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Breaking the Poverty Cycle in Africa-the Case of Infrastructure Investment

Infrastructure investment and democracy as a form of government in Africa is the only solution to Africa's underdevelopment and impoverishment. The continent is lagging behind all the continents in the world in terms of economic and social development. All the countries making up the African continent have similar economic problems namely unemployment, higher deficits, poor state of economic and social infrastructures including roads, harbours, education, airports, telecommunication, health and sanitation.

Centuries of slavery and colonialism deprived the continent of her able human and economic resources. Where as the able men and women were carried away to work in the plantations of the Americas (in all about 30 - 40 million), the natural resources where looted by the European countries namely Belgium, Britain, France, Germany, Portugal, Spain and Italy. After slavery was abolished the looting of the natural resources continued. The irony is that virtually all the income from these resources was used to finance the economic and the infrastructural development of the European countries with little or nothing used to develop the various countries where these resources came from. A clear example is the case of Democratic Republic of Congo where King Leopold II of Belgium enslaved the Africans, forced them to work without pay, killed about 10 million and looted the country of her resources and virtually nothing was used to invest in the country except guns which the Belgium army used to kill the Africans. When the DRC was transferred from Leopold II to the Belgium state the looting and killing continued till DRC gained her independence in the 1960s. In fact DRC (Congo Free State) was the main supplier of rubber a vital raw material for the tyre industry and all the money from the sale of the rubber went to Belgium. King Leopold II was able to transform Belgium as one of the poorest countries in Europe into one of the wealthiest courtesy the enslavement and looting of Africans and their resources.

Belgium was not alone in what they did to the continent. Britain, France, Spain, Portugal, Germany and Italy all looted Africa of her gold, diamond, ivory, timber, cobalt, and all the minerals you can think of. The Africans who resisted the illegal activities were killed in their millions as happened in South West Africa (now Namibia) where the Germans in 1904 to 1907 committed the first genocide of the 20th Century by killing the Herero and the Namaqua people. While Europe became richer Africa became poorer and the trend continued till the 1950s when the African countries started to gain their ‘independence’beginning with Libya in 1951, Sudan, Morocco, Tunisia all in 1956 and Ghana in 1957.

With little or no investment in the continent the various post colonial governments inherited countries with practically no infrastructure: roads, rails, harbours, telecommunications, education, health and sanitation and airports. The only areas which saw some few infrastructure investments during the colonial days were those where raw materials were heavily extracted. The attainment of independence did not come on silver Plata. Algeria, Zimbabwe, Angola, Kenya, Namibia and to some extent South Africa all attained their independence from their colonial masters through arm struggles and in most cases the few infrastructures that existed were destroyed due to the conflict.

As if slavery, colonialism and the looting of the continent's resources were not enough the continent became a battle ground during the Cold War as the two super powers and their allies battled for influence and control on the continent mainly for her resources. As a result many African governments who were deem to be pro-Russia or America were overthrown using the military. A case in point was the overthrow of Dr. Kwame Nkrumah of Ghana on February 24th ,1966.Another example is the overthrow and assassination of  Patrice Lumumba of Congo on January 17th 1961.Other leaders such as Nelson Mandela were imprisoned for either advocating for independence or improvement of conditions of Africans.  CIA and the western intelligence community have been implicated for engineering the assassinations and overthrow of elected leaders of Africa. For example Larry Devlin, the CIA Station Chief in Congo during Patrice Lumumba’s  days spoke to Washington Post in December 2008 saying he refused an order to assassinate Patrice Lumumba but his refusal did not stop the CIA and the Belgium government from overthrowing and assassinating him. The assassination attempt on Gamal Nasser of Egypt on 24th October 1954 and the assassination of President Anwar Sadat in 1981 were alleged to be the work of Britain M16 due to their refusal to hand over the administration of the Suez Canal the British.  The CIA, KGB and their allies encouraged and financed wars and political instabilities throughout the continent. Angola became the battle ground for the CIA, KGB and the Chinese as each tried to gain control over the country, her people and resources. The civil war that engulfed the country in 1975 only ended in 1991 after 26 years of conflict. When the war ended the few infrastructures that remained after the war of independence (1961-1974) were gone.

The product of these assassinations and coups were the political instabilities and the wanting destruction of lives and property including infrastructures that have bedevilled Africa till today. As the elected leaders of the continent were assassinated, overthrown and subjected to all forms of cold war tactics including bribery, arm twisting and blackmail the continent degenerated and faulted on all aspects of human endeavour. The new crop of leaders who replaced the post colonial independence leaders and who were largely puppets of the European and American governments became increasingly authoritarian and corrupt. Joseph Mobutu Seseseku who became the choice of the Americans after they help to assassinate Lumumba ruled Congo for 32 years and in those years the country became poorer as Mobutu and his cronies got richer and the western countries notably USA and her allies had free hand looting the mineral resources most importantly cobalt a very important mineral needed for missile development. Little infrastructure activities was carried out by Mobutu. As a result Congo today can only be accessed by boats and canoes mainly through the River Congo.

As tyrants and dictators gained the support of western governments and did whatever they wanted with their economies without questions their people became poorer and hopelessness and desperation were the hallmarks of their lives. As the little money that came into government coffers were taken by corrupt government officials and civil servants there were almost no money to carry out infrastructural development and the poverty deepened. Poverty, desperation and hopelessness visited the people and coupled with their inability to change their leaders democratically, dissents were sowed among the population which serve as breeding grounds for more coups, civil wars and civil disturbances. This was evidence in Ghana, Nigeria, Niger, Ivory Coast, The Gambia, Liberia, Mauritania, Algeria, Gabon, Togo, Cameroon, Equatorial Guinea, Guinea Bissau, Central Africa Republic, Chad, Sudan, Ethiopia, Uganda and Sierra Leone all experienced coups in the 1960s, 1970s, 1980s and even in the early 1990s. These waves of coups were followed by civil wars that hit Liberia, Sierra Leone, Ivory Coast, Congo, Chad, CAR, Somalia, Uganda, Sudan, Angola, Niger and Guinea. These wars apart from it human cost also contributed to the destruction of roads, harbours, airports, rail lines, telecommunications, hospitals, schools and many more. With the absence of infrastructures the countries have been unable to make any headway in terms of economic development. To reverse centuries of slavery and colonialism on one hand and decades of coups and civil wars on the other hand, governments should focus their attention on building the infrastructures on the continent.

This is because the state of infrastructures on the continent is nothing to write home about: the roads, harbours, telecommunications, health, education, market and airport are either none existence or are in a state to appalling to describe. We have neglected the few that have existed to decay yet we have forgotten that no continent or nation no matter the size of the natural resources that she has can develop without investing in infrastructure. That is why Democratic Republic of Congo has every mineral you can think of yet they are one of the poorest on the continent. That is why Malaysia, Korea, Taiwan, Singapore, Hong Kong have developed and that is why President Elect Obama  is talking about building US infrastructures because they are the engines that run the economy. You cannot export if you do not have harbours and airports to support it. You cannot attract tourists if you do not have airport, hotels and other infrastructure that support it. You cannot move goods from centres of production to centres of consumption if you do not have roads, rail lines and inland water infrastructure to deliver it. You cannot supply the industries with doctors, architects, bankers, lawyers, planners, engineers, teachers, nurses if you do not have the educational infrastructure to deliver it. And you cannot run an efficient and vibrant economy if you do not have the energy and telecommunication infrastructures in place. Africa has been experiencing serious disruptions in the energy sector for years and no government has seen any wisdom to solve. As a result factories are folding up and are laying off workers and we are waiting for nature to help fill our dams before we rectify the problem. Could these do nothing approaches to problem solving help our continent and nations to develop? What are we doing with the abundance of sunshine on the continent? We have not taken advantage of it, have we? We have sunshine 365 days and we have not tap into solar energy which is cheap and more reliable than hydro. It is another indication of the useless institutions that we have and lip service paid by the various political parties and their leaders to development. Look around yourselves and see if any of the goods you see are made in Africa. I mean the mobile phones, computers, televisions, cars and all the flashy things that Africans are crazing for. It is sad to note that almost all the raw materials needed to build these mobile phones, cars etc are obtained from countries on the continent.

To appreciate the importance of infrastructure as the bedrock of the continent’s development let us consider transportation infrastructure in a country for example. The development of every country is strongly dependent on a reliable transportation infrastructure system for internal transportation and for linking rural communities to market centres. The role of infrastructure to the economy of a nation cannot be overemphasized especially its effect on sustainable development, GDP growth, inflation, and poverty reduction. Efficient and effective provision of transportation infrastructure in a nation underlines all attempts to reduce poverty.

