The Benefits of a Healthy Lifestyle Essay Example For Students

The Benefits of a Healthy Lifestyle Essay Living a healthy lifestyle is a melting pot of several factors. One is not able to live a healthy lifestyle without a solid diet and workout foundation. The harmful side effects of processed food, drugs, alcohol, and sleep deprivation trump one’s life while mental and emotional stability aids in a healthy lifestyle. According to Jillian Michaels, â€Å"The right diet will regulate your blood sugar, balance your hormones, and maximize your energy, all of which promote optimal fat burning and muscle development.† None the less, one must form a platform based on healthy morals and principles in order to live life to its fullest potential. We will write a custom essay on The Benefits of a Healthy Lifestyle specifically for you for only $16.38 $13.9/page Order now A healthy diet consists of â€Å"three basic macronutrients- carbohydrates, proteins, and fats.† Protein comes in the form of lean meat and nuts, while fat comes from oils like almond, coconut, and peanut oil. A common misconception is that carbohydrates are only pastas. Carbohydrates can take the form as certain vegetables, fruits, and legumes. The correct foods and amount of calories depends on the type of oxidizer one is. There are three types of oxidizers. The first is a slow oxidizer which â€Å"requires a higher percentage of carbohydrates than of fat and protein.† A slow oxidizer should eat a ratio of fifteen percent fat, twenty-five percent protein, and sixty percent carbohydrates. A slow oxidizer is able to digest carbohydrates easier than other oxidizers so therefore a larger amount of carbohydrates is allowed. A slow oxidizer should look for protein that is low in fat, carbohydrates that are low in starch, and try to keep their fat consumption to a minimal. However, a balanced oxidizer â€Å"requires an equal percentage of carbohydrates, fat, and protein† and should have a ratio of thirty percent fat and protein and forty percent carbohydrates. Balanced oxidizers are able to eat a wide range of foods and still perform well. A balanced oxidizer should consume high-fat and low-fat protein and carbohydrates that are low in starch. On the other hand, a fast oxidizer â€Å"requires a higher percentage of protein and fat than carbohydrates.† A fast oxidizer is similar to a balanced oxidizer but the percent of carbohydrates and protein are switched around. A fast oxidizer should look for high-fat protein, low starch vegetables as carbohydrates, and natural oils or fats. Discovering the food that will benefit one’s body will ultimately raise energy levels, provide mental clarity, and stabilize one’s body.

Goals are created in order to provide motivation t Essays

Goals are created in order to provide motivation t Essays Goals are created in order to provide motivation to accomplish a want or need. Some believe they can accomplish any goal with hard work and dedication. Others believe in practicality and are limited when setting goals. In my opinion, people are limited in what they can accomplish because goals can become illogical, an individual's physical and mental ability disqualifies them from achieving goals, and overall societal influence contributes toward influencing our goals. Goals become illogical because people focus on doing what they want to accomplish and not on what they are able to achieve. Human ability causes limitations on what can be done because of a person's health, their schedule, and their commitments which causes loss of focus on their goal. Societal Influence creates peer pressure in which an individual's decision and goal making are affected. The goals that people set are not always able to be attained due to. Some people making goals that are too impractical or too far-fetched to be completed. Goals become impractical because when someone is determined to accomplish something, their determination affects the individual's ability to remain focused on reason when creating a goal. When most people set a goal to accomplish, it is something they want or they desire instead of something they know they can do. No matter how much time, dedication, and persistence someone puts into a goal, it does not mean they will be able to complete it. If a person sets a goal that is hard to achieve, like becoming President, there is a high chance it will not be completed because it is too high of a goal. Goals need to be set based off of human ability and not what the person wants. If a goal is based on a want of a person, the goal becomes desirable, and when a goal is desirable, all logic and standards of a person are essentially gone. H umans are not able to achieve any goal they set because of how illogical and difficult they can be. Everyone's life is different in which individuals have commitments, and different health issues that they go through. This dictates the goals that we are trying to achieve. Physical strength and ability ranges differently throughout society which limits people to realistic goals they need to set. Most adults have jobs to support their family, and many kids in school have after school activities, like sports or clubs which takes up most of their time including the school work they have to do, there would only be little time during the weekend to do any extra activities. Disease can have a big effect on your life and can have a big effect on what you can and cannot do. Illness like cancer for example the treatments can severely weaken your immune system, can hold you back from going out in public and engaging everyday normal activities. Science proves what we know humanity, and tells us what we can and cannot do, Physics helps you understand how nature behaves and puts limitations o n what is humanly possible, therefore we know what goals we can realistically achieve and what is out of our reach. Society limits people to their goals. Dedication, persistence, and time help achieve your goal. Hard work overcomes any type of physical gifts, working to perfect your craft is key to achieve anything. There are limitations that stop you from achieving your goal. You are limited physically and mentally. If you are 4'10 and a really good basketball player you will not be able to play in the NBA because of the taller players. There are limitations that stop you from achieving your goal. Everyone is limited to what they want to achieve in life. The human spirit is one of the few things in history that has never been broken. People have been exiled, conquered, and massacred, yet they get right back up and rebuild themselves. However, there is a limit to what can be accomplished individually. The mind and body, society, and over-ambition are all limiting factors. They chain, bind, and ground us, but amazing things can still be accomplished. Goals must be true to one's own realistic ambitions and skills, as well as

Assignment Research Paper Example | Topics and Well Written Essays - 500 words

Assignment - Research Paper Example Even though that is an increase on previous studies that have shown the percentage of businesses who measure results that are directly attributed to training efforts as a lot lower, the fact still remains that showing a direct causality between training and training programs is still a problem. Two problems that will be the focus of this study will be (1) finding variables that are directly impacted by training methods and (2) accounting for other influences of change that also might be causal reasons for the changes in the variables identified. While companies often measure their business success through sales figures, customer complaint numbers, accident figures, staff absences and similar statistics these same figures only offer a statistical reference if applied to staff training and its effectiveness. However anecdotal evidence is harder to ascribe measures to. Questionnaires have been used with some effectiveness to determine employee opinions on training programs, and how the same employees feel their skill set has improved because of the training (Olian et al, 1998). But the problem with using similar methods to accurately gauge the return on investment for the training in the workplace is that the data is often self-reported which comes with its own set of limitations. Another issue is that to get an accurate measure of improvements relating directly to training, a methodology would have to include a way of collecting data on a range of variables that included post-training behaviors as well as behaviors during and after the training had been finished. Also to ensure that some other causal element (such as a change in staff moral due to the implementation of training program) has not influenced the data collected (Olian et al, 1998). The purpose of this study will be to collect data and analyze the methods used in

REFLECTION ON INTERNATIONAL MARKETING Essay Example | Topics and Well Written Essays - 1250 words

REFLECTION ON INTERNATIONAL MARKETING - Essay Example Additionally, international markets are characterised by a wide range of market forces that may limit the success of particular products that do not conform to the market forces. Some of the pertinent issues that may affect the success of a product in the market includes the skin colour of the people, their cultural aspects, and even their general attitude towards specific products. For instance, in Asia, the idea of a bright skin colour is a sensitive issue that influences the sale of beauty products. As such, organizations that consider entering the international market should be prepared to conform to these market forces to avoid the risk of opposition from their potential customers. Unilever is one of the organizations that have faced a market resistance from their sale of skin whitening products in Asia. International marketing strategy demands that an organization conforms to the ethical aspects of the new market to avoid igniting moods and emotions that may affect their operat ions. In the Asian market, there has been an upsurge of the demand of beauty products, a trend that has attracted many beauty product organizations to venture into this market. McDougall (2013, Para. 2) pointed out that Asia contributes to a large extent to the expanding beauty market that is expected to hit $19.8 billion by the year 2013. In Asia particularly, the market for beauty products has expanded due to the great desire of citizens to lighten their skin as a way of conforming to the notion that dominates in this environment that the bright skin is a symbol for superiority while darker skin symbolizes a suppressed person in the society. In China, India, Japan and Thailand, the people have learnt to associate light skin with beauty, youthfulness and success. Additionally, the demand has heightened due to the change of use of these skin lightening chemicals. Traditionally, these products were used for facial care yet currently the products are used for whole body care. Resultan tly, the market is expected to grow rapidly for at least five years in the near future. Consequently, multinational organizations, such as Unilever, have identified this as a potential market for sale of beauty products. However, the organizations seem to have undermined the concept of consumer behaviour that Samli (2013, P. 2) regards as a giant market force in the 12st century business environment. Skin colour has been a controversial issue in the Asian society that has sparked a great debate on the definition of beauty in this market. The nortion that bright people are superior to the white people has lead to a vicious discussion as most activists regard this kind of attitude as an act of discrimination that must be eliminated once and for all in the society. One of the activists against colour discrimination, Nandita, has launched a campaign to declare that â€Å"Dark is beautiful† as a way of fighting this issue that has generated mixed emotions in this country (Daily Ne ws, 2013, Para. 1). Being a popular actress, Nandita has garnered a lot of public interest among the black people who have shown their support of the campaign to fight against colour and racial discrimination. This campaign is similar to the campaign in Senegal that declares that â€Å"Don’t Bleach, black is beautiful† to assert the public that beauty is beyond the skin colour. From this point of view, skin colour is a matter that is likely to influence the consumer behaviour in the Asian market and taking precaution is the only way to

The role of the HR function Assignment Example | Topics and Well Written Essays - 2000 words

