Has Child Behavior Worsened Over the Years? Essay

â€Å"Is your child forgetful, irresponsible, moody, and prone to daydreaming? (Figure 1.1) Does he seem to lack motivation and become easily bored?† (Empowering Parents) Has the problem become worse than it was a year ago? A child’s behavior is defined solely by environmental factors such as; family, cultures, and everyday experiences. As a result, studies have shown that due to these factors, children’s behavior has become worse. â€Å"A child’s behavior may be a problem if it doesn’t match the expectations of the family or if it is disruptive.† (Family Doctor.org) Parents are children’s greatest role models. â€Å"Your children will see your example – positive or negative – as a pattern for the way life is to be lived.† (Rcmp.Grc.go) â€Å"The 1960 Census reported that nine percent of children lived in single parent families, compared with the 28% reported by 2000.† (Prb.org) In 2012, according to the Cen sus Bureau about 80% of children were raised by single mothers. Therefore, many disadvantages come from a single parent household. The American Academy of Pediatrics proposes that boys in a single household become more â€Å"aggressive† trying to full the â€Å"father’s role† in the household. If the mother is absent, the young girls try to become the â€Å"caretaker† looking out for her family. (Everydaylife.GlobalPost) This leads children to raise themselves, forcing them to give up their childhood. This also could lead them into trouble because the children wouldn’t know right from wrong which is leading up to child behavioral problems. Single parents are also often financially stressed, making it hard n children. Children will be able to read through your stress and as they grow older, some would want to help. This will lead the children into desperation – causing them to steal or maybe bringing in dirty money, money they have earned illegally. Parents today are also becoming younger and younger. Kids raising kids is drastic. The cons of this are these young parents trying to be friends with their children instead of coaching them. Everything these young parents listen to or do, they will let their children do the same, thinking this act is â€Å"cute.† Many people with argue that child behavior has improved because of education, the technology is better. â€Å"Education is great. Education is by far better today than a hundred years ago! The fields of learning have been opened up to boys and girls equally to seek out far greater possibilities than were even imaginable a hundred years ago. The Education now is a better  than before. We are not beaten and now we can use internet for Education.† – Alisham2002 (Debate.org) Though technology has improved, and today’s education is better, this has nothing to do with the behavior of this generation. Technology is a downfall; kids have access to everything and are actually becoming too independent on electronics. Culture and everyday experiences such as music and video games have had a huge impact of children’s behavior. Music videos and games have become extremely explicit. I’ve known and seen children dance provocatively and cussing up a storm like the rappers does. Whereas, my mom would have never went for that! In conclusion, child behavior has worsened over the years because of single parenting in households, teen parenting, and today’s music and culture. In earlier years, there was a limit to all of these things. There could be a passcode on your TV so no child would witness th ese explicit things. Today, parenting is terrible and so is children’s behavior. Works Citied: â€Å"Dealing With An Angry, Acting-Out Child?† Parenting Articles about Arguing & Fighting. N.p., n.d. Web. 16 June 2014. . â€Å"What You Can Do to Change Your Child’s Behavior.† Health Education. N.p., n.d. Web. 16 June 2014. . â€Å"The Rise-and Fall?-of Single-Parent Families.† The Rise-and Fall?-of Single-Parent Families. N.p., n.d. Web. 16 June 2014. . â€Å"Family Issues for Single Parents.† Everyday Life. N.p., n.d. Web. 16 June 2014. .

Original Writing – A Short tale

A few miles south of your usual city packed with loud, noisy, busy people lay a small village of friendly folk. It was Spring in the land and in that one rural village the orchards blossomed, birds sung and the sun did not want to stray from this peaceful green valley. