The Productivity of Information Technology Essay Example

The Productivity of Information Technology Essay THE PRODUCTIVITY OF INFORMATION TECHNOLOGY: Review and Assessment Erik Brynjolfsson CCS TR #125 December, 1991 This research was sponsored by the MIT Center for Coordination Science, the MIT International Financial Services Research Center, and the Sloan Foundation. Special thanks are due Michael Dertouzos and Tom Malone for encouraging me to pursue this topic as part of a study group at the MIT Laboratory for Computer Science. I would like to thank Ernie Berndt, Geoffrey Brooke, and Chris Kemerer for valuable comments and Marshall Van Alstyne and Peter Perales for excellent research assistance. Only I am responsible for any remaining deficiencies The Productivity of Information Technology: Review and Assessment Erik Brynjolfsson Abstract Productivity is the bottom line for any investment. The quandary of information technology (IT) is that, despite astonishing improvements in the underlying capabilities of the computer, its productivity has proven almost impossible to assess. There is an increasing perception that IT has not lived up to its promise, fueled in part by the fact that the existing empirical literature on IT productivity generally has not identified significant productivity improvements. However, a careful review, whether at the level of the economy as a whole, among information workers, or in specific manufacturing and service industries, indicates that the evidence must still be considered inconclusive. It is premature to surmise that computers have been a paradoxically unwise investment. A puzzle remains in the inability of both academics and managers to document unambiguously the performance effects of IT. Four possible explanations are reviewed in turn: mismeasurement, lags, redistribution and mismanagement. We will write a custom essay sample on The Productivity of Information Technology specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on The Productivity of Information Technology specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on The Productivity of Information Technology specifically for you FOR ONLY $16.38 $13.9/page Hire Writer The paper concludes with recommendations for investigating each of these explanations using traditional methodologies, while also proposing alternative, broader metrics of welfare that ultimately may be required to assess, and enhance, the benefits of IT. Keywords: Productivity, Computers, Performance measurement, Economic value, Investment justification. CONTENTS The Productivity Paradox A Clash of Expectations and Statistics . 1 Dimensions of the Paradox .. Economy-wide Productivity and Information Worker Productivity . . 7.. The Productivity of Information Technology Capital in Manufacturing 11 The Productivity of Information Technology Capital in Services . 15 Leading Explanations for the Paradox .. 19 Measurement Errors 20 Lags . 5 Redistribution .. 28 Mismanagement . . 229. 9. Con clusio. n.. 32 Summary . . . 32 Where Do We Go From Here? . 34 Tables and Graphs . .. 40 Bibliography . 4477. Information Technology and Productivity The Productivity Paradox A Clash of Expecta tions and Statistics The relationship between information technology (IT) and productivity is widely discussed but little understood. On one hand, delivered computing-power in the US economy has increased by more than two orders of magnitude in the past two decades (figure 1). On the other hand, roductivity, especially in the service sector, seems to have stagnated (figure 2). Given the enormous promise of IT to usher in the biggest technological revolution men have known (Snow, 1966), disillusionment and even frustration with the technology is increasingly evident in statements like No, computers do not boost productivity, at least not most of the time (Economist, 1990) and headlines like Computer Data Overload Limits Productivity Gains (Zachary, 1991) and Computers Arent Pulling Their Weight (Berndt Morrison, 1991a). The increased interest in the productivity paradox, as it has become known, has engendered a significant amount of research, but, thus far, this has only deepened the mystery. The results are aptly characterized by Robert Solows quip that we see computers everywhere except in the productivity statistics, and Bakos and Kemerers (1991) more recent summation that These studies have fueled a controversial debate, primarily because they have failed to document substantial productivity improvements attributable to information technology investments. Although similar conclusions are repeated by an alarming number of researchers in this area, we must be careful not to overinterpret these findings; a shortfall of evidence is not necessarily evidence of a shortfall. Nonetheless, given the increasing significance of IT in the budgets of most businesses and in the nation as a whole, continued investment cannot be justified by blind faith alone. Draft: 1/29/92 page 1 Information Technology and Pr oductivity This paper seeks to contribute to the research effort by summarizing what we know and dont know, by distinguishing the central issues from diversions, and by clarifying the questions that can be profitably explored in future research. After reviewing and assessing the research to date, it appears that the shortfall of IT productivity is at least as likely due to deficiencies in our measurement and methodological tool kit as to mismanagement by developers and users of IT. One can only conclude, as Attewell and Rule (1984) did in an earlier survey, that we still have much o learn about how to measure the effects of computers on organizations. While particular emphasis is placed on economic approaches to both theory and empirics in this review, it is hoped that the process of addressing the productivity mystery will prove to be a useful springboard for other methodologies as well and for examining the broader issues involved. As a prelude to the literature survey, it is useful to define some of the terms used and to highlight some of the basic trends in the economics of IT. Definitions: * Information technology can be defined in various ways. Among the most common is the category Office, Computing and Accounting Machinery of the US Bureau of Economic Analysis (BEA) which consists primarily of computers. Some researchers use definitions that also include communications equipment, instruments, photocopiers and related equipment, and software and related services. * Labor productivity is calculated as the level of output divided by a given level of labor input. Multifactor productivity (sometimes more ambitiously called total factor productivity) is calculated as the level of output for a given level of several inputs, typically labor, capital and materials. In principle, multifactor productivity is a better guide to the efficiency of a firm or industry because it adjusts for shifts among inputs, such as an increase in capital intensity, but lack of data can make this consideration moot. Draft: 1/29/92 page 2 Information Technology and Productivity * In pr oductivity calculations, output is defined as the number of units produced times their unit value, proxied by their real price. Establishing the real price of a good or service requires the calculation of individual price deflators, often using hedonic methods, that eliminate the effects of inflation without ignoring quality changes. Trends: * The price of computing has dropped by half every 2-3 years1 (figure 3a and figure 3b). If progress in the rest of the economy had matched progress in the computer sector, a Cadillac would cost $4. 98, while ten minutes labor would buy a years worth of groceries. 2 * There have been increasing levels of business investment in information technology equipment. These investments now account for over 10% of new investment in capital equipment by American firms3 (figure 4). * Information processing continues to be the principal task undertaken by Americas work force. Over half the labor force is employed in information-handling activities. (figure 5). * Overall productivity growth has slowed significantly since the early 1970s and measured productivity growth has fallen especially sharply in the service sector, which consumes over 80% of IT (figure 2). * White collar productivity statistics have been essentially stagnant for 20 years. figure 6) 1 In the last 35 years, the quality-adjusted costs of computing have decreased by over 6000-fold relative to equipment prices outside the computer sector [Gordon, 1987]. This relationship has been dubbed Moores Law after John Moore who first documented the trend in microprocessors. It is widely projected to continue at least into the next century. 2 This comparison was inspired by the slightly exaggera ted claim in Forbes, [, 1980 #279], that If the auto industry had done what the computer industry has done, Rolls-Royce would cost $2. 50 and get 2,000,000 miles to the gallon. The $4. 98 Cadillac is based on a price of $30,890 for a 1991 Sedan de Ville divided by 6203, the relative deflator for computers. The grocery comparison is based on a wage of $10 an hour and $10,000 worth of groceries, each in actual 1991 dollars. 3 Some studies estimate that as much as 50% of recent equipment investment is in information technology [Kriebel, 1989 #417]. This higher figure seems to be partly due to a broader definition of IT. A discrepancy also arises when recent investments are expressed in 1982 dollars, when IT was relatively more expensive. This has the effect of boosting ITs real share over time faster than its nominal share grows. Draft: 1/29/92 page 3 Information Technology and Productivity These facts suggest two central questions, which comprise the productivity paradox: 1) Why are companies investing so heavily in information technology if it doesnt add to productivity? ) If information technology is contributing to productivity, why have we been unable to measure it? In seeking to answer these questions, this paper builds on a number of previous literature surveys. Much of the material in section III is adapted from an earlier paper with Bruce Bimber (Brynjolfsson Bimber, 1990) which also included an annotated bibliography of 104 related articles and a summary of six explanations for the productivity paradox from outside the economics literature. An earlier study by Crowston and Treacy (1986), identified 11 articles on the impact of IT on enterprise level performance by searching ten journals from 1975 to 1985. They conclude that there had been surprisingly little success in measuring the impact of IT and attribute this to the lack of clearly defined variables which in turn stems from an inadequacy of suitable reference disciplines and methodologies. One natural reference discipline is economics and an excellent review of recent research combining information systems and economics, by Bakos and Kemerer (1991), includes particularly relevant work in sections on macroeconomic impacts of information technology and information technology and organizational performance. Because statistical work is central to the majority of the approaches to assessing IT productivity, another very useful survey is Gurbaxani and Mendelsons (1989) paper on the use of data from secondary sources in MIS research. In addition to summarizing the work that has already been done, they make a convincing case that using pre-compiled data sets has significant advantages over starting de novo with original data, as has been the more common practice among MIS researchers. Finally, many of the papers that seek to directly Draft: 1/29/92 page 4 Information Technology and Productivity assess IT productivity begin with a literature survey. The reviews by Brooke (1991), Barua, Mukhopadhyay and Kriebel (1991), and Berndt and Morrison (1991b) were particularly useful. Although over 150 articles were considered in this review, it cannot claim to be comprehensive. Rather, it aims to clarify for the reader the principal issues surrounding IT and productivity, reflecting the results of a computerized literature search of 30 of the leading journals in both information systems and economics,4 and more importantly, discussions with many of the leading researchers in this area, who helped identify recent research that has not yet been published. The remainder of the paper is organized as follows. The next section summarizes the empirical research that has attempted to measure the productivity of information technology. Section III classifies the explanations for the paradox into four basic categories and assesses the components of each in turn. Section IV concludes with summaries of the key issues identified and some avenues for further research. Dimensions of the Paradox Productivity is the fundamental measure of a technologys contribution. With this in mind, CEOs and line managers have increasingly begun to question their huge investments in computers and related technologies (Loveman, 1988). While major success 4 The journals searched included American Economic Review, Bell (Rand) Journal of Economics, Brookings Papers on Economics and Accounting, Econometrica, Economic Development Review, Economica, Economics Journal, Economist (Netherlands), Information Economics Policy, International Economics Review, Journal of Business Finance, Communications of the ACM, Database, Datamation, Decision Sciences, Harvard Business Review, IEEE Spectrum, IEEE Transactions on Engineering Management, IEEE Transactions on Software Engineering, Information Management, Interfaces, Journal of Systems Management, Management Science, MIS Quarterly, Operations Research, and Sloan Management Review. Articles were selected if they indicated an emphasis on computers, information systems, information technology, decision support systems, expert systems, or high technology combined with an emphasis on productivity. Draft: 1/29/92 page 5 Information Technology and Productivity stories exist, so do equally impressive failures (see, for example (Kemerer Sosa, 1990; Schneider, 1987)). The lack of good quantitative measures for the output and value created by information technology has made the MIS managers job of justifying investments particularly difficult. Academics have had similar problems assessing the contributions of this critical new technology, and this has been generally interpreted as a negative signal of its value. The disappointment in information technology has been chronicled in articles disclosing broad negative correlations with economy-wide productivity and information worker productivity. Econometric estimates have also indicated low IT capital productivity in a variety of manufacturing and service industries. The principal empirical research studies of IT and productivity are listed in table 1. Draft: 1/29/92 page 6 Information Technology and Productivity Table 1: Principal Empirical Studies of IT and Productivity Economy-wide Cross-sector or (Jonscher, 1983; Jonscher, 1988) (Baily Chakrabarti, 1988; Baily, 1986b; Baily Gordon, 1988) (Roach, 1987a; Roach, 1988; Roach, 1989b) (Brooke, 1991) (Osterman, 1986) (Grove, 1990) (Dos Santos, Peffers Mauer, 1991) Manufacturing (Berndt Morrison, 1991b) (Siegel Griliches, 1991) (Loveman, 1988) (Weill, 1988) (Dudley Lasserre, 1989) (Morrison Berndt, 1990) (Barua, Kriebel Mukhopadhyay, 1991) Services (Cron Sobol, 1983) (Strassman, 1985) (Baily, 1986a) (Roach, 1991; Roach, 1987b; Roach, 1989a) (Noyelle, 1990) (Brand Duke, 1982) (Pulley Braunstein, 1984) (Bender, 1986) (Bresnahan, 1986) (Franke, 1987) (Harris Katz, 1988; Harris Katz, 1989) (Parsons, Gotlieb Denny, 1990) (Weitzendorf Wigand, 1991) Economv-wide Productivity and Information Worker Productivitv The Issue One of the core issues for economists in the past decade has been the productivity slowdown that began in the early 1970s. There has been a drop in labor productivity growth from about 2. 