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Introduction

Changing business needs and industry trends affect all businesses. Some businesses prosper, whiles others barely survive, and many still, close their doors forever. Competitive and adaptive advantages are tools that organisation teams must master to increase their chances of survival. Comprehensive needs analysis increases both competitive and adaptive advantages. Strategic planning is a complex process, especially, when data collection is necessary for success. External data collection adds another layer of complexity to the planning process. There are no guarantees that the data will yield positive results for the decision making process. However, taking precautionary measures, organisations can increase the potential for collecting valuable data. Comprehensive data collection and analysis provides a tool whereby the information collection adds value for the organisation. Surveys, interviews, group discussions, task analysis, performance appraisals, observations, incidental procedures, performance analysis, and external scans each tell a story of the information collected via those mediums. Hence, it is imperative for the experts conducting data collection and comprehensive needs analysis be well versed in their craft if they are to improve existing business conditions. The research conducted herein presents a comprehensive needs analysis for the The-Second-Greatest-Company Corporation.

Comprehensive Needs Assessment (CNA)

Education and employee development is imperative to any organisation. The planning of education and training does not apply to new hires alone, managers and supervisors are equally valued within the organisation. Organisations must ensure that the training and development process is not just a matter of training, but rather to enhance productivity, improve interactive communications, and increase overall return on investments for stakeholders. Hence, all education and training plans must begin with the goals and objectives of the organisation at the forefront of employee development initiatives.

Company Background

This document represents a comprehensive needs analysis conducted on behalf of The-Second-Greatest-Company Inc. (a fictional organisation modeled after a real one; additionally, relevant industry information is factual). The-Second-Greatest-Company is a women owned interior design business started by three college students. The students became friends after taking an art course together. They envisioned an online interior design business that suggested design layouts for college dorms.

The-Second-Greatest-Company Inc. receives orders for interior designs via the internet, as well as, their artwork. Interior designs are reasonably priced beginning at ninety-nine dollars for a single dorm. Prices increase with the space size. The business blossomed enough to catch the attention of venture capitalists (this information from the real company, 2015).

Current Literature

Cekada (2010) discusses an example of an employee who accidentally trips over a bucket. The management team immediately suggests more training. But Cekada (2010) questions that motion. Is it actually necessary to conduct training or could other precautions have been taken to avoid slips and trips? Cekada (2010) suggests that not all issues are training related and cautions against using training where none is necessary.

Rothwell and Kazanas (2003) discuss the different levels of CNA. The first level is conducted for strategic planning purposes. The second relates to coordinative purposes. The third concerns operational needs. Hence, they stress importance in identifying where the needs exist at the different levels.

According to Bresciani (2010), data informs the planning process. The information can be converged with environmental information and forecasts for resource planning and policy creations. Bresciani (2010) asserts that the data collection process is not a decision replacement process. It is the data that drives the decision making processes (Bresciani, 2010).

Karkkainen, Piippo, Puumalainen, and Tuominen (2001) recommend that companies maintain a vision to the future to meet client demands. They believe that companies should continuously plan to exceed client’s expectations with better services and life enhancing products. They posit further that companies must remain proactive in seeking hidden opportunities early in business initiatives. Karkkainen, Piippo, Puumalainen, and Tuominen (2001) suggest that CNA processes must include assessment tools and strategies that highlight unrecognized customer needs.

Karkkainen, Piippo, Puumalainen, and Tuominen (2001) conducted their study with the “new customer” (p. 393) in mind. They wanted to demonstrate that contrary to popular belief, customers do not have the foresight to know what their future needs are. Karkkainen, Piippo, Puumalainen, and Tuominen (2001) found that the clarification experience for determining new customer needs benefitted the participants (various organisation, different industries) by approximately eighty-five percent. As a result, Karkkainen, Piippo, Puumalainen, and Tuominen (2001) also found that the companies felt the needs assessment tools helped them increase new customer awareness by forty percent.

Purpose of CNA

The purpose of this comprehensive needs analysis (CNA) was to collect relevant information with the intent of providing recommendations for business improvement. Included herein is an environmental scan (ES) that serves a dual purpose. The first purpose intends to provide interior design industry awareness. The second purpose is to gather information on business competencies. Finally, training and development recommendations are provided.

Rothwell and Kazanas (2003) discuss CNA as an investigative process necessary to determine where business deficiencies and competency weaknesses exist, and thereafter, devise a plan for corrective action. Cekada (2011) discusses training assessments from a capital and resource return on investments perspective. He considers that properly allocated resources will yield returns and vice versa. Shipley and Golden (2013) recommend using the CNA’s to identify gaps and resolve them with appropriate training initiatives. Muller and Roberts (2010) recommend looking at impending issues and deficiencies from multiple perspectives with the intent to identify problems which can be resolved without training and development initiatives.

Data Collection

Data collection is about information value that translates into desired changes (Rothwell & Kazanas, 2003). The information value comes from evaluating ways to apply different methodologies for desired changes. The collection process should bring to light the knowledge or skills necessary to implement changes. Rothwell and Kazanas (2003) recommend using multiple data collection methodologies.

Lundberg, Elderman, Ferrell, and Harper (2010) advise caution when collecting data because no process can be one hundred percent correct. They argue that people respond with assumptions when they do not have an appropriate answer. Lundberg, Elderman, Ferrell, and Harper (2010) emphasize further that the potential for data redundancy remains ever-present. Bresciani (2010) advises discretion to ensure the process enhances strategic planning process not eliminate activities in it.

Data collection methods used:

Interviews provided insight into the client base, services offered, sales process lifecycle, design process, and what the ownership team expected from freelance designs, as well as, what they offered potential freelancers to join their team.
Interviews with the management team identified management relevant requests concerning their learning and talent development needs.
Surveys from clients identified service gaps, client levels of satisfaction with the services rendered, client opinions on the quality of service provided, and other services clients would like to have in the future.
Surveys taken from college students (major clientele) provided their opinions on the future of the interior design industry, number of times they used interior design services in a full year, their thoughts on carefree interior design services.
Surveys were taken to identify demographic information that will further advance the growth of the company.
Observations provided information on the status of the interior design industry.
Task analysis identified the actual interior design and sales process lifecycle, as well as the actions required to complete a sale.
Task analysis was conducted to examine the freelance design process.
Advisory Committee formed includes four employees, one senior manager, and consultants to gather ongoing talent development information.
Performance documents assessed individual and team production.
Industry Scan provided information on competitors. Two competitors have inferior websites (Decorator, 2015; Homeblue, 2015), hence, giving The-Second-Greatest-Company a higher ranking website. Ibisworld (2015) suggests that the industry is expected to grow at approximately four percent within the coming year. Ibisworld (2015) also predicts positive upward growth for the industry.
Analysis

During the year 2014, the interior design industry experienced downtime as a result of the recession, economy anomalies, and financial instabilities (Ibisworld, 2015). Current business trends indicate that business will blossom in the next five years. Data analysis indicates that the company is interested in expansion opportunities. Survey analysis indicates that clients are satisfied with the services provided, however, they are interested in follow-up services.

Data collection indicates that the ownership team will benefit from leadership development. The team lacks extensive industry and business expansion knowledge. Task analysis shows that freelancers will benefit from sales development skills. The-Second-Greatest-Company team (owners & freelancers) could benefit from networking skills to grow their businesses and take advantage of the predicted industry boom.

Data collection also indicated that confusion existed with current freelancers who were not sure that sales were something they needed to engage in. The freelancers feel that they are artists and designers. As a result, they cannot see how gaining sales training will benefit them. It is suggested that business development workshops are conducted to help the freelance designers understand how they can see themselves as sales people who enhance the lives of their clients.

Summary of Results
The-Second-Greatest-Company Corporation desires to become an industry leader within ten years. Crossley, Cooper, and Wernsing (2013) suggest becoming and remaining proactive in the achievement of leadership goals. Crossley, Cooper, and Wernsing (2013) affirm the complexity of remaining in leadership positions for long. They recommend devising plans that coordinate and direct activities towards achieving leadership goals.
The The-Second-Greatest-Company organisation could benefit from interpersonal communication skills. Perry and Losman (2012) stress the importance of effective communication skills for information exchange. As this company continues to evolve the communication process will greatly enhance their understanding of the industry, their customers, and amongst themselves. Perry and Losman (2012) assert there is great value in improving communication skills because the potential for miscommunication decreases and productivity increases.
The ownership team will benefit from team and leadership development. Grenny, Patterson, Maxfield, McMillan, and Switzler (2013) discuss the inevitably of relying upon others to transact business. They assert that no one can work alone and that opportunities must be present to allow for the development of abilities in working as a team. Grenny, Patterson, Maxfield, McMillan, and Switzler (2013) posit further the organisation success depends upon experts working in concert with one another to complete projects.
Industry is following a positive upward growth at approximately four percent per year. Silber and Kearny (2010) use the recession of 2009 to demonstrate that organisations cannot operate in a vacuum. They posit that economic crisis are not the only reason to remain industry aware, but also because competitors will always look for ways to put you out of business. Silber and Kearny (2010) state that the only industry that appears to do well at the worst recessions, “is the alcohol industry, where year-to-date-sales in 2009 were almost double those of previous years” (p. 41).
The freelance team shows a gap in sales skills. They lack the ability to close sales faster. The lack of sales knowledge interferes with freelancer ability increase sales quotas. Stein (2011) suggest that sales alone will not get the sale, but the ability to use a combination of interpersonal and communicative skills for success. He suggests that clients are high tech and navigate the internet to compare products, services, and prices. Thereby, making the sales process significantly complex.
The Advisory Committee is expected to meet once weekly to develop the training plans and continue scanning the environment for changes. Rothwell and Kazanas (2003) advise that advisory committees work similar to strategic committees because they serve the same purpose of identifying weaknesses and strengths in the education and development plans. Advisory committees can compare current plans to future expectations and set relevant priorities. The advisory committee role in the development process can never be overstated (Rothwell and Kazanas, 2003).
Implications for The-Second-Greatest-Company Management Action

The Above Examples Might Suggest the Following Implications:

The-Second-Greatest-Company management’s team must meet to discuss budget factors that influence the training process further.
The-Second-Greatest-Company management’s team, Advisory Committee, and Consultants must agree upon the talent development specifics and a time line of delivery.
References

Bresciani, M. J. (2010). Data-driven planning: Using assessment in strategic planning. New Directions for Student Services, (132), pp.39-50.

Cekada, T. L. (2010). Training needs assessments: Understanding what employees need to know. Professional Safety. pp. 28-33.

Cekada, T. L. (2011). Need training?: Conducting an effective needs assessment. Professional Safety, pp. 28-34.

Crossley, C. D., Cooper, C. D., & Wernsing, T. S. (2013). Making things happen through challenging goals: Leader proactivity, trust, and business-unit performance. Journal Of Applied Psychology, 98(3), 540-549. doi:10.1037/a0031807

Decorator (2015). Decorator designer guide. Retrieved from http://www.decoratordesignerguide.com/interview40089

Grenny, J., Patterson, K., Maxfield, D., McMillan, R., & Switzler, A. (2013). Influencer: The new science of leading change. McGraw Hill, NYC, NY.

Homeblue (2015). Get matched. Retrieved from http://interior-decorators.homeblue.com/pros/interior-decorators.aspx?gclid=CJXF-t2n9ccCFQoRHwod_1MGyw.

Ibisworld (2015). Interior designers in the U.S.: Market research report. Retrieved from http://www.ibisworld.com/industry/default.aspx?indid=1410

Karkkainen, H., Piippo, P., Puumalainen, K., & Tuominen, M. (2001). Assessment of hidden and future customer needs in Finnish business-to-business companies. R&D Management, 31(4), 391.

Lundberg, C., Elderman, J. L., Ferrell, P., & Harper, L. (2010). Data gathering and analysis for needs assessment: A case study. Performance Improvement, 49(8), pp.27-34.

Muller, N. & Roberts, V. (2010). Seven cures to skipping the needs assessment. Training and Development, pp. 32-34.

Perry, M., & Losman, E. (2012). Themed monthly evaluations: a focus on individual competencies. Medical Education, 46(5), 517. doi:10.1111/j.1365-2923.2012.04247.x

Rothwell, W. & Kazanas H. (2003). The Strategic Development of Talent. MA:HRD Press.

Shipley, F. & Golden, P. (2013). How to analyze and address your organization’s learning needs. Training & Development, pp. 29-31.

Silber, K. H. & Kearny, L. (2010). Organizational intelligence: A guide to understanding the business of your organization for HR, training, and performance consulting. Pfeiffer, San Franscisco, CA.

Stein, D. (2011). Developing Winning Sales Teams. T+D, 65(6), 62.

This work was produced by one of our professional writers as a learning aid to help you with your studies

1. Introduction

The globalization of the economy, internationalization of businesses and emergence of new markets are all key themes in contemporary business. Whereas international business may once have been the province of organisations with sufficient scale and reach, these types of companies – typically multi-national corporations – no longer have a monopoly on this kind of business. Increasing numbers of firms, of varying scale, are confronted with compelling reasons for expanding their activities across multiple national boundaries. In some cases, such motivation includes the knowledge that success in international markets is a pre-requisite for survival; if competitor organisations succeed in international markets, they may achieve the scale and liquidity which affords them sustainable competitive advantage. However, scrutiny of the empirical experience of international expansion suggests that the apparent potential is by no means straightforward to achieve in practice. This raises questions about whether or not it is realistic to envisage a ‘best practice’ in terms of international expansion strategy. Can the latter be conceived of as a specific and transferable management skill, or is it instead reliant upon expertise in a particular sector of business, a market, or a national culture? After all, if proven strategists are found wanting, where can the organisation go in terms of its future practice?

Large, successful and sophisticated businesses have often found that international ventures do not fulfil their promise. Moreover, these failures do not feature in only one sector of the economy; retailers, manufacturers, transport and energy companies have all found that expansion in contemporary markets is easier to plan than to achieve. The relevant strategies were often developed by otherwise successful managers and executives, appointed because of proven track records in similar or parallel enterprises. The retail sector alone furnishes numerous examples of this problem. The previously ascendant US Wal – Mart group eventually abandoned its expansion into the buoyant German consumer market, selling up to domestic rivals Metro (Felsted and Jopson 2011). Sir Terry Leahy of the UK’s Tesco PLC saw his flagship Fresh n’ Easy store venture in the United States rapidly turn into a loss making enterprise (Felsted 2011). The point here is that these large, well-resourced businesses have been in the vanguard of market research techniques which employ benchmark digital data capture to measure consumer behaviour – yet they still failed. It may be that, as the statistics obtained by as Guler and Guillen show, (Appendix Three), firms prefer to target what they perceive as legally secure, politically stable hosts (2005, p.2) A number of empirical questions are raised by these developments. For example, how best can organisations secure and maintain the right kind of strategy formation capacity within their capabilities? Should strategic planning ever be thought of as a continuing capability, or should it instead be seen as a reflexive capacity, more likely to be brought into being by the specific conjunction of factors, i.e. a one-off development?

2. Purpose

The purpose of the proposed study will be to ascertain answers to the following types of question, i.e.

Is there a ‘best practice’ of international business strategy formation which is transferable between business sectors?

Are some elements of strategy formation indispensable?

If so, what are the indispensable elements of strategy formation?

Do the business models of particular sectors render them more or less scaleable in terms of international expansion?

What constitutes the best practice in the development of business strategy for international markets? Such a question will obviously be subject to enormous variables across different sectors of the economy, or types and sizes of business. However, it may be argued that there will be a continued demand for this kind of business expertise, both in terms of strategy development and knowledge management.

3. Conceptual and Theoretical Foundations.

As Czinkota et al indicate, strategy formation should not be conceived as a generic activity or process, since it will to a certain extent be informed by the specific stimulus for the expansion itself, i.e. whether the perceived competitive advantage is based on technological or other kind of advantage (2009, p.228) This is an important consideration, since each organisation has its own motivation for wanting to expand into international markets, as well as varying levels of capability, resources, and preparedness. De Burca, Fletcher and Brown argue, there are numerous reasons for pursuing international expansion, the first of which lays in orthodox competitive strategy, i.e. ‘…in many industries, competitors can access customers almost anywhere…many customers that are going global want their key suppliers to be there to service them. Secondly, technology evolves at different speeds in different countries…if a business is located close to leading-edge technology development, it is likely to be closer to the early adopters phase of new markets…Third, economies of doing business are changing in terms of cost of funds, cost of labour, availability of specialised skills and opportunities for specialisation.’ (2004: p.560).

Some strategic factors are generic, in as much as no firm can realistically overlook them in international expansion. These consist of considerations such as control of the value chain, control of personnel resources, the securing of the necessary financial resources, and a realistic assessment of the associated risks (Muhlbacher et al 2006, p.405). Other factors will arise from the nature of the target markets themselves: emerging economies, for example, will not necessarily feature the ’embeddedness’ of mature Western markets (Doole and Lowe 2008, p.4). As Muhlbacher et al point out, ‘…many international marketing efforts fail not because research was not conducted, but because the issue of comparability was not adequately addressed in defining the marketing research problem…’ (2006, p.123). It is also important to consider the ‘…unconscious reference to our own cultural values when defining the problem we are attempting to research in international markets…’ (2006, p.123). For example, many studies of global expansion have as their focus the strategies of Western multinationals; however, given the flow of globalization, there is no logical reason why they should be restricted to this area. If anything, the strategies of Chinese, Middle Eastern and other corporations may become even more relevant. As Berger argues, globalization may be deemed the single greatest factor in contemporary business, and yet virtually all the assumptions made about it come ‘…either from opinions…or…general economic theories. Analyses based on hard evidence from the experience of societies dealing with these pressures are few and far between.’ (Berger 2006: p.7).

4. Methodology
i. Research Design and Research Strategy.

As Marshall and Rossman argue, a research design should be able to ‘….generate data appropriate and adequate for responding to the research questions and will conform to ethical standards.’ (2011, p.56). In this instance there are several levels of design options to be acknowledged in the overall form of the research. In paradigmatic terms, this is a predominantly qualitative study, which nevertheless acknowledges the points made by Collis and Hussey regarding the relationship between the phenomenological and the positivist positions. As they point out, the distinction between them can rarely be maintained in the context of practical research processes (Collis and Hussey 2003, p.48). This is a point also made by Jupp, who concedes that research paradigms may need to be reconsidered during the process itself (2006, p.213).

At the preparatory stage, it is obviously important to demonstrate that there is a justification for this research, i.e. a ‘gap’ in the relevant knowledge as presented in the relevant secondary literature (Longnecker 2009, p.134). An exhaustive survey of all the relevant secondary literature may be an ambitious objective given the resources available to this study; however, this must be pursued until it becomes clear that the same or similar points are constantly being re-discovered. As Winkler and Metherell point out, the cautious researcher should see a ‘…consensus of opinion among experts that can be used to judge the reputation of an author or source.’ (2011, p.62). By this means, as Patzer points out, a viable context for the study may be established (1995, p.6). It is anticipated that the gaps in the literature will mostly be those arising from new developments in the dynamic of globalization; as Stevens et al argue, ‘old’ information ‘…is not necessarily bad information; however, in many dynamic markets, up-to-date information is an absolute necessity.’ (2006, p.98). As Saunders et al (2009) acknowledge, any generalization based on secondary data should acknowledge that it has been influenced by the culture, predisposition and ideals of those who originally compiled it (p.272).

The study will take account of the major theorists in the relevant areas of scholarship, such as Porter on competitive advantage and national competitive advantage, and Mintzberg et al on strategy. Work such as that of Jones in Multinationals and Global Capitalism: From the Nineteenth to the Twenty-first Century (2005) will be consulted in order to orientate the study empirically. Detailed studies of niche areas such as De Burca et al’s work on SME strategy (2004), and Phan et al (2008) on entrepreneurship in emerging economies will also be important. It will also acknowledge anti-globalisation theorists such as Lynn, through the arguments he presented in his End of the Line, the Rise and Coming Fall of the Global Corporation, (2005).

Conducted on a qualitative basis, this will be an inductive rather than deductive study, since it cannot realistically proceed on highly defined questions or areas of enquiry. Rather, its purpose is to make the initial foray into a new and under-research area which will inform a more deductive approach in the future. Consequently, the questioning will be exploratory rather than descriptive in nature, allowing participants the maximum scope to relay their reflections. As Rubin et al (2010) point out, when engaged in descriptive research, ‘…we try to identify or describe events or conditions…When doing explanatory research, we look for underlying causes and explanations of events. Exploratory research encompasses what is referred to as interpretative research, as a way of making sense of events.’ (198).

Strategy formation, whatever its focus, represents an important aspect of competitive practice in commercial markets. For this reason, there may be finite limits to the extent to which contemporary practice will be meaningfully discussed or shared for the purposes of an academic study. However, participants may be more likely to share worthwhile observations where past practice is concerned, or where they are no longer involved with the business or organisation in question. Participation will be sought from twenty individuals in relevant organisations, and the interviews will be conducted by e-communication as far as is possible due to the budgetary limit of ?1500 (excluding labour). The survey(s) themselves will be conducted within a two week period as far as is possible, to retain the cross-sectional format. It is anticipated that some of this budget will be absorbed by travel and associated expenses where online research is not possible.

ii. Sampling

The representative nature of any research depends to a significant degree on the sampling methods on which it was based. As McGivern points out, the most representative samples are those based on random or probability sampling, in which all elements of a particular population have an equal or proportionate chance of being included (2006, p.277). However, this approach has obvious implications in terms of both resources and outcomes. A genuinely random sample would involve a wide initial recruitment process and a lengthy period of filtering, during which the most relevant participants could be identified. This in itself would require significant resources and time, and would not necessarily produce the most suitable cohort for a specialist research project. The value of focused business research must be linked to the insights provided by the participants, and only those with the requisite experience and knowledge can provide this. Consequently, a non-probability or purposive sampling approach was deemed most appropriate, with practitioners from both past and present international businesses invited to participate.

The responses obtained will most likely involve insights from past as well as present strategy, so that the study may be said to have a wide chronological focus. However, this study should be seen as a cross-sectional rather than a longitudinal one, since its resources do not permit a longer research process. It may be, however, that further study is possible later, is the research objectives and questions are refined. As Yin cautions, despite the care taken to ensure that a sample is representative of some larger group, the number in a qualitative study ‘….will likely be too small to warrant any statistical generalisation….’. However, the findings may be sufficiently replicated in similar situations, allowing them to be ‘…generalized to other similar situations.’ (2010, 226).

The questions will be ordered into three sections, i.e. a binary or closed question Yes/No section, a Likert-scale multiple choice section, and an ‘open’ section of discursive enquiries. Each section in the sequence will be developmental and complimentary, allowing the juxtaposition of positivist and phenomenological findings, as in Appendices One and Two.

iii. Data Analysis

As Wolcott (2001) has argued, ‘…good qualitative research ought to confound issues, revealing them in their complexity rather than reducing them to simple explanation.’ (p.36). Whilst it is not envisaged that this limited research will uncover any conceptually original points, it is planned that a balance of positivist and phenomenological data will reveal contextual clues in the contemporary environment which may contribute to further investigation. This will be pursued according to the schema of analysis set out in Appendices One and Two.

5. Ethical Considerations

There are two levels of ethical responsibility involved in this proposal, i.e. that owed to the respondents, and that inherent in the conduct and evaluation of the work itself.
This research will be conducted on the basis that the participants themselves should have the maximum control over the conduct and outcome of the research process. This implies that they should be informed, prior to participation, of the possible uses and availability of the published research results (Tracy and Millar 2009, p.102).

This proposal also acknowledges the ethical responsibilities which arise from the interpretation of the research results themselves. As Gill et al point out, the researcher, ‘…through developing his/her research design, is usually trying to test hypotheses generated from a theory, through data collection, in order to see whether or not the theory survives those attempts at falsifying or disproving it.’ (2010, p.72) As an inductive study, this research will not be aiming to prove or disprove a particular idea. It will, however, rely for its value upon the originality or otherwise of the information uncovered. Responsible assessment of this should avoid inflating its significance or originality when drawing up the conclusions; where similar findings have appeared earlier or elsewhere, this will be drawn to the attention of the reader. The research findings should be closely linked to the evidence which supports them, and where some of this does not support the argument, this should also be acknowledged (Gray 2009, p.192).

6. Conclusion

Overall, the background issue may be said to fall into two areas; firstly, what kinds of expertise are necessary to assure the development of successful international strategy, and secondly, how may this be effectively researched? As Gravetter and Forzano have cautioned, it is all but impossible for a single research study to eliminate all threats to validity, therefore, ‘…each researcher must decide which threats are most important for the specific study.’ (2011, p.171). The single greatest problem in this research is the choice between a study which looks at the issue as it occurs across all sectors, or one which concentrates on a single business sector. As will be discussed further, this dilemma also has to be solved in a manner which takes account of the resources available for the work itself. As Patton advises, ‘…deductive hypothesis testing or outcome measurement aimed at confirming and/or generalizing exploratory findings, then back again to inductive analysis to look for rival hypotheses and unanticipated or unmeasured factors.’ (2002, p.57).

References

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Appendix One: Questioning Sequence.

Section One: Binary/Closed Question.

It is possible to identify a ‘best practice’ model of international business strategy formation, which is transferable between business sectors. Yes/No/Neutral.

Section Two: Likert Scale Question.

It is possible to identify a ‘best practice’ model of international business strategy formation, which is transferable between business sectors. Strongly Agree/Agree/Neutral/

Section Three: ‘Open’ Question.

How would you identify a generic ‘best practice’ model of international business strategy formation, i.e. one which is transferable between business sectors? Please explain in your own words.

Appendix Two: Data Integration in sequence.
Appendix Three: Foreign Capital Investments by U.S. Firms by Host Country, 1991-2002.
CountryNumber of Ventures

United Kingdom

183

Canada

135

Israel

109

Japan

91

France

55

Germany

54

China

43

India

35

Ireland

31

Netherlands

30

Singapore

25

Source: Guler, I., and Guillen, M. F., ‘Knowledge Institutions and Foreign Entry: the internationalisation of U.S. venture capital firms’, [online], available at http://www-management.wharton.upenn.edu/guillen/NewFolder/IntVC18.pdf , [Accessed 17th March 2012]., p.46.

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Introduction

This study examines the complex strategic dilemma faced by Portsmouth City Council, in its popular bid to save its two landmark Grade II listed theatres. This complex journey continues to involve a diverse range of stakeholders, the majority of which are highly attached to Portsmouth’s theatre heritage. The ‘Two Theatres for Portsmouth Project’ was clearly hugely challenging from the outset and was hampered by lack of effective strategic planning, limited funding, changing consumer trends and its ever developing, successful competitors. The project has taken the council into conflict with stakeholders as well as into significant debt and the future of Portsmouth’s beloved theatres is arguably no more certain than when the dilemma began in 1999.

Strategy Overview

In 1999, due to changing consumer behaviour trends and increased competition for Portsmouth’s live theatre industry, Portsmouth Council developed its ‘Two Theatres in Portsmouth Strategy’. The project budget was to be stretched across two different theatres, offering quite different entertainment products and targeted at different audiences. Originally this strategy aimed to fill an ambitious 2,000 seats per week, all year round.

Strategy elements:

Kings Theatre – 1,500 seating capacity
Focus on major popular entertainment products including for example musicals and major UK touring productions.
Set up as a non-profit theatre trust in 2001, this theatre was managed by the company ‘Kings Theatre Southsea Limited’ until its bankruptcy in 2003

The New Theatre Royal – 500 seat capacity
Focus on smaller commercial productions such as experimental drama.
Theatre also managed by ‘Kings Theatre Southsea Limited’

Funding for the project was a seriously contentious issue from the outset. It focused on possible grants from The Heritage Lottery Fund and The Arts Council of England. Although worth millions, these grants would not cover the further estimated ?4 million required for essentials such as putting disabled access in place and installing new lighting systems. These significant costs would need to be met by Portsmouth City Council. It is important to note that although The Arts Council did agree to provide grants amounting to several million pounds for this stage of the project, no money was actually released.

From the case study evidence, it seems unlikely that Portsmouth Council would ever have been able to meet its financial commitments to the two theatres project. For example, its leisure budget was already under heavy pressure from existing approved projects including a new swimming pool and the City museum. These initiatives represented an expenditure of ?13 million over five years. Ultimately such financial pressures would put the two theatres project in danger.

Little consideration seems to have been given to how the two ailing theatres were going to attract sufficient audiences in order to secure viability. For example, no specific market audiences were targeted; instead hopes were pinned on Portsmouth’s existing core group of loyal theatre goers. From the outset, key players in the project recognised this group was insufficient to fulfil commercial needs or to enable the two theatre strategy to become sustainable and profitable. Nevertheless, the problem was not tackled.

The initial two theatres strategy positioned The King’s Theatre as Portsmouth’s main commercial theatre, which would attract major touring companies and bring in the most revenue possible. This aim was unrealistic as the theatre was unable to cater for such touring companies as its facilities were so out of date and insufficient – it was therefore unable to fulfil its basic purpose. Furthermore, two of The King’s Theatre’s nearby competitors (Mayflower in Southampton, Festival Theatre in Chichester) were already able to attract such artists with vastly superior facilities, which did not need heavy investment. It can therefore be argued that even a renovated, updated King’s Theatre would be unable to compete with key local rivals.

It was doubtful that the Portsmouth strategic plan was ever going to break even with the city subsidy of only ?135,000 per year. It is important to note that a quarter of this annual subsidy could be risked in one week alone, through the practice of offering guaranteed revenues to attract large scale productions to The King’s Theatre. Although officially no direct explication was given, the offering of such risky guarantees was one of the most likely factors behind the bankruptcy suffered by the limited operating company in March 2003. Other additional factors included the consistent inability to reach the audience capacity target of 70% as well as management’s lack of financial control of the project.