The role of the HR function - Assignment Example Self development plan not only provides the self reflection but it also sets the path straight in terms of career Personal development program is very important. It provides the framework to the individual to conduct personal self assessment and identify his strengths and weaknesses. It helps in charting out the guideline to optimize and capitalize on the existing capabilities and determine the future path. It helps in identifying the areas of development and ways to enhance capabilities and knowledge and helps in deciding and developing a clear picture of the future in terms of career. Personal development plan is geared towards progress of both personality and self. A clear analysis of existing capabilities and desired ones helps in boosting self esteem and a clear picture of the future enable to add appropriate qualifications especially when you are vying for higher position (Attwood, 2005). This paper aims at creating my own personal development plan in the light of the different theories of personality, learning and leadership. Personal Development Plan A personal development plan consists of the following major steps. 1. What is my current state 2. What is my desired state 3. How do I get there? What is needed 4. ... So it is beneficial to identify the personality type first using the Myers Brigg Type Indicator (MBTI). MBTI It is one of the best known and most widely used for identifying personality and learning style. MBTI identifies the psychological type on four different scales namely Extraversion Vs Introversion (E-I), Sensing Vs Intuition (S-I), Thinking vs. Feelings (T-F) and Judging vs. perceiving (Gardner, 2009). The E-I indicator shows whether the energy and attention primarily comes from inside or from outside events. S-I indicators shows how the individual perceive the world and take the information whether directly from the five senses i.e. sensing or indirectly by using intuition. T-I indicator shows preferences in decision making either logical and rational or subjective values like based on like and dislike. The last indicator is J-P that shows individual’s choice whether to use judging or perceptive attitude for dealing with the environment (Knights et al 2007). I took MBT I online test to identify my personality. The test identified my personality type as ESFP. It shows I am an extrovert and I have the following characteristics sociable, outgoing, talkative, gregarious, active, optimist and impulsive. In my perceptions I rely on my five senses. Both of them are my strengths. However in my judgments I am not rational and logical and mostly make judgments based on my likes and dislike. That is a weakness. My attitude in dealing with the environment is based on perception rather than judging, it can also be considered a weakness (Ewing, 2006) Learning Style There are six types of learning styles namely reading, writing, listening, speaking, visualizing and manipulating. No one style is better than the other. Generally people use the learning style

Interpersonal Relationships: Advantages and Disadvantages

Interpersonal Relationships: Advantages and Disadvantages Tiffany Steeples Interpersonal Relationships Interpersonal relationships are one of the most important things we have, and our ability to form meaningful relationships, rest largely on your interpersonal communication competencies (DeVito, pg. 196). The advantages of relationships often outweigh the disadvantages but to form more meaningful relationships, to keep them, or even to dissolve them and maintain emotional health at the end of a relationship; one must be able to evaluate the stages of relationships and their importance (Hamlett). A good way to understand the study of interpersonal relationships is to take a look at your own relationships, whether past, present or even the type of relationship you want in your future. Focusing on your own relationships such as friendships, romantic relationships, your family, or your work relationships can explain a lot about whether your relationships fail or succeed. Major advantages of having interpersonal relationships are: You lessen your loneliness (DeVito pg. 196). When you feel like someone cares or loves you and is there to protect you, you feel less lonely. Gaining a self-knowledge and having the self esteem you need through contact with others helps you to see things through different perspectives. Placing yourself in different roles can strengthen the availability of so many relationships will help you to focus on viewing  yourself and your relationship. Healthy interpersonal relationships also help enhance self-esteem and self-worth (DeVito pg. 196). Having that one friend or that one romantic partner will make you feel more worthy and more desirable. DeVito states that research shows that without interpersonal relationships, you are more likely to become depressed and by becoming depressed, interpersonal relationships can contribute to physical illness (DeVito pg, 197). Not only can you become depressed, but relationships can also contribute to high blood pressure, high cholesterol, obesity, smoking, or lack of physical exercise (DeVito pg. 197). With having those â€Å"good friends†, you’re able to maximize your pleasure and they help to minimize your pain. For example, when losing a job, your friends are supposed to make you feel less hurt when unexpected confrontations arrive. Friends are there to help and will make you feel better whether it be good news or bad news. The last advantage of interpersonal relationships, human contact is one of the best ways to secure the intellectual, physical and emotional stimulation that we all go through (DeVito pg. 197). DeVito also states that even having an imaginary friend is better than not having a friend at all. The advantages all seem to have a good effect on a person who is involved with interpersonal relationships and understanding all of these things will help us to determine how far our relationships will go. The disadvantages of Interpersonal relationships are expressed through what most people would consider to be â€Å"disadvantages†. People conclude that close relationships puts pressure on you to reveal yourself and to expose your vulnerabilities (DeVito pg. 197). I find this to be true, especially with friendships because you can know and find out so much about a person and  then as soon as the relationship deteriorates, the relationship may backfire and all of your personal information becomes a weakness that is used against you. Close relationships may increase your obligations towards others. This means that your time becomes their time as well. Not only your time is felt obligated but even possibly your financial obligations become shared and you may not be too excited about sharing your time or your finances. While building close relationships, other relationships you may have may start to feel abandon. I believe this to be true, especially if your building a romantic relationship that may require a lot more of your time and your friends are not as supportive or understanding. Your friendships can become abandoned. Relationships take a lot of both, time and energy, and you have to be willing to sacrifice which relationships are more important or even better, learn to balance the two different relationships to make sure everyone is happy. The closer your relationships, the more emotionally difficult they are to dissolve (DeVito pg. 197). It is whole lot harder to rid a relationship that you have put forth time, emotional strength, and even financial stability. This can cause depression or distress that some people dislike to face. The last disadvantage of having interpersonal relationships is that Your partner may break your heart (DeVito pg. 197). After all of the time and different things that you could possible put forth to make a relationship work, it could all backfire and against all pleas and promises your whole life could change. If you care a great deal, you’re likely to experience a great hurt; if you care less, the hurt will be less (DeVito pg. 197). To better understand interpersonal relationships, you must also understand the relationship stages. The six stages are the significant stages you may go through as you try to achieve your relationship goals (DeVito pg. 198). The six stages which are Contact, Involvement, Intimacy, Repair, Deterioration and Dissolution are use for all types of relationships including friendships, love relationships and even online relationships. Contact is the first stage that includes perceptual contact. Perceptual contact allows you to see what the person looks like, what they sound like and even what they smell like (DeVito pg. 199). After perceptual contact there is interactional contact in which you are interacting with the person. This type of contact can be nonverbal by exchanging winks and smiles and also allows the person to learn information about the other person. DeVito states, that it is during this stage, that your may initiate interaction and engage in invitational communication (DeVito pg. 199). The involvement stage is the second stage in which a sense of mutuality, of being connected, develops (DeVito pg. 199). During this stage your empathizing more with each other and you are committing to getting to know the person at an even better level than the contact stage. It is during this intimacy stage that you begin to express your feelings and thoughts by being honest. Your communication with each other becomes more personal. Within this stage you have the interpersonal commitment phase which allows you to commit yourselves to each other in a more â€Å"private† way and then there is the social bonding phase that allows commitment that is made more publically. It is also during the intimacy stage the two becomes a unit, a couple or a pair. The deterioration stage is the stage where the bonds begin to become weakened. When the reasons for coming together are no longer present or things may take a drastic change, then the relationships deteriorates (DeVito pg . 202). The repair stages has different phases that it  considers; the first phase is the intrapersonal repair. This is when you analyze what exactly went wrong and you may consider ways of solving your differences. During the interpersonal repair, you may discuss the problems of your relationship and what can be done to fix whatever the problems. DeVito states that you can look at the strategies for repairing a relationship in terms of the word REPAIR (DeVito pg. 203). To break down the word REPAIR, it means to Recognize the problem, Engage in productive conflict resolution, Pose possible solutions, Affirm each other, Integrate solutions into your life and Risk. The last stage in the dissolution stage, the stage is the cutting off of the bonds that tie you together, whether in a friendship or romantic relationship. DeVito gives some suggestions for dealing with dissolution. He suggest that you should break the loneliness-depression cycle, take time out, bolster self-esteem, seek the support or others and to avoid repeating negative patterns (DeVito pg. 204). Interpersonal relationships are something that we all as people have to and will experience. Professor Ralph Hamlett states that we must remember that all relationships are dynamic, meaning that they change (Hamlett). In order to accommodate these changes, we must all be aware of the change and how we are going to adapt. Works Cited DeVito, Joseph A., Interpersonal Messages: Communication and Relationship Skills,3rd ed. (Boston:Pearson, 2014). RalphHamlett. N.p., n.d. Web. 4 Oct. 2014. Why is Hamlett Timeless? Why is Hamlett Timeless? Shakespeares Hamlet is exemplary of the universal nature, which, despite the passage of time still holds its textual integrity. As Hamlet  is not limited by contextual barriers multiple interpretations are plausible through the texts ability to be re-contextualised. The thematic representations of love, power and the central theme of life and death continue to hold significance to audiences and propose an understanding of the mental instability of the human condition. The themes will be highlighted in this response in order to expose Hamlets transcendent nature. Political instability and Power through matters of Corruption are timeless and can be expressed during the Elizabethan Era of Hamlet. Corruption is epitomised in Hamlet through the character of Claudius who used the ambiguous method of murdering King Hamlet to satisfy his obsession for power. Claudiuss immoral and corrupt rise to power is illustrated in Act 1 scene 5 as King Hamlet states, The serpent that did sting thy fathers life now wears his crown. The metaphoric language present exemplifies Claudiuss unjust rise to power. Claudius has used corruption at the detriment of justice and virtue to proclaim power within Denmark. Furthermore, Claudius corrupt rise to power is further cemented into the kingdom of Denmark through Hippocratic characters such as Polonius and Rosencrantz and Guildenstern. This can be reinforced as Hamlet states, there are many confines, wards and dungeons; Denmark being one oth worst. The extended metaphor of imprisonment not only encapsulates his view of C laudiuss corrupt kingdom but represents his feelings of being entrapped in an unstable political monarch. Therefore political instability and power occur through matters of corruption. Central to Hamlets development is the themes of intricacies of the human condition thus being life and death. Shakespeares usage of soliloquies depicts Hamlet thoughts and feelings strengthing Hamlets as a truth teller. This dramatic technique is used to reveals admiration of his father in contrast to Claudius. A hostile Hamlet illustrates the difference between the two kings, his deceased father and Claudius through the anthropomorphic allusion of his father to Claudius in being as Hyperion as the satyr. Thus suggesting Claudius who appears regal to be in reality like that of a lustfulness beast while his father to be that of a loyal God. The iambic pentameter present in the most part of the soliloquy is heavily disregarded as this line extends to fifteen syllables as to implore Hamlets distress. His turbulent response is furthermore illustrated by the enjambment which closely follows in the soliloquy indicating struggle to control his emotions. Imagery displays greater meaning in t he death of his Hamlets father. tis an unweeded garden, that grows to seed symbolises that the thrown has been overtook by weeds, that is Claudius, after what was before has died. Shakespeare imagery used allows the audience to view Hamlets thoughts graphically of the truth of the fratricide and incest in Elsinore. Shakespeares use of soliloquies reveals Hamlets thoughts into life and death and reveals the weight of the contemplation in this stream of consciousness. The speech is written in a fractured, fragmented manner which is symbolic of Hamlets internal struggle. Emphasis is placed upon the second last syllable rather than the last syllable, which draws upon the tradition of feminine rhyme further elucidating Hamlets inner turmoil. Anadiplosis is evident in the metonymic chain in this soliloquy between the association of sleeping with death. The use of metonymy stresses the introspection of Hamlet, as it is a technique often used to convey thought processes, as thinking is an associative practice. Shakespeare suggests through the characterisation of Hamlet that the fear of what will come after death makes individuals suffer the corrupt world as suicide would mean eternal damnation. This is again reflected in his statement, Thus consciousness does make cowards of all. Poignantly highlightin g Hamlets inability to execute his reprisal and his struggle to turn his desire for revenge into action, accentuating his restraint due to the fear of what his future will hold after death. Alas poor Yorick! Iknew him / Horatio a transcendent quotation and is a famous reflection on the fragility of life. It is in this soliloquy where Shakespeare reveals Hamlets intelligence, emotional complexity into the fate of us all as the themes of life and death follow on into his stream of consciousness. Hamlet is a play which both, reflects its own context and resonates with modern audiences. Through exploring themes such as the love, power and most highly life and death. Hamlet educates the modern responder about the Shakespearean context and allows them to relate to universal these themes. This combination will ensure that the text continues to be valued as significant through numerous contexts.

