, rather than hackers and other utsiders. Security experts know many stories about people exchanging their passwords, or IT managers attaching notes with logins and passwords to their monitors, or about hackers finding these notes in the trash. To avoid this kind of mistakes, experts are talking about enforcing security policies in organisations, to be able to address user-related factors in security, (Flynn, 2001). Therefore, security practices have embraced user-related factors. This example helps to illustrate the importance of user-related factors in the design and operation of information systems.The f ollowing example illustrates a failure of a payment system due to neglecting to focus on user and market needs. The Chipknip â„ ¢ and Chipper â„ ¢ smart card payment technologies, (Nannery, 1998), were introduced in the Netherlands in early 90s. Both systems were intended to provide a way of paying small amounts in everyday transactions, which people would normally pay with cash. However, these two systems competed with each other for some time, being incompatible, so customers could not pay with the competitor’s card at certain shops, (BIS, 2001).Eventually, this created problems of interoperability and limited the user base for both systems. Another obstacle was that the card readers were installed in shops where people already had another method of payment – debit cards, which worked very effectively and efficiently and which were used by most people for all kinds of payments. In a way, Chipknip and Chipper duplicated the functions and applications of debit ca rds. On the other hand, the real need for Chipknip and Chipper for small payments at parking lots, vending, and public transport tickets machines was not met.A serious situation arose regarding the high costs of accepting Chipknip for merchants. As the result, the union of Small and Medium Enterprises in the Netherlands threatened to boycott Chipknip, (Het Financieele Dagblad, 2001). In this case, an important factor stimulating the development of EPSs was not met, namely the reduced operational and processing costs. Despite of a certain potential for uses acceptance of e-purse technology (Van Hove, 2004), this situation is changing slowly.All these issues led to a low acceptance of Chipper and Chipknip technologies. Chipper International decided to stop operations and support of Chipper in the Dutch market, (Libbenga, 2001; BIS, 2001); Chipper has fused with Chipknip, and while some issues have been addressed, the expected applications for this smart-card technology are yet to come . The example above helps to illustrate the complexity of human and marketing factors in the context of payment systems and their crucial influence on the eventual success of a payment system.Therefore, for successful design of electronic payment systems from the user perspective it is important to find out what user-related factors and systems’ aspects have the most direct impact on user acceptance and which of them can cause problems when neglected in design. 1. 3Research objectives 1. 4Research scope 1. 4. 1 The role of electronic payments in customer e-commerce activities The process of paying is an essential part of customers’ online buying activities. These activities are well described by the Consumer Mercantile Activities Model, (Kalakota & Whinston, 1997).The model comprises prepurchase interaction, purchase consummation and postpurchase interaction phases. The payment activity takes place within the purchase consummation phase, Figure 1. 2. â€Å"The purchas e consummation phase specifies the flow of information and documents associated with purchasing and negotiating with merchants for suitable terms, such as price, availability, and delivery dates; and electronic payment mechanisms that integrate payment into the purchasing process†, (Kalakota & Whinston, 1997). The buyer arrives to payment activities after identifying products of services to be purchased.The buyer and seller conduct then a mercantile transaction. In a mercantile transaction the buyer and the seller exchange information followed by the necessary payment. The payment methods they use should be mutually negotiated and agreed on (ibid). Therefore, in order to conduct a successful e-commerce mercantile transaction the buyer should at least be willing to use the payment method offered by merchants. From this viewpoint, user acceptance of e-commerce EPSs is critical for the completion of the purchase consummation phase and the whole purchasing process. It can be there fore bserved that the payment process and the user involvement in it are highly important for e-commerce activities. Scope of payment systems Business-to-consumer Payment Systems This research is focused on user acceptance of new payment systems in consumer ecommerceenvironments. The main focus of the presented work is therefore Businessto- Consumer e-commerce EPSs, which are designed with the main purpose to facilitate payments for consumer e-commerce. Taking into account the B2B systems would have made the scope too broad to handle within this research. Payment Systems designed for the WebCurrently, consumer e-commerce is done mainly via the WWW (Web) service of the Internet. The market for conducting e-commerce payments via wireless PDAs, mobile phones and other Internet services is still under development, (Bohle, 2001a), and therefore does not have a wide user basis and usage experience. Thus, in the scope are Web-oriented online e-commerce EPSs and Web e-commerce applications. Scope of payment tasks Because the scope of the defined business relations is Business-to-Consumer, the payment tasks in the focus of this thesis are related to consumer e-commerce and trade of goods and services.In these tasks there should be at least one 1) business party involved and 2) one physical person, who is conducting purchasing activities in an ecommerce environment. Scope of target activities These activities include those that are related to buying goods and services, and essentially represent consumer e-commerce. The scope of these activities is embracing a significant and, arguably, the most important part of the consumer e-commerce represented by B2C relations. Purchasing goods: tangible, require shipping, intermediated (by shipping companies). Purchasing information and software: intangible, immediate, not intermediated (by shipping companies). Purchasing services: intangible/tangible, not always immediate, can be intermediated (by service companies). The followi ng activities are therefore excluded from the scope because they are not in line with the defined scope of electronic payment systems, namely B2C consumer ecommerce. Consumer-to-Consumer (C2C) money payments and exchange.C2C payments do not belong to B2C e-commerce, (Figure 1. 3), e. g. personal auctions payments, debt settlement. Specific payment applications, for instance, gambling or adult-content sites. In this context the sites place specific requirements on B2C relations and userrelated factors, e. g. on privacy. Related activities Additional activities that have to be explored are the influence of pre- and postpurchase interaction phases, according to Kalakota and Winston (1997) on the user experience with a payment system on the whole.It is very likely that correct introduction,application and follow up of payment products and services in retail e-commerce are important for user acceptance of EPSs, and therefore the pre- and post-purchase interaction phases cannot be reaso nably disregarded when investigating the payment process. The user experience within these phases could affect their decision as to whether to use the e-commerce service at all, without even arriving at the payment process itself. Amount of money The minimum amount of money within the scope was chosen to be above â‚ ¬2.This means excluding small and micropayments. The nature of payment tasks in case of micropayments is different from higher amounts. For instance, users may wish to automate this kind of payments to avoid the need to authorize a payment of â‚ ¬0. 01 every time, while with bigger amounts they are likely to have control over each transaction. Furthermore, different researches show that at this moment there is little market for services that support small and micropayments, (Bohle, 2001b). In the focus are therefore small to medium sized payments, e. g. from â‚ ¬2 to â‚ ¬1,000.The upper payment limit is set to â‚ ¬1,000 to indicate that highest amount with in the scope of this research. The suggested range of payment amounts is typical for the current status of the domain and is similar to range of payments with existing offline EPSs, like credit, debit and smart cards, (Lelieveldt, 2001; Bohle, 2001a). Larger payments can be expected to raise different user acceptance issues, because of more user attention to risks, security, efficiency and other aspects of transactions with such amounts, (Humphrey, 1995). 1. 4. 2 Approach and methodologyThis research employs practices of the multidisciplinary scientific field of Human- Computer Interaction in order to research issues of user acceptance and user-related factors in online e-commerce electronic payment systems. Specifics of HCI research The nature of Human-Computer Interaction is such that it has to employ various scientific, research and design disciplines and cross borders between them for successful research. HCI is different from other disciplines in that it studies interaction bet ween people and artificially created artefacts, and not an independent natural phenomenon, like in other disciplines.This complex nature of HCI and its research goals compel researchers to adopt both inductive and deductive approaches to science, as described in Mackay & Fayard (1997). In the deductive approach the purpose is to generate a set of hypothesis that can explain real world phenomena. The scientist proposes a theory about a phenomenon, and formulates a hypothesis to be tested in an empirical research. In order to verify the hypothesis, an experiment is conducted, and with the revision of its results the theory is re-examined and an updated hypothesis is created.This approach is employed by the experimental study of this thesis. The inductive model aims to construct the most precise description of the real world, as opposed to explanation. The scientist observes phenomena in the real world without having a preconception or theory of what they are looking for. Then the scie ntist attempts to create a model of the world that explains the phenomena. By returning to the real world the model can be validated and changed if there are contradictions between the model and the studied phenomena.The qualitative study in this thesis employ this approach for requirements elicitation and creation of the design recommendations. The research process applied in this thesis, aimed to gain validated design knowledge, can be described as an iterative circular or spiral movement. This process is best described by Figure 1. 4, adapted from the work of Rauterberg (2000). This approach asserts to combine â€Å"analytical strength of empirical validation methods (e. g. , observation, experiment, inquiry, etc. with the synthetic strength of system design†. This triangle structure conceptualizes the three most important components of HCI research: â€Å"(1) the collection of ‘design relevant knowledge’, (2) the ‘interactive system’ in differen t possible representation forms, and (3) the several possibilities to represent a ‘user’ for (empirical) validation†, (ibid). The following sections describe how using diverse research activities helped to combine these components in the research reported in this thesis. Outline of the thesis The diagram in Figure 1. illustrates a combination of the research and design activities of this thesis. These activities included acquiring design knowledge on ecommerce EPSs, applying the knowledge to a commercial payment system designed by an industrial party, and empirical validation of the design knowledge. Chapter 2 presents a survey of literature on EPSs, which was necessary for understanding EPSs. The outcome this survey is a classification and a set of characteristics of EPSs. The importance of the characteristics of EPSs had to be confirmed with potential users of EPSs.Chapter 3 describes an investigation into the importance of the characteristics of EPSs to end use rs by means of a survey of consumer attitudes towards EPSs. The user survey helped to identify what characteristics should be given more attention in the design of EPSs. However, the knowledge about the importance of the characteristics did not inform how they should be realised in design of EPSs. To acquire a deeper understanding of these issues, a qualitative research in the form of a diary study was conducted, Chapter 4.The diary study aimed to understand how EPSs are experienced and perceived by users in the context of actual use and how EPSs can be designed to meet users’ needs. As the outcome of the diary study, implications for design of Internet-based payment systems have been derived and formulated as design recommendations. To ensure that the application of the design recommendations benefits user acceptance of EPSs, an experimental study was conducted, that is described in Chapter 5. This study helped to substantiate the validity of a subset of the design recommend ations.It was hoped to find the ideal situation where it is possible to apply the hypothesised design knowledge to a real-life system, rather than testing them in the laboratory, in order to achieve high realism of the results. Due to the participation of industrial parties, this situation has become available. The experimental study involved two parts: 1) a real-life EPS was redesigned in accordance with the proposed DRs, 2) an experimental comparison of the redesigned system with the old one has indicated improvements of user attitudes in several aspects, thus demonstrating the validity of the design recommendations.Chapter 2 2. 