Eventually the Council was forced to consider making a complete U-turn and pull away from its original two theatres strategy altogether, with its new plan to sell off The King’s Theatre and direct its limited funds towards The New Theatre Royal. This plan would commit the Council to a more manageable annual subsidy of ?130,000 per year to be backed up with ‘other’ significant funding which remained to be confirmed. However, ultimately this plan was rejected and the Council voted to keep both theatres going under subsidy, for a further three years.

2008 Situation

After major interior restoration work, funded by the Council and a separate restoration appeal, The King’s Theatre reopened and enjoyed a well-supported programme of live theatre. The New Theatre Royal is also doing relatively well although it has suffered staffing issues.

The Portsmouth Theatre Dilemma in detail
Pestle Analysis
Political factors

Portsmouth’s theatres are run by the local city Council but are operated within limits and guidelines as defined by national government

The Council is run by Councillors, who are elected local politicians. The Council has some element of choice in managing its arts provision including how it allocates its limited budget for such activities

The threat of closure for The King’s theatre became a major political pressure for the city Council

The Council was hung and there was little enthusiasm from councillors, to take locally unpopular decisions to, for example, close the King’s Theatre

Economic factors

Portsmouth City Council has an annual budget of ?200 million from which to draw funds for supporting its arts activities such as the theatres

Insufficient restrictive funding for the modernisation of the two theatres was provided by for example, The Heritage Lottery Fund. Portsmouth Council and its citizens were also required to raise a further ?4 million, in order to top up grants

Portsmouth is a major tourist venue supported by major employers including IBM and its European HQ

In the past, arts activities including live theatre, have been underfunded in Portsmouth

Sociological factors

The total population of Portsmouth is over 170,000

In line with general UK trends, the public are consistently turning away from live theatre in favour of more ‘fun’ entertainment options including nightclubbing

The spread of mass car ownership opened up the competition to include other theatres and rival venues from outside Portsmouth

Technological factors

To become competitive, significant investment in updated operational technology is needed by both theatres

The New Theatre Royal was partly destroyed by fire and so has extremely limited operational facilities. For example, the theatre is unable to accommodate even basic large scale scenery.

Legal factors

Both theatres remain at least partly un-modernised and out of date and could therefore arguably fall short of legal requirements such as current health and safety measures etc.

Bankruptcy of the theatres management company in 2001, threw doubt on the entire viability of the two theatres project

Environmental factors

The King’s Theatre is particularly poorly situated in Portsmouth

Porter’s Five Forces
Degree of rivalry

According to The Arts Council for England, Portsmouth’s two major theatres did not appeal to the specialist niche markets which it needed to reach, in order to become viable. Key rival theatres and other venues within reach of the city were far better positioned to fulfil the needs of these markets.

Portsmouth city itself provides fierce competition for its theatres, these rivals include numerous comedy and night clubs, sporting venues and The Guildhall Concert Hall

Supplier power

The Arts Council for England, a major funder of the arts provision in Portsmouth, did not agree with the ‘Two theatres for Portsmouth’ strategy from the outset. Funding and support for the project was therefore difficult to obtain

Threat of substitutes

The Arts Council for England warned Portsmouth Council that there was insufficient consumer demand for two major theatres in the city. This would suggest that there was a significant flaw in this strategy from the beginning.

Buyer power

With the advent of mass car ownership and the trend towards more accessible ‘fun’ pastimes, live theatre still finds it challenging to compete and attract audiences. Customers now have far more choice as to how, where and when to spend their money on live entertainment.

Barriers to entry

Funding for the two theatres project was stretched from the outset and so it can be argued that the project was always going to be financially fragile

On top of initial investments on acquisition of the theatres, Portsmouth Council also initially needed to raise around ?4 million to top up possible funding grants for its project

Experts in the field of arts development such as The Arts Council for England predicted that the theatre market would be particularly tough for Portsmouth and that niche target marketing would be needed for strategic success. This advice seems to have been ignored by the theatre management in Portsmouth.

SWOT Analysis
Strengths

Although much diminished since its heyday n the 1950’s, Portsmouth still has a devoted live theatre audience

Both theatres are historically much loved, Grade II listed arts venues

Weaknesses

The King’s Theatre was re-launched in 2001 but its subsidiary commercial operating company was unsuccessful and became bankrupt only 2 years later

Portsmouth’s loyal live theatre audience still exists but is much diminished and is not sufficient to fill the 2,000 seats needed each week, for the ‘Two Theatres for Portsmouth’ strategy to be financially viable and sustainable

The flagship King’s Theatre, although an impressive Grade II listed building is poorly located, away from the city centre, with inadequate parking facilities

Portsmouth’s two theatres were unable to compete on ticket price with key rival theatres. For example, King’s tickets sold for up to ?10 each with Southampton and Chichester theatres averaging a ticket price of up to ?14.

The Portsmouth population’s interest in live theatre has clearly dwindled over time. For example in 1950, the city boasted four live theatres which were so popular that they were full every performance night. By the end of 1990’s only two major theatres remained plus a smaller arts theatre which was relocated in 2003 due to lack of funding.

Opportunities

Portsmouth’s ‘ two theatres strategy’ has the public’s backing

Leading decision makers such as former Council leader Frank Worley, publicly recognised that Portsmouth is a city with cultural ambitions and thus a desire to support cultural activities (such as live theatre)

Threats

Both theatres require substantial investment in order to modernise them and to enable them to compete with successful rivals such as The Mayflower Theatre in nearby Southampton. For example, The King’s Theatre initially required an investment of up to ?13 million and The New Theatre Royal required ?5 million.

Key competitors include the large, modern and well located city centre theatres based in nearby Southampton and Chichester as well as popular local town venues and numerous Portsmouth based rival live entertainment venues

The development of mass car ownership has enabled once faithful Portsmouth theatre goers, to travel to competing theatres

Other forms of entertainment have become more fashionable than live theatre – these include television as well as nightclubbing. The trend for more ‘serious’ entertainment as offered by live theatre, including opera, drama and ballet, are on a continual downward spiral.

Following bankruptcy in 2003, The King’s Theatre still carried over ?200,000 of debt

Councillors are elected politicians which can arguably be swayed by vote winning policies rather than by purely altruistic objectives, such as keeping theatre alive in Portsmouth

An Arts Council for England study argued against the two theatre policy from the outset, claiming that there was simply not enough customer demand to support two theatres in the town. The Arts Council wanted Portsmouth to focus its resources on the smaller New Theatre Royal which was in a stronger city centre location.

Ultimately lack of funds could force the sale of the well-loved King’s Theatre, to a brewery chain

Conclusion

Portsmouth Council’s two theatre strategy seems to have been doomed from the start. It is clear from the case study evidence that the strategy was financially unsound with wholly insufficient funding. Expert advice was ignored by the theatre’s management and obvious strategic measures, such as targeting niche audience markets and putting together a strategy to compete effectively with stiff growing competition, were left un-tackled. The strategic mismanagement of the project forced Portsmouth City Council to make two entire strategic U-turns in the space of only four years. Although both theatres are currently operating, it is clear that they still face an uncertain future.

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Introduction

The aim of this report is to analyse the current situation of McDonalds as an organisation in the UK market and to evaluate their current sales decline. The primary focus is to provide a detailed analysis of the organisation and its position in the UK market, developing a link between declining sales and the overall shift in consumer behaviour. The report initially provides an overview of McDonalds as an organisation. This is followed by a detailed evaluation of the firm’s current position in the market which links back to why sales are declining for the firm and what are the root causes for this in the business. This is followed by a recommendations section which develops a ground up strategy for the organisation to improve its performance in the UK market.

McDonald’s Overview

McDonald’s UK is part of the larger group called McDonald’s, which operates in over 100 countries. The organisation reported a revenue of $33 billion in 2014 and has over 400,000 employees worldwide (McDonald’s Annual Report, 2014). As an organisation the firm operates over 36,000 outlets which is more than any other retailer across the globe. Before moving on, it needs to be highlighted that while McDonald’s operates with a global ‘menu’, the organisation also develops bespoke products for some of the markets based on demand in the region (BBC, 2014).

McDonald’s in the UK

McDonald’s is a well-known fast-food brand in the UK. It operates at over 3000 locations and has seen growth over the past 10 year (McDonald’s Annual Report, 2014). However, recently, McDonald’s across the globe and in the UK highlighted a consistent decline in sales. Millington (2014) states that McDonald’s has reported a drop in sales by 4% in the UK, which highlight that the firm is not on the same growth path as it used to be. Similar article was published by Bold (2015) where the author highlighted that the growth pattern of McDonald’s has stopped and the firm, for the first time in 45 years, is re-structuring due to a rapid decline in sales. This is critical for a firm that operates at a global scale, a 4% drop is effectively billions of dollars that the firm is unable to convert. Neilan (2014) states that from an earnings point of view the overall decline is GBP 3.8billion which is a significant number.

The Cause of this Decline

While the previous section clearly highlights a downward trend in McDonald’s market share in the UK, it is important to examine the overall cause of why this is happening. Doyle and Stern (2006) state that the UK market is one of the most rapidly declining fast food industries in Europe. This indicates that there is a change in trend within the market that is impacting the fast food business the market.

Research conducted by Long et al (2014) states that one of the major reasons as to why there is a sharp decline in fast food consumption is obesity. The core notion here is that over the past 8 years more cases of obesity have been reported by the NHS than that in over 50 years (Pieterman, 2015). This is critical as health services often term ‘junk’ food as a cause of the obese society in the UK. McDonald’s being one of the main suppliers of fast food is directly impacted by this change and stance by the NHS. The UK government has highlighted obesity as a high risk to individual’s health this was backed by the NHS (Nutrition and Food Science, 2012). This is one of the major factors that has impacted the McDonald’s market share and declining sales.

Another important aspect linked with the loss in revenue and sales is associated with the fact that there is a shift in consumer behaviour towards fast food. Bernhardt et al (2012) state that an average UK individual is now 4 times more conscious of what they are eating from a health point of view. This clearly highlights that users now tend to look for healthy food options, which has a direct impact on the sales and revenue of McDonald’s. Hence consumer behaviour plays a vitally important role in the current position of McDonald’s in the market. There is also a consumer shift that is focused away to healthier fast food chains. Bloomberg (2015) highlights that 4 out of 10 individuals that skip McDonald’s move on to buy a Subway meal as they consider it a healthy alternate to McDonald’s.

Another important aspect that is linked with the lack of sales is the inability of the firm to innovate and diversify. McDonald UK’s menu has not changed over the past 50 years, and this has a direct impact on the buyers and how they perceive a firm from an innovation as well as a development point of view. While McDonald’s strategy has worked over a period of time, it is clearly showing signs of its limitations with rapid decline in overall business revenue.

Finally, another important aspect linked with the decline of McDonald’s is negative promotions through social media. Kotler and Keller (2012) highlight that the advent of social media means free information flow across the market. Regardless of the authenticity of the data, information on social media has a direct impact on business sales. McDonald’s is often termed as the fast food chain that only cares about revenue and not about consumer health, and social media has spread this aspect on a large scale. (Neilan, 2014) This therefore impacts the consumer buying behaviour and negatively impacts the sales of McDonald’s in the UK market.

All in all it is clear that the decline of the organisation in the UK is linked to the change in market conditions, consumer behaviour and a shift towards healthy living. It is also evident that McDonald’s is highlighted as an organisation that is only working for its own good and hence its inability to innovate is clearly visible in the process.

Recommendations, McDonald’s

The previous section of the report clearly highlighted multiple elements that need to be considered by McDonald’s in order to improve its current situation in the UK market. Keeping the discussion in context, it is critical that viable recommendations for the business are developed in order to improve the sales performance of the organisation. In order to develop a new model and to improve the overall position of the organisation in the market, it is recommended that McDonald’s launches a new product line called ‘McDonald’s Health!’ as discussed below.

McDonalds Health: healthy Fast Food for the Masses!

One of the primary reasons linked with the rapid decline in sales for the business is the perception and the overall type of food served by the business. This food is classified as ‘unhealthy’ by various individuals and organisations. Keeping this in context, it is recommended that McDonald’s starts a new product which is under the umbrella of the current organisation. The idea here would be to develop a unique product line focused on the healthy aspect of the market. Keeping this new product line a focused segmentation, targeting and positioning strategy is discussed in the table below.

SegmentationMcDonald’s health will be segmented through the current geographical positions of McDonald fast food chains. The idea would be to start with the areas where sales have declined the most and launch the product line focused on geography as well as behavioural segmentation in order to target the most ‘health conscious’ areas of the country.
TargetingThe target market for this new product line will be individuals that are health centric. The main driving force here would be behavioural targeting which impact the consumer buying behaviour significantly. The idea would be to develop a viable path to brand awareness through a focused target market consisting of individuals that look for healthy food.
PositioningAs it stands McDonald’s is positioned at the affordable end of the market. This is often highlighted as one of the major USPs of the firm. However, McDonalds Health will be targeted at the mid-tier end of the market, which would effectively mean that the brand will be considered a ‘premium’ option as opposed to McDonald’s current offering.

The STP analysis highlights that McDonald’s health will effectively be a premium, health version of the current brand, with a menu that is based around the concept of having healthy fast food.

After highlighting the STP strategy it is now important to define the overall promotional strategy of the new product line. Hooley et al (2012) state that promotion forms one of the most important components of developing a viable business footprint in the market. Two key aspects will be used to promote the new brand:

Traditional awareness market campaigns will be launched to enhance the overall visibility of the brand in the market. The idea would be to move into different malls in the form of kiosks, which would offer free tasters and highlight key features. This, along with a collaboration with various health agencies to certify the product as healthy will be used to promote the product line across the country.
The second core aspect that needs to be highlighted here is linked with the development of a social media marketing approach which builds around healthy living. The idea here would not be to promote the product line or the sub-brand, but to link with real world scenarios and push it on social media as a story. The call out for this campaign will be #mchealth which is linked directly with the newly launched product line.

This approach would allow the organisation to develop a viable path to promote the firm offering and therefore enhance the overall standing of the organisation in the market. Keeping this in context, it is now important to develop the marketing mix for the business (product line) as shown in the table below:

ProductPlace
The new product line will include a menu consisting of heath centric options. The idea would be to have a product line that is not only effective but also has a positive impact on the brand itself.The pricing structure of the product line will be different from the current approach. This product line will be placed at the mid-tier end of the market, hence falling in the semi-premium range.
PlacePromotion
The product line will be sold through normal McDonald locations. The idea would be to start off with a few locations and build a hype around this, before moving towards a wider audience.Promotionally the core aspects are promotions through both traditional and non-traditional means. This would mean the focus would be on social media as well as creating awareness through traditional means.

The end goal of this re-launch, or upgrade to the brand, is to effectively provide consumers with an option. The first step towards the development of a sales enhancement model is about making sure that the consumer perception and the buying process is enabled for the new product lined. With a health centric approach the idea is to provide a viable path for the development of a shift in the consumer thought process towards McDonald’s.

Conclusion

Overall the report provides and in-depth analysis of why McDonald’s as a firm is witnessing a decline in its current market share. This highlights that the organisation due to its inability to cope with the changes in the market is unable to react to the changing consumer behaviour towards fast food chains. It is also clear from the analysis that the organisation needs to re-vamp its current position in the market in order to develop a viable footprint. To do this it is recommended that a health centric product line is launched which would allow the organisation to focus on the shifting trends in the market. Coupled with effective marketing, McDonald’s UK should be able to steer its sales back to the required position.

References

BBC (2015) McDonald’s global sales continue to decline, Available from:

Bernhardt,M. Mays,D. and Hall,A (2012) “Social marketing at the right place and right time with new media”, Journal of Social Marketing, Vol. 2 Iss: 2, pp.130 – 137

Bloomberg (2015) McDonald’s US to shrink for the first time in 45 years, Available from: http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/11797531/McDonalds-US-to-shrink-for-the-first-time-in-45-years.html

Bold, V. (2015) McDonald’s reports falling global sales, with performance partly buoyed by UK, Available from: http://www.marketingmagazine.co.uk/article/1330795/mcdonalds-reports-falling-global-sales-performance-partly-buoyed-uk

Clive Long , Arleen Rowell , Anita Gayton , Elizabeth Hodgson , Olga Dolley , (2014) “Tackling obesity and its complications in secure settings”, Mental Health Review Journal, Vol. 19 Iss: 1, pp.37 – 46

Doyle,P. & Stern,P. (2006), Marketing Management and Strategy, Harlow: Prentice Hall,

Hooley,G. Piercy,N.F. & Nicoulaud,B. (2012) Marketing Strategy and Competitive Positioning, Harlow: FT Prentice-Hall

Kotler,P. & Keller K. L. (2012), Marketing Management,14th Edn London: Prentice Hall

McDonald’s Annualreport (2014) Available from: http://www.aboutmcdonalds.com/content/dam/AboutMcDonalds/Investors/McDonald’s%202014%20Annual%20Report.PDF

Millington, A. (2014) McDonald’s looks to pared-back UK menu to arrest global sales decline, Available from: https://www.marketingweek.com/2014/12/11/mcdonalds-looks-to-pared-back-uk-menu-to-arrest-global-sales-decline/

Neilan, C. (2014) McDonald’s to restructure after “significant decline” in sales, Available from: http://www.cityam.com/1413895152/mcdonalds-review-and-restructure-after-significant-decline-sales

Nurtrition and Food Science (2012) “Accelerating Progress in Obesity Prevention”, Nutrition & Food Science, Vol. 42 Iss: 6, pp.458 – 458

Roel Pieterman (2015), Obesity as Disease and Deviance: Risk and Morality in Early 21st Century, Emerald Group Publishing Limited, Vol.44 Iss:1, pp.117 – 138

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Does the Company Educate its Consumers or Does it Serve a Unique Market Segment?
ABSTRACT

In the current retailing market, Hennes and Mauritz AB (H&M) remains a unique phenomenon in part due to the observable difference in the behavior of the company’s customers. This study evaluates two theories attempting to explain the deviation in H&M customers’ behaviour-patterns. The first theory suggests that the customers’ behaviour is attitude-bound and learned-taught through the customer-company interaction. The second theory argues that H&M customers belong to a genuinely unique market segment. The researcher surveyed 160 shoppers at H&M and one of the department stores and used a grounded-theory approach to analyse the data. The results substantiated the first theory claiming that shopping behaviours were taught and learned. The study had an important practical value. However, its results were subject to l reliability and validity threats; thus, further research would be required to confirm the findings.

I. INTRODUCTION

The issues of consumer relationships have been the focus of marketing research inquiries for at least a century. In the last decade, with the discovery of organizational core competences, relationship knowledge experienced a new wave of research interest and was named among the leading “strategic powers” of an organization (Hamel & Prahalad 1994, pp. 3-5; Bergenhenegouwen et al. 1986, p. 29). Hennes and Mauritz AB (H&M) stands out in its respective market largely because of the company’s unique and innovative approach to serving its customers. Moreover, the company is frequently cited for its ability to create customer needs rather than address the existing market requests (Kumar 1997, p. 834).

As an intangible attribute of the company’s market activities, the company’s relationship knowledge is invisible to the observer; therefore, H&M customer relations cannot be analysed directly (Petts 1997, p. 551). However, it is possible to explore this attribute indirectly through its effect on H&M consumers. Thus, the goal of this study was to investigate H&M consumers’ shopping-behaviour patterns and to compare them to the behaviour of department-store shoppers. The outcomes of the comparison were expected to explain the foundation of H&M’s consumer-relationship strategy as aimed at changing their consumers’ behaviour or at serving a pre-defined market segment.

To introduce the reader to the topic, the second chapter of this paper offers an overview of the company as well as a summary of the relevant theories. The third chapter describes the methodology utilized in the study. Chapters IV and V present and discuss the findings while the conclusion overviews the process to evaluate the practical and theoretical utility of the presented research.

II. LITERATURE REVIEW
Company overview

H&M is a clothing retailer with its operations primarily set in Europe, North America, and Asia (Datamonitor 2006, p. 4). The company is headquartered in Stockholm, Sweden and employs 68,000 workers in more than 1,500 outlets worldwide (Datamonitor 2006, p. 4). H&M’s strategic approach is to offer designer clothes to general population at affordable prices; the company works with such brand names as Stella McCartney, Karl Lagerfeld, and Roberto Cavalli (Capell & Beucke 2005, p. 16; Kroll 2004, p. 71; Zimmerman 2009, p. D1).

H&M builds its strengths by operating through complementary retail channels – stores, Internet, and catalogues – in several geographic locations and by offering a balanced product mix, which appeals to a number of customer audiences (Datamonitor 2006, p. 5). However, currently, the company faces the threat of decreasing retail sales in Eurozone amplified by strong competition from Target and Wal-Mart (Datamonitor 2006, pp. 6-7).

H&M Consumer Relations

According to Kumar, the new age of retailing is characterized by the changing relationships between retailers and their customers (1997, pp. 834-835). More specifically, H&M belongs to a group of retailers, which learned how to drive the market by driving the consumers’ behaviours instead of being driven by them (Kumar 1997, p. 834). Kumar argues that by adopting EDLP (everyday low pricing) strategy, H&M teaches fashion buyers to not wait for department-store sales but rather buy H&M low-price brand-name products (1997, p. 834).

Raugust expands the discussion to claim that, in addition to the prices, H&M changes customers’ behaviour by creating a thrilling shopping experience (2004, p. S10). The company renews its store inventory daily; therefore, even the customers who come to the store every day can expect to discover new deals on each shopping trip (Raugust 2004, p. S10). Thus, H&M manages to keep their stores intriguing for its customers and to make them return more often than they would otherwise.

Both media and empirical research observe behaviourist differences in H&M consumers. However, potentially, there are two explanations for the mentioned deviation. First, as suggested by Kumar, H&M strategy might persuade the consumers to adopt new behaviours. Second, H&M customers might belong to a different consumer segment characterized by unique behaviours; they choose H&M because it is a better fit for their needs. Currently, there is no research that reliably supports one or the other hypothesis.

Shopping-Behaviour Theories

According to Smith and Lux, “current knowledge of how consumers behave in the market place predominantly consists of unrelated still photos depicting consumers at isolated times and places” (1993, p. 607). Bass and Talarzyk argue that there are strong causal relationships between attitudes, brand preference, and purchasing behaviour (1972, p. 93). Therefore, the attitudinal trends might serve as the link between the consumers’ past, present, and forecasted behaviours and be the key to explaining these behaviours. Moreover, if attitude modification is proven to affect the behaviour then H&M is, in fact, able to transform its consumers’ behaviours by altering their attitudes toward shopping.

In contrast with Bass and Talarzyk, Bower and Christensen claim that by offering new “disruptive” approach to shopping, companies like H&M create value proposition for a different and less-demanding group of consumers (1995, p. 43). These consumers feel over-served by the traditional department store; they cannot adopt mainstream shopping behaviours and, thus, prefer not to shop at all (Christensen & Raynor 2003, pp. 10-12). By creating the environment in which shopping is simpler but more exciting, H&M bring these unique group of consumers back to the market (Christensen & Raynor 2003, pp. 10-12).

There is one key difference between the attitude-bounded behaviour theory and the disruptive-technology theory. The former claims that consumers change their behaviour as related to one area of their activities – e.g. apparel shopping – while adhering to mainstream behaviours in other areas: e.g. grocery or house-ware shopping (Kumar 1997, p. 834). Contrary to that, the disruptive-technology theory argues that consumers attracted by H&M belong to a genially different segment and display the same behaviourist patterns regardless of the product/service, for which they shop (Christensen & Raynor 2003, pp. 10-12). The empirical support of one or the other claim will establish the validity of the respective theory.

Study Problem Statement

The problem addressed in this study is the lack of theoretical consensus on the deviations in the behaviour of H&M customers. The researcher believes that this study has significant implications in the field of management as it investigates the validity of Kumar’s argument (1997, p. 834). The study explores whether H&M teaches its customers to adopt new attitudes and behaviours or whether Kumar’s observation is a market illusion and H&M is attracting consumers characterized by existing shopping-behaviour patterns. If proven right, either of the hypotheses would influence both the theory and practice of strategic marketing in the retail sector.

III. METHOD
Purpose Statement

The purpose of this study was to explore if the shopping behaviour of H&M customers is different from the behaviour of department store customers when shopping for goods other than clothes.

Research Questions

1. Does the shopping behaviour of H&M customers differ from the behaviour of department-store consumers when shopping for beauty products?

2. Does the shopping behaviour of H&M customers differ from the behaviour of department-store consumers when shopping for home decor and house-wear?

3. Does the shopping behaviour of H&M customers differ from the behaviour of department-store consumers when shopping for clothes?

4. Does the shopping behaviour of H&M customers differ from the behaviour of department-store consumers when shopping for grocery and food?

Study Design, Procedures, and Timelines

The data collection for this study was performed with a help of a paper-based survey. The researcher approached potential respondents while they were shopping at H&M and a selected department store and invited them to participate in the survey. Those who agreed were given the survey, a pen, and the necessary instructions. While attempting to increase the likelihood of the respondents taking the survey, the researcher used an attractive design for the questionnaire (Robson 1993, pp. 5-15). The data collection stage of the study lasted for one week: March 9-15, 2009. It was followed by two weeks of data coding and four more weeks of data analysis.

The choice in favour of a paper-based face-to-face survey was dictated by two factors. First, the populations were physically available for a face-to-face survey while the access to the populations’ contact information would be restricted (Alreck & Settle 2004, pp. 15-22). Second, this method was highly effective in terms of the outcome for the monetary and time inputs (Miles & Huberman 1994, p. 28).

Population and Sample

The population under study was all the consumers, who shopped at H&M regardless of the frequency of their shopping trips or the amount spent on purchases. The population was inclusive of both genders and all age groups. The shoppers at one selected department store served as a control population for the purposes of comparative analysis of the studied population’s behaviour patterns.

This study was categorized as marketing rather than empirical; therefore, the size of the sample was estimated at 160 participants. This number allowed the researcher to expect a liberal degree of confidence at 80% and a relatively large sampling error of 10% (Birchall, http://www.marketresearchworld.net/index.php?option=com_content&task=view&id=23&Itemid=1).

The researcher chose a convenience sampling technique: the participants of the study were recruited among the volunteers, who shopped at H&M and the department store during the week of March 9-15 and who agreed to take the survey (Miles & Huberman 1994, p. 28). By selecting the research sites – H&M and the department store – the researcher attempted to ensure that the participants had the experience relevant to the study: they had shopped at both stores at least once (Creswell 2007, p. 128).

Data Collection Instrument

All the participants of the study were offered to take the same questionnaire regardless of their shopping destination. The questionnaire consisted of two parts: theme questions and demographic questions. There were four themes: shopping for cloth, beauty products, grocery, and housekeeping products. The instrument had two identical questions for each theme: 1) how often do you shop for a theme product during an average month and 2) on average, what amount do you spend on a shopping trip. The answers to the first question were measured on a four-point Likert-type scale: 1 (once or twice a month), 2 (once a week), 3 (two-three times a week), 4 (every day). The second question was open-ended.

The group of demographic questions inquired on the respondents’ gender, age, employment status, and combined household income. The respondents’ gender was defined as male or female. The questions about age and household income were open-ended. The employment-status question had six possible answers: employed part-time, employed full-time, unemployed, retired, student, and housekeeper.

Study Limitations

Despite of the researcher’s desire to conduct an extensive investigation, the study had to remain within a realistic framework established by its purposes as well as external forces. The problem of access to the population affected the study’s data collection activities by limiting the variability of research sites (Homan 2001, p. 329). The data was collected at one H&M outlet and one department store, which permitted the surveying of their customers (Wanat 2008, p. 195).

In addition, the research was limited by internal boundaries set by the researcher (Counelis 2000, p. 58). Considering the resources assigned to this study, the researcher limited the geographic location of the research populations to one specific city and the period of data collection to one week.

Ethical Concerns

Several ethical concerns had to be addressed as the study progressed. First, the author had to ensure the anonymity of the participants (American Psychologist 1992, p. 1598). Any unfavourable remarks might have resulted in the disruption of the customer’s relationships with H&M or the participating department store. Therefore, the researcher restrained from collecting any identifiable information and reported the data in aggregate (American Psychologist 1992, p. 1598).

Next, the author had to preserve the confidentiality of the participating department store to prevent the negative effect of the consumers’ statements and the findings of the study on the store’s business reputation (American Psychologist 1992, pp. 1599-1600). The author omitted the name of the store throughout the study report

The next ethical area was the voluntary participation in the study (American Psychologist 1992, pp. 1599-1600). To ensure the participants’ voluntarism, prior to giving the respondents the questionnaire, the researcher explained to them their right to refuse to answer any question or to exit the study at any point (American Psychologist 1992, pp. 1599-1600).

Finally, the study was based on the assumption that H&M was a successful retailer and the goal of the researcher was to confirm that assumption. Nevertheless, the researcher strived to provide unbiased data, which could be reliably applied in the field of marketing and management (Onwuegbuzie 2000, p.21).

IV. FINDINGS

The goal of the study was to contribute to reducing the theoretical gap in understanding consumer behaviour. The aims and expected outcomes of the study justified the researcher’s choice to analyse the data from the grounded theory perspective (Creswell 2007, p. 10). This approach is used to explore large groups of people and to develop an abstract framework, which can be expanded into a theory (Creswell 2007, p. 10).

The data analysis was performed as a series of t-tests comparing H&M and department store shoppers in each theme question separately (Field 2005, p. 125). The relationships between the respondents’ demographics and their shopping behaviour were analysed through three types of correlations: for both respondents groups together, H&M consumers separately, and department store consumers separately (Field 2005, p. 107).

There were no statistically significant difference between H&M and department store consumers on their behaviour related to shopping for grocery/food and home decor. However, the behaviour of these two groups was statistically significantly different when they shopped for clothes and beauty products (p<0.5). H&M consumers were shopping almost twice more often than the department store customers; moreover, the former spend more per each shopping trip than the latter.

There were no statistically significant correlation between the respondents’ demographics and their shopping behaviour for any of the groups. Therefore, it is reasonable to conclude that the difference in shopping behaviour was not due to demographic differences within the groups of respondents.

Overall, H&M customers had proven to deviate from the mainstream shopping behaviours when they shop for clothes and beauty products but they continue to adhere to the traditional behaviours when shopping for other types of goods. Considering similar roles of beauty products and clothes in peoples’ life, the findings support Kumar’s theory that shopping behaviour can be taught to the consumers by their retailers.

V. DISCUSSION

This research is subject to several threats to reliability and validity. First, by choosing to study a convenience sample and by limiting the number/location of sites, the researcher introduced a selection bias (Onwuegbuzie 2000, p.17). This threat is induced by convenience and volunteer samples, which members might not be representative of the overall populations (Onwuegbuzie 2000, p.17).

Related to the selection bias, the convenience sample causes low generalizability of the findings (Onwuegbuzie 2000, p.30). This threat is common to most of the studies and is often a trade-off for the freedom from researcher bias (Onwuegbuzie 2000, p.30).

Next, the results might be affected by the matching bias (Onwuegbuzie 2000, p.22). The researcher chose the study and control populations based on the assumption of existing similarities between the two. However, this assumption might be wrong; and the populations could be genuinely different.

Finally, the study could be a subject to temporal validity in a case if the consumers’ preference of H&M was due to the effect of economic downturn (Onwuegbuzie 2000, p.31). To evaluate this threat, the researcher would need to replicate the study after the current recession is over.

Despite the threats listed above, this study has a practical utility because it contributes to bridging the theoretical gap in understanding the deviations of H&M consumers’ behaviour (Kumar 1997, p. 834). However, to “result in an actual addition to the field of knowledge”, the study has to be replicated on a different (random) sample and in a more favourable economic context (Gordon & Brown 2004, p. 3).

VI. CONCLUSION

In conclusion, effective relationships with the customers are a strong competitive advantage of a retailer because they allow a company to obtain first-hand information about the changes in the consumers’ needs. They help the company modify its offer in a timely manner and more successfully than its uninformed competitors. The outcomes of this study confirm the theory suggesting that the company could be an active agent in its relationships with the customers. Moreover, it can educate its customers and induce their behaviour-change instead of passively reacting to the change that happens naturally. This is a revolutionary thought, which can transform the balance of powers in retailing and lead to dramatic changes in the field of strategic marketing. However, even though this study confirms the hypothesis, suggested by the theory, the research findings are subject to several threats challenging their validity. Therefore, there is a need to conduct a longitudinal study and replicate the survey several times with several different populations. If this series of surveys produces positive outcomes, the theory can be transformed into practical models applicable to strategic marketing.

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Analyse the business model of supermarket chain Aldi
Introduction

Aldi, a German supermarket chain, entered the UK market in 1990 and now operates a network of over 500 stores (Aldi, 2014). The competitive landscape for UK supermarkets is fierce (Sandberg, 2013) with many different strategies being adopted, each aligned to a different segment of the market. Aldi focuses on delivering a basic, value for money shopping experience (Naslund, 2013). Such a cost leadership strategy and lower cost structure enables discount companies to enter and take a larger percentage share of the market (Harvard Business Review, 2005).

As consumers focus on saving money in times of recession, the business model used by Aldi presents an opportunity to save money on weekly food shopping whilst still buying healthy food. Supermarkets following a low cost leadership strategy often stock the same product as their rivals but deliver it under a different service model (Harvard Business Review, 2005). Smaller companies, such as Aldi, do not spend as much time publicising their plans or marketing their products, this can create competitive advantage as they are less exposed to public opinion. This leads to an information gap, however it also allows them to develop and grow quickly whilst adapting to the changing trends (Skordili, 2013). The increased demand for cheaper food is better served by discount retailers. It also removes a significant cost associated with in store branding, technology and functionality, enabling the same or similar products to be offered cheaper.

The external business environment is made up of two elements; the general macro environment which takes a wide lens view of the environment in which the business operates and the micro view which focuses on the specific industry or sector in which the business operates (McLean, 2005). The external environment refers to events or trends, which are relevant to the business, as well as being uncontrollable by the business. The external environment directly contributes to the success or failure of the business, for example in 2010 Aldi left the marketplace in Greece citing unfavourable external factors as the reason (Skordili, 2013). By understanding the external environment leaders make better decisions (Kefalas, 1981); knowing the likely impact of that decision and knowing what might affect the organisation in the future. The external business environment is changing faster than ever (Mason, 2007) and therefore being able to understand, anticipate and adapt to changing trends is a key leadership skill (Kotter, 1996).

This essay presents an analysis of the external business environment in which Aldi UK operates. Analysis of the general macro environment using PEST before a more focused analysis of the retail supermarket sector is conducted using Porter’s Five Forces Model in order to draw conclusions.

The External Business Environment

Stacey (2011) explains that the dynamic of this macro external market place can be categorised into a number of headings for the purpose of analysis. PEST allows a business to periodically scan the environment to anticipate future trends as well as identify current challenges. PEST scanning splits the environment into 4 key factors: Political, Economic, Social and Technology. This is a commonly used, simple model which allows the general market to be scanned.

The micro external environment was described by Porter as being concerned with getting raw materials to consumers, suppliers to buyers and how the connection are made in a competitive way (Linstead, Fulop and Lilley, 2004). In this model the specific sector or market in which the organisation operates is analysed, this allows the specific market challenges within that sector to be understood for that organisation. To undertake this micro level analysis Porter created a model called the Five Forces which looks at the interaction between the forces. At the heart of the model is ‘competitive rivalry’ which is impacted by 4 other forces:

Power of suppliers
Threat of new entrants
Power of customers
Threat of substitutes

Porter argued success was created by the organisations ability to negotiate with suppliers to get the right prices which enable a low cost leadership model or enable larger margins. By putting itself in this position the organisation remains in the driving seat.

PEST Analysis

There are a number of factors which Aldi need to consider as part of their PEST analysis of the UK marketplace.

The Political Environment
The UK elections in May 2015 may result in a change of government. A new government may impose new legislation, tax implications and market conditions. Furthermore, with some of the parties pledging a European referendum as part of their campaign, such a move could lead to the UK leaving the European Union which, as a German company, may present a further risk which will need to be addressed.
Employment legislation continues to change on a regular basis, 2015 has already seen significant changes with the introduction of shared parental leave (ACAS, 2015). There are continued discussions around the extension of paternity leave. Such changes have an economic impact on the business but also create risk that staff may take a case to tribunal.
It is proposed that zero-hour contracts will be abolished in 2015 (ACAS, 2015), as a supermarket it is likely that seasonal staffing is used in busy periods such as Christmas. Without zero hour contracts this could become harder to staff and more expensive.
As a European company, EU legislation is also a factor to consider as any change at a EU level will also have a direct impact on the organisation.
The Economic Environment
As the UK economy moves out of recession, there could be a change of buying behaviour from low-cost stores back to mainstream supermarkets. This shift could have a detrimental effect on market share. Aldi may need to consider how to compete in such conditions, if at all.
During times of financial pressure consumers turn to cheaper food suppliers (Skordili, 2013), which has created an ideal market for Aldi in the UK and has contributed to its growth.
This may in turn change demand, supply and fundamentally affect pricing creating instability in the company as customers go back to higher priced competitors.
A change in government may also create a different in tax requirements, which could become more costly.
Success is created through a finely tuned supply chain, with distribution and logistical capability becoming one of the key competitive weapons available (Sandberg, 2013). Aldi operates a model which has created success in Germany where the main point of competition is price, with consumers preferring lower levels of service and a narrower choice to enable a lower price (Fernie and Arnold, 2002).
The Social Environment
Discount chains could be met with a degree of social stigma, as the economy rises individuals may want to shop at more expensive leading names such as Tesco, Sainsbury’s or even Waitrose.
The UK has an aging population (Cracknell, 2010), an older workforce may be more costly in terms of sickness and present further problems for employers. With the introduction of auto-enrolment for pension schemes this adds a further cost to the business as employers will have to contribute to employees pensions.
As competitors such as Asda, Tesco and Sainsbury’s introduce a more diverse range of products including clothing, non food items, opticians, chemists, travel agencies and more which could see a change of buying behaviour.
Competitors also offer a 24 hour opening service, as the way people work becomes more diverse over time will this see a change in buying habits. Aldi may need to consider this strategy as a way to maintain market share. This will carry increased costs both in terms of overheads and staffing costs.
There have been a number of international companies highlighted in the press due to their accounting practice and what this means in terms of where they pay their tax (Barford and Holt, 2013) This could lead to a change in favour by UK consumers who may feel increased loyalty to UK established firms.
By operating a narrower product range, Aldi has moved away from abundance of choice and created a streamlined shopping experience. Busy family life may benefit from this approach of making the shopping process quicker and more focused.
The Technological Environment
Online and mobile shopping is becoming increasingly popular (Butler, 2013), currently not offered by Aldi this may be a strategy that needs to be considered. This may also need to be enhanced with other technology led initiatives such as in-store media, self-checkout and access to Wifi.
Technological infrastructures are a key component of the supply chain of the modern business, intelligent stock management and supply is key to success.
Point of sale systems and checkout facilities are significantly different in larger stores, Aldi operates a traditional conveyor belt approach with no options for self service. Enhanced service from competitors such as offering to pack up bags for consumers creates a different in store experience however the average time per person will increase.
Five Forces Analysis

Within the grocery sector in the UK there is fierce competitive rivalry. A micro analysis is presented below:

Threat of New Entrants – Low

The threat of new entrants is relatively low due to the cost of entry and the competitive environments.

The cost requirement for a new brand to establish itself in the market is high. Building a large retail estate network coupled with stock levels will take significant investment.

As Tesco enters a period of decline, due to what is widely considered unethical practice, bad financial management and abuse of power (Proud, 2015). This may lead to a decline in consumer favour leading to opportunities for merger and acquisition of the brand.

Threat of Substitute Products – Medium / HighBy offering a narrow product range, Aldi remains agile to changing trends. Products can be changed quickly in the event of changing market trends.
Aldi operates relatively small stores therefore limiting the number of products that can be offered. Substituted could therefore be offered by larger stores, with more space to offer an increased product range.
The Bargaining Power of Suppliers – Low
Supermarkets have greater bargaining power than suppliers, often pushing for discounts and favourable terms due to the scale of buying power (Proud, 2015).
Suppliers may favour larger orders from the bigger competitors, therefore are less willing to offer discounts and offers to the Aldi chain. However Aldi still operates a chain of 500 stores so has a degree of buying power in its own right. It also has the additional power to buy across multiple countries in order to get favourable terms.
The Bargaining Power of Buyers – High
Buyers can make choices about which supermarket to use very easily based on offers, availability of items and ease of access.
Aldi does not offer a loyalty scheme so there is no additional incentive to return week on week.
Rivalry among Existing Firms – High
The sector is subject to intense rivalry with a focus on cost. Many brands offer to match prices of their competitors and undertake price comparison activities. This fierce rivalry leads to aggressive marketing campaigns with each player trying to win market share from the other. This increase competitive activity creates additional costs through advertising and marketing as well as leading to reduced prices (Linstead, Fulop and Lilley, 2004.
Aldi operates on a low level of fixed costs in order to deliver lower priced products, with competitors also targeting this lower price point this presents a risk to Aldi if they are not able or willing to invest in advertising to address such activity.
Conclusions

Aldi operates in a highly competitive market place, both the macro and micro perspectives show challenging market conditions. Whilst new entrants are unlikely there is a clear need to explore changing customer buying trends and how interactive routes to market contribute to customer loyalty. With buying patterns moving towards 24 hour shopping, online marketing and self-service, consideration needs to be made around whether this needs to be included in Aldi’s long term strategy.

The UK election in May 2015 presents the most immediate challenge, particularly if that results in a change of government and possible European referendum. Should the UK leave the EU this is likely to present Aldi with a financial challenge as well as imposing possible import restrictions for products. Equally, such a move could also see buying trends move towards British companies.

Aldi continues to thrive in the market, however a change in the disposable income of its customers may also change buying habits. Focus on retention of market share needs to be integrated into the strategic sustainability plans, particularly in the absence of any loyalty schemes. Continual development and alignment to its target market is critically important to maintain market share and ultimately survive.

Consideration needs to be made around what consumers want from their experience. By undertaking market research and focus groups Aldi will be able to understand what is working and what may be useful to start to consider. In a world where change is the norm it should be expected that all businesses will have to adapt and become more agile to some degree.

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On a global scale, several important firms are determined to attain “Agile management” as this enhances a company’s capability to swiftly manage” internal and external” transformation and gain competitive advantage (Khosrow-Pour, 2001, p 831). An “agile” company is adept in its ability to “detect changing markets, rapidly learn to take advantage of these market changes, detect new techniques, adapt these techniques to organisational culture” in order to incorporate them into the company “while maintaining their spirit”, efficiently exploiting them to meet changing “standards in diverse markets” and adapting “products to individual preferences” (Desouza, 2006, p123). To be able to react rapidly to transformation by making “quick decisions” on methods to counter the transformation and consequently execute the methods, it is crucial for organisations to effectively utilise Information Technology (Khosrow-Pour, 2001, p 831).

A Management information System (MIS) is useful by way of its procedure and as such it must be effortlessly up to standard for a firm (Khosrow-Pour, 2001, p 831). The usefulness of MIS is measured by how much the system is utilised, whether end-users are content with the system, “favourable attitudes about MIS functions, achievement of objectives” and whether it increases business profitability (Khosrow-Pour, 2001, p 831).

MIS Risk

As an MIS system is made up of “hardware and software”, consequently transformations in the system make it susceptible to a “penalty of change” such as “system failure” or other costly time consuming risks (Khosrow-Pour, 2001, p 831). As such technology must be effectively applied to the MIS “infrastructure (hardware, software and data)” in order to eliminate or minimise system risk (Khosrow-Pour, 2001, p 831).

MIS issue

A “field research” at a UK bank to analyse a “multidisciplinary” move towards “empirical investigation” on handling Information Technology concluded that the dialogue between those “who request development of a management information system (MIS), the client or sponsor and the technologists” who build the systems usually creates a “confused picture” (Currie, 1995, p7). The clients are usually not clear about their systems requirements and consequently this leaves room for interpretation on the part of the “technologists” (Currie, 1995, p7). In addition, an “ad hoc approach” originates from problems experienced by “project managers” in detecting suitable “financial and non-financial performance” measures for continuous observing and managing of Information Technology projects (Currie, 1995, p7).

How to address the MIS issue

The issue is a result of miscommunication between the business and Information Technology. Management has to ensure that the dialogue between the two teams is effective and also that organisation goals such as high productivity and cost reduction are included in the planning of an MIS systems implementation or change.

Design/UCD Failures

Strategic Information Systems can sustain and “shape” business strategy to impact “organisational performance” in a relationship that forms a “trilogy” (Croteau et al, 2001, p78) however; the design and development” of Information Systems plays a major factor in the use of Information Technology (Das et al 1991, cited in Croteau et al 2001, page 80). User centred design places the end user’s requirements and ability at the “forefront”, conversely current technology focuses on the quest for technology answers with no consideration for the end user’s requirements in terms of “functionality” and ease of use (Kent et al, 2003, p87).