Transportation infrastructure plays essential role by unifying all sectors of the economy including agriculture, health, education, trade, industries, and services. It is therefore said that transportation is the life wire of the economy. Without transport infrastructure social and economic activities and development in general will stagnate. Transport infrastructure ensures that raw materials are brought to the factory, while industrial finished goods are also distributed to market centres and communities where they are mostly needed. Agriculture commodities such as food crops are made available to urban dwellers through roads, rails, airports and harbours. Transportation infrastructure also ensures that services produced elsewhere are available where they are needed and at appropriate time.

Transportation infrastructure again makes the administration of political entities such as districts, boroughs and regions easy because it provides access to social infrastructural facilities such as schools, clinics, hospitals, markets, security services, and administrative offices. Transportation infrastructure has a correlation in the improvement of the overall living standards of people living in both rural and urban communities. It improves the quality of life of the people and has added advantage of ensuring rapid growth and sustainable development and has a long run effect of alleviating poverty.

In areas where transportation infrastructure facilities are unavailable or have deteriorated in the   serious difficulties are encountered in the production, distribution and marketing of goods and services. Such situations also have negative implications for the patronage of goods and services produced as well as usage of such facilities such as clinics, hospitals, markets, and schools. This has a negative repercussion on the state and quality of life of the people affected by such situations as well as a down trodden effect on production and productivity levels in the areas where the transportation infrastructure condition is bad. It is a well recognized fact that transportation infrastructure and for that matter all infrastructure investments have correlations in development and hence the standard of living of the people.

 To move the continent away from its current predicament, public transportation infrastructure works should be carried out by all governments. Fast speed rail lines should be constructed to link the various parts of the continent. This will make the transport of bulky raw materials and goods easier. Roads should be constructed to make transportation less difficult.  River Nile which is the longest river in the world should be developed as a major internal water transportation network so that goods could be transported up and down the stream. The other major rivers such as the Limpopo, Zambezi, Congo, Niger all should be developed to make it possible for goods and people to move easily. Every effort should be made to develop the technology that will harness the solar energy potential of the Sahara Desert so as to make access to energy easily. 

Major harbours such as those in Durban, Cape Town, Lagos, Tema, Mombasa,  Port Said, Tunis, Tripoli and Benghazi should be developed be expanded if necessary and every effort should be made to remove every administration bottleneck and bureaucracy that will cripple trade and development. The airport infrastructure should be developed to make it easier for people to move with ease throughout the continent. The international airports in each country should be expanded if need be and should be equipped with modern technology to make less cumbersome for passengers to go through. Besides bureaucracies, administration bottlenecks, delays that inhibit easy flow of people should be eliminated. Therefore there should be a common immigration policy which is well streamlined to take care of the people. The benefit of transportation investment is enormous and therefore should be given a priority.

If we can benefit so much from transportation infrastructure then how about our education sector upon which the development of the continent and our nations rest? The education infrastructures on the continent and in our nations have not been developed. Have they? Look at the world ranking of Universities and see where the first university on the continent falls. Can we afford to develop the continent and our nations with low quality graduates not to mention the millions of illiterates and semi-literates that roam around the continent and in our countries? Of the about 9,760 Accredited universities in the World, less than 10 universities were able to make it the top 500 and even those that made it about 90% came from South Africa which is the most developed country on the continent (source: topuniversities.com). It is abundantly clear that our education system is not producing the architects, engineers, planners, bankers, lawyers, doctors, teachers, social workers, nurses and the scientists that we need in the 21st Century. That is why every major architectural and engineering activity on the continent is undertaken by foreigners and foreign companies especially from USA, Japan, China, India and Europe. And any continent and for that matter any nation that depends on foreign expertise for her survival is doom to fail in the long run.

The Universities lack well trained lecturers. They lack modern facilities such as state of the art libraries, laboratory simulation facilities, studios, computers, and books. They lack them because we cannot build them; we cannot build them because the curricula have not prepared our students to build them. As a result we have to import the equipments and books from countries that have done their home work well and have invested heavily in education notably in science and technology. In many of our universities, Polytechnics and secondary schools lecturers/teachers are still teaching students the same way the 19th century academic institutions taught forgetting that we are in the 21st century. The same notes given a final year student four years ago are still being given to first year students with no addition and subtraction.  Lecturers cannot write books for students because they do not have the resources to carry out research that form the basis of any academic material.