5% per year between 1953-1968 to about 0. 7% per year from 1973- 1979. Multi-factor productivity growth, which takes into account changes in capital, declined from 1. 75% a year to 0. 32% over the same periods (Baily, 1986b). Even after accounting for factors such as the oil price shocks, changes in labor quality and potential measurement errors, most researchers still find that there is an unexplained residual drop in Correlations Models II . w w If i Draft: 1/29/92 page 7 i Draft: 1/29/92 Information Technology and Productivity page 8 productivity as compared with the first half of the post-war period. The sharp drop in productivity roughly coincided with the rapid increase in the use of information technology (figure 1). Although recent productivity growth has rebounded somewhat, especially in manufacturing, the overall negative correlation between economy-wide productivity and the advent of computers is at the core of many of the arguments that information technology has not helped US productivity or even that information technology investments have been counter-productive (Baily, 1986b). This link is made more explicit in research by Stephen Roach (1987a; 1988) focusing specifically on information workers, regardless of industry. While in the past, office work was not very capital intensive, recently the level of information technology capital per (white collar) information worker has begun approaching that of (blue collar) production capital per production worker. Concurrently, the ranks of information workers have ballooned and the ranks of production workers have shrunk. Roach cites statistics indicating that output per production worker grew by 16. 9% between the mid- 1970s and 1986, while output per information worker decreased by 6. 6%. He concludes: We have in essence isolated Americas productivity shortfall and shown it to be concentrated in that portion of the economy that is the largest employer of white-collar workers and the most heavily endowed with high-tech capital. Roachs analysis provides quantitative support for widespread reports of low office productivity. 5 A more sanguine explanation is put forth by Brooke (1991). Although he confirmed a broad-level correlation with declines in productivity, he hypothesized that this was due to increases in product variety which resulted in commensurate reductions in economies of scale. This hypothesis was supported by his finding of a positive correlation 5 For instance, Lester Thurow has noted that the American factory works, the American office doesnt, citing examples from the auto industry indicating that Japanese managers are able to get more output from blue collar workers (even in American plants) with up to 40% fewer managers. III Information Technology and Productivity between IT investment and the number of trademark applications. Because variety generally has positive value to consumers, but is ignored by conventional measures of productivity, this finding suggests a measurement problem, which is explored more fully in below in the section on mismeasurement. Comment Upon closer examination, the alarming correlation between IT and lower productivity at the level of the entire US economy is not compelling because so many other factors affect output and therefore productivity. Until recently, computers were not a major share of the economy. Consider the following order of magnitude estimates. Information technology capital stock is currently equal to about 10% of GNP, or total output. If, hypothetically, IT were being used efficiently and its marginal product were 20% (exceeding the return to most other capital investments), then current GNP would be directly increased about 2% (10% x 20%) because of the existence of our current stock of IT. However, information technology capital stock did not jump to its current level in the past year alone. Instead, the increase must be spread over about 30 years, suggesting an average contribution to aggregate GNP growth of 0. 06% in each year. 6 This would be very difficult to isolate because so many other factors affected GNP, especially in the relatively turbulent 1970s and early 1980s. Indeed, if the marginal product of IT capital were anywhere from -20% to +40%, it would still not have affected aggregate GNP growth by more than about 0. 1% per year and productivity growth by even less. 7 6 In his comment on Baily and Gordon (1988), David Romer notes that a similar argument applies to almost any capital investment. 7 In dollar terms, each white collar worker is endowed with about $10,000 in IT capital, which at a 20% ROI, would increase his or her total output about by about $2000 per year as compared with pre-computer levels of output. Compare to the $100,000 or so in salary and overhead that it costs to employ this worker and the expectations for a technological silver bullet seem rather ambitious. Draft: 1/29/92 page 9 Information Technology and Productivity This is not to say that computers may not have had significant effects in specific areas, like transaction processing, or on other characteristics of the economy, like employment shares, organizational structure or product variety. Rather it suggests that very large changes in capital stock are needed to measurably change total output under conventional assumptions about typical rates of return. However, the growth in information technology stock is still strong and the share of the total economy accounted for by computers is becoming quite substantial. Presumably, if computers are productive, we should begin to notice changes at the level of aggregate GNP in the near future. As for the apparent stagnation in white collar productivity, one should bear in mind that relative productivity cannot be directly inferred from the number of information workers per unit output. For instance, if a new delivery schedule optimizer allows a firm to substitute a clerk for two truckers, the increase in the number of white collar workers is evidence of an increase, not a decrease, in their relative productivity and in the firms productivity as well. Osterman (1986) suggests that this is why clerical employment often increases after the introduction of computers and Berndt and Morrison (199lb) confirm that information technology capital is, on average, a complement for white collar labor even as it leads to fewer blue collar workers. Unfortunately, more direct measures of office worker productivity are exceedingly difficult. Because of the lack of hard evidence, Panko (1984; 1991) has gone so far as to call the idea of stagnant office worker productivity a myth, although he cites no evidence to the contrary. Independent of its implications for productivity, growth in the white collar work force cannot be entirely blamed on information technology. Although over 38% of workers now use computers in their jobs8, the ranks of information workers began to 8 According to the US National Center for Education Statistics, 38. 3% of persons in the 1989 Current Population Survey used computers at work, including nearly 60% of those with four or more years of college. Interestingly, Kreuger [, 1991 #411] finds that workers using computers are paid an average wage premium of 8%, even after controlling for education, computer literacy and other factors. Draft: 1/29/92 page 10 Information Technology and Productivity surge well before the advent of computers (Porat, 1977). Jonscher (1988) even goes so far as to argue that causality goes the other way: the increased demand for information enabled economies of scale and learning in the computer industry, thereby reducing costs. These mitigating factors notwithstanding, the low measured productivity at the level of the whole economy and among white collar workers, especially in the face of huge increases in the accompanying capital stock, does call for closer scrutiny. A more direct case for weakness in information technologys contribution comes from the explicit evaluation of information technology capital productivity, typically by estimating the coefficients of a production function. This has been done in both manufacturing and service industries, and we review each in turn. The Productivity of Information Technology Capital in Manufacturing The Issues There have been at least seven studies of IT productivity in the manufacturing sector, summarized in table 2. A study by Gary Loveman (1988) provided some of the first econometric evidence of a potential problem when he examined data from 60 business units. 9 As is common in the productivity literature, he used ordinary least squares regression and assumed that production functions could be approximated by a Cobb-Douglas function. By taking the logarithm of all variables, he was able to estimate a linear relationship between changes in the log of output 0Â ° (q) and changes in the log of spending on key inputs, including 9 Namely, the Management Productivity of IT (MPIT) subset of the PIMS data set. 10 Where output was defined as (sales + net change in inventories)/ price index. Draft: 1/29/92 page 11 Information Technology and Productivity materials (m), purchased services (ps), labor (1), traditional capital (k), and information technology capital (c), while allowing for an exogenous time trend (), and an error term (? ): q = Blm + B2ps + 1331 + 4k + 135c + X + ? (1) Loveman estimated that the contribution of information technology capital to output (135) was approximately zero over the five year period studied in almost every subsample he examined. His findings were fairly robust to a number of variations on his basic formulation and suggest a paradox: while firms were demonstrating a voracious appetite for a technology experiencing radical improvements, measured productivity gains were insignificant. While Lovemans dependent variable was final output, Barua, Kriebel and Mukhopadhyay (1991) traced Lovemans results back a step by looking at ITs effect on intermediate variables such as capacity utilization, inventory turnover, quality, relative price and new product introduction. Using the same data set, they found that IT was positively related to three of these five intermediate measures of performance, although the magnitude of the effect was generally too small to measurably affect final output. Dudley and Lasserre (1989) also found econometric support for the hypothesis that better communication and information reduce the need for inventories, without explicitly relating this to bottom-line performance measures. Using a different data set, Weill (1988) was also able to disaggregate IT by use, and found that significant productivity could be attributed to transactional types of information technology (e. g. data processing), but was unable to identify gains associated with strategic systems (e. g. sales support) or informational investments (e. g. email infrastructure). Draft: 1/29/92 page 12 Information Technology and Productivity Morrison and Berndt have written two papers using a broader data set from the US Bureau of Economic Analysis (BEA) that encompasses the whole U. S. manufacturing sector. The first (Morrison Berndt, 1990), which examined a series of highly parameterized models of production, found evidence that every dollar spent on IT delivered, on average, only about $0. 