UCD Failures

An eminent online book retailer’s first online ordering system had a major costly flaw (Hambling et al, 2008, p10). System developers had included an electronic refund facility that allowed users to receive credit on their debit or credit cards if they purchased a negative number of books (Hambling et al, 2008, p10). During testing the systems developers did not anticipate that online shoppers would try to order a negative number (Hambling et al, 2008, p10). The program was amended to allow only the retailer’s administrative staff to carry out refunds (Hambling et al, 2008, p10).
Another UCD failure resulting from inadequate software design and testing was when the “European Space Agency Ariane 5” was initially launched in June 1996 and failed after 37.5 seconds (Hambling et al, 2008, p10). A software glitch resulted in the rocket deviating from its “vertical ascent” and had to be put into “self-destruct” mode to prevent the disastrous consequences of an active horizontal rocket (Hambling et al, 2008, p10).
Furthermore, when the UK government launched “online filing tax returns”, a weak security design allowed access to other users’ confidential earnings data regardless of log in location (Hambling et al, 2008, p10).

How to prevent UCD failures

A manager must ensure that the end users of the system are the main focus of any system design with particular reference to a user’s computer skills, security and the main objective of building the system, to improve business process. Consequently if the design is user focused; it is bound to function as intended. In addition, User Acceptance Testing (UAT) is the process whereby end users test a system to ensure that it “meets their business needs” (Hambling et al, 2008, p45). Although this process is seen as the responsibility of the end users of a system, it should be managed by managers to prevent errors (Hambling et al, 2008, p45).

Project Failures

A failed project is one that exceeds its set budget, over runs, does not incorporate organisational goals or just one that is cancelled (Standish Group International 1994, cited in Linberg 1999, page178). The proportion of IT systems failure is still high when compared to other technologically advanced projects (Yeo, 2002) and although there have been some “success stories” in systems “development” projects these have been overshadowed by “broadly publicised failures” (Linberg, 1999, p177). When Information Systems projects fail, the trustworthiness of technical staff is negatively impacted (Remenyi, 1999, p5) and it is believed that the lack of risk management has greatly contributed to these project failures (Remenyi, 1999, p9). With particular reference to Information Systems projects, failure can range from little technical hardware problems to total “system failure” that harms a firm’s business activity by creating huge costs (Remenyi, 1999, p19). Consequently, ineffective risk management is synonymous with leaving the results of a project to chance and “unfounded optimism” (Fairley 1990, cited in Remenyi 1999, page9).

Project Failure Issues

When there are unrealistic expectations and people “try to do the impossible”, projects are likely to fail (Linberg, 1999, p177). A good example is a company bending over backwards in an attempt not to lose a significant client (Linberg, 1999). An unrealistic software development project deadline was set and when programmers protested profusely that is was just impossible, more programmers were added on to the project that was already operating around the clock (Linberg, 1999). Needless to say the project failed and the client was not retained (Linberg, 1999).
Another example of a failed project was a large one that over run by at least eighteen months, had eight absconding “team leaders” out of a total nine, lacked clarity in the project definition and involved excessive working hours of more than sixty a week. However because the project was eventually finished, the project programmers did not have see the project as a failure even though it was due to the very late completion and inadequate project planning (Linberg, 1999).

How to address the project failure issues

The approach to the first project should have been honest and realistic in order to meet the client’s needs and also increase the likelihood of repeat business with the client. This is due to the fact that “a consulting engagement is successful if the consultant has met client expectations” (McLachlin, 2000) and if this is the situation then” the consultant has enhanced his or her reputation, with expectations of future revenue streams – whether or not any immediate income has been received” (McLachlin, 2000). Consequently business managers should first ensure that they can deliver before taking on the task.
With reference to the second project failure, a carefully structured project plan with a clear project definition needs to be in place before management embarks on a project. A well structure project plan with carefully allocated resources, effective risk management and well monitored project stages will introduce and enforce project and budget controls.

E-Commerce and its Issues

E-commerce is a compressed name for a broad range of unified business ideas, “technologies and cultural phenomena” (May, p2). E-commerce is about online retail commerce for certain individuals and for others, it concerns the sale of advertising space amongst other things (May, p2). Nevertheless, irrespective of its definition, E-commerce has warranted a lot of interest and in fact it is a vital transformation in “the way business is conducted” (May, p2). E-commerce has resulted in creating new prospects for several businesses in various industries to contend in the “global marketplace” (Chaffey, 2006, p4). As a result of readily available information on businesses, goods and services, companies are rapidly expanding the customer base and retaining customers due to the resulting improved client-customer relationships (Chaffey, 2006, p5).
However, E-commerce software programs need more technical support than a good number of conventional “business systems” (May, 2000, p222). Business to business and “business-consumer” online programs demand twenty four operations around the clock, seven days a week right through the year (May, 2000, p222). Even though mirror sites are run to ensure “scalability”, web systems failure still occurs with several pages experiencing downtime (May, 2000, p222).

E-commerce Issue

A website experienced an overload and needed to be taken offline in November 2005 due it being incapable of handling a lot of simultaneous logins resulting from publicity on some information on the website (Hambling et al, 2008, p10). Although this is a frequent occurrence in today’s online activity, the main issue in E-commerce is security risk and as the confidence of shoppers determines the frequency and amount of purchases made online, this is indeed a very significant point.
An online consumer’s perception of security is affected by absence or presence of “third party certification” software on their websites (Pingjun et al, 2008). A review of a representation of the link between “third-party identifying logos, trust transfer and trust build-up” based on information acquired from an “online survey” confirms that when online consumers see a “third-party seal” on a shopping website, they tend to transfer their trust in the security “logo” to “online e-marketers” (Pingjun et al, 2008).
These issues should be handled by anticipate overload from a technical perspective and also by ensure the consumer confidence is gained and retained in E-commerce.

New Technology

Today’s world is an age of unique transformations within technology in the midst of technology transforming communication, work, how business is conducted and how people socialise (Boreham, 2006, p1). When new technology is implemented, it is expected that management will impact how it is adapted by the workforce, despite this, an empirical study states otherwise (Leonard-Barton et al, 1988). When new technology is implemented, staff with existing technical abilities adapt automatically whereas staff low on computer literacy skills wait to be directed by management (Leonard-Barton et al, 1988).
However, as an increasing amount of time and “investment capital” is absorbed by Information Technology and its consequences, business managers have a developing “awareness” that technology cannot be the “exclusive territory” of specialised IT companies or the Information Systems department (Porter 2008, p73). Businesses notice their competitors employ Information Technology to gain competitive advantage and acknowledge the necessity to become “directly involved in the management of new technology” although “in the face of rapid change, they don’t know how” (Porter 2008, p73).

New Technology Issues

New Technology is usually opposed as it usually involves change and people assess the size of the change required. New technology also usually results in a “large-scale organisational change” and consequently extra caution is applied as individual feelings must be influenced to get people to participate in new technology (Kotter et al, 2002, p1). In theory the opposition to new technology also known as the “crisis of progress” is as unconnected as it is connected in that community response to new technology impacts new technology “in a circular process” (Bauer, 1997, p2).
Management should address resistance to new technology by first ensuring a “readiness for change” through training and guidance.

References

Bauer M, 1997.Resistance to New Technology: Nuclear Power, Information Technology and Biotechnology; Cambridge University Press

Boreham P., Parker R., Thompson P., Hall R., 2006. New Technology Work; Routledge

Currie W. 1995.’The IT strategy audit: formulation and performance measurement at a UK Bank’. Managerial Auditing Journal.10 (1). pp 7-16.DOI:10.1108/02686909510077343. www.emeraldinsight.com. (Accessed: 15th February 2010)

Chaffey D., 2006. E-Business and E-Commerce Management; Prentice Hall

Desouza K. C., 2006.Agile Information Systems: Conceptualization, Construction, and Management; A Butterworth Heinemann Title

Hambling B., Morgan P., Samaroo A., 2008. Software Testing: An ISEB Foundation; British Computer Society

Kent S. T., Millet L. I., 2003. Who Goes There?: Authentication Through the Lens of Privacy; National Academics Press

Khosrow-Pour M., 2001.Managing Information Technology in a Global Economy: 2001 IRMA Proceedings; IGI Publishing

Kotter J P and Cohen D S(2002), The Heart of Change; Real-Life Stories of How People Change Their Organizations, Harvard Business School Press

Leonard-Barton D., Deschamps I., 1988.’Managerial Influence on the Implementation of New Technology’. Management Science. 34(10). Pp 1252-1265.www.jstor.org. (Accessed: 16th February 2010)

Linberg K. R., 1999, ‘Software developer perceptions about software project failure: a case
study. The Journal of Systems and Software.49 (1). pp 177-192.www.elsevier.com. (Accessed: 16th February 2010)

May P., 2000. The Business of Ecommerce: From Corporate Strategy to Technology; Cambridge University Press
McLachlin R. D., 2000,’Service quality in consulting: what is engagement success, Managing Service quality, 10(4).pp. 239-247. www.emeraldinsight.com. (Accessed: 16th February 2010)

Pingjun J., Jones D. B., Javie S., 2008.’ How third-party certification programs relate to consumer trust in online transactions: An exploratory study’ .Psychology and Marketing. 25(9). Pp 839 -858. www3.interscience.wiley.com. (Accessed: 16th February 2010)
Porter M. E, 2008, On Competition; Harvard Business School Press 2nd Edition
Yeo K. T., 2002.’Critical Failure Factors in Information systems projects’. International Journal of Project Management.20(3). www.elsevier.com. (Accessed: 16th February 2010)

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Describe the Structure and Functions of Microtubules – Why Can Drugs That Interfere With Microtubule Assembly Be Used as Cancer Therapy?

Introduction

Microtubules form as a highly organised network of polarised tube filaments from a protein called tubulin. Its regulation is needed for processes such as mitosis, cell migration, cell signalling and cell trafficking. The microtubules themselves are regulated by several kinases and phosphatases via signalling cascades, and concomitantly by interactions with actin cytoskeleton and adhesion sites.

Microtubule-targeted drugs (MTDs) constitute a major anticancer therapeutic class having properties of anti-mitotic and anti-angiogenic properties, thereby inhibiting malignant cell growth mainly by altering microtubule dynamics in both cancer and endothelial cells. The key to design of MTDs and the understanding of tumour progression regulators is the identification of proteins regulating the microtubule network.

Cell Morphology and Function

As the name implies, microtubules are hollow tubes having an external diameter of roughly 25nm and a cell wall thickness of 5-7nm. One of their functions is to transport organelles (e.g. secretetory vesicles) through the cytoplasm, a particularly important role in nerve cells where axoplasmic flow is required. They also have a critical role in cilia and flagella movement. Microtubules originate from a complex structure known as centrosome.

Between cell divisions (figure 1), the centrosome is located at the centre of a cell near the nucleus. Embedded in the centrosome are two cylindrical centrioles, arranged at right angles to each other. At the onset of cell division, a centrosome divides and the two daughter centrosomes move to opposite poles of the nucleus to form a mitotic spindle

The functions of microtubules are important to the survival of eukaryotic cells because, along with actin and intermediate filaments, microtubules constitute the cytoskeleton which offers shape and strength to the cytoplasm. It is therefore vital that we understand their fundamentals, such as what they are composed of and how their structure is both maintained and destroyed within cells.

As mentioned in the introduction, the building blocks microtubules are tubulin. However, only two forms of tubulin, ?-tubulin and ?-tubulin, play a role in the formation of the microtubule structure. When the ? and ?-tubulin bind, a useful subunit called a heterodimer forms.

When intracellular conditions favour assembly, tubulin heterodimers assemble into linear protofilaments, which in turn assemble into microtubules. All such assembly is subject to regulation by the cell. [11]

The interactions holding ? and ?-tubulin in a heterodimeric complex are strong enough that ? tubulin subunit rarely dissociates under normal conditions. Each tubulin subunit binds two molecules of GTP. One GTP-binding site, located in ?-tubulin, binds GTP irreversibly and does not hydrolyze it, whereas the second site, located on ?-tubulin, binds GTP reversibly and hydrolyzes it to GDP. The second site is called the exchangeable site because GDP can be displaced by GTP. The recently solved atomic structure of the tubulin subunit reveals that the non-exchangeable GTP is trapped at the interface between the ? and ?-tubulin monomers, while the exchangeable GTP lies at the surface of the subunit

Microtubules may appear to be stable but they usually oscillate between growth and shortening phases. During growth, heterodimers are added on to the end of a microtubule, and during shrinkage they come off as intact subunits. [11]

This active process of assembly and disassembly can be inhibited by a range of drugs that bind to many sites in the ?-tubulin subunit. These drugs prevent mitotic division and ultimately lead to cell death, by means of necrosis and apoptosis.

The subunits are aligned end to end into a protofilament. The side-by-side packing of protofilaments forms the wall of the microtubule. In this model, the protofilaments are slightly staggered so that a-tubulin in one protofilament is in contact with a-tubulin in the neighboring protofilaments.

Microtubules and Cancer Therapy

The aim of treatment in patients with cancer is cure or, if this is not possible, effective palliation of many cancers present as localised tumour masses, but surgery or radiotherapy often fails to eradicate the disease, which eventually becomes widespread. For this reason, there is a trend to incorporate systemic treatment with local treatment at the time of diagnosis. [3] The basic mechanism of anticancer drugs is the inhibition of cell proliferation processes.

However if they fail to selectively target tumour cells over proliferating normal cells, this renders the drug toxic. This particularly arises in the bone marrow, gastrointestinal epithelium and hair follicles. A cytotoxic drug is said to be selective in cancer therapy if it inhibits malignant composite cells undergoing division and concomitantly allows for normal cell proliferation.

Anticancer drugs are classified according to their sites of action either during the cell cycle or along the synthetic pathway of cellular macromolecules. Some drugs are only effective during part of the cell cycle, which are termed phase-specific drugs, while others are cytotoxic throughout the cell cycle usually called cycle-specific drugs [3].

Vinca alkaloids and taxanes are drugs that inhibit mitosis by binding to the microtubular proteins necessary for spindle formation. They can therefore be classified as phase-specific drugs – to be more precise however; they are M-phase specific.

The main vinca alkaloids are vincristine, vinblastine and vindesine. They have been used in the treatment of cancer for over many years. It is because of their efficacy that has guaranteed that they remain among the drugs of choice for numerous types of human cancers, “They are used in acute lymphoblastic leukaemia, lymphomas and some solid tumours” [3]. They bind to tubulin and inhibit its polymerisation into microtubules which prevents spindle formation. [14]

Microtubules are central to a number of cellular processes including the formation of the mitotic spindle. It is without a doubt that the destruction of the spindle leads to a loss of chromosome segregation which consequently inhibits cell division causing cell death.

Although the cell spindle was an obvious goal for further drug development, research in this area was obsolete until the exciting clinical results of the taxane drugs were reported in the late 1980s [4].