Whereas students in advanced countries get their hands on books immediately they are released those on the continent have to wait 4 years or even more to get the same books. What is more the academic facilities including libraries are in a state too appalling to describe. Not a single of our universities can boast of more than two million volumes of books in their libraries. Even the few books that they have are so old that information contained in them are useless. Very few books have been published by Africans. Due to this most students have to rely on the notes that lecturers give them. This is state of our universities and the little I say about our Polytechnics and secondary schools (High Schools) the better. Our research institutions have achieved very little because they are underfunded and the researchers do not have the expertise and the facilities to carry out any meaningful research. A case in point is Cocoa Research Institute of Ghana (CRIG) located at New Tafo in the Eastern Region of Ghana. Despite decades of its existence Ghana still exports raw cocoa beans for peanuts. No value has been added to the cocoa. CRIG has not been able to come up with other ways in which to use the beans to benefit Ghanaians despite the mounting evidence that the beans have several potential uses. In order to make Africa continent and the governments should make education a priority. They should as matter of urgency and of necessity invest in educational infrastructure.

In addition to these institutions of higher learning should be structured to produce engineers, doctors, lawyers, bankers, sociologists and all the various human resource needed for nation building. Exchange programmes should be established between the institutions and universities on the continent so that students on the continent could meet, interact and share ideas. Every effort should be used to raise the learning and quality of learning on the continent. Effort should be made to attract Africans in the Diaspora to come and share their expertise with their colleagues and contribute their knowledge towards the development of the continent.  Research institutions should be established across the continent and funding provided to them to come up with how the various natural resources on the continent could be used to benefit the people. With the right human resource capacity Africans could now embark on their journey of liberating her people from poverty

How about the state of the housing infrastructure? A visit to any village or town gives the same picture of poor housing and poor quality of public service. People are living in mud/thatched houses with bamboo or raffia leaf as roofing sheet with no electricity, potable water and clinics. They live in a subsistence environment without social security, health insurance and are condemned to poverty, desperation and hopelessness. Those living in urban areas are without jobs, without mortgage, and face high utility bills with poor service. They face constant barrage of water and energy disruptions everyday. In every country, region, district the situation is not different. On the other hand our MPs, ministers, vice presidents, the presidents and political leaders, their cronies and families live in total luxury with mansions, SUVs, bodyguards, fat salaries, fat bonuses, house servants and they have all the resources of the continent at their disposal. Yet they claim to be serving the people. How can it be? Governments should invite the private sector to take part in the delivery of housing. Land and other service infrastructure such water, electricity and waste management should be provided to make it less difficult for the private sector to join.

Look at the state of the agricultural sector. How many of our farmers have their own tractors and farming equipments to produce beyond the level of subsistence? Virtually none. Nearly all the important equipments needed to make the agric sector viable and productive have to be imported and how many of our farmers have their own resources to buy even the basic machinery to expand their farms? Although we are in the 21st Century yet our farming practices indicate that we have still not moved beyond the 19th century. This is the more reason why we continue to hunger even though rich soils abound in Africa. During the early part of the 2008 financial crisis violence broke out in Egypt, Sierra Leone and in many other countries on the continent. Why is this so? The answer is we have neglected the sector for quite too long. Farmers have no access to irrigation which can make farming all year round possible. They have to rely on nature for rain before they can start planting. They have no access to credits could help them to expand their farms. Yet Ethiopia for example could afford millions of dollars to buy military hardware while famine threatens to annihilate her people. She cannot afford tractors and irrigation equipments that could help put food on the table and bring back her people’s dignity. Lack of agricultural infrastructure has brought famine to millions on the continent. There are no silos for storage during bumper harvest. No roads to producing areas. We under utilise our land for lack of political commitment. We cannot develop our economies if we fail to invest in infrastructure.