1 Classification of payment systems 2. 1. 1 Introduction This chapter presents a framework for classification and characterising of electronic systems that facilitate paying in an e-commerce environment. This framework is an attempt to describe and to relate the wide variety of the payment systems, with more than 150 payment mechanisms invented worldwide. This chapter also presents a survey of literature on EPSs, which has been a necessary step for understanding payment systems. The outcome of this phase of the research is a classification and characterisation of electronic payment systems. . 1. 2 Primary classification of payment systems The principal classification of EPSs is based on the form of money representation and the principle of money transfer. Existing payment systems can be divided into two groups: electronic cash mechanisms (or electronic currency) and credit-debit systems, (Medvinsky & Neuman, 1993). Electronic cash resembles conventional cash, when parties exchange electronic tokens that represent value, just as banknotes and coins determine the nominal value of conventional cash money.The credit-debit approach in the context of electronic payments means that money is represented by records in bank accounts, and this information is electronically transferred between parties over computer networks. Another terminologic al approach offered by Wayner (1997), based on the type of information that is exchanged, distinguishes between ‘account-based’ and ’token-based’ systems, which, respectively, corresponds to credit-debit systems and electronic cash in the definition of Medvinsky and Neuman. A similar distinction is found in Camp et al. 1995), who distinguish between notational and token forms of money. A different view on classification of EPSs is offered in Asokan et al. (1997), where payment mechanisms are classified based on the temporal sequence of money flows between the payer and receiver of the payments. Various attempts of classification of payment systems are also reported in Kuttner and McAndrews (2001), and Schreft (2002). These references are aggregated into the classification of electronic payment systems, illustrated in Figure 2. , which was first reported in Abrazhevich (2001b). The figure illustrates the further classification of EPSs, described in the foll owing sections. It provides examples of EPSs in each subcategory; some of these systems are described further in the text. The figure illustrates if the systems are only theoretical developments, that were only tested as limited pilots, and that have never been implemented for the commercial use. Payment mediation services that aggregate various EPSs in one payment infrastructure are described in section 2. 1. 5. 2. . 3 Further classification of account-based systems In the group of account-based systems, one can distinguish between 1) generic online EPSs that use simple account-based model for serving Internet payments, 2) systems that use the debit and credit cards model, and 3) specialized payment systems that, for instance, were designed for trading content online such as music. Some researchers consider credit cards systems as a separate group of payment models, (Medvinsky and Neuman, 1993), others consider them to be a variant of the credit-debit type.This classification adopt s the latter distinction. The basic principle of account-based systems is that the exchange of money between accounts is maintained by a payment service provider. Users can authorize charges against their EPS accounts, as they would do with usual bank accounts, though the ways of authorization are different for various systems. With the debit approach, the customer maintains a positive balance of the account and money is subtracted when a debit transaction is performed.With the credit approach, charges are posted against the customer's account and the customer is billed for this amount later or subsequently pays the balance of the account to the payment service. One of the most widely used systems for electronic payments is the debit card, which as the name suggest, is a clear example of a debit system, (Evans & Schmalensee, 1999). Debit cards combine the service of Automatic Teller Machines (ATM) cards and cheques. When customers pay with a debit card, the money is automatically de ducted from their checking bank account.In contrast with the credit cards, the spent money comes from the bank account directly. Many banks issue a combined ATM/debit card that looks like a credit card and can be used in places where credit cards are accepted. In this case, when users pay with a debit card, the payment will still be processed as a debit transaction. Other payment mechanisms that use the credit-debit model are Yahoo PayDirect, Pay- Pal. com, and theoretical payment projects like NetBill (Sirbu and Tygar, 1995), and NetCheque (Medvinsky and Neuman, 1993).A special group of account-based instruments that are currently in wide use are credit card systems. A great part of trade on the Internet is done using credit cards and these payment systems should not be overlooked. The biggest advantage of this approach is that the customers, who have already received credit cards offline, can use them directly for online payments. This also results in high scalability, as no addit ional installations are necessary. Credit cards provide a large customer base for merchants who accept them, thus their applicability is quite high.There are critical security issues associated with the use of credit cards in an online environment. When using credit cards over open networks, encryption mechanisms, such as widely used Secure Socket Lauer (SSL), in principle can prevent a hacker or eavesdropper from intercepting the customer's credit card number. There are some schemes that even hide card numbers from the merchant, providing protection against intercepting the card details from merchant databases or against fraud by the merchant. Nevertheless, these incidents happen regularly (Caunter, 2001; IFCC, 2003; Wales, 2003).It is important to note, however, that without some form of customer registration with a payment service or substantial proofs of identity, credit cards can be very risky to pay with and can be easily abused. Even encrypted Internet credit card transaction s do not include the owner’s signature, and anyone with knowledge of the customer's credit card number and expiration date can create a payment order. An important aspect of credit card payments in the online world is referred to as card-not-present (CNP) transactions.CNP transactions are those where neither the card, nor its holder are present at the point of sale, e. g. in orders by mail, telephone, fax or the Internet. The buyer does not have to demonstrate the physical presence of the card, or the card and the buyer do not have to be co-located. This imposes issues with card validation, security and fraud. CNP transactions are widely used in mail order/telephone order purchasing (MOTO) which also do not require co-location of buyer and seller. To secure transactions of this type, credit card companies ask for additional information, such as name, address, etc. that can be used to verify their identity, for instance, if the ordered goods should be mailed to the billing add ress associated with the credit card. Other information often required is the additional 3-4 digits code, printed on the back side of the card and not present in the credit card number. Merchants ask the customer to read this code from the card in a card-not-present order. The merchant then asks for verification during the authorization process. The issuer (or credit card processor) validates the code and relays the decision to decline or approve the transaction to the merchant.Nevertheless, the MOTO transactions incorporate limited protection against credit card fraud. Credit card CNP transactions could sometimes employ even less identity verification information. Since no signature involved in CNP transactions, the buyers can opt out of any order, if they claim they did not agree with the purchase, (O'Mahony, Peirce, & Tewari, 1997). The charges for orders cancellation are borne by merchants in the form of the higher costs for processing of CNP transactions. In addition, merchants could be liable for the whole amount of the disputed order, (APACS, 2002).Furthermore, because online payments are administered as standard credit card charges, the costs are too high to make this method unsuitable for payments below â‚ ¬1 and hence inefficient. Credit card companies are constantly lowering the minimum amount that can be paid to enable small payments, but charges for merchants still remain high. It should be also taken into account that cards are issued by banks and organisations, which after a screening, decide whether they can issue credit cards to certain customers.Customers with a low income, an imperfect credit history, might not be eligible for a credit card. This may restrict the customer base to a certain degree and limit user and merchant acceptance of credit cards as a payment method. 2. 1. 4 Further classification of electronic cash systems Electronic cash is stored in a digital form and serves as a cash substitute for the Internet or other informatio n systems. Electronic cash represents value in some form and can be spent with merchants, who deposit money in their own accounts or can spend it in other places.It can be represented by electronic ‘bills’ and ‘coins’, certificates, packets of data, or electronic tokens in one form or another. When using electronic cash systems, customers purchase electronic digital tokens from the issuing company using a conventional payment system, e. g. credit cards, electronic checks, or even paper currency (for example, via a reverse automatic teller machine which accepts cash, or when purchasing prepaid cards). Some of the systems allow converting electronic cash back into another form of money (Medvinsky and Neuman, 1993), which is very important for convertibility of the systems.Another distinction amongst electronic cash systems is between those that use smart cards for the storage of tokens and those where tokens reside only on user’s accounts and computer networks. The former are often called electronic purses (e-purses), the latter are sometimes addressed as ‘online cash’ or ‘Web cash’. Examples of e-purse electronic cash systems are CAFE project, (Boly et al. , 1994) and Mondex (Martin, 1994). Tokens in these systems exist and travel in the computer environment,for example, on a currency server or customers’ hard disk.Mondex is a smart card payment system that was designed to enable person-to-person as well as Internet payments, (Van Hove, 1999, p. 141). The card can be used to make small payments, store personal and application-specific information, and serve as a telephone card. Web cash representatives are E-cash, E-gold, Millicent (Glassman & Manasse, 1995), PayWord and MicroMint (Rivest & Shamir, 1996), and NetCash system (Medvinsky and Neuman, 1993). It has to be noted that these systems are mostly theoretical work and have not been implemented on the market. Systems that employ smart cards e. g. Chipknip, Chipper in the Netherlands, Proton in Belgium, and Visa Cash can be also placed in the category of electronic cash and also called e-purses, however, in representing money they hardly use tokens. In this case, the numerical data stored on the card is changed when a payment takes place. Judged by the principle of the operation and use they act like electronic purses. The value is stored on a card and if the card is lost, the money is gone, in a fashion similar to cash. It has to be noted that smart cards like Chipknip are not principally designed for Internet payments and are used mainly at point-of-sale terminals.There have been nevertheless pilot tests of facilitating paying over the Internet with Belgian Proton smart card EPS, but the use of Proton on the Internet is now discontinued. An important development towards standardisation of e-purses is establishing Common Electronic Purse Specifications with the goal to define requirements needed to implement a globally i nteroperable electronic purse program, while maintaining full accountability, (see www. cepsco. org). CEPS, which were made available in March of 1999, outline overall system security and certification.Being established by the key parties in electronic purse cards, and supported by organisations from over 30 countries, CEPS paved the way for the creation of an open global electronic purse standard. For cardholders it means that they will be able to use their electronic purse cards domestically and internationally with the knowledge that the card will be accepted wherever the acceptance mark is displayed. Visa Cash is an example of CEPS implementation, (see www. visa. com). Prepaid card EPSs can be also included in the same category of electronic cash, because the principle of their work resembles the use of e-purses, such as Chipknip.Users can buy a prepaid card for a specified amount. Prepaid card systems are specifically designed for Internet payments. Users can pay with a prepaid card by entering on merchant sites the card’s unique number, which corresponds to the card’s nominal. The value of the card is decreased by the amount paid to the merchant. To better understand what issues that surround electronic payment systems, it makes certain sense to introduce a definition of payment mediation services, which use existing payment systems as mediators to provide extra services. 2. 1. 5 Payment mediation services vs. payment systemsTo further refine the focus of this research, we have to make one important distinction, which is between payment mediation services and payment systems. This distinction particularly makes sense in the context of electronic and Internet payment mechanisms. Payment mediating services have appeared as a response to the imperfection and inefficiency of current payment systems for the Internet. They extend the services of the existing systems and operate as mediators between merchant, payment systems and users. Their goal is to help merchants to accept as many payment systems users could possibly want to use when paying over the Internet.In payment mediation services the existing payment infrastructure from many payments providers is aggregated to provide broader services, or to overcome shortcomings of the available payment options. Figure 2. 2 describes the relations between merchants, EPSs and payment mediation services. The difference between payment mediation services and payment systems can be summarized in that a payment mediation service is as an intermediary between payer, business, and payment system, while there is no such middle tire for payment systems. The payment process in this case is transparent to the users of a site.A mediating service provider ‘intercepts’ payments from users, processes them, and credits the account of the owner of the site when the authorization and transactions are completed. For example, there are numerous companies among mediating services provid ers that facilitate acceptance and processing of various credit cards. A special class of payment mediation services has emerged, that provides convenience for paying bills for businesses and end users. An example of payment mediation services is providing bill payments for end users and companies, for instance, utilities or telephone bills.Over a Web front-end provided by the billing systems, customers and companies can pay bills that are normally paid offline by paper cheques or bank transfers. Some systems even provide additional services such as automated accounting merged with online payment facilities. Syndication of payment services Another angle on payment mediating systems is viewing them as a form of syndication of payment services in an online environment. The notion of syndication originates from the entertainment world, where it forms the fundamental organizing principle.With the advent of the ‘new economy’ and the use of the power of Internet distribution, syndication can be recognised as an emerging model for e-commerce. In this context syndication would mean selling the same information to many different customers, who render and integrate it with other information in various value-adding ways and then redistribute it. According to this principle, businesses involved can play three or more roles: originators who create original content; syndicators, who collect and package digital information to meet specific customers’ needs; and distributors who deliver digital content to customers, (Werbach, 2000).In the context of online payments, payment mediation services can be seen as syndicators of the original services offered by payment systems. Payment mediation services syndicate e-commerce EPSs, offering merchants the way to accept a variety of payment systems. Examples of payment mediation services A good illustration a payment mediation service is Bibit Billing Services (www. bibit. com). This Dutch company specializes in Int ernet payment and billing services. The service supported about 70 payment methods from 18 countries by 2004.When customers want to pay on a Web site of a Bibit’s client, they select one of the provided payment methods. The payment process goes as follows: 1. A customer selects products on sale in a virtual shop. 2. For payment, the customer is then redirected to Bibit Payment Service. 3. Within Bibit Payment Service, the customer can select a payment system he or she would like to pay with, provided it is supported by Bibit. The customer makes the payment with the system of his or her choice. 4. After a successful payment, Bibit notifies the merchant that the order can be shipped and transfers the money to the merchant.The processing of the transactions, which is conducted entirely by Bibit, is therefore transparent to the customers of the site and the client company. The company business model, which utilizes a number of payment systems, relies on providing extra services t o facilitate payments, and therefore it fits into the definition of a mediating system. It is interesting to note that the service allows the use of micropayments, by accumulating charges for products like news, articles, stock and research reports, online games and charging users on a subscription basis.Examples of other payment mediation services are Orbiscom (www. orbiscom. com), iBill (Ibill. com), PayTrust, (www. paytrust. com), DataCash (www. datacash. com), PayNet (www. paynet. ch). Systems that conceal real customer’s credit card numbers by providing them a unique temporary card number for each transaction have gained certain popularity among payment mediation services. The customers can then use this unique number in a normal credit card transaction, and their real credit card will be charged.This temporary card number expires after every transaction and would not be approved for the subsequent use. The data of real credit cards of customers is not exposed to parties online in online transactions. In this case the payment mediation services are using credit cards infrastructure to provide extra security and anonymity (ABN-Amro e-wallet, O-Card by Orbiscom. com). By using these measures merchants expect to accept more secured payments without changing the way shoppers pay and without changing existing payment processes or infrastructure.The research summarized in this thesis is concerned mainly with payment systems and not with mediating solutions for existing payment infrastructure. Payment mediation services on the Internet emerged because of the absence of relevant payment solutions or have problems that prevent their successful use by merchants and users. Many of EPSs are probably transitory systems, unable to completely solve problems that appear in the context of the Internet paying process, because the problems originate in the payment systems they use; see discussion on PayPal. om in section 2. 4. While syndication of EPSs by payment med iation services provides in the end a better level of service than individual EPSs they use, it also places the payment mediation systems out of the scope of this research, which is exploring ways to design better individual EPSs. 2. 2 Identifying the characteristics of payment systems As observed in the example with Chipknip and Chipper in the previous chapter, there are a lot of factors that determine the success or failure of payment systems, and not all of them are of technical nature.As mentioned already, user acceptance depends on many issues, such as consumer choice, preferences, advertisement, a state of the market, etc. The discussion of diverse aspects of electronic payment systems can be found in many works on development and research of payment systems. Attempts to classify and describe the requirements and characteristics of payment systems such as security, reliability, convertibility, efficiency, traceability, and others can be found, among others, in the works of Med vinsky & Neuman (1995), Langdon et al. (2000), Lynch & Lundquist (1996), Wayner (1997).It has to be noted however, that these studies are mainly focused on technical aspects of electronic payment systems, which is not the only facet that is important in this field. Below the characteristics of payment systems are extended to account for user-related aspects of EPSs. These characteristics can be also used for assessment of payment systems, as described further. The list of characteristics of payment systems Anonymity, privacy This characteristic reflects the desire of users to protect their privacy, identity and personal information.In some transactions, the identities of the parties could be protected by anonymity. Anonymity suggests that it is not possible to discover someone’s identity or to monitor an individual's spending patterns. Where anonymity is important, the cost of tracking a transaction should outweigh the value of the information that can be obtained by doing so . As an illustration, when a customer pays with a debit card, the purchase is registered at the vendor and bank’s databases. It is possible to find out what amount was paid and what actually was purchased. Thus debit card payments are not anonymous.On the contrary, when one pays with cash at a shop or in a marketplace, no one can say by examining the cash that money came from the payer, as there is no direct information about this payer’s personality associated with the banknotes. Thus, cash is an anonymous payment system. Currently, the right of users to choose how their personal information is disclosed is viewed as privacy. There are privacy laws in several countries that limit usage of personal information by banks, authorities and other parties, including online businesses and payment systems, like European privacy acts or similar directives, e. . European Commission Data Protection Directive. Applicability The added value of a payment mechanism is dependent upon how useful it is for buying something. Applicability (or acceptability, as it is often referred in literature, (Medvinsky & Neuman, 1995)) of a payment system is defined as the extent to which it is accepted for payments at points of sale, or at online e-commerce sites in this case. For instance, cash is accepted widely and virtually everywhere in the offline world and thus has a very high level of applicability.Debit cards and credit cards have a very high applicability, as one can pay with them in a variety of places. The applicability of a payment system may vary from country to country. For example, in Germany and in the Netherlands cheques are no longer common due to the steady growth of other payment methods. However, in the UK and the USA cheques are still quite a common method of payment and the level of their applicability is quite high. Authorization type Authorization type is referred in the literature as the form of a control over the validity of transactions, (Lynch and Lundquist, 1996; Asokan et al. 1997). The authorization type can be offline or online. Offline authorization means that users of the system can exchange money while not connected to a network, without a third party mediating for the transaction. Paper cheques are an illustration of offli

Thirty Years' War caused by religious tensions Essay

Thirty Years' War caused by religious tensions - Essay Example Perhaps the most significant outcome of the religiously coloured tensions between adherents of the Protestantism and the Roman Catholic Church, that ensued from the actual religious division within Germany, was represented by the devastating Thirty Years' War of 1618-48. Indeed, it is estimated that up to one-third of the German population was lost due to military activities and ensuing diseases and famine. Historians suppose that the pre-war population level was reached only in almost a century after the end of Thirty Years' War. Economy of Germany was also in disarray due to the ruin brought in by the Thirty Years' War, so that the economic deterioration that already was significant in the second half of the 16th was further worsened. The prosperous economies that some German towns had in the late Middle Ages and in the beginning of the 16th century declined, and Germany was about to face a long period of economic depression that would end only in the second half of the 19th centur y (Bonney, 2002, p.74). Considering the long-lasting consequences of the devastating Thirty Years' War, it is important to understand what factors caused its outbreak. We have already mentioned the religious factor, and it is hardly a coincidence that such an important development as the spread of Protestantism preceded the war. But to what extent was the Thirty Years' War caused by religious tensions and to what degree such factors as a struggle for power or for territories within the Holy Roman Empire were involved To answer this question let us overview the historical developments that occurred before the 17th century, and try to establish the link between the religious factor and the causes of the Thirty Years' War. All too often it happens in history that the connection between the studied events that seems to be self-evident is by far not the only explanation but rather just a part of the general picture. In the same vein, the effect that the Protestant Reformation seems to have had on Germany was equally just a part of the story. The other characteristic of the Germany before the beginning of the Thirty Years' War, which is important for our study, was inherited from an earlier time. This characteristic is the so-called German particularism - the presence of numerous states of different types, like free cities, electorates, principalities, and ecclesiastical territories. The roots of this peculiarity of Germany go back to the Carolingian Dynasty (752-911), when Charlemagne's empire was separated into three kingdoms, but in the East Kingdom regional duchies (namely Franconia, Saxony, Bavaria, Swabia, and Lorraine) strengthened and obtained form of small kingdoms. Such eastern subdivision initi ated the German particularism, when territorial sovereigns pursued their particular interests without consideration of interests of the kingdom. When the Carolingian line ended in 911 such duchies were further reinforced because now there was no direct blood heritage of the

Social Work - Welfare Agenda Essay Example | Topics and Well Written Essays - 500 words

Social Work - Welfare Agenda - Essay Example Wales also introduced Childrens Commissioner into the social welfare network. This was later to be implemented by Scotland as well. However, Wales did not limit itself to Children’s Commissioner but rather went a step ahead and introduced the Older Peoples Commissioner. The chairperson of this new post would be bestowed with the primary job to consider and promote interests of the senior citizen in Wales by removing discrimination and modifying legislations among other things. The Welsh Assembly actively participated in these programs. Only in England and Wales has the Mental Capacity Act 2005 been implemented. An adult mental health plan is also in the pipeline as the Welsh Assembly is working on it. The Councils in Wales also take part in the development of the social sector and also helps in the development of the social services workers and volunteers. A Social Services Improvement Agency has also been introduced in Wales in order to develop the services rendered by the local authority. This is done by informing the workforce about the prevalent policies, research and various legislations in practice. Since 2007 the Welsh Assembly government facilitated the amalgamation of two bodies into a new Care and Social Services Inspectorate Wales (CSSIW). The purpose of the CSSIW was to develop the existing facilities for social services. In the future, one may foresee two possible scenarios1. Qualified social workers are most important to attend to the welfare of the society. Over the years, the demand for social workers has increased leading to an imbalance and which is likely to remain for the next few years to come till there are more qualified social workers pitching for the job. This leads to the consequence wherein there is lack of local authorities to deliver social work services. The challenges thus presently existing the local authorities are

HS630 Conf Week 3 Question Essay Example | Topics and Well Written Essays - 250 words

HS630 Conf Week 3 Question - Essay Example In the Dam sector, various systems plus redundancies are in use to prevent risk occurrence; cyber insecurity results to threat of safety (McGrath, 2011). Control systems in Dams are vital systems when they are in improved form. Improved control systems occur in suitable designs and work in a manner that is safe and free from cyber insecurity (Stewart et al., 2011). There exists information sharing criteria in the Dam sector that pertain cyber and physical coercion plus procedures for protection. The Homeland Security Presidential Directive 7 (HSPD-7) has ensured presence of a National infrastructure Plan (NIPP) leading to development plus improvement of backup systems (McGrath, 2011). The Federal Emergency Management Agency ensures the existence of web associated training courses. These entail various issues of safety concerning Dams. It is difficult to maintain strong partnerships between the private and the public bodies that ensure proper sharing of authorities plus resources in order to implement strategies (McGrath, 2011). Application of appropriate technology becomes a challenge because various complexities may emerge. Existence of unreliable safeguards results to damages due to flooding and other aspects (McGrath, 2011). A climatic change presents challenges because it results to a variance in the flow of rainfall. This change affects dam structures because parameters used during design will need adjustment to conform to the existing variables (Stewart et al.,