80 of value on the margin, indicating a general overinvestment in IT. Their second paper (Berndt Morrison, 1991b) took a less structured approach and examined broad correlations of IT with labor productivity and multifactor productivity, as well as other variables. This approach did not find a significant difference between the productivity of IT capital and other types of capital for a majority of the 20 industry categories examined. They did find that IT was correlated with significantly increased demand for skilled labor. Finally, Siegel and Griliches (1991) used industry and establishment data from a variety of sources to examine several possible biases in conventional productivity estimates. Among their findings was a positive simple correlation between an industrys level of investment in computers and its multifactor productivity growth in the 1980s. They did not examine more structural approaches, in part because of troubling concerns they raised regarding the reliability of the data and government measurement techniques. Draft: 1/29/92 page 13 Draft: 1/29/92 Information Technology and Productivity page 14 Table 2: Studies of IT in Manufacturing Study Data source Findings Loveman, 1988) PIMS/MPIT IT investments added nothing to output (Weill, 1988) Valve manufacturers Contextual variables affect IT performance (Dudley Lasserre, IT and communication reduces inventories 1989) (Morrison Berndt, BEA IT marginal benefit is 80 cents per dollar 1990) invested (Barua, Kriebel PIMS/MPIT IT improved inte rmediate outputs, if not Mukhopadhyay, 1991) necessarily final output (Berndt Morrison, BEA, BLS IT not correlated with higher multi-factor 1991 b) productivity in most industries, more labor use (Siegel Griliches, Multiple govt sources IT using industries tend to be more 1991) productive; government data is unreliable Comment All authors make a point of emphasizing the limitations of their respective data sets. The MPIT data, which both Loveman and Barua, Kriebel and Mukhopadhyay use, can be particularly unreliable. As Loveman is careful to point out, his results are based on dollar denominated outputs and inputs, and therefore depend on price indices which may not accurately account for changes in quality or the competitive structure of the industry. The results of both of these studies may also be unrepresentative to the extent that the relatively short period covered by the MPIT data, 1978- 83, was unusually turbulent. The BEA data may be somewhat more dependable but are subject to subtle biases due to the unintuitive techniques used to aggregate and classify establishments. One of Siegel and Griliches principal conclusions was that after auditing the industry numbers, we found that a non-negligible number of sectors were not consistently defined over time. However, the generally reasonable estimates derived for the other, non-information technology factors of production in each of the studies indicate that there may indeed be something worrisome, or at least special, about information technology. Additional III Information Technology and Productivity econometric work would go far toward establishing whether these results are an artifact of the data or a genuine puzzle in need of more thorough analysis. The Productivity of Information Technology Capital in Services The Issues It has been widely reported that most of the productivity slowdown is concentrated in the service sector (1991; Roach, 1987b; Schneider, 1987). Before about 1970, service productivity growth was comparable to that in manufacturing, but since then the trends have diverged significantly. Meanwhile services have dramatically increased as a share of total employment and to a lesser extent, as a share of total output. Because services use over 80% information technology, this has been taken as indirect evidence of poor information technology productivity. The studies that have tried to assess IT productivity in the service sector are summarized in table 3. One of the first studies of ITs impact was by Cron and Sobol (1983), who looked at a sample of wholesalers. They found that on average, ITs impact was not significant, but that it seemed to be associated with both very high and very low performers. This finding has engendered the hypothesis that IT tends to reinforce existing management 11 According to government statistics, from 1953 to 1968, labor productivity growth in services averaged 2. 56%, vs. 2. 61% in manufacturing. For 1973 to 1979, the figures are 0. 68% vs. 1. 53%, respectively (Baily, 1986). However, a recent study (Gordon, 1989) suggests that measurement errors in US statistics systematically understate service productivity growth relative to manufacturing. More recently, computers definitely have caused some divergence in the statistics on manufacturing and service productivity, but for a very different reason. Because of the enormous quality improvements attributed to the computers, the nonelectrical machinery category (containing the computer producing industry) has shown tremendous growth. As a result, while overall manufacturing productivity growth has rebounded from about 1. 5% in the 1970s to 3. 5% in the 1980s, about two thirds of this increase is simply attributable to the greater production (as opposed to use) of computers (see comment by William Nordhaus on Baily Gordon, 1988 and section III. A of this paper) Draft: 1/29/92 page 15 Information Technology and Productivity approaches, helping well-organized firms succeed but only further confusing anagers who havent properly structured production in the first place. Strassman (1985; 1990) also reports disappointing evidence in several studies. In particular, he found that there was no correlation between IT and return on investment in a sample of 38 service sector firms: some top performers invest heavily in IT, while some do not. In his most recent book (1990), he concludes that there is no relation between spending for computers, profits and productivity. Roachs widely cited research on white collar productivity, discussed above, focused principally on ITs dismal performance in the service sector (1991; 1987a; 1987b; 1988; 1989a; 1989b). Roach argues that IT is an effectively used substitute for labor in most manufacturing industries, but has paradoxically been associated with bloating whitecollar employment in services, especially finance. He attributes this to relatively keener competitive pressures in manufacturing and foresees a period of belt-tightening and restructuring in services as they also become subject to international competition. There have been several studies of ITs impact on the performance of various types of financial services firms. A recent study by Parsons, Gottlieb and Denny (1990) estimated a production function for banking services in Canada and found that overall, the impact of IT on multifactor productivity was quite low between 1974 and 1987. They speculate that IT has positioned the industry for greater growth in the future. Similar conclusions are reached by Franke (1987), who found that IT was associated with a sharp drop in capital productivity and stagnation in labor productivity, but remained optimistic about the future potential of IT, citing the long time lags associated with previous technological transformations such as the conversion to steam power. On the other Draft: 1/29/92 page 16 Information Technology and Productivity hand, Brand (1982), using BLS data and techniques, found that moderate productivity growth had already occurred in banking. Harris and Katz (1988; 1989) and Bender (1986) looked at data on the insurance industry from the Life Office Management Association Information Processing Database. They found a positive relationship between IT expense ratios and various performance ratios although at times the relationship was quite weak. Several case studies of ITs impact on performance have also been done, including one by Weitzendorf Wigand (1991) which developed a model of information use in two service corporations, and a study of an information services firm by Pulley and Braunstein (1984), which found an association with increased economies of scope. Table 3: Studies of IT in Services Study Data source Findings (Brand Duke, 1982) BLS Productivity growth of 1. 3%/yr in banking (Cron Sobol, 1983) 138 medical supply Bimodal distribution among high IT wholesalers investors: either very good or very bad (Pulley Braunstein, Monthly data from Significant economies of scope 1984) information service firm (Clarke, 1985) Case study Major business process redesign needed to reap benefits in investment firm Strassman, 1985; Computerworld survey No correlation between various IT ratios Strassman, 1990)] of 38 companies and performance measures (Bender, 1986) LOMA insurance data on Weak relationship between IT and variou s 132 firms performance ratios (Bresnahan, 1986) Financial services firms Large gains in imputed consumer welfare (Franke, 1987) Finance industry data (Roach, 1991; Roach, Principally BLS, BEA Vast increase in IT capital per information 1987b; Roach, 1989a) worker while measured output decreased (Harris Katz, 1988; LOMA insurance data Weak positive relationship between IT and Harris Katz, 1989) for 40 various performance ratios Noyelle, 1990) US and French industry Severe measurement problems in services (Parsons, Gotlieb Internal operating data IT coefficient in translog production Denny, 1990) from 2 large banks function small and often negative (Weitzendorf Interviews at 2 Interactive model of information use Wigand, 1991) companies Draft: 1/29/92 page 17 Information Technology and Productivity Comment Measurement problems are even more acute in services than in manufacturing. In part, this arises because many service transactions are idiosyncratic, and therefore not subject to statistical aggregation. Unfortunately, even when abundant data exist, classifications sometimes seem arbitrary. For instance, in accordance with a fairly standard approach, Parsons, Gottlieb and Denny (1990) treated time deposits as inputs into the banking production function and demand deposits as outputs. The logic for such decisions is often difficult to fathom and subtle changes in deposit patterns or classification standards can have disproportionate impacts. The importance of variables other than IT also becomes particularly apparent in some of the service sector studies. Cron and Sobols finding of a bimodal distribution suggests that some variable was left out of the equation. Furthermore, researchers and consultants have increasingly emphasized the theme of re-engineering work when introducing major IT investments (Davenport Short, 1990; Hammer, 1990). A frequently cited example is the success of the Batterymarch services firm, as documented by Clarke (1985). Batterymarch used information technology to radically restructure the investment management process, rather than simply overlaying IT on existing processes. In sum, while a number of the dimensions of the information technology productivity paradox have been overstated, the question remains as to whether information technology is having the positive impact expected. In particular, better measures of information worker productivity are needed, as are explanations for why information technology capital hasnt clearly improved firm-level productivity in manufacturing and services. We now examine four basic approaches taken to answer these questions. Draft: 1/29/92 page 18 Information Technology and Productivity Leading Explanations for the Paradox Although it is too early to conclude that ITs productivity contribution has been subpar, a paradox remains in our inability to unequivocally document any contribution after so much effort. The various explanations that have been proposed can be grouped into four categories: 1) Mismeasurement of outputs and inputs, 2) Lags due to learning and adjustment, 3) Redistribution and dissipation of profits, 4) Mismanagement of information and technology. The first two explanations point to shortcomings in research, not practice, as the root of the productivity paradox. It is possible that the benefits of IT investment are quite large, but that a proper index of its true impact has yet to be analyzed. Traditional measures of the relationship between inputs and outputs fail to account for non-traditional sources of value. Second, if significant lags between cost and benefit may exist, then short-term results look poor but ultimately the pay-off will be proportionately larger. This would be the case if extensive learning, by both individuals and organizations, were needed to fully exploit IT, as it is for most radically new technologies. A more pessimistic view is embodied in the other two explanations. They propose that there really are no major benefits, now or in the future, and seek to explain why managers would systematically continue to invest in information technology. The redistribution argument suggests that those investing in the technology benefit privately but at the expense of others, so no net benefits show up at the aggregate level. The final type of explanation examined is that we have systematically mismanaged information Draft: 1/29/92 page 19 Draft: 1/29/92 Information Technology and Productivity page 20 technology: there is something in its nature that leads firms or industries to invest in it when they shouldnt, to misallocate it, or to use it to create slack instead of productivity. Each of these four sets of hypotheses is assessed in turn in this section. Measurement Errors The Issues The easiest explanation for the low measured productivity of information technology is simply that were not properly measuring output. Denison (1989) makes a wide-ranging case that productivity and output statistics can be very unreliable. Most economists would agree with the evidence presented by Gordon and Baily (1989), and Noyelle (1990) that the problems are particularly bad in service industries, which happen to own the majority of information technology capital. It is important to note that measurement errors need not necessarily bias IT productivity if they exist in comparable magnitudes both before and after IT investments. However, the sorts of benefits ascribed by managers to information technology increased quality, variety, customer service, speed and responsiveness are precisely the aspects of output measurement that are poorly accounted for in productivity statistics as well as in most firms accounting numbers. This can lead to systematic underestimates of IT productivity. The measurement problems are particularly acute for IT use in the service sector and among white collar workers. Since the null hypothesis that no improvement occurred wins by default when no measured improvement is found, it probably is not coincidental that service sector and information worker productivity is considered more of a problem than manufacturing and blue collar productivity, where measures are better. III Information Technology and Productivity a. Output Mismeasurement As discussed in the introduction, when comparing two output levels, it is important to deflate the prices so they are in comparable real dollars. Accurate price adjustment should remove not only the effects of inflation but also adjust for any quality changes. Much of the measurement problem arises from the difficulty of developing accurate, quality-adjusted price deflators. Additional problems arise when new products or features are introduced, not only because they have no predecessors for direct comparison, but also because variety itself has value, and that can be nearly impossible to measure. The positive impact of information technology on variety and the negative impact of variety on measured productivity has been econometrically and theoretically supported by Brooke (1991). He argues that lower costs of information processing have enabled companies to handle more products and more variations of existing products. However, the increased scope has been purchased at the cost of reduced economies of scale and has therefore resulted in higher unit costs of output. For example, if a clothing manufacturer chooses to produce more colors and sizes of shirts, which may have value to consumers, existing productivity measures rarely account for such value and will typically show higher productivity in a firm that produces a single color and size. 12 Higher prices in industries with increasing product diversity is likely to be attributed to inflation, despite the real increase in value provided to consumers. In services, the problem of unmeasured improvements can be even worse than in manufacturing. For instance, the convenience afforded by twenty-four hour ATMs is frequently cited as an unmeasured quality improvement (Banker Kauffman, 1988). 