Besides, trade among the countries should be encouraged at all levels. Africans must know that together they stand or fall and therefore the old politics of former colonial master first and neighbours second should be discouraged and stopped straightway.  This is the more reason why it is so important that these countries trade among themselves, develop their market, share their resources so that the lives of their citizens will improve. The continent should not be allowed to serve as the dumping ground for European manufactured goods. Import substitution industries should be adopted widely on the continent and trade should be encouraged at all levels. The era where raw materials with little added value are exported for peanuts should be given the boot. As the Americans used to say to the Japanese‘if Japan wants a share of the American market then their goods should be manufactured right here in America. The same yardstick should apply to any company or country that wants a share of the African raw material.

All national interests should give way to a common interest for the good of the people on the continent and the allegiance and influence of outside bodies should be treated as detraction. Africa and her people must be given a serious consideration in all matters of economic, social and political developments. The old philosophy of selling out the continent to international cartels and corporation should be given the boot. Africans should know that the Europeans, Americans and their Bretton Wood Institutions have no interest to see them develop at best they would rather that slavery and colonialism were back.

The above mentioned issues should be given a priority if Africa is to break away from the cycle of poverty which the people have endured for decades if not centuries.   

Hope that the 21st Century will be different for the continent. Hope that infrastructure building will be given a higher priority by the various African Union members.

About the Author

Lord Aikins Adusei

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Managing In A Strategic Business Context-Consultancy Report

Introduction

Mersey Care NHS Trust was established with the aim of streamlining the healthcare system. In the 1980’S healthcare was not well organized, the government used to provide funding to doctors and practitioners directly to cater for provision of healthcare services. But this system was overwhelming as more and more people kept waiting for a chance to gain access to healthcare services. This was the reason why the idea of trusts arose. The first NHS trust was established in the year 1991 and its purpose was to fund healthcare. This is still the main aim up to present day and applies to Mersey Care NHS Trust. (Katherine, 2002)

Environmental factors affecting the industry

This shall be examined using the STEEPLE analysis as shown below

Social factors

When Mersey Trust intends on making severe changes in its provision, structure and any other aspects, it needs to consider the community; these are the main beneficiaries of decisions made by the trust. The NHS Trust under study has to put in mind that the number of patients is increasing and more needs to be done to reduce waiting times and quality of health care provided to these increasing numbers. They need to ensure that patients have been adequately catered for. (Katherine, 2002)

Staff members need to be incorporated in any changes that the Trust intends on undertaking. It should be aware that changes in staff payments or employee conditions are to be kept at minimum in order to reduce friction and possible confrontations that have been seen in the past from similar NHS trusts.

The Trust has to face conflicting roles. It has to fulfil its humanitarian aspect of helping out those who need assistance in terms of health care. In addition, it also has to deal with the fact that it still has to consider market forces during its commissioning activities. This can prove to be a rather daunting task. (Legge, 2004)

Technological factors

The Trust has to include technological advancements in its administration. Technological advancement should also be incorporated in the organisation’s information system so that accountability and good governance are promoted.

Economical factors

Mersey Care has to deal with the increased competition among providers that has arisen after a number of independent health Care service providers have been given the mandate to provide their services to patients. Also, there have been some treatment and diagnostic centres that have been commissioned. This means that the Trust needs to focus highly on commissioning activities. (Black, 2003)

There are a number of partners that are involved in health care provision. These need to be incorporate into the management of the Trust. Policies within the organisation should be such that they promote partnerships that are already in existence or those that will be made in the future.

Political factors

In the year 2005, the NHS Commissioned a patient led trust. This means that Mersey Care has to adjust to this new reform as described in the Department of Health, (2005). Besides this, the trust has to deal with recent government pronouncements that there should be more third sector contributors in statutory services. This implies that policies taken up by Mersey Trust need to be in line with these stipulations i.e. they should be contestable and plurality should be reflected in their policies. (Phegan, 2000)

Legal factors

The trust must also be careful when deciding who will procure health services as their decisions can be challenged in Court. This was emphasized when a Trust Care similar to Mersey was taken to court by a patient following the patient’s dissatisfaction with the bidder chosen; the bidder was United Health Europe Limited.

According to the Health and Social Care Act passed in the year 2001, NHS trusts need to engage in a lot of consultation prior to reorganisation of service provision or before testing new services in the market. If Mersey Care plans on doing this, then

The organisation has to consider legal issues when deciding in a provider who will procure health services. The Trust has to make sure that the group they have in mind is a legal entity and that they have fulfilled all the legal obligations required for any health service provider

Environmental factors

The trust has to get involved in projects that are geared towards restoring a safe environment. Some of the projects that can be undertaken by the Trust include cleaning projects as part of an endeavour to give back to the Community.