Al Qaidas Major Domestic Attack on the United States Research Paper

Al Qaidas Major Domestic Attack on the United States - Research Paper Example This includes the recent attack on U.S. embassy in Yemen and evidence proves the involvement of the Al-Qaida group in the attack (Ghobar and Blair 2012). The Al-Qaida group has been reignited by the launch of film â€Å"The Muhammad† and has openly announced increase in terrorist attacks against the US (Hasni 2012) Many researchers and analyst, studying Al-Qaida’s strategies and threats, forecasted that the death of their former leader Osama Bin Ladin, would be the major setback for the group. Unfortunately, this prediction turns out to be false as the strength of the Al-Qaida group does not look to shrink, with their new leader and new strategies (Geltzer 2010). After the death of Al-Qaida’s former leader and administrator, members of the group started spreading in different European countries with fake nationality, to escape from the US invasion in Afghanistan and Iran (Hollywood, Synder, Mckat, Boon 2004). Al-Qaida’s movement in South Asian countries, have also been reported, giving signs of their flexibility to change, with regard to the situation. So even now, they should be considered as a serious threat as they do not look to settle down or get weaken (Geltzer 2010). Joshua Geltzer, in his book highlights key factors, which have nailed in the Al-Qaida troop. This includes killing of Osama Bin Ladin, the most prominent figure of this group and the mastermind behind most attacks made by the Al-Qaida (Geltzer 2010). In addition, US army has been successful in tracing down locations of Al-Qaida’s members worldwide and eradicating them from the face of the earth. Moreover, their funds of around $140 million and a large number of weapons have been captured (Geltzer 2010). And they have been forced to leave their homeland in Afghanistan, from where they used to meet and plan their terrorist activities. But despite all these factors, Al-Qaida still stands as a big threat to Western or Non-Islamic countries, especially the U.S.A (Khalsa 2004).   

Blog Reflection Post for personal branding Research Paper

Blog Reflection Post for personal branding - Research Paper Example Lewis presents five classification in conformity as far as branding is concerned. They are: Fearing Breed conformity, Buck the norm, questioning everything, Running away, and lastly, embracing risks (Lewis, 2014) Conformity has affected the way marketing is carried out in this age. Customers indulge purchase practices to the acceptable groups in society. Many business ventures opt to follow this practices and this has played a role in eradication of the innovative spirits in entrepreneurs. Personal branding therefore steps in to make a careful study and manage such consumer perceptions to ensure success in marketing. (Rampersad, 2009). According to Lewis 2014, of which is true, his idea of ‘screaming louder’ is very costly. It will require lots of funds to finance. The world of marketing has also become so competitive and personal branding should embrace unique ways which ought to be less costly. Hence it’s a key factor to do a careful analysis on consumer preference. Business ventures should embrace ways to stand out as unique but not drifting away from the expectations of their customers. Montoya 2002, notes that personal branding is an asset to the business venture and ensures excellence. Conformity is still a major setback to customization. Lewis 2014 quotes that three-quarters of the individuals in a group conform to a phenomenon at the first instance. This presents a critical viewpoint that marketers ought to take so as to achieve their sales targets without compromising their customers. Lewis presents three tips, which are agreeable to me: first is to make a comprehensive analysis of industry’s best performers, then to analyze market norms and lastly to take in the aspect of rick and insurance. The business can then be confident to take a different route cautiously having in mind that its customers will ‘feel better’ going in that direction. Effective branding in a corporate environment seeks to

Newton, Leibniz, and the Invention of Calculus Essay

Newton, Leibniz, and the Invention of Calculus - Essay Example The theorem was the start of the Newton’s mathematical innovation (Dunham 6). In 1666, Newton made his first contribution to calculus through the introduction of fluxions. In the late 1665 before his first publication, Newton had made studies on the tangent problems by combining velocity components of the moving points in a proper coordinate system. This was vital for the introduction of fluxions which is a key component in geometric applications (Edwards 191). Newton was capable of exploiting the concepts of antidifferentiation and differentiation by the substitution methods. This is the equivalent of what is called integration and chain rule by substitution. This is essential in the building of calculus of fluxions (Edwards 196). Newton applied the method of successive approximations in his De Analysi to the reversion of series. Newton proceeds further to use the technique of reversion of series in the discovery of sine and cosine series (Edwards

Managing Patient safety Assignment Example | Topics and Well Written Essays - 2750 words

Managing Patient safety - Assignment Example The person on whom the medication/ treatment is administered is harmed, and the person who recommends, performs or prescribes the use of the treatment is at fault (MAC, 2010). Each year more than 98, 000 individuals have fatal outcomes medical errors. The errors may arise as a result of doing the wrong treatment wrong treatment, going ahead with the treatment with insufficient information, or due to inefficient processes. About 10 to 20 % of the medical errors are as a result of errors in prescription of drugs or known as ‘medical errors’ (Patel, 2004). The cost of medical errors are very high and this may result in longer hospital stay, post-treatment complications that require a lot of care, etc (Patel, 2004). A more universal definition of a medication consists of any deviation away from the normal intention, expectation or desirability. There are many other ways of perceiving errors includes psychological ways, sensory events, perceptual occasions, cognitively, motor events, any action in well-managed system, and a negative output in a controlled environment Usually an error is related to an adverse effect and even if errors are not caused, they can still occur. For instance even if a drug is perfectly administered according to doses, indications, contraindications, prevention of interaction, etc, an adverse event can still occur as the (Kopec, 2007). Goldberg 2001 considers that the medical errors may have a serious effect on the system such as increasing the patient stay by a couple of days, which adds on to about a spending of $4600 per patient. Overall, with the total number of medical error cases reported every year, about 2.4 million hospital days would be spend and $9.3 billion. The impact is that patients have longer stay (LOS increased), the return to work is longer (indirect costing), and both these direct and indirect costing is preventable to a large extent (Patel, 2004). Most of the medical errors occur at the rate of 1 per day in a hospital, and they have the chance of causing serious negative outcomes for the hospital. Following the medical error, the aggrieved patient has the right to seek damages and compensation. In the year 2008, Medicare declared it would no longer cover for preventable medical errors in healthcare. Today with the introduction of such measures from the CMS and insurance companies, greater efforts are being laid in reducing medical errors as the hospitals are being held responsible (Patel, 2004). A medical error can be related to various aspects of healthcare including:- On a large scale, it is found that from the physician quarters about 57 to 60% of the errors can be prevented if a computerized ordering system is implemented and can be used appropriately (Maganelli, 2009). Patient Safety According to the AHRQ, patient safety is defined as â€Å"...as a discipline in the health care professions that applies safety science methods toward the goal of achieving a trustworthy system of he alth care delivery...’. Here greater efforts are being placed on trust in the healthcare delivery system (AHRQ, 2008). According to the IOM, patient safety is defined as â€Å"...the prevention of harm to patients...† They have placed greater emphasis preventing errors, learning from past errors, building a culture that is safe for the patients including efforts from organisation, professionals and the patients (Mitchell 2008). During