12The same phenomenon suggests that much of the initial decline in productivity experienced by centrally-planned economies when they liberalize is spurious. Draft: 1/29/92 page 21 Draft: 1/29/92 Information Technology and Productivity page 22 How much value has this contributed to banking customers? Government statistics implicitly assume it is all captured in the number of transactions, or worse, that output is a constant multiple of labor input! (Mark, 1982) In a case study of the finance, insurance and real estate sector, where computer usage and the numbers of information workers are particularly high, Baily and Gordon (Baily Gordon, 1988) identified a number of practices by the Bureau of Economic Analysis (BEA) which tend to understate productivity growth. Their revisions add 2. 3% per year to productivity between 1973 and 1987 in this sector. 13 b. Information Technology Stock Mismeasurement A related measurement issue is how to measure information technology stock itself. For any given amount of output, if the level of IT stock used is overestimated, then its unit productivity will appear to be less than it really is. Denison (1989) argues that the rapid decreases in the real costs of computer power are largely a function of general advances in knowledge and as a result, the government overstates the decline in the computer price deflator by attributing these advances to the producing industry. If this is true, the real quantity of computers purchased recently is not as great as statistics show, while the real quantity purchased 20 years ago is higher. The net result is that much of the productivity improvement that the government attributes to the computer-producing industry, should be allocated to computer-using industries. Effectively, computer users have been overcharged for their recent computer investments in the government productivity calculations. c. Input Mismeasurement 13 They also add 1. 1% to productivity growth before 1973. III Information Technology and Productivity A third issue is the measurement of other inputs. If the quality of work life is improved by computer usage (less repetitive retyping, tedious tabulation and messy mimeos), then theory suggests that proportionately lower wages can be paid. Thus the slow growth in clerical wages may be an artifact of unmeasured improvements in work life that are not accounted for in government statistics. Baily and Gordon (1988) conjecture that this may also be adding to the underestimation of productivity. To the extent that complementary inputs, such as software, or training, are required to make investments in information technology worthwhile, labor input may also be overestimated. Although spending on software and training yields benefits for several years, it is generally expensed in the same year that computers are purchased, artificially raising the short-term costs associated with computerization. In an era of annually rising investments, the subsequent benefits would be masked by the subsequent expensing of the next, larger, round of complementary inputs. On the other hand, IT purchases may also create long-term liabilities in software and hardware maintenance that are not fully accounted for, leading to an underestimate of ITs impact on costs. d. Methodological Concerns In addition to data problems, the methodology used to assess IT impacts can also significantly affect the results. Alpar and Kim (1990) applied two approaches to the same data set. One approach was based on key ratios and the other used a cost function derived from microeconomic theory. 4 They found that the key ratios approach, which had been 14 An example of the key ratios approach is examining the correlation between the ratio of information processing expenses to total expenses and the ratio of total operating expenses to premium income, as Bender [, 1986 #295] did. An example of the cost function approac h is to use duality theory to derive a cost function from a production function, such as the Cobb-Douglas function described above that was used by Loveman [, 1988 #58]. The exact function used by Alpar and Kim was the translog cost function, which is more general, but which requires the estimation of a large number of parameters. Draft: 1/29/92 page 23 Draft: 1/29/92 Information Technology and Productivity page 24 previously used by Bender (1986) and Cron and Sobol (1983), among others, could be particularly misleading. In an effort to model IT effects more rigorously, several papers have called for the use of approaches derived from microeconomics. Cooper and Mukhopadhyay (1990) advocate a production function approach while frontier methodologies such as data envelopment analysis (DEA) have been proposed by Chismar and Kriebel (1985) and Stabell (1982). A very different approach has been applied in an article by Tim Bresnahan (1986). Recognizing the inherent difficulties in measurement in the financial services sector, Bresnahan made no attempt to directly measure output. Instead, he inferred it from the level of spending on mainframes under the assumption that the unregulated parts of the financial services sector were competitive and were therefore acting as agents for consumers. He found that welfare gains were five times greater than expenditures through 1973. Bresnahans findings serve to underscore the size of the gap between the benefits perceived by the consumers of IT and those measured by researchers using conventional techniques. Comments Output measurement is undoubtedly problematic. Rapid innovation has made information technology-intensive industries particularly susceptible to the problems associated with measuring quality changes and valuing new products. The way productivity statistics are currently kept can lead to bizarre anomalies: to the extent that ATMs lead to fewer checks being written, they can actually lower productivity statistics. Increased variety, improved timeliness of delivery and personalized customer service are additional benefits that are poorly represented in productivity statistics. These are all qualities that are particularly likely to be enhanced by information technology. Because III Information Technology and Productivity information is intangible, increases in the implicit information content of products and services are likely to be under-measured compared to increases in materials content. Nonetheless, some analysts are skeptical that measurement problems can explain much of the slowdown. They point out that by many measures, service quality has gone down, not up. 15 Furthermore, they question the value of variety when it takes the form of six dozen brands of breakfast cereal. Indeed, models from industrial organization theory suggest that while more variety will result from the flexible manufacturing and lower search costs enabled by IT, the new equilibrium can exhibit excess variety making consumers worse off (Tirole, 1988). Denison is in the minority in his view that the government is overestimating the improvements in computing power per dollar. A study by Gordon (1987) found that, if anything, computer prices are declining slightly faster than government statistics show. More recently, a study by Triplett (1989) considered Denisons criticisms but in the end supported the BEA methods. 16 Ultimately, a closer look at productivity statistics reminds researchers that the poor showing of information technology may not rest on an entirely solid foundation simply because the statistics are not as reliable as we would like. Lags The Issues 5 Nordhaus in a comment on Baily and Gordon (1988) recalls the doctors house call, custom tailoring, and windshield wipin g at gas stations, among other relics. 16 Most economists appear to be less concerned than Denison about this bias in the BEA statistics. For instance, a consensus of economists at the June, 1990 NBER conference on productivity concurred with Tripletts conclusions. Draft: 1/29/92 page 25 Information Technology and Productivity A second explanation for the paradox is that the benefits from information technology can take several years to show up on the bottom line. a. Evidence of Lags The idea that new technologies may not have an immediate impact is a common one in business. For instance, a survey of executives suggested that many expected it to take at much as five years for information technology investments to pay-off (Nolan/Norton, 1988). This accords with a recent econometric study by Brynjolfsson et al. (1991a) which found lags of two to four years before the strongest organizational impacts of information technology were felt. Loveman (1988) also found slightly higher, albeit still very low, productivity when small lags were introduced. In general, while the benefits from investment in infrastructure can be large, they are indirect and often not immediate. b. Theoretical Basis for Lags The existence of lags has some basis in theory. Because of its unusual complexity and novelty, firms and individual users of information technology may require some experience before becoming proficient (Curley Pyburn, 1982). According to dynamic models of learning-by-using, the optimal investment strategy sets short term marginal costs greater than short-term marginal benefits. This allows the firm to ride the learning curve and reap benefits analogous to economies of scale (Scherer, 1980). If only short-term costs and benefits are measured, then it might appear that the investment was inefficient. Viewed in this framework, there is nothing irrational about the experimentation phase firms are said to experience in which rigorous cost/benefit analysis is not undertaken (Nolan/Norton, 1988). Because future information technology investments tend to be large Draft: 1/29/92 page 26 Information Technology and Productivity relative to current investments, the learning effect could potentially be quite substantial. A similar pattern of costs and benefits is predicted by an emerging literature that treats investments in information technology as options, with short term costs, but with the potential for long-term benefits (Kambil, Henderson Mohsenzadeh, 1991). Comments One way to address the measurement problem associated with complementary inputs (see section III. A. 1 . c) is to introduce appropriate lags in the estimation procedure. For instance, the purchase of a mainframe computer must generally precede the development of mainframe database software. Software, in turn, usually precedes data acquisition. Good decisions may depend on years of acquired data and may not instantaneously lead to profits. 17 Optimally, a manager must take into account these longterm benefits when purchasing a computer and so must the researcher seeking to verify the benefits of computerization. If managers are rationally accounting for lags, this explanation for low information technology productivity growth is particularly optimistic. In the future, not only should we reap the then-current benefits of the technology, but also enough additional benefits to make up for the extra costs we are currently incurring. However, the credibility of this explanation is somewhat undermined by the fact that American managers have not been noted for their ability to postpone benefits to the future. On the contrary, the risk and uncertainty associated with new technologies can make risk-averse managers require higher, not lower, rates of return before they will invest. Increased familiarity, ease-of-use 17 It has been observation that firms that spend proportionately more money on software appear to be more profitable (Computer Economics Report, 1988) If firms go through a hardware buying phase followed by an applications phase, then this may have more to due with firms being in different stages of a multi-year process than with different technology strategies. Draft: 1/29/92 page 27 Draft: 1/29/92 Information Technology and Productivity page 28 and end-user computing may lead to reduced lags between the costs and benefits of computerization in the future. Redistribution The Issues A third possible explanation is that information technology may be beneficial to individual firms, but unproductive from the standpoint of the industry as a whole or the economy as a whole: IT rearranges the shares of the pie without making it any bigger. a. The Private Value of Information Can Exceed its Social Value There are several arguments for why redistribution may be more of a factor with IT investments than for other investments. For instance, information technology may be used disproportionately for market research and marketing, activities which can be very beneficial to the firm while adding nothing to total output (Baily Chakrabarti, 1988; Lasserre, 1988). Furthermore, economists have recognized for some time that, compared to other goods, information is particularly vulnerable to rent dissipation, in which one firms gain comes entirely at the expense of others, instead of by creating new wealth. As Hirshleifer (1971) pointed out, advance knowledge of demand, supply, weather or other conditions that affect asset prices can be very profitable privately even without increasing total output. This will lead to excessive incentives for information gathering. In a similar spirit, races to be the first to apply an innovation can also lead to rent dissipation (Fudenberg Tirole, 1985). The rapid-fire pace of innovation in the information technology industry might also encourage this form of wasteful investment. III Information Technology and Productivity b. Models of Redistribution Baily and Chakrabarti (1988) run a simulation under the assumption that a major share of the private benefits of information technology result from redistribution. The results are broadly consistent with the stylized facts of increased amounts of information technology and workers without increases in total productivity. 2. Comments Unlike the other possible explanations, the redistribution hypothesis would not explain any shortfall in IT productivity at the firm-level: firms with inadequate IT budgets would lose market share and profits to high IT spenders. In this way, an analogy could be made to models of the costs and benefits of advertising. It is interesting to note that most of the reasons for investing in information technology given by the articles in the business press involve taking profits from competitors rather than lowering costs. 