How external factors impinge on business strategies and suppliers.

The main factor affecting the strategy of Mersey Trust is political in nature. The government stipulated that there should be more involvement of the public in the NHS. Mersey has to act in compliance with this requirement. The organisation has adopted a strategy that involves more of the public in policy decisions.

The Trust has a forum for addressing complaints through the Complaints procedure. Besides this, patients can be able to contribute their ideas concerning plans to be implemented by the Trust. Sometimes, the Trust asks members of the Public what their opinion is through questionnaires and interviews it was also seen that some parts of the Trust involve users in improvement of services. However, there is sill a lot that can be done in this area. (Murray, 2003)

This strategy is quite an appropriate one because it contributes towards quality improvement. The purpose o the Trust was to cater for patients’ health care and when they are involved in the process then the Trust is able to get first hand information as to what is required to satisfy the end consumer.

Potential contribution to be played by personnel and development function during intensified competition

Personnel can involve themselves in development functions through a variety of ways. The first one being that they can increase their responsiveness. This can be seen during increased patient demands. Employees can increase effectiveness and efficiency during times of intensified competition. (Hill and Jones, 2001)

Staff can also play their part in development through involving themselves in training programmes. Professional education is crucial in this kind of scenario.  It will increase their professional competence and will make them better equipped to deal with increased rivalry.

Lastly, personnel can also play their part in development through involvement in innovative ideas and practices. Innovation is vital in improving how services are delivered. Personnel should always be engaged in the process of service redesign and improvement. This will give the organisation an added advantage compared to other competitors who may be used to conventional means of service delivery.

Marketing policy and methods adopted by the organisation and whether they support the business strategy

The main marketing policy that has been used by the company is through public relations. Public relations entail creating positive relationships with the public through communication pathways. (Dopson, 2003) This covers notifying the public about a company through editorials in the media. It also entails assessing media outlets for statements about services offered by the company or other issues concerning the company. Mersey Care has also promoted goodwill among their target market through programs, events, and charities for the community. Public relations are essential in marketing policy for the Trust because it makes up the company image and builds the product too. The advantage with the use of public relations is that when the media is mentioning the organization, it gives additional information about the Company thus selling their services.

This marketing policy supports the business strategy because it is in line with inclusion of the public in service provision by the NHS. (Hyde, 2004)

Style of organisational relationships adopted and whether it supports the business strategy

The Trust Care has set up an organisational structure which gives promotions based on experience and merit. In addition, good communication structure in the Trust has ensured that staff members easily and freely communicate to each other. Also management structure is quite effective such that the employees know what they are expected to do in the course of their duties and who their supervisors are. (Short ell, 1997)

All the above modes of organisational relationships are an appropriate style because they create an organisational climate that is conducive for patient service care which is the overall objective of the business strategy. (Handy, 1999)

Conclusion

Mersey NHS Trust has been affected by a number of external factors. There are use of technology in their administration, government regulations concerning the health sector, legal considerations when procuring health services and involvement of the public in their administration. The main one is involvement of the public in its running. This has changed the organisation’s business strategy. The organisation uses public relations as a marketing policy to enhance this business strategy it has also created good organisational relationships in line with this. This has been done through fair promotions, strong management structure and good communication. Lastly, employees take part in development through better training and increased responsiveness. (Katherine, 2002)

reference:

Department of Health (2005): NHS improvement plans: putting people at the heart of public services; a report by Department of Health

Hill, C. W and Jones, G. R (2001): Strategic Management. Houghton Mifflin

Black, R. J. (2003): Organizational Culture: Creating the Influence Needed for Strategic Success, London UK,

Legge, K (2004): Human Resource Management: Rhetoric and Realities. Anniversary Ed. Hampshire: Palgrave Macmillan,

Murray, ME & DiCroce, H.R (2003): Leadership and management in nursing, 3rd edition, Prentice Hall, New Jersey.