Worldview Essay Example | Topics and Well Written Essays - 1500 words

Worldview - Essay Example To be a Baptist, to me, means that a person can be â€Å"different† from the others yet still be part of the same collective. This is a beautiful and inclusive message, and that is why I would describe my worldview as diverse and inclusive. The core beliefs of Baptism include that there is only one God, who manifests Himself in three persons: the Father (God in Heaven), the Son (Jesus Christ), and the Holy Spirit. Moreover, there is belief in the birth of Jesus Christ from a virgin mother, Mary. Jesus Christ performed many miracles during his lifetime, including raising the dead, and then died, was buried, and finally resurrected. Also, we believe that human beings are in need of salvation, without which they are doomed; this salvation is provided to us by the very death, burial and resurrection of Christ. It is the grace of God, due to which He has given us humans the unearned favor of eternal salvation by sending his Son to earth and dying on a cross for our sins. Baptists a lso believe that the world will end, and Jesus would return to us and the dead will be raised and everyone be judged by Him. Finally, we believe that the Message of God needs to be spread throughout the world, so that more people can be brought within the fold and experience the Grace of God. I know that my beliefs are true, because the Bible speaks out to me. I have personally experienced the grace and miracles of Jesus Christ in my life. When a very close cousin of mine was diagnosed with cancer, and it was clear that the cancer had spread throughout her body, the doctors told her that there was no treatment available for her, and the best all of us could do was to keep her comfortable at home. I turned to Jesus Christ in my time of need and He spoke out to me and answered my prayers through a miracle: my cousin not only survived, but her cancer is in complete remission. My worldview is accurate because it is clear by looking around that God exists, also, He is just and kind and i t was told in the Bible many years ago. What is more, the Bible is a direct account of what God wanted people to do, and its message is still true today. Even after 2,000 years, we can still derive our morality from the Bible and that is clear proof of its Divine Origins. It is very clear when one observes these facts that my worldview is accurate and believable. Part 2 Just like Baptists, Catholics are a denomination of Christians who believe in the unity of the God and the Holy Trinity. There are many more similarities between the two groups. The Catholics also believe in the virgin birth of Jesus Christ. Like the Baptists, the Catholics believe in the miracles of Jesus Christ, including healing the leper and raising Lazarus; his crucifixion and subsequent death; his burial; and his resurrection after three days. Moreover, they also believe in the infinite Mercy and Grace of God, which God showed by sending his only son to die for humans for their salvation. There are many similar ities in the ethics of the two groups as well; there is an emphasis on moral uprightness in both the groups, but, both believe, that there is no salvation for us except through Jesus Christ and his sacrifice for us. There are, however, many differences between the two, I will mention two big differences here. Firstly, there is no central authority for Baptists. Unlike the Catholics who have the papacy, whereby a group of priests elect a Pope, the Bishop of Rome, who is the considered to be a successor of Saint Peter, the Baptists do not have a central authority that ensures that beliefs are kept identical throughout the various Churches of the denomination. For Catholics, the pope gets to decide the policies

Family meals Essay Example for Free

Family meals Essay The article present the issue of meals from a good perspective: it identifies that some families eat together and others do not. It states from researches that studies carried out on families that eat together on the same table are more likely to produce positive health results than others who do not: such positive health factors are enumerated in each paragraph. It states that such family meals make it easier to control diet, amount and quality. It promotes communication about nutrition; it helps to regulate the type of food consumed. Besides it is a good forum for socialization among the family members, and even visitors.   It provides the ‘opportunity to eat better’ and also the ‘chance to connect’. The latter helps to understand each other better, find about current issues in the lives of members, and even teaches the children cooking and eating etiquettes.   It concludes with a profound statement:   Family meals arent just about food, theyre about family. I am particularly interested in the type of meal that can earn the tag ‘family meal’. And really, it is worth remembering that meals can also be a time to get together with family members. For parents that do not have time for their children, this may not possible but for others who have such opportunity, I strongly believe it is a very good idea: it creates a forum for me to learn how to cook, how to serve and how to eat especially when it involves others. If I have anything bothering my mind, I can share it there. If I also notice something about my siblings, friends, visitors, other extended family members, I can bring it and the challenge/burden can be shared. It is also a good forum to celebrate any achievement. I like the idea of family meals because it helps to strengthen families and build loving homes. There is no doubt that if we can adopt this kind of idea all over the country, things would change, families are likely to become more stable and children will live in conducive happy homes. I think that the topic was presented in a good and lively way. It has information from researches and experts in the food. After going through the article, you’d have read through an unusual topic that makes a lot of sense. It starts with a description of meal times, connects to the advantages of family means and ends with the obstacle to achieving the concept. I am also concerned about this noble idea can be implemented in this kind of age, when everyone appears to be in a hurry chasing the wild wind. Is it really practicable in this jet age? Are there other means of achieving same socialization outside meals times? REFERENCE Family meals. http://www.cnn.com/2008/HEALTH/family/11/07/cl.family.meals/index.html