Carl Friedrich Gauss :: essays research papers

Carl Friedrich Gauss   Ã‚  Ã‚  Ã‚  Ã‚  Carl Friedrich Gauss was a German mathematician and scientist who dominated the mathematical community during and after his lifetime. His outstanding work includes the discovery of the method of least squares, the discovery of non-Euclidean geometry, and important contributions to the theory of numbers.   Ã‚  Ã‚  Ã‚  Ã‚  Born in Brunswick, Germany, on April 30, 1777, Johann Friedrich Carl Gauss showed early and unmistakable signs of being an extraordinary youth. As a child prodigy, he was self taught in the fields of reading and arithmetic. Recognizing his talent, his youthful studies were accelerated by the Duke of Brunswick in 1792 when he was provided with a stipend to allow him to pursue his education.   Ã‚  Ã‚  Ã‚  Ã‚  In 1795, he continued his mathematical studies at the University of Gà ¶ ttingen. In 1799, he obtained his doctorate in absentia from the University of Helmstedt, for providing the first reasonably complete proof of what is now called the fundamental theorem of algebra. He stated that: Any polynomial with real coefficients can be factored into the product of real linear and/or real quadratic factors.   Ã‚  Ã‚  Ã‚  Ã‚  At the age of 24, he published Disquisitiones arithmeticae, in which he formulated systematic and widely influential concepts and methods of number theory -- dealing with the relationships and properties of integers. This book set the pattern for many future research and won Gauss major recognition among mathematicians. Using number theory, Gauss proposed an algebraic solution to the geometric problem of creating a polygon of n sides. Gauss proved the possibility by constructing a regular 17 sided polygon into a circle using only a straight edge and compass.   Ã‚  Ã‚  Ã‚  Ã‚  Barely 30 years old, already having made landmark discoveries in geometry, algebra, and number theory Gauss was appointed director of the Observatory at Gà ¶ttingen. In 1801, Gauss turned his attention to astronomy and applied his computational skills to develop a technique for calculating orbital components for celestial bodies, including the asteroid Ceres. His methods, which he describes in his book Theoria Motus Corporum Coelestium, are still in use today. Although Gauss made valuable contributions to both theoretical and practical astronomy, his principle work was in mathematics, and mathematical physics.   Ã‚  Ã‚  Ã‚  Ã‚  About 1820 Gauss turned his attention to geodesy -- the mathematical determination of the shape and size of the Earth's surface -- to which he devoted much time in the theoretical studies and field work. In his research, he developed the heliotrope to secure more accurate measurements, and introduced the Gaussian error curve, or bell curve. To fulfill his sense of civil responsibility, Gauss undertook a geodetic survey of his country and did much of the field work himself. In his theoretical work on surveying, Gauss developed

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INDIAN INSTITUTE OF MANAGEMENT AHMEDABAD INDIA Research and Publications The Logistics Sector in India: Overview and Challenges Pankaj Chandra Nimit Jain W. P. No. 2007-03-07 March 2007 The main objective of the working paper series of the IIMA is to help faculty members, Research Staff and Doctoral Students to speedily share their research findings with professional colleagues, and to test out their research findings at the pre-publication stage INDIAN INSTITUTE OF MANAGEMENT AHMEDABAD-380 015 INDIA INDIAN INSTITUTE OF MANAGEMENT AHMEDABAD INDIA Research and Publications The Logistics Sector in India: Overview and ChallengesPankaj Chandra Nimit Jain Indian Institute of Management Ahmedabad Vastrapur, Ahmedabad 380015 [email  protected] ernet. in, [email  protected] ernet. in Abstract The logistics industry in India is evolving rapidly and it is the interplay of infrastructure, technology and new types of service providers that will define whether the industry is able to help its customers reduce their logistics costs and provide effective services (which are also growing). Changing government policies on taxation and regulation of service providers are going to play an important role in this process.Coordination across various government agencies requires approval from multiple ministries and is a road block for multi modal transport in India. At the firm level, the logistics focus is moving towards reducing cycle times in order to add value to their customers. Consequently, better tools and strategies are being sought by firms in order to enhance their decision making. In this paper, we provide a perspective on these issues, outline some of the key challenges with the help of secondary information, and describe some interesting initiatives that some firms & industries are taking to compete through excellence in managing their logistics.IIMA INDIA Research and Publications 1 Introduction The Indian economy has been growing at an average rate of more than 8 per cent over the last four years (Srinivas, 2006) putting enormous demands on its productive infrastructure. Whether it is the physical infrastructure of road, ports, water, power etc. or the digital infrastructure of broadband networks, telecommunication etc. or the service infrastructure of logistics – all are being stretched to perform beyond their capabilities.Interestingly, this is leading to an emergence of innovative practices to allow business and public service to operate at a higher growth rate in an environment where the support systems are getting augmented concurrently. In this paper, we present the status of the evolving logistics sector in India, innovations therein through interesting business models and the challenges that it faces in years to come. Broadly speaking, the Indian logistics sector, as elsewhere, comprises the entire inbound and outbound segments of the manufacturing and service supply chains.Of late, the logistics infrastructure has received l ot of attention both from business and industry as well as policy makers. However, the role of managing this infrastructure (or the logistics management regimen) to effectively compete has been slightly under-emphasized. Inadequate logistics infrastructure has an effect of creating bottlenecks in the growth of an economy, the logistics management regimen has the capability of overcoming the disadvantages of the infrastructure in the short run while providing cutting edge competitiveness in the long term.It is here that exist several challenges as well as opportunities for the Indian economy. There are several models that seem to be emerging based on the critical needs of the Indian economy that can stand as viable models for other global economies as well. Chandra and Sastry (2004) have pointed towards two key areas that require attention in managing the logistics chains across the Indian business sectors – cost and reliable value add services. Logistics costs (i. e. inventor y holding, transportation, warehousing, packaging, losses and related administration costs) have been estimated at 13-14 per cent of Indian GDP which is higher than the 8 per cent of USA’s and lower than the 21 per cent of China’s GDP (Sanyal, 2006a). Service reliability of the logistics industry in emerging markets, like India, has been referred to as slow and requiring high engagement time of the customers, thereby, incurring high indirect variable costs (Dobberstein et. al, W. P. No. 2007-03-07 Page No. 3 IIMA INDIA Research and Publications 2005).However, the Indian logistics story is one with islands of excellence though there has been a general improvement on almost all parameters. It is this aspect that we explore further in this paper. The paper is organized as follows: the next section gives a brief introduction of some of the peculiarities of the Indian logistics sector. In section 3 we discuss the determinants of growth in this industry. In section 4 we prov ide some interesting initiatives that point towards a renewal of the sector. The challenges facing the sector are discussed in the last section. 2 Some Peculiarities of the Indian Supply ChainsThe Indian logistics sector has typically been driven by the objective of reducing transportation costs that were (and often continue to be) inordinately high due to regional concentration of manufacturing and geographically diversified distribution activities as well as inefficiencies in infrastructure and accompanying technology. Freight movement has slowly been shifting from rail to road with implications on quality of transfer, timeliness of delivery and consequently costs except for commodities which over long distances, predominantly, move through the extensive rail network. More on the infrastructure issues later.Figure 1 shows the relative value of transportation costs vis-a-vis other elements of the logistics costs in India. The transportation industry is fragmented and largely unorga nized – a large number of independent players with regional or national permits that carry freight, often with small fleet size of one or two single-axle trucks. This segment carries a large percent of the national load and almost all of the regional load. This fragmented segment comprises owners and employees with inadequate skills, perspectives or abilities to organize or manage their operations effectively.Low cost has been traditionally achieved by employing low level of technology, low wages (due to lower education levels), poor maintenance of equipment, overloading of the truck beyond capacity, and price competition amongst a large number of service providers in the industry. Often, one finds transportation cartels that regulate supply of trucks and transport costs. However, the long run average cost of transport operations across the entire supply chain may not turn out to be low. W. P. No. 2007-03-07 Page No. 4 IIMAINDIA Research and Publications Figure 1: Elements of Logistics Cost in India Trans por tation 40 War e hous ing, Pack aging & Los s e s 24 26 Inve ntor y Or de r Pr oce s s ing & Adim ins trative 0 5 10 10 15 20 25 30 35 40 45 percent contribution Source: Sanyal (2006a) Table 1 gives a breakup of the logistics cost across different sectors of the Indian industry and the changes therein over the last five years. It shows how the logistics spend is increasing, sometimes dramatically, across various industrial sectors. Steel, harmaceuticals, food & agro-business, and auto have also been the sectors that are growing most rapidly in the national economy – it is no surprise that their logistics costs have been increasing at a faster rate. A few observations are in order here. The low change in order processing & administrative costs in the cement sector could possibly be due to the use of call centers by various producers for order processing and dispatch planning. Steel and pharmaceutical sectors have seen maximum changes in compon ent costs.The distribution practice of pushing goods down the channel might be responsible for high increase in the inventory and warehousing costs in the pharmaceutical industry. Investments in new cold chains and losses might be the causes of high change in the warehousing, packaging & losses related costs. Warehousing, has also been typically dominated by small players with small capacities and poor deployment of handling, stacking and monitoring technologies. While it has had detrimental effect on almost all sectors, the food sector has been the one that has suffered the most due to low investment in cold chains and allied machinery.Erratic power outages have also meant low dependence on technology and a more manual operation. Another fact that has affected both the location as well cost of operating a W. P. No. 2007-03-07 Page No. 5 IIMA INDIA Research and Publications warehouse has been the â€Å"octroi tax1. † Firms have been locating warehouses outside city limits. Ta ble 1: Distribution of Logistics Costs across Some Sectors (2000-2005) Logistics Cost Components (in US $ mn) Transport ation Inventory holding Warehousing, packaging & loses Order processing & administrative Total Logistics cost SectorAuto Cement Consumer Durables FMCG Food Garment Pharmaceutical Steel Source: IAEIS 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 2000-01 2005-06 Avg. Change 285. 0 406. 5 20. 3 50. 6 55. 4 4. 8 331. 9 398. 9 11. 2 201. 5 280. 7 13. 2 398. 7 524. 5 21. 0 337. 3 454. 4 19. 5 174. 0 310. 0 22. 7 438. 3 693. 6 42. 5 171. 0 243. 9 12. 2 30. 4 33. 3 2. 9 199. 1 239. 3 6. 7 120. 9 168. 4 7. 9 239. 3 314. 7 12. 6 202. 4 272. 11. 7 104. 4 186. 0 13. 6 263. 0 416. 1 25. 5 185. 3 264. 3 13. 2 32. 9 36. 0 3. 1 215. 7 259. 3 7. 3 131. 0 182. 5 8. 6 259. 2 340. 9 13. 6 219. 2 295. 3 12. 7 113. 1 201. 5 14. 7 284. 9 45 0. 8 27. 7 71. 3 101. 6 5. 1 12. 7 13. 8 1. 2 83. 0 99. 7 2. 8 50. 4 70. 2 3. 3 99. 7 131. 1 5. 2 84. 3 113. 6 4. 9 43. 5 77. 5 5. 7 109. 6 173. 4 10. 6 712. 6 1016. 4 50. 6 126. 5 138. 5 12. 0 829. 6 997. 3 27. 9 503. 8 701. 8 33. 0 996. 8 1311. 2 52. 4 843. 2 1135. 9 48. 8 434. 9 775. 0 56. 7 1095. 7 1734. 0 106. 4 They delay moving goods into retail network as late as possible.It has also led to the development of a unholy business-government nexus to avoid the tax and extract rents. Use of technology is quite limited – both IT and engineering equipments in order to increase productivity and service. An in-appropriate evaluation of the diverse benefits of technology has led to higher usage of manual labour across the logistics industry whether An entry tax on goods coming into a city. The tax is a major source of revenue for city municipal corporations. W. P. No. 2007-03-07 1 Page No. 6 IIMA INDIA Research and Publications it is in the distribution activities or within pla nts.Many firms try to compete through the factor advantage of low wages which have necessitated hiring low or no skill personnel thereby sacrificing productivity related gains in the long run. Understanding the linkage between inventory and transport planning is a key to reducing operational cost of distribution. Chandra and Sastry (2004) identify transport & dispatch planning as an area of concern in a survey of manufacturing firms in India. Ninety eight per cent of sample firms in that survey have a contract with trucking companies for making dispatches and only 11 per cent own their own fleet of trucks.While 36 per cent of these firms use third party logistics (3PL) service providers for making dispatches, about 30 per cent use 3PL service providers for procuring their material from their suppliers. Somehow, transport planning has remained a unglamorous area within Operations despite the fact that about 10 per cent of the cost of sales comes through physical distribution (Sanjeev i, 2003). Transport planning (e. g. , optimal dispatch quantities & frequency of dispatch, vehicle routing, loading pattern in the trucks etc. ) does not appear to have received the required attention.For example, in the same survey, only 21 per cent of sample firms report the use of some software for scheduling dispatches. It is worth understanding the structure of the Indian supply chains, in aggregate, to get a better appreciation of many of the issues raised earlier. In Figure 2 Chandra and Sastry (2004) present the structure of the supply chain of a sample of firms. It can be seen that about 4 per cent of firms have less than five suppliers, about 85 per cent of firms have less than five plants, about 14 per cent of firms have less than five regional distributors, and about 9 per cent of firms have less than five retailers.A similar statistics is obtained for other ranges of suppliers, plants, distributors, and retailers. What is worth noting is that 63 per cent of firms have m ore than 100 suppliers, about 39 per cent of firms have more than hundred distributors, and 77 per cent of firms have more than hundred retailers. In addition, about 17 per cent of firms claim to have more than 500 suppliers. The same for distributors and retailers is 22 and 54 per cent respectively. This is perhaps where difficulties in managing logistics in India lie – larger the number of suppliers or distributors, higher is the cost of coordination.W. P. No. 2007-03-07 Page No. 7 IIMA INDIA Research and Publications Figure 2 : Structure of the Supply Chain of Sample Firms 90 80 70 Percent of Firms 60 50 40 30 20 10 5000-10000 1000-2000 2000-5000 500-1000 100-500 50-100 10-15 15-25 25-50 0 5-10 0-5 more than 10000 Range Suppliers Plants Approved Retailers Regional Distributors Source: Chandra and Sastry (2004) When we look at the spatial distribution of both plants and suppliers, the above statement becomes even stronger. Of the sample firms that operate more han one plant , 48 per cent of these plants are located more than 100 kilometers away from each other, 33 per cent of these plants are located more than 500 kilometers away from each other and 18 per cent of these plants are located more than 1000 kilometers from each other. Similarly, on an average, only 4 per cent of suppliers are located within 5 kilometers of the manufacturing plant, about 13 per cent are located within 5-25 kilometers of the plant, 16 per cent are located within 25-100 kilometers of the plant and about 67 per cent of suppliers have facilities that are more than 100 kilometers away from the plants.Location policies of the past may have forced some firms to locate plants away from each other. However, this may be coming to haunt today as the cost of coordination increases and the ability to provide quick response to customer requirements might reduce. This problem gets exacerbated with suppliers. Manufacturers have to either develop suppliers separately for each location (ther eby increasing the number and affecting consistency in quality, price & delivery times) else material has to travel longer distances if there is a common supplier to all plants. W. P. No. 2007-03-07Page No. 8 IIMA INDIA Research and Publications The logistics challenge in such an environment is immense – build the infrastructure, manage the requirements of a changing structure of various sectoral supply chain, change industrial policies to facilitate efficient production and movement of goods and services, deploy effective managerial practices and technology to enhance the competitiveness through better management of logistics networks, and develop new models for new sectors especially in the service sectors as well as traditional areas like agri-business etc.It must be mentioned that the logistics industry in India is transforming itself very interestingly despite its peculiarities by developing innovative business models and by chipping away at the such structural and polic y based rigidities. In a later section, we discuss some of these innovative initiatives that are leading the renewal of the logistics industry in India. 