The taxanes paclitaxel and docelatel also bind to tubulin, however these agents, in contrast to the vinca alkaloids, stabilise the spindle and produces mitotic arrest. Thus, microtubule stabilisation leads to similar effects as microtubule disruption.

Research in the field has again increased following the observation that agents that bind to tubulin can selectively destroy the arrangement of blood vessels within tumours, causing widespread tumour necrosis [5]. It may be possible that the vinca alkaloids and the taxane drugs also exert part of their tumour-destroying action through an antivascular mechanism. This may depend on targeting endothelial cells rather than tumour cells for drug action. A possible advantage of this approach is that endothelial cells are not transformed and are unlikely to acquire mutations resulting in drug resistance. [6] The destruction of the tumour vasculature also arises through a tubulin-related mechanism.

The disorder of the microtubular arrangement impairs the cell function because microtubules are involved in the maintenance of cell shape. The tumour selectivity begins from the unsystematic character of tumour blood vessels. Rouget cells or pericytes are associated abluminally with all vascular capillaries and post-capillary venules. [10] The tumour blood vessels lack these cells along with sustaining smooth muscle which causes them to be feeble.

Therefore the endothelial cells lining the tumour blood vessels are more vulnerable to the effects of vinca alkaloids and taxanes. Although contact with these anticancer drugs is experienced by all vascular endothelial cells, it is the vulnerable tumour blood vessels that are damaged the most. This ultimately leads to necrosis of tumour cells that were reliant on the blood vessels.

One problem seen in these studies is the survival of cancer cells at the periphery of the tumour [7]. These are nourished from the blood vessels of the normal neighboring tissue and are therefore not affected by the damage of blood vessels in the tumour. These tumour cells are likely to increase in number again. For that reason, it is doubtful that these anticancer drugs will be effective unless given in combination with additional therapies. This may be strikingly more successful than single drugs, for example in the treatment of some cancers such as Hodgkin’s disease. [3]

The shortcoming in previous clinical trials on agents targeting tubulin was the rejection of potentially useful agents because interest was more centered on toxicity and survival of drugs, rather than the action or effects of drugs on blood vessels. The breakthrough of new antivascular treatments would be an essential addition to cancer therapy; hence it is these agents that are presently most fascinating to scientists.

Other Drugs That Inhibit Function of Microtubules

There are more than thirty drugs in the past or in present clinical development. [13] In order to maintain a reasonable size for the following sections, only a few of the more fascinating drugs will be discussed. Some that where not mentioned previously include:

Taxol – an anti-cancer drug, stabilises microtubules
Colchicine – binds tubulin and blocks polymerisation. Microtubules depolymerise at high colchicine concentration.
Nocodazole – causes de-polymerisation of microtubules.
Actinomycin – antibiotic able to halt cancer, not widely used as it is highly toxic
The Microtubule Network as a Target for Therapeutic Agents

The various M-phase specific drugs act by targeting different parts of the heterodimer. To date, three binding areas have been acknowledged: the colchicine site close to the ?/? interface, the region where the vinca alkaloids bind, and the taxane binding pocket. [13]

Colchicine, currently a medication for acute gout, also inhibits cell division and has therefore previously been used in cancer therapy. It binds to a site near the ? and ?-tubulin interface within the microtubule, blocking microtubule polymerisation [15]. However, its high toxicity prevents its use for current cancer therapy.

Vinca alkaloids inhibit microtubule assembly by cross-linking at the inter-dimer interface; they sterically distort the protofilament and induce tubulin to form alternate spiral polymers [16].

The mechanism of action of taxanes is quite different from that of the other two, for it promotes the assembly of microtubules, resulting in highly stable, non-functional polymers. Taxanes bind at the M loop on the ?-subunit, stabilising lateral contacts between protofilaments [17].

Antimitotic agents that interact with microtubule components are of interest for the insights they can provide into the roles of microtubules in cells and the subtleties of tubulin structure and also for their potential activity in the treatment of human neoplastic diseases. A variety of bioassays have been used to identify new antitubulin agents and new techniques have been developed to further understand their biological potency and mechanistic basis at the molecular level.

Drug Combinations

Although M-phase specific drugs are remarkable in that it prevents further malignant growth, the administration of combinations of drugs given intermittently often produces better results than more continues treatment with a single drug. The rationale is that a combination of drugs with different toxic effects and affecting different biochemical pathways has anti-tumour activity without addictive toxicity. [3]

However, a large number of antimitotic drugs are currently under development, this implies that microtubules are still a very worthwhile target for anticancer therapies.

Bibliography

[1] Gillian Pocock, Christopher D. Richards. Human Physiology: The Basis of Medicine (Oxford Core Texts). Oxford University Press; 3Rev Ed edition (Jan 2006). p 23

[2] http://www.daviddarling.info/encyclopedia/C/cell_cycle.html

[3] Michael J. Neal, Medical Pharmacology at a Glance, Blackwell Publishing; 5^th Edition (Aug 2005), p92-93

[4] Rowinski, E.K., Cazenave, L.A., Donehower, R.C. (1990) Taxol: a novel investigational antimicrotubule agent. J Natl Cancer Inst 82, 1247-1259.

[5] Dark, G.G., Hill, S.A., Prise, V.E., Tozer, G.M., Pettit, G.R. and Chaplin, D.J. (1997) Cancer Res 57, 1829-1834.

[6] Antivascular therapy: a new approach to cancer treatment. British Medical Journal, March 27, 1999 by A J Hayes, L Y Li, M E Lippman

[7] Zhao, S., Moore, J.V., Waller, M.L., McGown, A.T., Hadfield, J.A., Pettit, G.R. and Hastings, D.L. (1999) European J Nuclear Medicine 26, 231-238.

[8] http://www.ba-education.demon.co.uk/for/science/dnaphotos/dnaphoto.html

[9] http://www.emc.maricopa.edu/faculty/farabee/biobk/BioBookmito.html

[10].http://www.ncbi.nlm.nih.gov/entrez/query.fcgi?cmd=Retrieve&db=PubMed&list_uids=8915187&dopt=Abstract

[11] http://www.ruf.rice.edu/~bioslabs/studies/invertebrates/microtubules.html

[12] Harvey Lodish, Arnold Berk, Lawrence S. Zipursky, Paul Matsudaira, David Baltimore, James Darnell. Molecular Cell Biology, W. H. Freeman; 5th edition (2003) p1036-1035

[13] Jordan, A., Hadfield, J.A., Lawrence, N.J. and McGown, A.T. (1998) Tubulin as a target for anticancer drugs: agents which interact with the mitotic spindle. Med. Res. Rev. p18

[14] H.P. Rang, M. Maureen Dale, James M. Ritter, Philip Moore, Pharmacology, Churchill Livingstone; 5th edition (31 Mar 2003), p 704

[15] Downing, K.H. and Nogales, E. New insights into microtubule structure and function from the atomic model of tubulin. (1998) Eur. Biophys J 27, 431-436.

[16] Wilson, L., Jordan, M.A., Morse, A. and Margolis, R.L. (1982) Journal of Molecular Biology 159, 125-149.

[17] Snyder, J.P., Nettles, J.H., Cornett, B., Downing, K.H. and Nogales, E. (2001) Potential for self-assembly and microtubule interaction 98, 5312-5316.

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Introduction

In general, the term ‘evolution’ can imply a drastic or gradual change from a very broad perspective. Life on earth, the universe,galaxies, as also the earth in general have evolved through millions of years. In this essay we consider only one aspect of evolution emphasizing on evolution as a biological tool for change among species and consider fossil record as supportive of both evolution theories and also the other theories contrary to evolution. Evolution is the central unifying concept, a theory that successfully connects biology, palaeontology and other branches of science. Evolution is a gradual descent of organisms accompanied by changes that help the organisms to adjust and adapt to the surroundings. ‘Descent with modifications’ as Darwin contended implies changes in organisms in successive generations (Mayr, 1976). These changes are triggered by the derivation of new species and there is a change in the properties of populations of organisms and these properties tend to transcend the lifetime of any single individual. Newers pecies are modified versions of older species.

Although, individual organisms do not biologically evolve,populations evolve when heritable genetic materials are transmitted from one generation to another. Biological evolution can range from very limited changes to drastic transformations on a large scale changing the entire special together and bringing in new forms. Evolution can thus be defined as inheritable changes in populations of species that are spread and transmitted over many generations (Zimmer, 2002). It is also more scientifically defined as changes in the frequency of alleles within a gene pool carried through different generations as understood in the Darwinian version of the theory(Dawkins, 1989). Evolution studies are supported by detecting changes in gene frequency within a population and the fact that the theory of evolution emphasizes on a common ancestor, only indicates that two or more species show successive heritable changes in populations since they are separated from each other as distinct forms (Allen and Briggs, 1989). Most popular definitions of evolution however highlight not the transmission of heritable traits and changes but the processes of diversity that has given rise to millions of species from the most primitive organisms. Here however we move on to the evidence for and against evolution theories and the role of fossil record in this context. Some researchers claim that the theory of evolution has been supported by four primary sources that serve as evidence (Zimmer, 2002; Allenand Briggs, 1989):

The fossil record that tracks changes in early and primitive forms of life
The anatomical and chemical similarities in the constitutions of different species.
The genetic changes observed and recorded in several living organisms over several generations
The geographical spread and distribution of species that seems to suggest a definite pattern, and
The Fossil Record

Fossils are buried in rock layers as indentations of dead plant and animal materials. The totality of these artefacts and their impressions on the rock formations is considered a fossil record. Fossil record as we have briefly mentioned is the primary source of evidence supporting the theory of evolution and the gaps in these records ironically also forms the bone of contention taken up by anti-evolution theorists. Fossil records are used by scientists to understand the process of evolution in general, and the subsequent changes in several species at several times of the earth’s existence(Donovan and Paul, 1998).

The Fossil Record seems to provide an important clue to the changes in primitive and even now extinct species and this definitely helps us to frame a conceptual graph on how evolution has taken shape. Fossil and rock record forms the primary source of evidence collected by scientists for nearly400 years and the consequent database obtained is mainly observational. The fossil record among all other evidence gives a large database of documented changes in past life on earth. The use of Fossil record to study life forms on earth dates back to pre-Darwinian times and the changes in life forms could be studied from a sequence of layers of sedimentary rocks and fossils of different groups of species were found in each of these successive layers (SA, 1982).Sedimentary rocks are found widely across the earth’s surface and are formed when small particles of sand, mud or gravel, shell or other materials withered off by water or wind accumulates in sea beds and oceans. As these sediments pileup they bury shells, leaves, bones, and parts of living organisms. Layers of sediments are thus formed for every large period of time and all these layers become subsequently cemented to each other to become different layers of sandstone,limestone, shale and so on. Within these layers of sedimentary rocks the plant and animal remains become buried as fossils and are later revealed as fossil records (Allen and Briggs, 1989). From these fossil records several species have been identified, some of which are extinct and some of which have traits transitional between different major groups of organisms. Fossils of transitional forms actually give considerable evidence of species evolution over time. However there is not enough evidence through fossil records to conclusively prove evolution, as there are still talks of ‘missing links’ as very few and according to some, no transitional forms have been actually discovered. The Fossil record data available to us is incomplete and in conclusive at present.

During the late eighteenth and early nineteenth centuries,William Smith, a British Engineer observed different assemblages of fossils preserved at different levels and different ages of rocks. These assemblages succeeded one another in a regular and determinable order (cited in, Wikipedia,2004). This was further bolstered by the fact that rocks collected from different locations showed similar fossil formations according to the different times they represented. Smith named this correlation of rock fossil data as the principle of faunal succession. The occurrence of faunal succession was one of the primary arguments of Darwin who used fossil evidence as supporting the theory of evolution.

Various modern approaches to the theory of evolution have been recently developed. Mayr claims that the theory of Punctuation for instance has two basic points that

most or all evolutionary change occurs during speciation events, and
most species usually enter a phase of total stasis after the end of the speciation process (which involves formation of new species).

Speciation thus involves transformation of species in geological time (Erwin and Anstey, 1995). Formation of new species is explained either by phyletic gradualism or a gradual steady transformation of species by phyletic evolution highlighting the deficiency of the fossil records, or by sympatric saltational speciation that highlighted punctuational equilibria and branching of species rather than transformation as lineages as the real explanation for evolution (Mayr and Provine, 1998). Biologists like Gould and Eldredge have also supported punctuation theories. Richard Dawkins on the other hand stresses on the principle of gene multiplication where genes as replicators seems to be the focal point of defining evolution (Sterelny, 2001).

In quite an important paper Volkenstein (1987) suggests that there can be no contradiction between punctuated equilibrium and phyletic gradualism if synergetics and theory of information are incorporated within the theory of evolution. Punctualism can be seen as phase transition maintaining the directionality of evolution. Volkenstein argues that Punctualism, non-adaptationism and neutralism form the triad of internally connected features of evolution.

Problems with Fossil Records

Of course at that point, the absence of a proper theory of evolution prevented Smith or other researchers from providing an explanation of the actual cause of faunal succession. The cause of faunal succession as is known today is mainly due to evolution of organisms and species that change,transform or become completely extinct, leaving behind their traces on earth as fossils. Age of rocks and the changes in species features are both determined by fossil record and faunal succession used as tools in bio stratigraphy. However fossil data show extremely few records of transitional species,organisms that can conclusively suggest how and when evolution of new and different species occurred (Donovan and Paul, 1998). Darwin himself suggested that the geological record itself is imperfect and incomplete and this is further strengthened by the fact that transitional species were short lived and had very narrow geographical range.

Radiometric and Carbon dating have made it possible to identify fossils more than 3.5 billion years old and have indicated that animal species may have appeared abruptly, a phenomenon which Darwin himself found difficult to accept. Even though one or two forms of organisms which may be considered as transient have been identified, there are no records of transitional plants and thus an evolutionary plant history could not be drawn as of yet. Along with these issues it has also been seen that most of the fossils found are of species which have existing forms and are either similar to existing species or are completely identical. The intermediate temporary stages as serve to act, as links between two related species seems to have been completely downplayed by the fossil data obtained. Animals seem to have remained more or less unchanged through all these years. Despite the collection of a huge number of fossils,nearly all of them being fossils of presently existing animals have created problems for the theory of evolution. It is a general belief that based on fossil discoveries already made, there will be little or no evidence that evolution had actually occurred and continues to occur (Donovan and Paul,1998). If animals die a natural death, they are usually decomposed even before being fossilized. However during sudden catastrophes can bury the animals and embed them deep in the earth. Some rocks and organisms that transformed to show fossils for years and decades were actually deposited within a short period of time.

Although Darwin based his arguments heavily on fossil record, most scientists now believe that fossil record is actually incompatible with evolutionary theory as no transitional links or intermediate forms have been discovered among this huge collection of fossils in all these years. This suggests that there is no real evidential data that the theory of evolution is in fact true. There is no evidence of partially evolved species or intermediate forms either in the past or in the present fossil record and the fossil record available is quite representative of all fossil data that will ever be collected. Evolution seems to point out towards more undefined and partially evolved species, fact completely undermined by available fossil record that shows well-defined organisms rather than gradual gradations. The incomplete fossil record is the primary bone of contention in the evolutionary debate and seems to give an edge to non-evolutionists.