18 Mismanagement The Issues A fourth possibility is that, on the whole, information technology really is not productive at the firm level. The investments are made nevertheless because the decision- 18 Porter and Millar, 1985, is not atypical. They emphasize competitive advantage gained by changes in industry structure, product and service differentiation and spawning of new businesses while devoting about 5% of their space to cost savings enabled by IT. Others ignore cost reductions entirely. Draft: 1/29/92 page 29 Draft: 1/29/92 Information Technology and Productivity page 30 makers arent acting in the interests of the firm. Instead, they are a) increasing their slack, b) signalling their prowess or c) simply using outdated criteria for decision-making. a. Increased scope for managerial slack Many of the difficulties that researchers have in quantifying the benefits of information technology would also affect managers (Baily, 1986a; Gremillion Pyburn, 1985). As a result, they may have difficulty in bringing the benefits to the bottom line if output targets, work organization and incentives are not appropriately adjusted (McKersie Walton, 1988). The result is that information technology might increase organizational slack instead of output or profits. This is consistent with arguments by Roach (1989a) that manufacturing has made better use of information technology than has the service sector because manufacturing faces greater global competition, and thus tolerates less slack. b. Information consumption as a signal Feldman and March (1981) also point out that good decisions are generally correlated with significant consumption of information. If the amount of information requested is more easily observable than the quality of decisions, a signalling model will show that too much information will be consumed. c. Use of outdated management heuristics A related argument derives from evolutionary models (Nelson, 1981). The difficulties in measuring the benefits of information and information technology discussed above may also lead to the use of heuristics, rather than strict cost/benefit accounting to set III Information Technology and Productivity levels of information technology investments. 9 Our current institutions, heuristics and management principles evolved largely in a world with little information technology. The radical changes enabled by information technology may make these institutions outdated (see e. g. (Clarke, 1985; Franke, 1987)). For instance, a valuable heuristic in 1960 might have been get all readily available information before making a decision. The same heuristic today could lead to information overload and chaos (Thurow, 1987). Indeed, Ayres (1989) argues that the rapid speed-up enabled by information technology creates unanticipated bottlenecks at each human in the information processing chain. More money spent on information technology wont help until these bottlenecks are addressed. Indeed, researchers have found that a successful IT implementation process must not simply overlay new technology on old processes (Davenport Short, 1990). At a broader level, several researchers suggest that our currently low productivity levels are symptomatic of an economy in transition, in this case to the information era (David, 1989; Franke, 1987; Gay Roach, 1986). For instance, David makes an analogy to the electrification of factories at the turn of the century. Major productivity gains did not occur for twenty years, when new factories were designed and built to take advantage of electricitys flexibility which enabled machines to be located based on work-flow efficiency, instead of proximity to waterwheels, steam-engines and power-transmitting shafts and rods. Comments While the idea of firms consistently making inefficient investments in IT is anathema to the neoclassical view of the firm as a profit-maximizer, it can be explained 19 Indeed, a recent review of the techniques used by major companies to justify information technology investments [Yamamoto, 1991] revealed surprisingly little formal analysis. See Clemons [, 1991 #284] for an assessment of the IT justification process. Draft: 1/29/92 page 31 Draft: 1/29/92 Information Technology and Productivity page 32 formally by models such as agency theory, employment signalling models and evolutionary economics, which treat the firm as a more complex entity. The fact that firms continue to invest large sums in the technology suggests that the individuals within the firm that make investment decisions are getting some benefit or at least believe they are getting some benefit from IT. For instance, a model of how IT enables managerial slack can be developed using agency theory. The standard result in this literature is that when managers (agent) incentives are not aligned with shareholder (principal) interests, suboptimal investment decisions and effort can result. One little noted feature of most agency models is that the incentives for agents to acquire additional information generally exceed the social benefits. This is because agents can use the information to earn rents and to short-circuit the incentive scheme (Brynjolfsson, 1990a). Thus, information technology investments may be very attractive to managers even when they do little to boost productivity. To the extent that competition reduces the scope for managerial slack, the problem is alleviated. In general, however, we do not yet have comprehensive models of the internal organization of the firm and researchers, at least in economics, are mostly silent on the sorts of inefficiency discussed in this section. Conclusion Summary Research on information technology

Marketing Questionaire Essay Example

Marketing Questionaire Essay Most people think that marketing is only about the advertising and/or personal selling of goods and services. Advertising and selling, however, are just two of the many marketing activities. In general, marketing activities are all those associated with identifying the particular wants and needs of a target market of customers, and then going about satisfying those customers better than the competitors. This involves doing market research on customers, analyzing their needs, and then making strategic decisions about product design, pricing, promotion and distribution. As a result, a business needs to discover: * What to make and sell We will write a custom essay sample on Marketing Questionaire specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Marketing Questionaire specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Marketing Questionaire specifically for you FOR ONLY $16.38 $13.9/page Hire Writer * How many to make and sell * Who to sell to * How to encourage these people to buy * How much to charge for what is sold Market planning also takes place to help the marketing department to achieve its goals and objectives. Using a SWOT analysis, the existing position can be analysed by looking at: * S the businesss present strengths * W and weaknesses * O its market opportunities * T and the external threats it faces Market Segmentation is important to a business as the business needs to know which of the different segments it is going to concentrate on and helps the marketing department to understand its market. It allows the business to target: * The product in each segment by establishing is USP (Unique Selling Point), the feature that distinguishes this products from other * Its advertising and other forms of promotions in the segment. The main things the business will think about when considering target market are: * Age (when considering location, products sold etc.) * Sex (this can affect some drinks etc.) * Ethnicity (people from different backgrounds may have different wants and needs) * Population (size and distribution varies) * Lifestyle (e.g. Sports and exercise goods etc.) * Income and Social Class (price of products, high class may be willing to pay more than others) Sources Used : Letts GCSE Success Visual Revision Guide Task 3 Questionnaire 1. How Old Are You? 0-13 years 14-16 years 17-21 years 22-35 years 36+ years 2. Are You? Male Female 3. What Is Your Ethnic Origin? White Mixed Asian or Asian British Chinese Other 4. Where Are You More Likely To Hear About Our Business? Leaflets Billboards Television Radio Newspapers/Magazines Word Of Mouth Other (please state) 5. What Theme Would You Prefer Our Coffee Shop To Be? Retro (bright colours) Retro (black ; white theme) Modern Other (please state) 6. For What Purpose Would You Use Our Coffee Shop? Social or Family Coffee, Tea and Refreshments Light Snacks Meals (breakfast/lunch etc.) Private Parties Business Meetings Quiet Place To Be On Your Own 7. What Other Services Would You Like To See Available? Self Catering Jukebox Television/Games Internet Club and Function Room Other (please state) 8. Would You Prefer A Fun and Lively Atmosphere, Or A More Quiet And Relaxed One? Fun and Lively Quiet and Relaxed Do Not Mind 9. What Type Of Food Would You Like To Be Served At The Coffee Shop? Healthy Fruit, Yoghurt Cakes, Snacks and Sandwiches Family Food i.e. Pizza, Chips etc. Other (please state) 10. What Type Of Drinks Would You Like To See On The Menu? Coffee, Tea ; Hot Chocolate Fresh Juices Fresh Smoothies Fizzy Drinks Other (please state) 11. How Much Money Would You Be Prepared To Pay At Our Coffee Shop (per visitor)? 5.00 or less 5.00-10.00 10.00-15.00 15.00-20.00 20.00 or more 12. Would You Be Willing To Pay More For Better Quality or A Wider Range Of Food ; Drink? Yes No Depends 13. Where Would You Like The Coffee Shop To Be Located? Town Centre The Edge Of Town Other (please state) 14. At What Time Would You Be More Likely To Visit The Coffee Shop?

Sub‐Saharan Africa poor development record over the last thirty years

Sub†Saharan Africa poor development record over the last thirty years Introduction Africa is one of the continents lagging behind in all sorts of developments for a long time. As a result, it has had continuous dependence on other continents for several items. Most of the industrial commodities used in Africa are imported.Advertising We will write a custom essay sample on Sub†Saharan Africa poor development record over the last thirty years specifically for you for only $16.05 $11/page Learn More That way, it continues to enrich other continents by adding into their foreign exchange. Over the last thirty years, the Sub Saharan Africa has recorded a very poor development, making its people to continue languishing in poverty. Compared to other continents, its economic performance is comparatively poor. The development record The poor development record can clearly be seen in its per capita Gross Domestic Product of the 1980s, which declined by 1.3 percent per annum coming five percentage points below the average of all inc ome developing countries (Collier and Gunning, 1999, p. 64). The decline has since continued to increase from the 1980s up to now. Between 1990 and 1994, the economic growth slowed down a great deal, whereby the per capita GDP decline accelerated to 1.8 percent and with time went up to 6.2 per cent (Collier and Gunning, 1999, p. 64). From the 1980s, it has declined by almost 1 percent annually making the countries poorer than they were in the 1980s. That has made it the lowest income region in the whole world. Reasons for poor development Lack of social capital is one of the reasons that have led to the poor economic growth. The community and the government through institutions that facilitate private property can generate social capital (Collier and Gunning, 1999, p. 65). The government plays the greatest role in determining the rate of development of a particular country. By imposing taxation on different areas of production or businesses, it only means one thing, and that is, man y people who would be willing to invest in certain areas will be cut off.. There are those who may go ahead but they end up realizing very little growth. When transaction costs are high, the level of economic development will slow down. This part of Africa has greatly been affected by civil wars. With wars, little developments can take place since insecurity will make people fear to make any form of investments in the affected areas. People will fear and run for their lives to different neighboring countries and this is what has happened in this region.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More That also affects the neighboring countries, as they have to put up with the increasing number of refugees from the affected areas. Today, most African countries are still facing wars and after the war, it takes a long time to rebuild the economy again (Crafts 1999, p. 20). Over the l ast three decades, there have been low levels of investments in the Sub Saharan Africa and the region is not in good capacity to import the capital goods and technology that are needed to accelerate structural change. Therefore, there is need for increase in support that the African countries get from multilateral organizations like the International Monetary Fund and the World Bank. This is because it is not easy to attain good economic growth from other sources like the Foreign Direct Investments. The slow economic growth could also have been greatly influenced by the region’s adverse climatic conditions, which results to poor health and thus reduces life expectancy (Collier and Gunning, 1999, p. 8). Most parts of this region are tropical which greatly affects the economy. This is because most of the people are affected by tropical diseases like malaria. The disease is said to be one of the leading causes of death in the tropical region of the world and the governments of t hose countries have to spend a lot in trying to curb it (Collier and Gunning, 1999, p. 7). The harsh weather conditions result to leached soils, which are of poor quality and unreliable rainfall thus making most of the region semi arid. All that affects agricultural activities and this greatly affects the economic development of the countries that lie in this region since they mainly depend on agriculture. When they are deprived of their major economic activity, poverty ensues and with it, positive economic growth cannot be recorded. In general, Africa is also said to be the leading continent in the rate of HIV and AIDS infections. It has recorded the highest number of deaths related to the dangerous disease and as a result, the continent has lost a lot of skilled labor (Sender, 1999, p.91). People who could bring about good economic growth perish with the disease and this greatly affects the given countries. The governments of such countries have had to spend a lot of money in taki ng care of the infected and the affected, for instance, they have to buy ARVs, which help to prolong the lives of the infected. Additionally, the government has the task of taking care of the orphaned children. That huge amount of finance spent in