3 The Changing Logistics Infrastructure With rising consumer demand and the resulting growth in global trade, the role of infrastructure support in terms of rails, roads, ports & warehouses hold the key to the success of the economy.In this section we provide a quick overview of the status of the logistics infrastructure in India and the current initiatives, both private and public, in that area. Goods are transported predominantly by road and rail in India. Whereas road transport is controlled by private players, rail transport is handled by the central government. With the second largest network in the world, road contributes to 65 per cent of the freight transport (Rastogi, 2006). Road is preferred because of its cost effectiveness and flexibility.Rail, on the other hand, is preferred because of containerization facility and ease in transporting ship-containers and wooden crates. Sea is another complementary mode of transport. Ninety five per cent of India’s foreign trade happens through sea (Deccan Herald, 2006). India has 12 major ports, six each on the West and East coasts and 185 minor ports. Table 2 maps the various modes on different performance indicators, clearly indicating the vitality and importance of road transport in Indian economy. There is also evidence of an, across the board, increase in freight traffic for all modes indicating an increased logistics activity.For instance, the per cent change in road, rail, air and sea cargo traffic has increased, between 2001 and 2005, from 5 to 14 per cent, 4 to 7. 5 per cent, 6 to 20 per cent and 3. 5 to 11 per cent respectively (CMIE Database, 2006). W. P. No. 2007-03-07 Page No. 9 IIMA INDIA Research and Publications Table 2: Comparison Chart for Various modes Rail 214760 10. 66 0. 11 Road 3487538* 5. 12* 3. 34 Sea 806 7. 9 12 Number (wagons, tr ucks, ships) Freight Capacity(mn ton) Route Length (mn km) /Number of major ports Freight Revenue (US $ bn) 7. 00 coal, steel, petroleum, primary metals 38. 64 automobile, electronic items, garments etc. 304 iron ore, coal, petroleum (and industrial and consumer products on the outbound export) Major Products Source: IAEIS, 2005-2006, Financial Express, 2006a *This figure is for 2002-03 1 US$ = Rs 44 In keeping with the increasing demand for road transportation, the National Highway Authority of Indian (NHAI) has been strengthening and widening national highways in multiple phases. As part of the National Highways Development Project, the work on the development of golden quadrilateral (connecting Delhi, Mumbai, Chennai and Kolkata) and the North-South and East-West links were started in 1998.It will build 13000 km expressways that would connect the nation (Surabhi, 2006). NHAI is investing about $650mn towards the development of an Intelligent Transportation System (ITS) which will make transport services on the highways (like reducing congestion, advance signaling, medical assistance, accident management, etc. ) efficient and automating many processes like toll collection etc. (Sanjai, 2007). Because of the growing opportunity and potential for high revenue, the Ministry of Railways has been taking measures to expand the rail connectivity and recapture the market share of freight business.By focusing on improving wagon utilization, the Railways have managed to reduce the freight cost from 61 paise2 per net tonne km (ntkm) in 2001 to 56 paise per ntkm in 2005 (Rastogi, 2006). At present, goods train run on same 2 100 paise = 1 Rupee W. P. No. 2007-03-07 Page No. 10 IIMA INDIA Research and Publications railway tracks as passenger trains at an average speed of around 25 kmph (Gill, 2006). With the proposed dedicated west and east freight corridors, the goods trains are expected to run at 100kmph. The West and East rail corridor of 1469-km and 1232-km will be bu ilt with an investment of $2. 0 bn and $2. 40 bn respectively and will be equipped with the latest centralized traffic control systems (Acharya, 2006a). Indian Railways has also decided to collaborate with bulk users of freight transport to build the rail network in a Public Private Partnership (PPP) mode. The first project on this line comprises nine public and private sector companies that are building a 82-km rail line between Haridarpur and Paradip at a cost of $ 120mn (Telegraph, 2006). Recently several steel companies have also shown interest in linking iron and coal mines in Orissa with a 98-km rail line (Business Standard, 2006).Multi-modal transport in India was a monopoly of the Container Corporation of India till 2005. With licenses being given to 13 new private players (Acharya, 2006b), rail trade should improve considerably. In order to encourage trade by small scale industries, Indian Railways has started a â€Å"road-railer†system where container vehicles are c apable of running both on highways hauled by trucks and on rail (Guha and Sinha, 2006). In 199899, the Konkan Railway (one of the railway zones in South-Western India) pioneered the ‘roll-on, roll-off' (‘RO-RO') concept between Mumbai (Kolad) and Goa (Verna).Privately owned trucks are loaded with their goods which are driven on to a rake of flat cars and are carried (trucks and their cargo) to the destination. In 2005-06, the ports handled 456. 20 million tonnes of cargo traffic. This is expected to increase to 700 million tonnes by 2011-12. In keeping pace with the growing demand, the government plans to increase port capacities to around 1 billion tonnes per annum in the next six years (Raja, 2006). Under the National Maritime Development Programme (NMDP), the government is encouraging public-private partnership to build and maintain ports.This scheme will cover 276 port related projects at an investment of $12. 40 bn (Raja, 2006). With rising congestion levels at majo r ports and with high average turnaround time, the government has decided to develop minor ports in seven states to ease the traffic of major ports (Financial Express, 20006b). Tables 3 the operational performance of various ports in India – while there is an improvement in performance, the pace is slow. The estimated cost of this development is expected to be around $350 mn. Further, private sector is likely to invest $ 7. 67 billion over the next six years.W. P. No. 2007-03-07 Page No. 11 IIMA INDIA Research and Publications Table 3: Average Turnaround Time At Ports (in Days) Port Chennai Cochin Haldia Jawaharlal Nehru Kandla Kolkata Marmugao Mumbai New Mangalore Paradip Tuticorin Vishakhapatnam Average Source: IAEIS 2000-01 2001-02 2002-03 2003-04 2004-05 2005-06 CAGR 6. 40 5. 80 5. 30 3. 70 4. 60 3. 80 (9. 90) 3. 23 3. 10 2. 37 2. 19 2. 22 2. 33 (6. 32) 5. 21 3. 96 4. 01 3. 02 2. 87 3. 00 (10. 45) 1. 72 2. 48 2. 34 2. 28 2. 04 1. 84 1. 36 6. 15 4. 72 6. 55 5. 94 5. 06 4. 62 (5. 56) 6. 59 5. 50 4. 71 4. 47 4. 29 4. 7 (8. 75) 4. 30 4. 25 2. 04 3. 86 4. 47 4. 35 0. 23 5. 60 5. 20 5. 47 5. 06 4. 10 4. 21 (5. 55) 3. 80 2. 89 2. 73 1. 90 2. 35 2. 96 (4. 87) 3. 89 4. 16 3. 99 3. 37 3. 42 3. 41 (2. 60) 6. 39 4. 10 4. 11 3. 59 2. 59 2. 66 (16. 08) 4. 75 3. 71 3. 51 3. 72 3. 33 3. 20 (7. 60) 4. 84 4. 16 3. 93 3. 59 3. 45 3. 38 (6. 92) Currently, fifteen private sector projects are operational at various major ports and four more projects are under implementation (Raja, 2006). One of them aims to build the deepest port in the world at an investment of $ 1bn (Financial Express, 2006c).This project is handled by a three-firm Chinese consortium with a Mumbai-based partner, Zoom Developers. Interestingly, firms like Ambuja Cement have been using barges for transport of clinkers from their factories to crushing and packaging plants all over the coast, thereby, reducing transport costs considerably. It can be seen that there is a fury of activity in enhancing the in frastructure capacities in the country. 4 Determinants of Logistics Growth in India The Indian logistics business is valued at US$ 14bn and has been growing at a CAGR of 7-8 per cent.As mentioned earlier, the logistics cost represents 13-14 per cent of the country’s GDP. The market is fragmented with thousands of players offering partial services in logistics; it is estimated that there are about 400 firms capable of providing some level of integrated service (Mahalaksmi, 2006). The economy is expected to grow around ten per cent over the next ten years and sectors like chemicals, petrochemicals (especially distribution), pharmaceuticals, metals and metal processing, FMCG, textile, retail and automobile are projected to grow the fastest.New business models are emerging as new firms, both domestic and foreign, enter the market. As a result of the ensuing competition, linkages with global supply chains and domestic market growth W. P. No. 2007-03-07 Page No. 12 IIMA INDIA Resea rch and Publications promise to change the face of logistics industry beyond recognition. In this section, we discuss how these are going to determine the growth of the sector. The scale of operations in manufacturing is changing and so are their markets and sourcing geographies.Growth in manufacturing in India has happened across clusters that are located in different parts of the country, e. g. , Ludhiana, NCR, Baddi and Dehradun in North, Rajkot, Jamnagar, Pune and Mumbai in West (along with Ankleshwar, Vapi, Aurangabad, and Kolhapur and most recently Kutch), and Coimbatore, Vishkahpatnam, Bangalore, Hosur, Chennai, Pudduchery and Sriperumbudur in the South. Assembly plants at these locations are being fed with raw materials and intermediate products from all over the country and abroad (as well as these locations).Moreover, distribution networks with emerging hubs in Indore and Nagpur (i. e. , Central India) supply all over the country and abroad. This is going to increase the n ature and extent of movement of goods and services across the country. This has been accompanied by the expansion of domestic production capacity (e. g. , ORPAT in Morbi has added capacity to produce 40,000 units of quartz clocks and time pieces at a single location) as well as a big MNC entry into the Indian manufacturing scene (e. g. NOKIA’s new factory at Sriperumbudur produces 1 million mobile phones per month). As the volume of production grows, so will the extent of movement of goods either to the ports for export or to the rest of the country. Some of the large players to enter (or expand significantly) the Indian market recently have been Reliance Retail, Big Bazaar Hypermart, Pantaloon and RPG in Retail; Nokia, LG, Samsung, Motorola, Sony, Blue Star in Consumer Electronics; Bajaj, Hero Honda, Maruti, Honda, Toyota, Audi,Volkswagen, Renault, Volvo in the Automotive sectors; Holcim in Cement; etc. It can be expected that their operations will drive the growth of logist ics industry. The liberalizing Indian economy is experiencing entry of large domestic and global firms in new businesses as well as enlargement of distribution network of many regional Indian firms. The announcement of large retail projects by Reliance and Bharti (in collaboration with Wal-Mart) will bring new technology, add additional warehouse capacity and will require fast and reliable movement of goods across the country.Reliance is thinking of establishing large warehouses in Thailand to take advantage of low cost sourcing from South-East Asia once the Free Trade Agreement with Thailand (as well as ASEAN) gets finalized. Similarly, regional food & grocery retail leaders like W. P. No. 2007-03-07 Page No. 13 IIMA INDIA Research and Publications Subhiksha who are present very extensively in the South Indian market are now entering the rest of the country with more than 600 new retail stores in 2007. Their logistics strategy and needs are transforming very significantly with this nationwide expansion.New retail chains are entering the non-metro towns and non-State capitals. It may be mentioned that the growth of the courier industry post-liberalization has helped change the parameters of service evaluation in the industry from cost alone to cost, time, and reliability. This sector has also seen a number alliances between regional and local players especially in the small package (less than 500 grams) market thereby creating networks of small players who are not only cost effective but also more flexible than the large national players.This segment of the industry has taken advantage of the large manpower and is gradually moving away from â€Å"Angadiyas† or manual inter-city couriers to a more organized network that shares transport infrastructure (and even consolidates sub-packages from various small couriers in a single large courier bag to be transported by air cargo or road transport rather than these sub-packages being carried by several manual couriers on the train; the courier firms are gaining on service and are sharing fixed costs).The entry of large third party logistics (3PL) carriers like Federal Express and DHL and the expansion of domestic networks of Indian firms like Gati and Shreyas Shipping is also transforming the nature of services and the business practices across the sector. Table 4 gives an idea of the investment plans announced by the various firms for the coming financial year and gives a sense of their increasing activity. Another trend driving growth in this sector has been the consolidation amongst the logistics player.Mergers & Acquisitions amongst Indian and MNC logistics firms is starting to increase the reach of MNC 3PLs in the domestic Table 4: Investment Plans of Major 3PL Service Providers Firms DHL TNT Gati *Shreyas Shipping and Logistics Investment Details/ Plans (2007-08) (in US $ mn) 260 115 200 350 Source: Baxi (2006), Sanjai (2006a) W. P. No. 2007-03-07 Page No. 14 IIMA INDIA Research an d Publications market while consolidating the business (e. g. , DHL acquired Blue Dart, TNT acquired Sppedage Express Cargo Service, Fedex bought over Pafex etc. ).Consolidation is expected to be beneficial to both the service providers as well as the consumers. Initially MNC 3PL firms were providing only custom clearance and freight forwarding facility to their international clients. With the logistics market growing we should see a shift in this trend. The complexity of managing the supply chain in the pre-consolidation era is illustrated through the following scenario at Nokia (Figure 3) . Logistics activity for Nokia’s India Hub was maintained by a large number of Figure 3: Typical Logistics Supply Chain of NokiaDHL, Panalpina Inbound logistics Nokia Hub in Sriperumbudur Gati, Blue Dart Domestic Outbound logistics UPS Warehouse in India Export Market International Outbound logistics DHL Source: Mishra et al. (2006 service providers. Coordination and handover was a problem at times. With DHL acquiring Blue Dart, it is now able to provide seamless end-to-end integrated supply chain solutions. Downstream distribution channels have also seen some consolidation.Manufacturing firms, particularly, in