Conclusion:

Considering all the aspects of the debate and gaps in fossil records and weighing this against evolution theories highlighting either generational transformation of lineages or drastic changes and speciation at specific periods, we can conclude that available gaps in fossil record may be more indicative and supportive towards speciation and abrupt changes rather than gradual evolution through phyletic transformation.

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NHS Cervical Screening Programme: Liquid Based Cytology vs. Conventional Cytology
Introduction

Cervical screening, such as the regular programme provided by the NHS, is a very successful way of detecting the early signs of cervical cancer (Kitchener, Castle, & Cox, 2006). The NHS programme screens around 3.5 million (Moss et al., 2003) to 4 million (Karnon et al., 2004) women annually and it is estimated that this prevents between 1100 and 3900 cases of cervical cancer a year (Moss et al., 2003). In recent years a new way of screening the cervical samples has been developed. This is referred to as liquid based cytology rather than conventional cytology. However, there has been considerable debate over the costs and benefits of the new technology, as will be examined below.

Background Information

Cervical cancer is linked to human papillomaviruses (HPV), a family of common sexually transmitted viruses (Eifel, Berek, & Markman, 2011). It is believed to be fairly common for women to be exposed to HPV viral cells but usually these are readily cleared by their immune response (Bosch & Iftner, 2005). However, in some instances women can develop an HPV infection following exposure to viral cells. The infection can seem largely asymptomatic but actually causes the abnormal multiplication of cells in the cervix, leading to warts, lesions or benign tumours and, if the infection persists, it can cause cervical cancer (Bosch & Iftner, 2005; Eifel et al., 2011). In fact, HPV is believed to be the main, perhaps even the sole, cause of cervical cancer.

The NHS cervical screening programme is available to women aged between 25 and 64 years of age and involves taking a regular swab or smear of cells from inside their cervix (Moss et al., 2003). These are then sent to a pathology laboratory where they are screened by a cytologist for any abnormalities associated with HPV. In the absence of any abnormalities women between the ages of 25 and 50 years are advised to return for testing every three years, and those aged between 50 and 64, every five years (Health and Social Care Information Centre, 2013). The 2013 national statistics for the UK screening programme indicated that 78.3% of eligible women were up to date with their smear screening (Health and Social Care Information Centre, 2013).

Cervical Cytology

The focus of this essay is on the process that takes place in the pathology laboratory, where the cervical samples are sent for cytological screening. A cervical cell sample that has no abnormal cells is categorised cytologically as being negative (negative for the presence of HPV or risk of cervical cancer). Alternatively, samples may be identified as containing borderline abnormal changes, or having dyskaryosis (Health and Social Care Information Centre, 2013). In some literature the terms dysplasia or CIN (cervical intraepithelial neoplasia) seem to be used in place of dyskaryosis (Eifel et al., 2011), but NHS literature seems to make most consistent reference to dyskaryosis. The extent of dyskaryosis is then classified across a range from mild to severe. Depending upon the severity, the woman may be referred for colposcopy or recalled for a repeat cervical smear test 6-12 months later. In the 2013 national statistics, 6.5% of cervical samples were identified as being abnormal, although only 1.2% were classified as being high risk (Health and Social Care Information Centre, 2013).

Recently a new cytological screening technique has been developed, called liquid based cytology (LBC). The aim of this new method was initially to try to reduce false-negative and false-positive results (Karnon et al., 2004; Siebers et al., 2009), as well as the number of samples that are ‘inadequate’ or ‘unsatisfactory’ for effective screening (Arbyn et al., 2008; Siebers et al., 2009). In the conventional cytology method, a woman’s cervical sample is transferred directly from the collection spatula onto a microscopic slide (Arbyn et al., 2008; Moss et al., 2003). This transfer process seems to sometimes lead samples to be ‘inadequate’ for screening because the transferred cells are too difficult to clearly discern. This manual process does also, very occasionally, result in false results, even when conducted by experienced cytologists. The liquid based cytology (LBC) method involves a slightly different approach to the preparation of the slides. The cell sample is placed into a vial containing a preservative fluid (Arbyn et al., 2008; Moss et al., 2003). This creates a liquid suspension of the sample, which can then be poured onto the slide in a very thin, uniform layer. However, debate remains over whether this method really offers a substantial improvement over conventional cytology. The main points of contention surround accuracy and cost effectiveness, with other arguments relating to patient anxiety and opportunities for HPV testing.

Exploring the Issues
Accuracy

Evidence is mixed over whether LBC offers a substantial improvement in accuracy compared to conventional cytology. Early studies, such as that by Monsonego et al. (2001), were very favourable towards LBC. Further, in an extension of the LBC technique described earlier, it became possible for a computerised system to read the LBC slides to identify potential areas of concern prior to examination by a cytologist (Davey et al., 2007). Across a large Australian sample of over 55,000 women, Davey et al. (2007) found that this method of LBC was significantly better at detecting additional high grade histology cases than conventional cytology. However, more recent studies seem to undermine these reputed improvements of LBC over conventional cytology. For instance, in 2009, Siebers et al, drawing upon a sample of close to 90,000 women in the Netherlands, concluded that LBC “is neither more sensitive nor more specific in detecting CIN or cancer” (p.1764). This same point is reiterated almost exactly by Arbyn et al. (2008) at the end of their thorough review of the most reputable, gold standard comparison studies.

Whilst this creates a somewhat inconclusive picture, it is evident that LBC has not offered as marked an improvement in accuracy as might have been hoped. However, it is important to point out that none of the studies suggest that LBC is less accurate than conventional cytology. In fact, all of the studies mentioned above agree that LBC probably is more sensitive at picking up mild abnormalities and changes. It is just that this too is framed from a negative angle in the more recent studies because of concerns that unnecessarily following up these cases, when they are likely to be cleared by the patient naturally, would waste resources that would be better focused on high risk patients (Arbyn et al., 2008).

There is, however, one clear point that emerges in favour of LBC in relation to accuracy. All studies seem to conclude that LBC does reduce the number of inadequate or unsatisfactory samples (Arbyn et al., 2008; Davey et al., 2007; Doyle et al., 2006; Moss et al., 2003; Siebers et al., 2009; Williams, 2006). For example, when LBC was initially trialled at three sites in the UK in 2002, Moss et al. (2003) collated data showing that LBC reduced inadequate slide preparations from 9% of samples down to 1-2%. In Scotland the difference was even greater, falling from 13% to 1.9%, and consequently referrals to colposcopy for women with repeated unsatisfactory results dropped from 25% to just 0.5% (Williams, 2006). These improvements substantially raise the efficiency of the whole screening programme. Therefore, it seems likely to have been these sorts of results that influenced the NHS that it would be cost effective to adopt LBC across the UK (Arbyn et al., 2008; Moss et al., 2003; Williams, 2006).

Cost Effectiveness

Turning to cost effectiveness, there are a number of aspects to take into consideration. As mentioned above, LBC may lead to a potential increase in costs if there is an increase in following up low risk abnormalities. Whilst this is framed negatively by Arbyn et al. (2008) it might be better, both for the patient and economically, to fully confirm that there is no cancer risk earlier on, rather than allowing any potential cancer to develop. Further, the significant reduction in inadequate samples may outweigh this through much larger potential savings. Reducing the number of women who are recalled due to an inadequate sample saves valuable nursing time, reduces administration costs and reduces the costs associated with repeating the whole procedure. With these primary care benefits in mind, Moss et al. (2003) estimated that LBC could generate savings of between one to ten million pounds annually.

More recent studies have focused on the laboratory to consider whether LBC improves productivity during this part of the process. Doyle et al. (2006) studied several laboratories during the change over from conventional cytology to LBC and found that on average each scientist was able to process more samples per day. The data collated by Williams (2006) similarly demonstrated that overall workload in the laboratories decreased and backlogs were cleared. Presumably, if LBC is combined with the computerised imaging technology that automates a large part of the process, there may be further efficiency as cytologist time and effort can be focused on the samples identified to contain abnormalities.

Of course, all of this economising does not take into account the initial investment costs involved, or the on-going cost of the LBC specific materials. It is notable that both techniques mentioned in the NHS pilot study, ThinPrep and SurePath, are registered trademarks. Perhaps this is why more recent studies tend to argue that one of the disadvantages of LBC is that it is more expensive, both in terms of initial outlay and on-going operating costs (Arbyn et al., 2008; Eifel et al., 2011). Therefore, Arbyn et al. (2008) suggest that “economic advantage might be peculiar to the United Kingdom where inadequacy rates for the conventional Pap were excessively high” (p.175).

Patient Anxiety

Beyond economics, another important point to consider is patient anxiety. A benefit of reducing inadequate samples is the reduction in anxiety for the patient. Although the nurse may try to reassure the woman that an inadequate sample does not indicate any abnormality, it may be difficult for the patient not to fear a risk of cancer. On the otherhand, if minor abnormalities picked up via LBC are followed up, as Arbyn et al. (2008) suggest, this might create unnecessary stress and anxiety for these patients and their families. This seems to suggest that between the two technologies patient anxiety may balance out – being alleviated for some patients or created for others. However, perhaps the balance swings in favour of LBC here, as it would seem preferable to monitor cases of mild abnormality just in case these progress, rather than to create unnecessary anxiety due simply to technical inferiority.

HPV Testing

The other key advantage of LBC is the potential it offers to conduct additional laboratory tests. Preparing an LBC slide from the cervical sample uses only a small amount of the solution in the vial. Therefore, the remainder can be subjected to further tests. In particular, it is now possible for laboratories to test for the presence of HPV using HPV DNA testing (Kitchener et al., 2011). Any cases showing cell abnormalities during LBC can undergo HPV testing on the same sample. This might clarify any false-negative cases or mild abnormalities without the woman even knowing. It would also reduce the costs of referring false-negative patients for colposcopy or for an unnecessary recall screening.

Whilst controversy has largely focused on conventional cytology and LBC, the NHS actually introduced LBC in combination with HPV testing (Moss et al., 2003). Recent studies have demonstrated that HPV testing may be more powerful than cytology, and suggest it may come to replace cytology as the primary screening technique (Katki et al., 2011; Kitchener et al., 2011). Katki et al. 2011 advocate that one negative result via HPV testing offers “strong reassurance against cervical cancer for five years in women from age 30” (p.1470). This could significantly reduce primary care costs as currently women aged 30-50 are tested every 3 years under the NHS screening programme. Kitchener et al. (2011) have gone further than this, suggesting that HPV testing might even allow the interval between cervical screens to be extended to every six years.

Conclusion

There has been significant debate around the shift from conventional to liquid based cytology when screening for cervical cancer. This has been particularly heightened given the evidence that LBC does not appear to reduce false-positive or false-negative results in the way that had been hoped. However, in the UK at least, LBC significantly reduces the number of ‘inadequate’ samples, reducing primary care costs and patient anxiety in these cases. Although it is a little unclear whether LBC is more cost effective when all costs are taken into consideration, it seems that by investing in the technique the NHS is now well placed to quickly and easily adopt new scientific developments, such as wide-scale HPV testing. Given LBC, HPV DNA testing and the HPV vaccination, cervical cancer prevention seems to be a rapidly advancing area of science where new developments progress fairly quickly from research into routine health practice. Therefore, it seems wise that the NHS chose to invest in LBC and HPV testing when it did so that it can keep apace, and continue to offer cutting edge cancer screening to women.

References

Arbyn, M., Bergeron, C., Klinkhamer, P., Martin-Hirsch, P., Siebers, A. G., & Bulten, J. (2008). Liquid compared with conventional cervical cytology: A systematic review and meta-analysis. Obstetrics & Gynecology, 111(1), 167-177.

Bosch, X. F., & Iftner, T. (2005). The aetiology of cervical cancer. Sheffield: NHS Cancer Screening Programmes.

Davey, E., d’Assuncao, J., Irwig, L., Macaskill, P., Chan, S. F., Richards, A., & Farnsworth, A. (2007). Accuracy of reading liquid based cytology slides using the ThinPrep Imager compared with conventional cytology: prospective study (Vol. 335).

Doyle, B., O’Farrell, C., Mahoney, E., Turner, L., Magee, D., & Gibbons, D. (2006). Liquid-based cytology improves productivity in cervical cytology screening. Cytopathology, 17(2), 60-64.

Eifel, P. J., Berek, J. S., & Markman, M. A. (2011). Cancer of cervix, vagina, and vulva. In V. T. DeVita, T. S. Lawrence, & S. A. Rosenberg (Eds.), DeVita, Hellman and Rosenberg’s Cancer: Principles & Practice of Oncology (9th ed.). Phildelphia: Lippincott, Williams & Wilkins.

Health and Social Care Information Centre. (2013). Cervical screening programme, England 2012-13. Leeds: UK Statistics Authority. Retrieved from http://www.hscic.gov.uk

Karnon, J., Peters, J., Platt, J., Chilcott, J., McGoogan, E., & Brewer, N. (2004). Liquid-based cytology in cervical screening: An updated rapid and systematic review and economic anylsis. Health Technology Assessment, 8(20).

Katki, H. A., Kinney, W. K., Fetterman, B., Lorey, T., Poitras, N. E., Cheung, L., . . . Castle, P. E. (2011). Cervical cancer risk for women undergoing concurrent testing for human papillomavirus and cervical cytology: a population-based study in routine clinical practice. The Lancet Oncology, 12(7), 663-672.

Kitchener, H. C., Castle, P. E., & Cox, J. T. (2006). Chapter 7: Achievements and limitations of cervical cytology screening. Vaccine, 24, Supplement 3(0), S63-S70.

Kitchener, H. C., Gilham, C., Sargent, A., Bailey, A., Albrow, R., Roberts, C., . . . Peto, J. (2011). A comparison of HPV DNA testing and liquid based cytology over three rounds of primary cervical screening: Extended follow up in the ARTISTIC trial. European Journal of Cancer, 47(6), 864-871.

Monsonego, J., Autillo-Touati, A., Bergeron, C., Dachez, R., Liaras, J., Saurel, J., . . . Mottot, C. (2001). Liquid-based cytology for primary cervical cancer screening: a multi-centre study. British Journal of Cancer, 84(3), 360-366.

Moss, S. M., Gray, A., Legood, R., & Henstock, E. (2003). Evaluation of HPV/LBC cervical screening pilot studies. UK: First report to the Department of Health evaluation of LBC (December 2002).

Siebers, A. G., Klinkhamer, P. J. J. M., Grefte, J. M. M., Massuger, L. F. A. G., Vedder, J. E. M., Beijers-Broos, A., . . . Arbyn, M. (2009). Comparison of liquid-based cytology with conventional cytology for detection of cervican cancer precursors. The Journal of the American Medical Association, 302(16), 1757-1764.

Williams, A. R. W. (2006). Liquid-based cytology and conventional smears compared over two 12-month periods. Cytopathology, 17(2), 82-85.