Subsidiary Perspective of a Mobile Phone Service Company

Subsidiary Perspective of a Mobile Phone Service Company Global Integration Background The literature review looks into the various resources related to the study on the subsidiary perspective of a mobile phone service company towards MNC global integration. This would justify the significance of the study in terms of the clarification and application of concepts as well as contribution to knowledge or research gaps. The literature review is structured to start with a clarification of the research issue for purposes of determining linkages to available literature before moving on with the identification of the parent, intermediate and immediate literature. Afterwards, debates or differences in perspectives based on various literatures, together with the gaps or unresolved questions follows. The literature review ends with a summary of developments in literature pertinent to the research topic. The Research Issue Investigating the subsidiary perspective of a mobile phone service company on MNC global integration has a number of research implications. One, the subsidiary perspective of firms on global integration determines the success of the global business operations through value chain configuration and marketing standardization. Another, the subsidiary perspective of a mobile phone service company on global integration also provides a contextual basis of the issues and problems experienced by the subsidiary and the mother company in achieving value chain integration and marketing standardization for its entire global operations. Integration and standardization are important to successful international business operations. Concurrently, it becomes important to clarify the concepts of global integration and subsidiary relations together with the sub-concepts under these general principles to provide a sufficient framework for the study. Categorization of literature covering these concepts an d sub-concepts fall under parent, intermediate or immediate literature with most of the literature constituting parent and intermediate literatures. This implies the need for empirical research investigating the application of these concepts and sub-concepts to actual business contexts, which the present study attempts to fulfill. The Parent and Intermediate Literature This section covers the parent literature, specifically those explaining the basic concepts involved in the study especially global integration and organizational structures of multinational corporations involving subsidiaries. Existing literature sufficiently covers the definition of global integration as well as the organizational structure that involve business operations in various markets through subsidiaries. Definition of Global Integration Existing literature on global integration have not been able to arrive at a consensus on the definition of global integration. Haspeslagh and Jemison (1991) explained that global integration actually carries a different meaning for various parties involved in different situations. This means the possibility that a subsidiary, operating on a distinct market environment, can develop a different perspective and understanding of global integration relative to the mother company or other subsidiaries operating in different markets. Although, there is no clear consensus on the definition of global integration, Schweiger and Goulet (2000) stated that the different perspectives commonly revolve around the combination of the assets and human resources of the target and the buyer or the subsidiary and the mother company. The concept of coordination has found close links to global integration. Mintzberg (1983a; 1983b) stated that coordination constitutes a fundamental element of management and since the management of global operations involves coordination, then integrating the operation of subsidiaries with the operations of the mother company necessitates coordination. However, even with the close links between global integration and coordination, there are distinctions between these two concepts, with the extent of difference covered by various perspectives. On one hand, Martinez and Jarillo (1989) described the close links between the global integration and coordination by using these two concepts as synonyms describing the same situation. The authors also defined coordinative mechanisms as administrative tools used in developing integration of the various business units of a business organization. On the other hand, Kobrin (1991) provided a clear variance between global integration and coordinati on. Global integration also meant transnational integration that involves the processes of product standardization, technology development centralization, and manufacturing linkages that is either horizontal or vertical. As such, global integration was characterized as a change process involving centralization, combination, concentration, and standardization. Coordination also meant cross-border coordination that pertains to the business efforts directed towards the alignment of the operations of various business units to ensure the completion of the tasks of these units in contributing to aggregate productivity. Global integration has also found links to value creating activities at the level of the business headquarters. Goold, Campbell and Alexander (1994) and Burgelman and Doz (1996) stated that global integration pertains to the manner that headquarters creates value encompassing its international operations. This definition of global integration provides a limit to the scope of the concept to cover only business units forming part of a multinational corporation. This means that global integration does not involve business units considered as external to the firm. In addition, existing literature also discussed the definition of global integration by looking at its opposite or contrast concepts. Through the process of contrasting, these resources have been able to determine the areas not covered by global integration (Hambrick Finkelstein, 1987). Bartlett (1986) considered local autonomy as the opposite of global integration with local autonomy referring to the independent management of the operations of different business units under a single multinational corporation so that decision-making in the local level is made without need of consulting the other business units or headquarters. Bartlett and Ghoshal (1989) identified local responsiveness as another opposite of global integration. This is similar to independent decision-making exclusively based on the particular context of the local market without need to consult decision with other business units or the corporate headquarters. However, Prahalad and Doz (1987) explained that business f irms could achieve high levels of responsiveness and integration. As such, the more rational opposite of global integration is local autonomy. Based on existing literature covering the definition of global integration, the definition used in the dissertation is cross-border integration, encompassing value-creating activities and marketing standardization, arising between business units operating in different markets but falling under a single multinational corporation. This definition limits the scope to business units forming part of a multinational corporation but operating in particular markets. This definition fits the requirements of the study in investigating the perspectives of subsidiaries on global integration that involves a subsidiary and headquarters as the units of data collection and analysis. Elements of Global Integration Based on the definition of global integration, this has two specific elements, which are the configuration and coordination of the multinational corporation’s value change and the standardization of marketing strategies. Existing literature have differentiated the configuration and coordination. Porter (1985) explained that configuration of the value chain pertains to the spatial decisions of the multinational corporation covering the location or site of business units together with the number of business units within the multinational corporation and in the different sites. Lim, Acito and Rusetki (2006) developed the concentration-dispersion perspective to encompass decision-making on spatial issues. Porter (1985) stated explained that coordination refers to the manner and extent that the activities of the different business units are combined as opposed to being autonomous. Lim et al. (2006) introduced integration-independence perspective as the concept that covers the combination of activities of various business units forming part of a single multinational corporation. The configuration and coordination of value chain processes of business units belonging to a single multinational firm includes t he sourcing of raw materials and basic service components, production processes and linkages, marketing strategies, distribution networks, and support activities encompassing the operations of business units located in different countries but comprising the sub-units of the multinational firm. Available literature also covered marketing standardization, which Jain (1989) describes as the extent of the uniformity in the experiences of customers of the different business units operating in various countries. Here, classification of literature depends on internal and external focus. Literature on strategies focus on business activity as the core basis of analysis so that these looks into the manner that business units apply uniform policies given specific business contexts. Literature on international marketing carries an external focus by considering the uniformity in the marketing mix applied across the business units. (Yip, 1997) The extent of uniformity in the aspects of price, product, place and promotion determines the level of uniformity in the experiences of the firm’s customers in different countries. Rationale for Global Integration After identifying the definition of global integration as limited to cross-border decisions encompassing business units belonging to the same multinational firm and covering the areas of value chain configuration and marketing standardization, the next area that involves clarification is the rationale for engaging in global integration. Available literature provided two distinct perspectives, which are environmental contingency and strategic choice, explaining the rationale for global integration. While the distinctions between these two perspectives is theoretical, these determines the driving factors for global integration as either industry forces and other factors in the external environment or firm-specific capabilities and other factors within the internal environment of the multinational firm. The distinctions reflect similar characteristics as the debates on environmental determinism as against strategic choice (Astley Van de Ven, 1983; Hrebiniak Joyce, 1985). In addition, the distinctions between the two perspectives are parallel to debates involving the positioning-oriented view (Porter, 1985) as opposed to the resource-based view (Barney, 1991) or the dynamic capabilities view (Eisenhardt Martin, 2000). These perspectives highlight one aspect or more reasons for engaging in global integration so that focusing on only one perspective would provide the study with a limited theoretical foundation (Morgan, 1997). As such, these perspectives require consideration to allow the study to gain insight on the multi-dimensional reasons of justifications for global integration. Advocates of the environmental contingency perspective propound the basic assumption that industries hold different potential for globalization. As such, firm strategists play the important role of identifying the trends and influencing factors affecting the industry as bases for the determination of the appropriate strategy addressing the needs and demands of the industry (Bartlett Ghoshal, 1989). In application, a number of best practices have emerged as generic strategies for various industry trends found to lead to positive performance (Prahalad Doz, 1987). This implies that the environmental contingency view favors the development of contingencies (Galbraith, 1973) that considers the alignment or congruence of the structure of the firm and the strategies implemented by the organization with the environment within which the business firm operates. These contingencies find expression in the different types and levels of structures and corresponding strategies that have evolved. A simplistic typology is the description of global firms as evolving from ethnocentric to polycentric before finally becoming geocentric (Perlmutter, 1969). This means that the structure of multinational firms evolves according to this evolutionary process and the strategy of multinational firms depend on the best practices determined for the different evolutionary stages. Another simplistic structure and strategy is one determined by technological drivers (Levitt, 1983) so that the organizational structure revolves around the enhancement of technological capabilities and the strategies involve the standardization of products through a uniform technological capability in order to enhance the homogeneity of customer experiences. However, the simplistic perspectives received criticisms for not being able to cover other important business factors. An alternative perspective involves mixed strategies (Douglas Wind, 1987) so that standardization occurs for some products and product components become while differentiation occurs for others. In application, the mixed strategy involves standardization marketing mix aspects in a given region, market or market segments and differentiation for one or more of the marketing mix components for different regions or markets. The rationale for the mixed perspective is that achieving a universal strategy is not possible since some strategies receive rational support in some market context but not in others even if the same products, brand and company is involved but operating as different business units (Ohmae, 1989). This implies that the purpose of global integration is not really to derive a universal structure and strategy but to provide a way for the multinational corp oration to rationalize its mixed strategies across regions or markets and tie these efforts to address common goals. Most of the typologies that emerged later on found basis on mixed strategies. One manner of classifying multinational firms is through worldwide integration, national responsiveness, and administrative coordination (Doz, 1980). This developed the concept of transnational firms and propounded the important role of administrative coordination to facilitate administrative and structural shifts directed towards the achievement of the benefits of integration on a global scale and responsiveness on a national level. This manner of classification revolves around firm level analysis. Another typology, which considered the industry perspective, distinguished industries as either multidomestic or global (Hout, Porter Rudden, 1982). This means that the structure and strategy selection of business firms depend on the characteristics of the industry within which the firm belongs, which is either multidomestic or global. Another typology that considered the industry level perspective distinguishes strategy selection based on whether the firm falls under multinational or transnational industry (Bartlett, 1986). The author explicitly developed the transnational concept. This means that integration and responsiveness act as the forces that pressure firms to move towards the transnational model. Hedlund (1986) further expanded this typology by introducing the concept of heterarchy to describe the business units of international firms organized into non-hierarchical networks moving toward the goals of integration and responsiveness. The characterization of international fi rms as networks was carried by other literature