the FMCG sector have started to reduce the number of wholesalers (and at times, distributors) so as to increase the reach and consequently the returns to each wholesaler. This also induces them to invest in new productivity enhancing technology and effective managerial practices. Technology in the logistics chain is being upgraded bringing better visibility on customer off-takes (though an absence of cash registers and the accompanying regulatory discipline to avoid tax evasion stand in the way of automated data updation).Introduction of more efficient transport technology and mobile communication has the potential of changing the logistics practices in the industry. Increasing competition and the low penetration of IT also implies that the scope for change is immense and imminent. The agri-business sector’s supply chain, for example, has changed significantly with increasing investment in coldchains across the country. With this, fruits and vegetables are being transported long distances (often more than 1500 kms) and milk grid is able to pickup and deliver liquid W.P. No. 2007-03-07 Page No. 15 IIMA INDIA Research and Publications milk from and to remote areas more frequently. Here the role of cooperatives like AMUL has been exemplary both in increasing the size of the distribution network and also in reorganizing the supply network very efficiently along with enormous buildup of social capital – a pre-requisite for growth in emerging economies (Chandra and Tirupati, 2003). Low penetration of hand eld technologies for order processing and tracking, product tracking and material handling accessories, as well as IT for improved decision making can be seen as opportunities for growth. Mobile technologies also hold the potent ial for rapidly using information for real time decision making as well as for coordinating both the inbound and outbound logistics. Indian customers exhibit strong value and variety seeking behaviour hence developing capabilities in the process of product and service delivery will induce loyalty (i. e. , process loyalty).Government policies have been another driver of change in the logistics industry. The trend towards a higher road cargo traffic as compared to rail is going to require better logistics control and coordination. The golden quadrilateral road project and the east & west rail corridors are expected to change the reactiveness of Indian firms through shorter lead times as well as lower maintenance costs on the transport equipment. They also have the potential of reducing the procedural delays on highways by reducing the number of checks and related stoppages of vehicles.Its impact on perishable good will be most significant. Thirteen States and three UTs have already am ended the State laws allowing private sector participation in direct purchases of farm produce from farmers (Ahya, 2006) which is making procurement more efficient and is bringing better technology as well as products in the rural production and distribution network (e. g. , see ITC echoupal in the next section). Banks have developed venture capital funds for logistics players. Small Industries Development Bank of India or SIDBI, for instance, has invested $ 2. mn in the Mumbai based firm Direct Logistics (Baxi, 2006). The unbundling of the logistics supply chain (both the physical pickup, storage and movement of goods as well as allied services like invoicing, order management, freight forwarding, customs clearance, octroi tax management etc. ) will lead to business opportunities and add value to the customers. An interesting example is that of Reliance Connect Service Centres that have been established on Indian highways by Reliance industry along with petrol stations.The Connect Centres provide a place for truckers to relax (sometimes with overnight stay facilities), send information (including data) to parent firms on their location, completed transactions etc. , receive material/instructions from the firm, remit money to parent firm, W. P. No. 2007-03-07 Page No. 16 IIMA INDIA Research and Publications etc. It has become a one-stop shop for truckers and their companies to keep in touch. Similarly, once VAT is introduced, it will simplify the process of goods servicing and will lead to rationalizing of many operational decisions.The implication of the emergence of a strong service industry on logistics performance is not well understood. Perhaps, a new business segment will emerge that is technology driven and will help coordinate activities across business channels. For example, there is a need to integrate the flow of information, goods and services between a medical physician, a diagnostics center, hospitals & nursing homes, and retail medical outlets à ¢â‚¬â€œ all of which are un-coordinated independent entities at the moment.This could range from digital transmission of MRI scans from a diagnostics center to a computer to blood collection and delivery from physician’s various city centers to nursing homes/blood banks or directly to dispersed operation theatres. The role of a coordinating agency becomes, organizationally, valuable in such an environment. The need is to link physical logistics processes with communication technologies –building on the strengths of the IT and mobile communication industries. 5 The Renewal of the Sector: Some Innovative ExperiencesThere have been several instances of firms undertaking innovative re-design of their logistics systems or deployment of interesting business models to enhance the effectiveness of their networks in order to deliver value to their customers. Sometimes it was done to overcome an inherent disadvantage that may exist in the supply chain. In this section, we presen t a few such experiences both at the firm level and at the industry level, through brief caselets highlighting their innovative contribution. They also represent the renewal process that is transforming the logistics sector and the distribution strategy of firms.GATI3 Established at a time (in 1989) when firms in India hardly outsourced their logistics requirements, Gati has transformed itself from a cargo movement company to become one of the leading end-to-end logistics and supply chain solutions provider in India. Continuous innovation and high end technological investments to improve service 3 Source: www. gati. com, Sharma and Thakur (2006), Prowess (2006), Reddy (2007) W. P. No. 2007-03-07 Page No. 17 IIMA INDIA Research and Publications quality, speed and efficiency can be ascribed as the reasons behind their success.It is staring to connect with mass retail market in several cities through 1500 Customer Convenient Centres. It is also the first Indian company to operate in th e far-east market with its own subsidiary in Hong Kong. On the service front, there have been several firsts in India by Gati – a money back guarantee on cargo services, cash-on-delivery and a tollfree number for convenience of customers. Gati operates one of the largest road networks linking 594 districts out of a total of 602 districts in India at a turnover of $104mn in 2005-2006. It covers 3. 2 lakh4-km every day with a fleet size of 2000 trucks.Its automated shipment tracking ability has brought it closer to the customers – for example, the SMS based tracking system has allowed the customers to continuously get an update on the status of their consignment. Another feature also enables customers to get email based conformation of any delivery. Gati has also transformed the warehouse management practices in India with its modern system, WMS – a web based warehouse management system that provides both functionality and flexibility to customers in managing thei r warehouse operations. WMS enables Gati and its customers to track inventory status in real time.Along with its transportation related capabilities, this has allowed Gati to manage the entire outbound logistics (i. e. , warehousing, transport and dealer/retailer replenishment) of Blue Star for his home air-conditioning division. Order processing times and shipping errors have decreased and customer service levels have improved, as a consequence. Currently, Gati operates with 10 warehouses and plans to setup another 25 over the next three years at an investment of $100mn. It is designing these new warehouses with mechatronic systems that could lead to a paradigm shift in warehouse management in India.It has implemented CRM and ERP systems, using IT to full advantage delivering value to the customers. AMUL5 The Kaira District Milk Cooperative Union or better known as AMUL was established in 1946 in Anand in the western State of Gujarat with an aim to remove the intermediaries in the milk procurement and distribution process and thereby increase return to milk farmers. The milk farmers were mostly marginalized members of the society and most of 4 5 1 lakh = 100,000 www. amul. org; Chandra and Tirupati (2003) W. P. No. 2007-03-07 Page No. 18 IIMA INDIA Research and Publications hem barely poured a few litres of milk each day. They, however, depended on this for their livelihood and any money lost to the middleman or to uncertainty in the environment meant a threat to their existence. Thus was born AMUL (which means invaluable in Hindi)! The Story of AMUL is an extraordinary story of vision, effort and power of networks for the benefit of the poor. From being a net importer of milk in 1947 when India became independent, India has now emerged as the largest milk producer in the world. This remarkable story has been scripted by a network of cooperatives called AMUL.The AMUL network is coordinated by the Gujarat Cooperative Milk Marketing Federation (or GCMMF) which markets milk and milk products that are produced by 12 Milk Unions (each having several factories) one of which is AMUL at Anand. The Unions are spread in twelve districts of Gujarat. Each Union collects milk from farmers through cooperative Village Societies. (This structure is now replicated in almost all the States of India. ) In 2005-2006, GCMMF had a sales turnover of $860mn through milk and milk products (its Unions or plants produce 15 categories of milk products with several products in each category).The 12 Unions collect about 6. 3million litres of milk every day from 2. 5 million farmers through 11,962 Village Societies. (with an annual collection of 2. 28 bn litres in 20052006). Each village society may have 100 to 1000 member farmers who pour milk twice a day. Twice daily, about 500 trucks collect milk from these Village Societies and bring them to either of the five chilling centers or the processing plants (or Unions). The Unions process the liquid milk – produ ce milk of various types for consumption, convert some to powder as inventory and use both powder and liquid milk for producing milk products.These products are distributed to consumers through a channel comprising 4000 stockists (or distributors) and 5,00,000 retailers. It is not difficult to imagine the complexity of coordinating such a network of perishable products with an explicit social objective, in addition to a commercial one. The network realized the need for a unique model to deliver value to customers and through that serve the key objective of setting up of the cooperative – making a producer out of a poor consumer and helping her get better returns. W. P. No. 2007-03-07 Page No. 19 IIMA INDIA Research and PublicationsBriefly, we will illustrate the unique mechanisms used by this network to coordinate the complex supply chain through the intervention of a number of third party service providers (distributors, retailers, logistics service providers and IT support groups). The network practices frequent delivery and works with low inventory levels in the chain, supported by extensive information network and IT kiosks at the milk pickup locations that provide a variety of services. Payment to farmers for RM procurement is instantaneous (well, almost! ) – during the same or in the next pouring shift by the Village Society staff.Milk is carried in cans by trucks (twice daily) or in chilling trucks, once in a day, to the plants. The routes of the trucks are well established and the arrival timetables at each Society well known and rarely is there any delay. This helps provide visibility to every member of the chain and improves the return on investment in the channel. The network operates with a zero stock out through improved availability of products and quick delivery. Disciplined planning to reduce variability at each stage helps in maintaining timeliness in the channel.GCMMF coordinates the production plan between the twelve Unions and ensures matching of geographic markets with supplies. TQM and Hoshin Kanri are the key tools used to plan and implement daily production and change programmes – these have facilitated a six-sigma performance throughout the network and has led to a doubling of sales revenue in the last ten years. Most interestingly, AMUL has the largest market share in every product category that it competes in – its competitors are both large MNCs and large & small Indian firms.AMUL illustrates how good managerial practices can help bridge the gap between profits for the supplier and low cost, highy quality products for consumers – all through exceptional coordination of logistics operations across an extensive network. AMUL operates with one umbrella brand for products from all its member Unions – a testimony to strong quality and cost coordination across all Unions and Village Societies. In addition, its has been singularly responsible for pulling out several million o f its members from poverty, ill health and illiteracy through its business model (called Anand Pattern) and social programmes.For details on this case study see Chandra and Tirupati (2003). W. P. No. 2007-03-07 Page No. 20 IIMA INDIA Research and Publications The DABBAWALLAHs of MUMBAI6 The â€Å"dabbawallah’s† or the ‘lunch box delivery people’ of Mumbai pickup and deliver lunch boxes from homes or restaurants and deliver it to the customer’s office – all within a specified time frame – and then deliver the empty box back to the place of pickup. It is an example of how processes can play an important role in coordinating logistics of an important service industry in India.The Nutan Mumbai Tiffin Box Charity Trust of Mumbai was established in 1891 to provide pick-up and delivery of lunch for Britishers working in Mumbai. Since then it has become the leading lunch delivery cooperative in the city. It picks-up and delivers 200,000 lunch boxes in a standard container every day and returns the same to the place of pickup. The firm has an annual turnover of about $12 mn and employs 5000 people for pickup and delivery – almost all of them are uneducated. However, there are less than 10 boxes mis-delivered or un-picked in a month!We discuss, briefly, the processes that help make this logistics network errorproof and deliver such an astonishing performance. The operations of the group has attracted global attention and won them many awards. They represent a growing group of service providers that exist as an element of the logistics network, provide niche service and generate value in return for the customer. The Trust which is organized as a cooperative is operationally organized in hierarchical teams – pick-up teams, consolidation teams, delivery teams (and then the reverse logistics for empty boxes with reversing of the functions for the teams).Typically, each dabba or the lunch box passes through more t han four pair of hands and may be transported up to 60 km each way. Pickup is done between 7. 