all that could have otherwise been used on development projects that could bring about positive economic growth.Advertising We will write a custom essay sample on Sub†Saharan Africa poor development record over the last thirty years specifically for you for only $16.05 $11/page Learn More Most of the African poor people are greatly affected by economic and health related factors, natural disasters, and conflict shocks, which continue to keep them in poverty (World Bank 201, p. 2). The World Bank looks forward to enabling the African countries to provide better health care and make use of irrigation together with other water management ways to help them deal with the effects of climatic change. Global warming , which is the main cause of climatic change, has led to raised temperatures, prolonged seasons of drought and decline in rainfall. All these make it hard for Sub-Saharan African countries to sustain their agricultural activities resulting to poverty and hence poor economic growth. This part of the African continent is made up of developing countries which face are technologically challenged (Commission on Growth and Development 2008, p.3). Most of them still lag behind in innovation and the creation of new technology; they just absorb and adapt technologies that already exist elsewhere in the world. For example, African countries started using computers a few years ago long after that innovation whereas in the western world, use of computers had become the norm of the day. This means that that they have taken long to develop economically as progress in technology is highly important in determining economic growth. Failures of the Sub Saharan Africa Corruption is another major probl em that has dragged behind Africans. For economic growth to prevail there must be openness in carrying out operations. Most African countries have however failed in fighting corruption (Collier and Gunning, 1999, p. 69). Africa is said to be the leading continent in the levels of the vice. Therefore, it is very hard to attain economic growth and development as embezzlement has already become deeply rooted in most African countries due to corruption. This happens when for instance money is set aside for developments such as roads construction but is not utilized for such purposes but for personal gain by corrupt leaders. This explains the reason as to why there is a very wide gap between the poor and the rich in this region. Some people are too rich because of acquiring property through the wrong means while others are too poor.Advertising Looking for essay on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More As said earlier, agriculture is the main economic activity in most of the African countries as many of the people depend on it for survival. The sector is very crucial, as it is a great source of foreign exchange in the region; 70 percent of the Africans depend on it and half of all employed women are in the sector (Sender, 1999, p. 97). This shows how important the sector is to the continent but things would be better if the African governments took measures to promote the farmers. Some Africans practice cash crop farming but the efforts of such people are greatly undermined by the fact that, they are made to remit a certain amount of money as agricultural taxation (Collier and Gunning, 1999, p. 66). For a country to reap economic gains, it must have good infrastructure. Definitely, anything that has been produced needs to be transported to the market. For this to happen, there has to be a good transport and communication network not only in the urban centers but also deep in the r ural areas. This is where most of the African governments have failed in (Collier and Gunning, 1999, p 66). The rural areas where agricultural products come from are hardly accessible as there are no enough roads and those that are available are in very bad conditions. The situation becomes worse when it rains, as most of the roads are very rough. As a result, great losses are encountered in the transportation process of agricultural perishable goods. It is estimated that in the Sub Saharan Africa, agriculture accounts for between 30 and 55 percent of the Gross Domestic Product (Sender, 1999, p. 96). Although the rural areas of the African region may be very rich in agricultural soils that may end up not contributing the right percentage to their economic growth as most of the produce, fail to get to the required market at the appropriate time. Therefore, the people and the governments need to cooperate in order to build social interaction and that will definitely lead to economic g ains. This can be achieved through building trust, which lowers the transaction costs (Collier and Gunning, 1999, p. 19). There is a growing rate of unemployment in most parts of this region. The governments of the African countries have failed in provision of employment, as most of the people remain jobless. As a result, many people are not able to place food on the table and they continue to live in poverty. Research shows that by the year 1996, only 1 percent of the African population consisted of civil servants which is lower compared to other developing countries whereby 3 percent and above of the population are civil servants. Those who are lucky to get civil employment may not be so happy as well, for they receive little wages, which is not good enough to lead a comfortable life. Most of the African nations have more ethnic diversity than other poor countries in the world and this makes it more difficult for them to have or develop an interconnected economy (Collier and Gunni ng, 1999, p. 67). The governments of the Sub Saharan African countries have not done much in fighting ethnicity. People continue to term themselves different from one another and this breeds nepotism and discrimination, which causes many conflicts. People of different ethnic groups have different beliefs and ways of life. What one group does and terms as very good may not be allowed by another group. When such differences occur, cooperation is not very easy and thus developments cannot be arrived at with much ease. The Sub Saharan Africa successes Sometimes back, there was a very high rate of infant mortality in the region. Most of the deaths occurred in children under five years because of the diseases that affect them while at that age. These diseases include measles, tuberculosis, and whooping cough among others. With continued improved medical care, the number of deaths in small children has greatly been reduced as they are immunized against most of the diseases in the first yea r of their lives. The number of children who die at infancy has drastically reduced (Sender, 1999, p. 90). There have been increased medical facilities that facilitate the provision of better health care and in addition to that, there has been improved nutrition adding to the advantage. As a result, there has been increased life expectancy even in the poor countries (Crafts, 1999, p. 21). Credit should also be given to these countries for promoting literacy to its people. It is no longer the time when women were to stay at home and raise children. Fifty years ago, women in Africa were very unlikely ever to attend school and over 90 percent of the adult females were illiterate (Sender, 1999, p. 92). Most of the countries in this region have done a lot to ensure that the girl child is protected, and gets the required education. The World Bank is in the process of making sure that the economy of African countries improves (World Bank 201, p. 1). This will see majority of people access employment and hence improving their living standards. Many of the poor people live and work in the rural areas but perhaps that may change in future as more people are now migrating to the urban centers in search of better lives. This has created a pool of people who are unemployed and many ends up indulging in criminal activities and prostitution for survival. Conclusion The Sub Saharan Africa has had poor development for a long time. It is considered the last in all development records compared to other regions in the world. The region’s tropical climate, which causes tropical diseases and harsh weather for agriculture, is one of the reasons associated with its failures. To add to that, the governments of countries in this region have failed in several ways and this has led to a decline in the economic development of the region. They have failed to provide good infrastructure, fight corruption, and have not been able to scrap taxation that is imposed on different areas of investment. Though these governments have failed in one way or another, they have also had their successes. They have been able to provide better health care and education to their citizens. Reference List Collier, P., and Gunning, J. (1999). Explaining African Economic Performance. Journal of Economic Literature, 37, 64-11. Collier, P., and Gunning, J. (1999). Why has Africa grown slowly? Journal of Economic perspectives, 13, 3-22. Commission on Growth and Development. (2008). The Growth Report, Washington DC: World Bank. Web. Crafts, N. (1999). Economic growth in the twentieth century. Oxford review of economic policy, 15, 18-31. Sender, J. (1999). African’s performance: Limitations of the current consensus. Journal of Economic perspectives, 13, 89-114. World Bank. (2011). Africas Future, World Bank: Washington DC. Available from  http://web.worldbank.org/WBSITE/EXTERNAL/COUNTRIES/AFRICAEXT/0,contentMDK:22846778~pagePK:146736~piPK:226340~theSitePK:258644,00.html

On Management Essay Example | Topics and Well Written Essays - 750 words

On Management - Essay Example It is always easier to come up with business goals than actually establishing and executing the required strategies to achieve these objectives. Being a manager is not just being able to show profits at the end of the year but being in charge of the critical daily business processes to work for it. Good management is indispensable to the success of any organization. The failure or success of any business institution lies in the hand of its management team as they "lay the company's long term direction, develop competitively effective strategic moves and business approaches and implements what needs to be done internally to produce day in and day out strategy execution" (Strickland, 4). Put simply, the manager is the major driving force that directs the organization to its expected end. In school, we are taught that manager has four primary functions-planning which refers to identifying the goals, objectives, and the business plans to achieve them; organizing which identifies and sets the necessary resources to execute the business plan; directing which includes pointing, leading, and managing employees to achieve organizational goals; and controlling which involves the evaluation process carried out by the organization to check if the actual performance of the company matches the devised business plan (Allen 2). I believe that these functions are significant in the achievement of business goals. However, all these functions are too broad to discuss together, so this paper will only tackle the leadership function of management. Leadership is a critical and rigorous process of influencing and motivating people to achieve business goals. Though the goal of each leader is essentially the same, they craft different ways to achieve them by employing unique management and leadership styles which often leads to conflict as to whether what leadership technique is superior. Two leadership styles are often utilized in business operations-authoritarian and participative management. Authoritarian organizations follow the military type of organization where decision making is centralized and lies at the hand of the top management. Middle managers do as they are ordered, following the chain of command implemented by their superior. Authoritarian organization essentially operates a top-down management style, where the primary role of managers is to transmit orders. Also, authoritarian organizations view that workers hate work and that they need to be compelled to the task demanded from them. This implies that the achievement of the company's goals can only be achieved through force. Authoritarian managers do not motivate their employees to perform well in their job. Their main concern is the achievement of a certain goal at the expense of their employees. ("Role of Managers under Different Management Styles" 38-51) In a participative management style, works are delegated to the employees and managers largely coordinate with the group work. Also, responsibilities are accepted and performed by the employees knowing they will be held accountable for the quality of their work. Work is viewed as a source of satisfaction or frustration depending on the manager's and organization's chosen style of leadership. People who derive satisfaction from their job will then perform the best way that they can while those who obtain frustration from it will tend to perform badly. Thus, managers highly motivate their em

U2 Are you listening Coursework Example | Topics and Well Written Essays - 250 words

U2 Are you listening - Coursework Example Agents can place customers on hold only when they have to consult for a solution to challenging customer inquiries. When taking a message, the agents should forward the message to the floor supervisor in charge, who presents it to the appropriate department or individual. The technique used to measure an individual’s telephone skills is through monitoring. Since all calls are recorded, the supervisors randomly select an individual’s recording, after which they analyze the skills to determine whether they meet the organizational expectations. The interviewee evaluates his performance by gauging reactions from the customer. The interviewee believes that the training offered by the company is vital for improving their customer service skills. The habit he has developed over time is to be patient when listening to customer inquiries. Patience is necessary for calming some of the irate customers, which eventually makes them confident with the services the company offers. To conclude, it would be essential to consider training call-center employees in order to improve their telephone skills. Additionally, monitoring their performance is not only necessary for optimizing individual performance but also assists in enhancing service delivery (Coen, 2001). These invaluable elements help in implementing and evaluating the organization’s quality assurance practices. A recommendation that would benefit the company is that they should consider training the call center agents frequently. This deliberation will allow the employees to refresh their telephone skills and to evaluate their individual performance (Coen, 2001). It might also be beneficial if the supervisors or managers could identify the imperfections of each agent through the recordings. The identification will enable them to determine the best way to assist the affected person, which will be beneficial to the entire