through the development of the concept of independent network (Bartlett Ghoshal, 1990) and differentiated network (Nohria Ghoshal, 1997). Another typology emerged as the alternative by combining the firm and industry level perspectives to come up with four distinctive strategies of multinational firms, which are purest global, export-based, high foreign investments together with extensive subsidiary coordination, and country-centered (Porter, 1986). Purest global and export-based strategies are variants of global strategy; country-centered strategies are similar to the multinational concept; and high foreign investment with extensive subsidiary coordination is similar to the transnational concept. Another alternative emanates from the integration and responsiveness factors to influence the introduction of the types of strategies into global, multifocal and locally responsive. Integration on a global level considers multinational customers, multinational competitors, intensity of investment, intensity of technology, cost reduction pressures, universal needs, and raw materials and energy access. Local responsiveness pres sures the firm to consider variations in customer needs, variances in the distribution channels, existence of substitutes and adaptations, market structure, and regulatory demands. These pressures then comprise the areas of strategy determination for international business firms. In addition, another strategic area that considers the factors of integration and responsiveness revolves around knowledge and capabilities sharing between corporate headquarters and the various business units (Bartlett Ghoshal, 1989). Based on the development of various typologies, three general structural and strategic distinctions emerge, which are the multinational, transnational and global configurations. These types involve different integration strategies. The global configuration involves the strategy of tight integration of the value chain processes of the different business units resulting to a high level of centralized strategic resources including knowledge and research and development (Bartlett Ghoshal, 1987a; 1987b). This means that the activities of the business units are likely to revolve around the utilization of raw materials and application of service policies instead of focusing on activities that promote the independence of the business units. Moreover, the business units under the global configuration are unable to function without consulting company headquarters. As such, the high level of centralized control leads to the importance of a strong centralized leadership and decision-making. This would likely involve limited development and innovation from the business units operating in the peripheral markets. The network flows between corporate headquarters and the business units revolve around products. Thus, firms adhe ring to the global configuration tend to achieve high levels of integration because of centralization but low levels of responsiveness on a national level because of the lack of development and innovation coming from the business units operating in various national contexts. The multinational or multidomestic configuration pertains to the fostering of high levels of autonomy on the part of the subsidiary units because of the corresponding high degrees of decentralization in decision-making (Roth Morisson, 1990; Harzing, 1998; 2000). This means that the business units or subsidiaries are self-sufficient in their operations on a national level. As such, the subsidiaries enforce value chains that can stand alone in their country of operations (Leong Tan, 1993). Corporate headquarters manage this situation by considering the business units as independent firms but manages the productivity of the subsidiaries through output controls, especially financial measures. The output controls comprise the integrating factor for the different subsidiaries since this measures their adherence to overall firm goals (Muralidharan Hamilton, 1999). Moreover, an informal network exists between the top managers assigned in the corporate headquarters and the expatriates serv ing as representatives of the headquarters in the subsidiaries (Gupta Govindarajan, 2001). Multinational business units exercise relatively high levels of independence because of the minimal intervention and interference from the corporate headquarters except only the application of output controls. The derivation and enhancement of knowledge occurs locally instead of coming from headquarters for dispersion in the different business units. Concurrently, the flow that involves corporate headquarters and the business units encompasses financial resources. Thus, the application of the multinational configuration leads to a high level of responsiveness on a national or local level but resulting to limited integration. The transnational configuration involves the creation of international business firms with the simultaneous capability for responsiveness on a local level, integration on a global level, and learning on a worldwide level. This configuration involves the ability to consider various areas of responsiveness or ambidexterity, which refers to the ability to target conflicting demands at one time (Birkinshaw Gibson, 2004). Nohria and Ghoshal (1997) described the transnational configuration as both differentiated and interdependent. As such, the transnational configuration involves greater integration relative to the multinational configuration but involves greater responsiveness relative to the global configuration. This means that the activities of the business units covering aspects of the value chain becomes integrated physically and coordinated strategically. The subsidiaries the play pre-determined roles within the context of the multinational goals instead of just focusing on the ma ximization of opportunities in the local level. Creation of knowledge involves a higher level of dispersion compared to the global configuration because the objectives are sharing of knowledge derived on level of the peripheral units. The manner of integration then involves mechanisms of socialization instead of output measures as in the multinational configuration. This means the development of standardized norms across the business units (Mintzberg, 1983a). Flow of resources is also expanded to encompass resources, products as well as knowledge across the various business units. Overall, the rationale for global integration based on the environmental contingency perspectives depends on the typology of the operations of business firms. The different typologies carry corresponding structural frameworks and strategic activities directed towards the achievement of the one or both objectives of integration and responsiveness. Proponents of the strategic choice perspective focus on internal factors and pressures in determining structure and strategy for international business firms constituting the rationale for engagement in integration. As such, the focal areas of the strategy choice view include resources, capabilities and processes (Ghoshal, 1987). Concurrently, available literature focused on the two concepts of strategic integration together with corporate parenting that provide distinct multinational firm capabilities. Strategic integration covers the manner that management develops value that encompasses value creation of the different business units forming part of the international firm. Moreover, strategic integration has links to the combination and cultivation of the different resources of the international firm such as the intangible assets together with capabilities in the long-term through the process of coordinated deployment from the corporate headquarters to the business units. However, the subsidiaries have room to enhance further assets and capabilities to respond to their particular business contexts. (Burgelman Doz, 1996) Another view of strategic integration is as pertaining to dynamic capability that is based on particular strategic and structural routine activities (Eisenhardt Martin, 2000). This means that integrating factors comprise the routine activities common in all the business units. Capabilities for strategic integration receives importance in the case when managers intend to shift from one configuration to another but there are variances in the levels of resource needs, strategic requirements, and structural frameworks involved in the configurations. Strategic integration as a capability is also important in situations involving the shift from a weak to a stronger implementation of a given configuration. (Teece et al., 1997; Eisenhardt Martin, 2000) This means that the international business firm employs various combinations of value chain integration and marketing standardization for particular configurations. To ensure integration and standardization, coordination mechanisms comprise important means of unifying processes and outputs across the different business units. Parenting theory evolved to apply to multi-business contexts, specifically the manner that corporate parents influence the operations of subsidiaries in order to add value to the operations of the business units (Goold, 1996a; 1996b; Goold Campbell, 1991; 2002; Goold, Campbell Alexander, 1998). The parenting theory does not particularly focus on integration. Nevertheless, the descriptions of the parenting strategies capture the situation of multinational firms and the manner that corporate headquarters affect the dynamics or workings of the subsidiaries. Since integration involves limitation on the freedom of operation of the business units, the role of the parent company becomes important in achieving effective integration. This means that according to the parenting theory, the rationale of engaging in integration lies in the significance of the role of the parent company in providing effective integrative factors intended to enhance the output and process outcomes across the diff erent business units. Parent firms can create value for the company in four ways. First, the parent company can apply a stand-alone policy, which means that the strategy and performance of the business units are affected minimally by the parent company. Integration at a minimal level of influence occurs through output standardization (Mintzberg, 1983a), which is implemented through financial rations serving as the targets of the subsidiaries. Second, the parent company can increase its influence on the subsidiaries by implementing synergistic practices and transfer of knowledge and best practices to the business units (Mintzberg, 1983a), specifically activities such as standard work systems, standard norms of practice, and training of workers. Third, parent companies can further enhance its influence on the business units by extending the reach of its central functions to the business units. This extent of influence is nearer integration as strategic change instead of coordination. Fourth, an even greater influence on the business units can be made with the parent company altering the corporate portfolio through the acquisition or removal of operations to facilitate restructuring. This also involves greater parallelism with integration as strategic change instead of a coordinative process. Fifth, parent companies can extend their influence to an extent that covers the influence of purchasing firms during post-mergers (Schweiger, 2002). These different extents of influence applied by the parent company translate into different rationales for integration given different multination firm contexts. Regardless of the extent of influence employed by the parent company, it is necessary that the parent company that constitutes the corporate center constitutes a resource in itself through varying levels of influence or provide alternative processes that derive resources for the business units in order for the level of integration to achieve value to the subsidiaries and justify the engagemen t in integration. In addition, there are also parenting styles (Goold, Campbell Alexander, 1994) that describe the manner that the parent company relates to its subsidiaries. First is the financial control style that involves decentralized decision-making of the business units that usually apply in small business firms (Hout et al., 1982). Second is the strategic planning style that involves an influential staff involved in a wide range of areas of operation in the business units (Hout et al., 1982). Third is the strategic control style involving top-down planning but bottom-up implementation that is achieved through the balanced consideration of financial objectives and strategic milestones. These parenting styles provide the factors that have to be present for parent companies to create value for the business units and provide a reason for the type of integration. Integration Challenges After discussing the definition and rationale for integration, the succeeding discussions look into the integration challenges experienced by the multinational firms. Existing literature classify these challenges into those experienced by corporate headquarters and those felt by the subsidiaries. Corporate headquarters experience a number of integration challenges. First is ensuring the creation of value to support the extent of integration. This means that the integration should create greater value compared to the previous status of the firm (Goold, 1996b). Second is preventing any misguided intervention that depend on the context of business units since excessive guidance can thwart much needed innovative action on the subsidiary level (Goold Campbell, 2002). Third is enhancing the quality of execution and support staff services of the company headquarters (Goold Campbell, 2002). Fourth is avoidance of multiple levels of parenting that could lead to redundancy and contradictions (Goold Campbell, 2002). Fifth is the management of various kinds of intra-firm reporting so that the type of reporting should match the simplicity or complexity of the multinational firm (Prahalad Doz, 1987). Sixth is the avoidance of the building of empires at headquarters by clearly establish ing the roles of top management in maintaining corporate entity and adding value to the subsidiaries (Goold Campbell, 2002). Subsidiaries also experience problems in integration. First is achieving structural and strategic fit (Jemison Sitkin, 1986a; 1986b; Olie, 1994; Carleton, 1997) given variances in administrative heritage (Bartlett Ghoshal, 1989) that requires the development of a common administrative infrastructure. Second is managing opportunism among the subsidiary managers within the context of agency relations (Jensen Meckling, 1976; Eisenhardt, 1989a; 1989b) through risk management and agency clarification. Third is ensuring the commitment of the subsidiary managers since commitment determines the success of the integration process (Kim Mauborgne (1991; 1995) by developing a perception of fairness of the integration (Greenberg, 1993). Available literature on the problems experienced by the subsidiaries provide significant foundational information for the study by providing concepts that relate to the study on the perceptions of subsidiaries, particularly the managers of the subsidiaries regarding the integration. The factors of attitudes, commitment and cooperative behavior are the problem areas of integration on the subsidiary side but these also comprise determinants of the perceptions of subsidiaries towards integration. Immediate Literature This section covers immediate literature since the integration capabilities and the modes of managing the subsidiary provide the determinants of the perspectives of subsidiaries towards integration, similar to the part on the problems experienced by the subsidiaries discussed in the previous section. Integration Capabilities A number of integration capabilities are important in the integration initiative. Since integration involves actions and responses not only from the company headquarters