Phegan, B. (2000): Developing Your Company Culture; a Handbook for Leaders and Managers, Context Press,

Katherine, W. (2002): From County Hospital to NHS Trust: the History and Archives of NHS Hospitals; Harvard Press

Handy, C. (1999): Understanding Organizations fourth edition; Penguin

Short ell, S. (1997): Essentials of healthcare management; Delmar publishers

Hyde, j (2004): Managing and Supporting People in Healthcare; Bailliere Tindall, London International Journal of Healthcare Management

Dopson, S. (2003): Leading Healthcare Organizations; Pal grave Macmillan

Griffin, R (2005): Management, eighth edition; Houghton Mifflin; international Journal of public Sector Management

About the Author

Author is associated with SuperiorPapers.Us which is a global Research Papers and Term Papers Writing Company. If you would like help in Research Papers and Term Paper Help you can visit www.SuperiorPapers.Us

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Influence Of Internet Advertising On Traditional Media

Introduction

Traditional media should pave way for the new wave in advertising; the internet.

Today, Industry players agree that internet advertising is a force to recon with. According to research carried out by centre for research in electronic commerce, internet advertising is predicted to revolutionise industries in the 21st century. Economy of the internet continues to increase robustly. Many companies both new and well established continue getting profits through internet advertising. Internet advertising still has a big market which has not been tapped. As Hoffman & Novak (1996) points out its effects on industrial economy may be compared to what happened when the world shifted from agricultural to industrialisation in the 17th century. Since customers today want more information about a company and their services before buying its products or services then this mode of advertising is quite ideal.

Traditional media has been in place ever since time immemorial but technology has brought something fresh in the advertising industry. There are a number of reasons why traditional media was and still is being used by Companies. This does not undermine the importance of web advertising. All these reasons will be examined in detail in the subsequent sections of the essay.

Literature review

The decline of traditional media has been recorded by research companies and bodies conducting surveys. There are statistics that support the latter statement. Here are some sample findings to support this view;

Newspapers have recorded reduced circulation. In the US, newspaper sales have gone down by about three percent from what they were last year. This has been backed by the job cuts observed in most newspaper Companies in that country. Carr (2007) of the New York Times reports that the Los Angeles Times dismissed eighty five of its employees, the Philadelphia Inquirer eliminated five percent of its employees, and similarly the Chicago Tribune has eliminated one hundred of its staff members from its payroll. All the above findings go to show that there is serious decrease in the demand of this traditional medium implying that there must be an underlying factor causing the shift in preference; internet use and internet advertising.

There are increased sales of published materials placed on the internet. For example, articles written by well known columnists have been posted. These articles require subscription prior to viewing. The idea has received a very positive response from readers meaning that advertisements placed on those articles can also be viewed through these subscriptions.

In the United States, research has shown that close to ten million homes have digital video recorders. This means that these people can be able to send and receive images via the net. Companies using this mode of advertising will also be favoured because most people relate to it. It has been estimate that this number will increase by threefold within the next five years. Such statistics from the US give n indication of what is to follow in other developed countries including the United Kingdom.

It was also shown that print advertisements have reduced in terms of the kind of profits they generate. Currently they bring sixty six percent of earnings for Companies engaging in advertisement. The remaining percentage has gone to internet advertising. And judging by the looks of things, these percentages are most likely going to increase with time.

Online advertising has caused the decline of use of traditional media because there are some advantages it offers that are exclusive to that form of advertising. (Kilter, 2006) The first is that it is now possible to track sales that come from the use of online advertising. In other words, Complies can be able to monitor the effect of their efforts and quantify them. This is because it is very easy to measure the number of people that visit/click through a certain website containing advertising information and it is also easy to track the lead that followed a click on an online advertisement. This feature is something that is unique to that form of advertisement. Traditional media does not offer that option as estimates of who has viewed a given message and the effect it has on them is quite ambiguous. This is an essential aspect because businesses now want to gauge their return on investment. They now want to now whether a business undertaking like advertising yields the desired results.

Another feature that can only be found in online advertisement is ‘search based advertisement.’ It was found that in the year 2006, Google attributed forty percent of their profit to search advertisement while other forms of advertising for the Company like banner advertisement brought in thirty percent of earnings. This goes to show that there is a new aspect to this medium that is only exclusive to it. In this form of advertisement, consumers can be able to specify what they are looking for by the use of key words. This form of advertisement is important to both parties involved because Companies can be able to influence a customer’s choice to a large extent; when they are searching for advertisements, then they are very close to purchase and more advertising seals the deal. These consumers are spared from having to wait for an advert and can find it at their own convenience. Besides, companies can be able to track the effect of their advert more precisely.