Personality & Attitudes on Revenge in the General Population of Scotland Essay Example for Free

Personality Attitudes on Revenge in the General Population of Scotland Essay Fantasies vary from person to person and are dependent on psychological condition. In a clinical population fantasies tend to last longer than in non-clinical populations. Although overall each fantasy has been reported to last relatively short periods of time, the frequency of which they occur is usually the factor that determines whether they are of concern or not (Gellerman and Suddath, 2005). There seems to be a limited quantity of research available on the general understanding of this topic however the literature that does exist appears to focus on three particular areas, sustaining fantasies as a means of coping with painful and stressful situations in the general population but particularly in the clinical population (Zelin, Bernstein, Heijn, Jampel, Myerson, Adler, Buie Rizzuto, 1983; Harder Zelin, 1984; Greenwald Harder, 1994; Greenwald Harder, 1995 Greenwald and Harder, 1997); aggressive fantasies for pleasure or satisfaction in the general population but more often than not habitually involuntary for the clinical population and generally violent, sexual and sadistic in nature (Gellerman Suddath, 2005; Egan Campbell, 2009 Selby, Anestis Joiner (2007), and finally, revenge fantasies concerning those who have experienced trauma (Mardi Harowitz, 2007). In search of material for this review surprise has it that homicidal fantasies on the whole is the one of which focuses on a more simple view of its apparent natural occurrence in natural surroundings of everyday life, and highlights the evolving acceptance that many normal law abiding citizens can and do have fantasies. Sustaining Fantasy From a study conducted by Zelin et al (1983) the Sustaining Fantasy Questionnaire (SFQ) was developed to measure sustaining functions in psychiatric inpatients in comparison with non-patients. This questionnaire was constructed specifically to measure fantasies of death, withdrawal, restitution, suffering, God, closeness, power and revenge, admiration of self, competition and aesthetics. The questionnaire was then utilised to determine that psychiatric inpatients scored higher than non-patients on fantasies of death, withdrawal, restitution, suffering, God and closeness but fantasies of power and revenge, admiration of self, competition and aesthetics did not differentiate between groups. Thus, suggesting that the questionnaire was able to differentiate the groups by fantasy factors such as death, withdrawal, restitution, suffering, God and closeness and highlighted associations of power and revenge, admiration of self, competition and aesthetics with an independent measure of psycho logy. It is said that experiencing Sustaining Fantasies is a familiar, consistent and repetitive conscious fantasy adopted to help cope with feelings of a painful and stressful situation. According to Zelin et al (1983) the sustaining fantasy is a concept based on the observation that at times of extreme negative emotional states, caused by anger or narcissistic grievance, people often resort to this as a means of re-creating a more ideal situation than that of which stimulated the painful experience, fabricating a sense of satisfaction, restoring self-esteem and emotional equilibrium, and decreasing frustration. Ultimately, the sustaining fantasy is based on the assumption that such fantasies signify and demonstration the basic construction and processes that have evolved in the course of efforts to adapt to painful situations. We are reminded by Zelin et al (1983) that this fantasy is of a specific type called only into play when suffering increasing levels of stress, and should not be c onfused by those fantasies used as a disguised endeavour of pleasure or solutions to relatively un-stressful problems, such studies will be discussed later in the review. One year on, Harder Zelin (1984) furthered the study of Zelin et al (1983) accepting that the sustaining fantasy questionnaire was developed primarily with psychiatric inpatients, but recognising also, the potential for its use in testing correlates among a more general sample. Assuming that everyone uses sustaining fantasies to aid or support themselves through highly stressful periods in life and presuming the importance of this factor in the capability to manage adaptively rather than maladaptively, Harder Zelin (1984) extended interests and investigations into the personality functioning in the general population as well as with pathological persons. They did this by examining the relationship between the 10 types of sustaining fantasies reported by Zelin et al (1983) and two dimensions of self-concept self-derogation and stability of self-concept, suspecting that the type of sustaining fantasy that the person characteristically brings into play will be consistent with and in support of their self-concept, an important relation with psychological-social adjustment and even a potential determinant of psychological-social adjustment. Successfully, the results demonstrated that the Sustaining Fantasy Questionnaire was reliable not only to differentiate between groups of psychiatric inpatients from normal controls, as Zelin et al (1983) demonstrated, but also to distinguish the group of college students used in this study. Just over a decade later Greenwald Harder (1994) followed on from Zelin et al (1983), attempting to examine the expected associations between psychopathology, almost replicating exactly, apart from their use of a student population primarily from a middle-class backgrounds. In addition, Greenwald Harder (1994) questioned if the sustaining fantasy scales associated with weaker functioning, reflects a more general pathology factor as proposed in the data of Zelin et al (1983) or, whether each reflects a particular maladaptive style that is signified by an exceptional construction of associations with the MMPI clinical scales. Further support and reliability of Zelin et al (1983) is strengthened in Greenwald Harders (1994) findings that power/revenge, death/illness, withdrawal/protection and suffering are all related significantly to two of the MMPI measures of overall psychopathology, therefore four of the six fantasy types that imply psychopathology in the inpatients (Zelin et al, 1983) were too the indicators of pathology in the study using the middle-class students. Considering all of the previously mentioned studies (Zelin et al, 1983; Harder Zelin, 1984; Greenwald Harder, 1994) it seems fair to say that ample evidence has been gathered to show that definite types of sustaining fantasy ideas, characteristically used to comfort the self when experiencing feelings of hurt and stress, are associated with indications of psychopathological adjustment. The aim for Greenwald Harder (1995) was then to examine to what extent there are parallels between them and the degree to which such content ideas may well point out psychopathology. With reference to past research on daydreaming, where Singer Antrobus (1972) have suggested that particular collections of imagery content appear to propose less favourable styles, there seems to be similarities with the findings of Zelin et al (1983), although they did emphasise the difference between other fantasies such as daydreams and remind us not to confuse them. Contrary to this emphasis and that of Zelin et al (1983), clinical impressions have proposed that in more ways than one, the overall content of these two types of fantasies is rather parallel. As a result of this proposal, Greenwald Harder (1995) investigated whether sustaining fantasies generally show a strong similarity to the typical daydreams preferred by an individual, or whether there really is a movement from the content of ordinary daydreams to the familiar self-comforting ones that provide support during feelings of pain and stress. To do this they compared the Sustaining Fantasy Questionnaire and the numerous Imaginal Process Inventory (IPI) (Singer Antrobus, 1972) scales for correspondence in content and in their relationships to measures of psychopathology, and a great deal of consistency was discovered even when partialling for social desirability. It was concluded that there was in fact considerable overlap in the content and of correspondence between both, sustaining fantasy and daydreams, and furthermore, it was highlighted that three particular IPI scales were observed to give significant indications of psychopathology fear reaction, bizarre and hostile. Despite the delight in these findings Greenwald Harder (1995) speculated the possibility that rather than the findings being a result of specific content they may be the result of a broad level of association between the two scales. In pursuit of this speculation further analysis detected the average degree of correlation between SFQ and IPI characteristics in comparison to the level of association displayed by those relationships they predicted, finding that although there was no significance, there was a trend toward significance. Thus, suggesting that a general commonality between the SFQ and the IPI may have been a factor in contributing to the extent of their success in predictions for the study. On this note one should be reminded that for the purpose of reliability and validity, considering an underlying weakness alongside the success is vital for future study in terms of recognising the possibility for individuals to very well fantasize and daydream simultaneously in ordinary and/or stressful situations. It is now becoming apparent that sustaining fantasies are perhaps not quite as specific from other fantasies in particular situations such as coping with stressful matters, as was first thought, or, that if they are, they do not always emerge completely alone. Based on the results of this study Greenwald Harder (1995) propose the question of whether it would be beneficial to use the findings of their study, subsequent past research, to investigate clinical manipulation of the content and/or frequency of fantasy having therapeutic effects, bearing in mind the given definition of sustaining fantasy in Zelin et al (1983) at the beginnings of this extensive research. To address the proposed questions that emerged from Greenwald Harder (1995) they conducted another study in 1997 replicating the previously discussed studies and replicating reported relationships between coping behaviours and psychopathology however, this time they utilised measurement instruments that were developed by different investigators, presented different response formats, and were not developed to measure the same content areas as before. They assessed whether consistent relationships exist between the content of self-reported coping behaviours, sustaining fantasies, and ordinary daydreams and in addition attempted to identify coping behaviours associated with psychopathology, exploring any connections between coping behaviours, fantasies, and daydreams correlated with pathology. Pearson correlations indicated similar content between coping behaviours and the two types of fantasy and significant inter-correlations were found between sustaining fantasies, daydreams, and coping behaviours that, separately, were found to be significantly associated with psychopathology. In the process of this investigation, and with influencing thoughts created by the previous workings, Greenwald and Harder (1997) took into consideration the likelihood to expect there would be a consistency between the region of fantasy and behaviour, and that individuals would report thoughts and action in parallel ways but then again, consider also that it is also probable to anticipate that fantasies could serve as a substitute for action, and that a report of specific fantasy content might be inversely associated with behaviour that contains similar content. Growing in strength, again the results of Greenwald Harder (1997) were successful in that there is a significant association with regard to the content among self-reported daydreams, sustaining fantasies, and coping behaviours, even after controlling for social desirability. These results are found to be more influential due to the fact that they were obtained with assessment instruments that were developed by different investigators, used different response formats, and were not developed to measure the same content areas. Therefore, this information suggest that, while there may be some instances of fantasies and behaviours that relate inversely to each other, fantasies usually are consistent with behavioural coping styles. These findings then highlight that there is a complex of daydreams, fantasies, and behavioural responses that could be used to characterize individuals. Furthermore, to generalize the findings of this study it was recommended that future studies should be conducted with other subject populations that take into account age, culture, socioeconomic status and residence environment (Greenwald Harder, 1997), however, it seems appropriate to mention that perhaps at this point it is a good time to look at how the sustaining fantasy ideology has branched out to embrace other influencing factors. Aggressive Fantasies Egan Campbell (2009) expanded research on sustaining fantasies almost taking it to a new level by selecting a diverse population, as recommended by Greenwald Harder (1997), but more importantly taking into account other domains that showed potential to reveal relationships from another angle. Such were, sensational topics, general personality traits, and self-reported physical aggression. They found relationships between sensational interests and physical aggression, regardless of gender. Personality and the application of negative sustaining fantasies significantly forecast physical aggression. When the SFQ was reduced to three higher order factors; positive, negative, and narcissistic sustaining fantasies, correlations were found between neuroticism (N) and both positive and negative sustaining fantasies, although the association was stronger for negative fantasies. There were small associations between positive sustaining fantasies and