30am-9. 00am, delivery between 12. 00 and 1. 00pm and return between 2. 00-5. 00pm. These represent tight time-windows where a team of 20-25 members (and supervised by a team leader who also fills in as a pickup person in case of any absence) pick-up lunch boxes from homes – about 30 per pick-ups person. The boxes are carried in a specialized fixture on a bicycle to the nearest train station where the boxes are consolidated by destination.A consolidation team performs this task and carries the boxes (which may have been picked by members of different teams but need to travel to the same destination geography) into the train. Often tiffin or lunch boxes are un-loaded at intermediate train stations – re-consolidated with boxes coming from other locations (i. e, cross-docked) and carried on a third train to its 6 Lecture of Mr Megde, President of the Nutan Mumbai Tiffin Box Suppl iers Charity Trust at IIM Ahmedabad, 2003; Chandra (2004) W. P. No. 2007-03-07 Page No. 21 IIMA INDIA Research and Publications estination station. At the destination station, the lunch boxes coming from various origins/cross-docking destinations, are once again segregated by the building where the delivery is made. Finally, a delivery team picks up their boxes, i. e. , boxes that they will deliver to specific owners in specific buildings, carry them on their bicycles and deliver them in the office of the owner of the box. Later in the afternoon, the same person picksup the empty box and pursues the reverse logistics and the box is ultimately delivered at its point of origin – either a home or a restaurant.With this as the complexity, what may be plausible reasons for such low errors? Contextually, the group members see their role as very important – they are responsible for delivering food to their customers – socially, it enhances their commitment to their tas k and establishes a critical customer-service provider link. Operationally, the handoff is done successfully through simplification or breaking down of tasks, codification and repetition. The designed process is simple and easy to understand for each operator.More important, each operator has a limited yet definite role. This role is one of pickup, consolidation & transfer and delivery (and the similarly for reverse logistics). Each pickup operator does not pickup more than 25-30 boxes as that is the number of addresses etc. that he can remember accurately which helps in avoiding mistakes. The lunch box is enclosed in a standard container which carries a unique code for the destination station, the building where the box is to be delivered and the floor number in that building where the office of the customer is located.Each operator recognizes a limited set of codes that are relevant to him (and does not have to learn the entire coding scheme). And finally, repetition of the task ( i. e. , same pickup location, same place for cross docking, same delivery location etc. ) helps in making the task foolproof. Of course, what helps is the linear geography of Mumbai, the punctuality of trains, relatively stable demand and strong inter-dependence between operators. It is an example of how manual logistics systems can be organized to effectively deliver value to the customer.ITC e-choupal7 The e-choupal project was launched by ITC (a large diversified company with strong FMCG presence) in 2000 in the central Indian State of Madhya Pradesh (MP) to reorganize the distribution of soyabean in rural markets. Today e-choupal reaches out to Source: www. echoupal. com, Talk by the eChoupal CEO S Sivakumar at IIMA, 2003, Mitra (2004), MBS CS (2006) W. P. No. 2007-03-07 7 Page No. 22 IIMA INDIA Research and Publications more than 3. 5 million farmers in 31,000 villages through 5,200 internet enabled kiosks and now covers a variety of agri-business products.The e-choupal was a u nique venture which aimed to eliminate the middlemen from the agricultural commodity supply chain and reduce information asymmetry for the farmers. It is an extremely profitable rural distribution system with its unique design features. The e-choupal was started with an objective to re-organize the soybean trade which was operating in an inefficient manner. Farmers used to sell their produce through government mandated markets called â€Å"mandis. † Mandi trading was conducted by commission agents who bought and sold the produce.As the produce was sold through auction by these traders, farmers would find out the market price only upon arrival at a mandi. If the buyers had purchased enough for the day at this mandi then either the auction prices fell dramatically or the farmers had to wait for the next day’s auction. While all this may have been happening at one mandi, the farmers were unaware of the auction status at other mandis where there could have been shortages. The decision regarding the quality of the produce was also dependent on the trader.Similarly, distortions in price and quality effected agro-business trading firms like ITC who were, by government law, required to purchase from the mandi and through these traders and not directly from farmers. Under the e-choupal model, kiosks were setup in villages providing farmers information in local language on agricultural inputs, best practices in farming, market price realized at various mandi auctions, weather details etc. Nevertheless, it enabled ITC to purchase products directly from farmers (through a change in the law), enhancing quality of products and significant cost reduction (e. . , it saved $5. 40 per tonne on soyabean). The e-choupal now has just two service providers in its procurement chain – the sanchalak, a person between the kiosks and the farmers who inspects the produce and based on his assessment of the quality, the price of the commodity is decided (he gets 0. 5 p er cent commission on the volume sold) and samyojak, a person who manages the ITC warehouses (he gets 1 per cent commission on transactions). Samyojaks also handle much of the logistics at the procurement hub like storage management and transportation from the hub to processing factories.ITC was able to overcome the hurdles posed by infrastructure inadequacy in villages. It uses solar energy to power the batteries of the computer kiosks and has shifted from W. P. No. 2007-03-07 Page No. 23 IIMA INDIA Research and Publications dialup connection to satellite based technology (VSAT). Farmers are now able to make informed decisions as they understand the market better leading to higher productivity. Various seed and fertilizer companies are now able to reach wider market with lesser transaction cost.The e-choupal has provided a market for more than 64 companies (to name a few, Monsanto and Nagarjuna Fertilizers). This innovative direct procurement channel is a win-win mechanism for all the involved parties. ITC is now building a rural retail infrastructure on the foundation of the e-choupal network thereby changing the rural distribution landscape. Transforming the Auto-Component Replacement Supply Chain With changing government policies and consumer preferences, the distribution supply chain of Indian companies has been effected significantly. This poses new challenges for various channel partners.We illustrate this transformation process through the lens of the auto component replacement market supply chain and discuss its implications. We surveyed 21 manufacturers and 22 channel members (distributors, wholesalers and retailers) spread equally in Northern and Western clusters of auto component Industry in India for this purpose. The auto component industry produced parts worth $6. 7 billion (2004-05) with 57 per cent of the demand coming from the replacement market (ACMA, 2005). Low entry barriers have led to a large number of players in the replacement market.T here are about 400 firms in the organized sector and more than 5000 in the unorganized sector. Another feature of this sub-sector is the long duration of ownership of vehicles in India which leads to high requirement of parts. It is also found, anecdotally, that willingness to pay for parts decreases with the length of ownership. This has led to an intense segmentation of the parts market by price. Pre–1991, this industry was still in a nascent stage. It was characterized by few manufacturers and low demand. Consequently, the distribution network was flat (Figure 4a).Availability of spare parts was a key issue with long delivery lead-times and manufacturers sought large order sizes. This also led to the growth of un-branded parts or parts branded by regional producers (often supplied by small firms) in the replacement market. The product was sold chiefly on personal relationship with the buyer; quality, brand and price were not the selling propositions. Maruti Udyog Limited h ad created a W. P. No. 2007-03-07 Page No. 24 IIMA INDIA Research and Publications network of suppliers of quality parts for its vehicles.Hero Honda had done the same for its motorcycles. Post-1991, the liberalization of the automotive industry led to an entry of many foreign auto players. Because of the impending automobile industry boom and high margins for distributors, the demand for spare auto-parts was expected to grow. The distribution channel was modified with the entry of two more channel members, i. e. , wholesalers and semi-wholesalers (Figure 4b). The latter were smaller versions of the former and locally oriented. The period 1994-2007 saw a major transformation of the distribution structure (Figure 4c).OEMs started to operate in the replacement market through a parallel supply chain selling parts through their service stations. Additionally, the entry of large number of channel members caused semi-wholesalers to move out of the supply chain – they either moved up the chain to become wholesalers or moved down to become retailers. To strengthen the coordination of this extended supply chain and to buffer against the differential tax structure across states, companies started to operate with Carry and Forwarding Agents (C&FA). Transportation related activities are carried out by all the members of the supply chain.Manufacturers use services of 3PL for transferring their stock to C&FA and distributor locations. But thereafter, the transportation activity is solely managed by channel members themselves. An analysis of the available IT infrastructure and its usage pattern for all the channel members in our sample survey indicates that there is a high deviation in the usage of IT in the replacement market supply chain. Eighty seven per cent of the sampled firms use an ERP package – most of which is customized and developed locally. The main impediment in the use of a branded packages is the high cost of purchase and mplementation. These pac kages are used to generate sales report, order from suppliers, account for the financial transactions and track the level of inventory at plant and C&FA. Manufacturers order the stock from suppliers mostly through emails. In order to track inventory in the channel, firms also made IT investments both at C&FA and within the firm. Linking the C&FA to the company website enabled firms to check stock status at the C&FA and reduce the order processing and customer response times. Larger firms are also providing a similar setup to their distributors.Since the C&FA is mostly owned W. P. No. 2007-03-07 Page No. 25 IIMA INDIA Research and Publications and managed by the firms, manufacturers are also able to check the inventory status, dispatching status and customer records. Distributors have invested primarily in computers for keeping track of the inventory and updating accounting details. On the other hand, rest of the channel partners (wholesalers and retailers) don’t even own comp uters. Parts are ordered primarily on the phone. Interestingly, most distributors were found to be following periodic review olicy while the rest of the channel members were following continuous review policy because of their low sales volume. Post 2007, with the implementation of a uniform tax structure across all states, there will be some changes in the way firms operate. The C&FA will, perhaps, become redundant as most manufacturers will prefer to deal directly with distributors. The concept of an exclusive distributor is expected to vanish. It is expected that with the increase in variety of components, distributors might become wholesalers and will stock multiple brands for the same product.Two parallel distribution channels are expected to be in operation – the OEM chain and the non-OEM chain (Figure 4d). OEM network will primarily handle the passenger car replacement parts and the non-OEM distribution network will sell parts for Light Commercial Vehicles, Heavy Commer cial Vehicles, 2-wheelers and 3-wheelers as the car customer is becoming more brand conscious even while replacing parts which comes along with superior service. Further, we perceive that the more advanced automobiles, Free Trade Agreement with other Asian countries and VAT are going to change the way the replacement market operates.There will be a rationalization of this market in terms of number of firms competing thereby leading to an improvement in quality, delivery time and availability of parts. The size of the firms is expected to increase with an emergence of large national players (in addition to OEMs). This may reduce the number of producers exclusively focusing on the local markets. W. P. No. 2007-03-07 Page No. 26 IIMA INDIA Research and Publications Figure 4a Manufacturer Figure 4b Manufacturer Distributors Distributors Retailers Institutional Buyers SemiWholesalers Wholesalers Institutional Buyers RetailersGovernment Agencies & Transport Companies Garage-station Govern ment Agencies & Transport Companies Garage-station Vehicle owners Vehicle owners Figure 4c Manufacturer Figure 4d Manufacturer Institutional buyers C&FA OEMs Institutional buyers OEMs Wholesalers Distributors Authorized Service Stations Authorized Service Stations SemiWholesalers Retailers Wholesalers Vehicle Owners Vehicle Owners Retailers Government Agencies & Transport Companies Garage-station Government Agencies & Transport Companies Garage-station Vehicle owners Vehicle owners W. P. No. 2007-03-07 Page No. 27 IIMA INDIA Research and Publications Challenges Ahead Several challenges remain before the Indian logistics sector and its future success will depend on the ability of the industry to overcome these hurdles. Some of these impediments are at the firm level while others are at the policy level. At the policy level, the issues of infrastructure and integration of the nation’s logistics network remain the two most critical areas that require attention. The growth of inf rastructure, since 1991, has been quite extensive (covering a wide geographical area) as well as strategic – linking the key industrial, consumption and transshipment centers.However, some imminent weaknesses need be addressed. Movement beyond the golden quadrilateral is required to bring goods from upcountry production sources to main shipment centers. The rate of growth of expressway has to increase. Poor road conditions increase the vehicle turnover, pushing the operating cost a