Justification of study

The Pricewaterhouse and Coopers Company have done a survey on how online advertisements have been revolutionised. The results are that a huge percentage of expenditure on advertising is going online. This has been proved by the continuous rise in profits of well-known internet Companies like Google, Yahoo and MSN. It was seen that profits from online advertising has increased by thirty five percent in the year 2006; they are now standing at almost seventeen million dollars. This means that there are serious indications that advertisements on traditional media are declining but a quantifiable figure needs to be reached. This will form the bulk of the research work. (Flaming and Connor, 2006)

Indicative mythology

The research aims at the following;

• Estimating how many people are influenced by online advertisement
• Determine the percentage reduction in use of traditional media
• Determine perceptions of people with regards to online advertisement

The research will be done by mean of a questionnaire. There are a number of advantages that come out of use of this method of research; the first being that it is easy to quantify data as all the answers will lie within a uniform range. It is therefore easy to verify or nullify a given hypothesis using this method. The method allows researchers to lead on members under survey. This is because other research tools like interviews tend to generate answers that may dig race from what the researcher is looking for.

An investigation seeking online advertisers will be posted online from a given date to another. This will be for duration of about a month. The investigation will be tied to 150 Web advertisements and 15 advertisement oriented bulletin boards and a similar number for electronic mailing lists. Respondents will also include a survey from announcements forwarded to advertisement-oriented chat rooms and to bloggers who consented to send the survey URL. On top of this, a run on technique will be used where readers can automatically forward the survey to fellow readers when they want to. (Flanigan, 2004)

There are a number of research questions that will be asked in regards to this research. People surveyed will be asked to give information concerning how online advertisements influence their purchases. They will be asked to rate the degree to which an online advertisement caused them to purchase the item advertised. Their answers will lie within four points. The choices are;

• Never influenced by the online advert
• Somewhat influenced by the online advert
• Moderately influenced by the advert
• Influenced largely by the advert

Then the percentages will be added up and the overall result calculated. The word ‘influence’ in the questionnaire can be interpreted differently. This could mean getting an idea of a purchase, getting a reminder of the item and hence purchasing it or getting the immediate compulsion to but the item and actually purchasing it. (Perrier and Jeffay, 2002)

Questions will also be asked with regards to traditional media. The choices above will be the same ones asked in the latter part of the essay but this time, the questions will be in reference to five categories of traditional media. These are; cable television, newspapers, magazines, broadcast television and radio. All the numbers will be assigned to a specific category and overall percentages determined. If online advertisements yield the highest response in the ‘influenced largely category’ then it will certify that use of traditional media is declining

Timetable for research within twelve weeks

Duration

Activity

Week 1-2

Generate sample questions

Week 3-4

Get consent from Google and Yahoo

Week 5-9

Start  the survey and monitor responses

Week 10-12

Compilation of data and coming up with conclusion

Contingency plan

If it is impossible to get consent from the respective Companies, then another form of research shall be carried out. This will be through interviews of randomly selected people within the surrounding environment. The same questions will be asked as those ones in the questionnaire mentioned above, the only difference is that this will be done on a personal level.

Conclusion

Finally, Internet advertising for businesses has advanced into different sectors over time and it has continued to grow. (Hoffman, 2006) The most popular feature for this form of advertising is that it can offer a simple yet effective way of measuring returns on investments. It is considered that the internet has taken advertising to higher heights and this will be proved through the research findings.

Reference:

Hoffman, D. and Novak, T. (2006): Marketing in Hypermedia Computer-mediated Environments: - Conceptual Foundations: Journal of Marketing, Vol. 60(July), pp 50 - 68

Flanigan, G (2004). Internet Applications  New York publications

Kilter, P  (2006): Principles of Marketing: Stages of customer relationships.  4th European Edition Prentice Hall Harlow (UK)

Parries, M K. and Jeffay, F.D (Dec.2002); the proceedings of the 9th International workshop on internet interface elements

Flaming, L. and Connor B. (1999), Real-Time internet applications; Linux Journals pp

5-12

Mark, D. (2001): Principles and Practice of Marketing; 3rd Edition of Chartered Institute of Marketing, Washington, U.S

Connor, B. (1999), Internet advertisement; Linux Journals pp

5-12

Corr, R. (2005): Job cuts in traditional media; The New York Times (21st November 2005)

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