indirect non-physical hostility although these relations were humble, and openness (O) was a stronger predictor. Narcissistic sustaining fantasies related to low levels of agreeableness (A), replicating associations between low A and narcissism generally. Ultimately proposing that aggressive and hostile persons are more stimulated by violent stimuli and that isolation is a further risk-increasing factor for aggressive interests. Following on from this conclusion of risk-increasing factors, attention was directed back a few years in literature to a study conducted by Gellerman Suddath (2005). They discussed risk-increasing factors in relation to questioning at what point would a health professional perhaps become concerned with a persons fantasy enough for it to become their duty to forewarn or protect others from potential dangerousness, or even attempt to protect the person from them self. In the health profession an evaluation of dangerousness includes not only asking about violent fantasies but also asking about physical and sexual content (Gellerman Suddath, 2005). Gellerman and Suddath (2005) looked at the conditions in which the disclosure of violent fantasies to a mental health professional may generate cause for concern and a duty to warn or protect other citizens. Reviewing legal cases in which violent fantasies were considered in the context of measuring potential dangerousness and the literature available on homicidal and sexually violent fantasies in both non-incarcerated and criminal populations was also examined. It was concluded that no dependable predictive relationship between violent fantasies and wickedly hazardous behaviour was reported in the available literature and suggestions of issues that mental health professionals may think about when gauging whether a particular violent fantasy is a sign for concern requiring rise to a duty in protecting others. At last, this paper is very interesting in that it is greatly unbiased and clearly discusses both the harmful aspects of fantasy as well as the innocent or un-harmful aspects, thus showing the importance of distinguishing between the two possibilities, which must be said, is something that is lacking in the papers previously reviewed. Gellerman and Suddath (2005) explained in detail the definition of violent fantasy for the purpose of their paper which must be credited as again, not many papers in this field have done so. They expressed their perception of violent fantasy as a thought in which an individual imagines physically harming a fellow human being in some way. They explain that the content of individual fantasies may vary from anything such as murder, sexual assault, or inappropriate sexual activity. It is emphasised that fantasy must be distinguished from an intention, in that the imaginary violence is not instantaneously designed to guide or prepare for action. On the other hand, it is said that any expression of intention to harm another person is when we should have cause for concern as this is without doubt communicating a threat rather than a fantasy. Gellerman and Suddath (2005) noted two important points in terms of distinguishing between fantasy being harmless or harmful, firstly, while not instantaneously aimed at guiding action, fantasy has been illustrated as serving a number of clinical functions, including control and relief of anxiety and substitution for action therefore harmless to others and at the same time very useful to the fantasizer, secondly, from a harmful perspective fantasy may also be preparation for action and it is from this perspective that concern should be heightened in the evaluation of dangerousness and the duty to protect. Gellerman and Suddath (2005) go on to give balanced examples of both harmless and harmful fantasies. In their comparisons of both sides and in both populations, un-incarcerated and criminal, together with their overall review of the literature they used, they suggest that as fantasies of murder were fairly common in general Western European and American populations, and a range of fantasies of aggression and sexual violence were less common, but were by no means rare, people should bear in mind that this high prevalence of homicidal and sexually aggressive fantasy can only make us question then, to what extent can such fantasies be considered deviant. In addition it should be highlighted that Gellerman and Suddath (2005) found that existing studies have evidently established that many more individuals have homicidal and sexually violent fantasies than act on them. The relationship between violent fantasy and behaviour in these studies was correlative at best, and no suggestions were given in attempt to identifying the minority of individuals with violent fantasies who may be at risk of acting them out. Altogether, it was concluded that predictors better than fantasies alone are the eminence of the fantasies, the concern with them, and the level of preparation and detail, and the history of any past violent behaviours all need to be looked at collectively (Gellerman Suddath, 2005). Another study of interest where aggressive fantasies seek personal pleasure but in a paradoxical way is that of Selby, Anestis Joiner (2007). They reported that suicidal individuals regularly report the reoccurrence of fantasy where they can visualise their death by suicide very clearly in their imagination, almost like watching it on TV. Selby et al (2007) found that many unremittingly suicidal individuals are thought to have a romantic affection for death and as a result, connect themselves in vivid fantasies or daydreams about the process and the after-effects. This somewhat idealistic thought process even appears to be a pleasant motion for them. In desperation of escape from torment and pain (Baumeister, 1990), it seems that the act of suicide is the answer and therefore thinking about the liberation that death would present, perhaps enables suicidal individuals to experience positive affects similar to that of non-suicidal individuals daydreaming or fantasizing about future life events such as holidays (Selby et al, 2007). This daydreaming may actually be a form of emotion dysregulation, in suicidal individuals, one that would appear, perhaps paradoxically, to increase positive affect yet may increase later risk for serious suicidal behaviour. This psychological state was also considered by Zelin et al (1983). Revenge Fantasies Suicidal behaviour, just like the fantasies they provoke, vary in content and from person to person however for the purpose of this review it should be mentioned that revenge fantasies among many other things, can often be the cause for suicidal behaviour (Mardi Harowitz, 2007). In one way the reason behind the fantasies are similar per se; feelings of rage shame guilt etc., but in another way very different; often unwanted and uncontrollable. Revenge fantasies are described as being beyond normal bitter thoughts and sometimes dangerous. The study conducted by Mardi Harowitz (2007) was an attempt to seek solutions to a hypothetical case demonstrating a problem existing in clinical practice. The method behind this is for the authors to review current data on prevalence, diagnosis, pathophysiology, and treatment and ultimately conclude treatment recommendations. Again it is brought to attention that the quantity of literature addressing fantasy is limited, Mardi Harowitz (2007) pointed out at the beginning of their paper that revenge fantasies have been discussed in literature, however not adequately addressed, a problem common for most papers in this review. Like all other fantasies per se, revenge fantasies can provide a sense of reinstated purpose and regain of control in an otherwise traumatized life and purely for this purpose it is imperative to assist traumatized individuals in recognizing this. Mardi Harowitz (2007) split the scenario up into sections in sequence to how step by step the scenario would be assessed and addressed in a clinical setting. All important techniques and procedures were discussed such as, the importance of techniques in psychotherapy being put in place with the much needed interpretations and reappraisals and with careful differentiation of rational and irrational beliefs. It was explained that it is then, that the function of revenge fantasies as giving an illusion of strength can be interpreted. Mardi Harowitz (2007) suggest the fact that the results of therapy may be attenuation of symptoms, and revenge fantasies are deep-rooted, there is an important need for informing the patients that revenge fantasies are likely to return, and are frequently generated by things as simple as seeing a movie, being hurt, or entering an irritated mood as a result of fatigue. Mardi Harowitz (2007) go on to explain that the professional should help the patient plan a comeback, which can engage in reviewing a pre-established set of ideas, overall they express that their goal is to help the patient gain a sense of restored control, self-esteem, and self-coherence without resorting to the strong-me property of a revenge fantasy. Taking into account the apparent lack of topic specific resources that provide general information on the influences of fantasy in the general public, and the gaps that seem wide open between studies in fantasy, it seems fair to say that the beginning would be a good place to start. As a result the current study will seek to investigate attitudes of the general public toward fantasies, looking to find out what they think fantasies might be and to what extent they think it is normal for people to have them. It will be hypothesised that most people will believe that a fantasy is a mere thought of imagination detached from reality to satisfy emotional desires without logical or moral constraints and likewise most people will agree that it is normal to have fantasies. It is expected that more people will agree, than disagree, that it is ok and can be accepted as normal for people to have homicidal fantasies. Method Design A between-participants point biserial correlation will be used to analyse the data. The independent variables will be the self report personality inventory (IPIP-NEO) and the attitude measuring questions and the dependent variable will be participants score on the IPIP-NEO and the attitude score. Variables such as gender, age, marital status, housing tenure, regions, employment status, income bracket and criminal convictions will also be considered in relation to participant response to both independent variables. Participants According to G Power participant number should be 191, however, for an equal balance, it will be at least 100 males and 100 females. The male and female participants will be ages of or between 21 and 65, and split between four regions (Glasgow, Paisley, Edinburgh Dundee). Apparatus Participant information sheets (PIS) and consent forms will be given along with questionnaires that will be used to measure psychopathic personality traits (IPIP-NEO) and attitudes on aggressive revenge fantasies. Each participant will be given the same questionnaire to complete. The statistical analysis programme SPSS will be used to analyse and correlate the data. Procedure Each participant will be given a brief introduction of the study and asked if they are willing to take part, if they are willing then they will be asked to carefully read the PIS, sign the consent form, which will be detached from the questionnaire as they will be anonymous, and complete the questionnaire. The questionnaire consists of a self-report personality inventory, the International Personality Item Pool NEO (IPIP-NEO) developed by Witt, Donnellan Blonigen (2009), of which permission for use was granted by Edward A. Witt. This 40 item inventory will measure the psychopathic personality traits of fearless dominance (20 items) and Impulsive Antisociality (20 items) to assess how high or low participants score in comparison with each other. A four-option multiple response (False, Mostly False, Mostly True, True) format and a Likert-type scale will be used (False = 1, Mostly False = 2, Mostly True = 3, True = 4) to measure the data. In exception, the 1st, 4th, 9th, 14th, 15th,16th and 17th questions of Fearless Dominance will be measured in reverse scale. The second part of the questionnaire consists of 10 questions regarding attitudes toward people having revenge fantasies. Again, a four-option multiple response (strongly disagree, disagree, agree, strongly agree) format and a Likert-type scale will be used (strongly disagree = 1, disagree = 2, agree = 3, strongly agree = 4) to measure the data. Reference Baumeister, R. F. (1990). Suicide as Escape from Self. Psychological Review, 97, 90-113. Egan, V. Campbell, V. (2009) Sensational Interests, Sustaining Fantasies and Personality Predict Physical Aggression. Personality and Individual Differences, 47, 464-469 Gellerman, D. M. Suddath, R. (2005). Violent Fantasy, Dangerousness, and the Duty to Warn and Protect. Journal of the American Academy of Psychiatric Law, 33, 484-495. Greenwald, D. F. Harder, D. W. (1994). Sustaining Fantasies and Psychopathology in a Normal Sample. Journal of Clinical Psychology, 50, 705-708. Greenwald, D. F. Harder, D. W. (1995). Sustaining Fantasies, Daydreams, and Psychopathology. Journal of Clinical Psychology, 51, 719-726. Greenwald, D. F. Harder, D. W. (1997). Fantasies, Coping Behaviour, and Psychopathology. Journal of Clinical Psychology, 53, 91-97. Harder, D. W. Zelin, M. L. (1984). Sustaining Fantasies and Self-Concept Among College Students. Journal of Clinical Psychology, 40, 743-748 Mardi, J. Harowitz, M. D. (2007). Understanding and Ameliorating Revenge Fantasies in Psychotherapy. American Journal of Psychiatry, 164, 24-27. Selby, E. A., Anestis, M. D. Joiner Jr, T. E. (2007). Daydreaming About Death: Violent Daydreaming as a Form of Emotion Dysregulation in Suicidality. Behavior Modification, 31, 867-879. Singer, J. L. Antrobus, J. S. (1972). Daydreaming, Imaginal Processes and Personality: A Normative Study. In P. W. Sheehan (Ed.). The function and nature of imagery. (pp. 175-202). New York: Academic Press. Witt, E. A., Donnellan, M. B. Blonigen, D. M. (2009). Using Existing Self-Report Inventories to Measure the Psychopathic Personality Trait of Fearless Dominance and Impulsive Antisociality. Journal of Research in Personality, 43, 1006-1016. Zelin, M. L., Bernstein, S. B., Heijn, C., Jampel, R. M., Myerson, P. G., Adler, G., Buie, D. H. Rizzuto, A. M. (1983). The Sustaining Fantasy Questionnaire: Measurement of Sustaining Functions in Psychiatric Inpatients. Journal of Personality Assessment, 47, 427- 439.