Fiscal Policy in the 1960s and 1970s

Fiscal Policy in the 1960s and 1970s By the 1960s, policy-makers seemed wedded to Keynesian theories. But in retrospect, most Americans agree, the government then made a series of mistakes in the economic policy arena that eventually led to a reexamination of fiscal policy. After enacting a tax cut in 1964 to stimulate economic growth and reduce unemployment, President Lyndon B. Johnson (1963-1969) and Congress launched a series of expensive domestic spending programs designed to alleviate poverty. Johnson also increased military spending to pay for American involvement in the Vietnam War. These large government programs, combined with strong consumer spending, pushed the demand for goods and services beyond what the economy could produce. Wages and prices started rising. Soon, rising wages and prices fed each other in an ever-rising cycle. Such an overall increase in prices is known as inflation. Keynes had argued that during such periods of excess demand, the government should reduce spending or raise taxes to avert inflation. But anti-inflation fiscal policies are difficult to sell politically, and the government resisted shifting to them. Then, in the early 1970s, the nation was hit by a sharp rise in the international oil and food prices. This posed an acute dilemma for policy-makers. The conventional anti-inflation strategy would be to restrain demand by cutting federal spending or raising taxes. But this would have drained income from an economy already suffering from higher oil prices. The result would have been a sharp rise in unemployment. If policy-makers chose to counter the loss of income caused by rising oil prices, however, they would have had to increase spending or cut taxes. Since neither policy could increase the supply of oil or food, however, boosting demand without changing supply would merely mean higher prices. The President Carter Era President Jimmy Carter (1976 - 1980) sought to resolve the dilemma with a two-pronged strategy. He geared fiscal policy toward fighting unemployment, allowing the federal deficit to swell and establishing countercyclical jobs programs for the unemployed. To fight inflation, he established a program of voluntary wage and price controls. Neither element of this strategy worked well. By the end of the 1970s, the nation suffered both high unemployment and high inflation. While many Americans saw this stagflation as evidence that Keynesian economics did not work, another factor further reduced the governments ability to use fiscal policy to manage the economy. Deficits now seemed to be a permanent part of the fiscal scene. Deficits had emerged as a concern during the stagnant 1970s. Then, in the 1980s, they grew further as President Ronald Reagan (1981-1989) pursued a program of tax cuts and increased military spending. By 1986, the deficit had swelled to $221,000 million, or more than 22 percent of total federal spending. Now, even if the government wanted to pursue spending or tax policies to bolster demand, the deficit made such a strategy unthinkable. Note This article is adapted from the book Outline of the U.S. Economy by Conte and Carr and has been adapted with permission from the U.S. Department of State.

The Life and Legacy of George Balanchine essays

The Life and Legacy of George Balanchine essays By the time of George Balanchine's untimely passing on April 30th, 1983, this 20th century master of choreography in ballet had created more than 400 works. His name is celebrated in the art world, much as Picasso or Stravinsky. Balanchine was arguably the most influential person in ballet, and his legacy continues to benefit the world of ballet long after George Balanchine was born Georgi Melitonovitch Balanchivadze in St. Petersburg, Russia. He was born the son of a composer, and as such, was exposed to music at any early age, not often experienced by any other composer. At the age of five, Balanchine began to take piano lessons, and at nine years old, "he was accepted into the ballet section of St. Petersburg's rigorous Imperial Theater School, and, with other young students, was soon appearing on the stage of the famed Maryinsky Theater in such spectacles as The Sleeping Beauty." ("George Balanchine, 1904-1983") While dancing, the multitalented Balanchine enrolled in the Petrograd Conservatory of Music, where for three years, he studied piano, music theory, composition, harmony, and counterpoint. ("SAB Biography") During the Russian Revolution, Balanchine oftentimes played the piano in cabarets or at silent movie houses for bread. It was this broad musical schooling that allowed Balanchine, as a choreographer, to communicate so effectively with the composers he worked with. In addition, he utilized this training to make piano reduction of orchestral scores, which helped him in translating music to dance. ("George Balanchine, 1904-1983") As a teenager, Balanchine began to work on choreography. His first piece, La Nuit, a pas de deux, was set to the music of Anton Rubinstein, and was created for himself and a female student. He staged one work for the Corps de Ballet entitled Enigmas, however he was more focused on choreographic experiments outside...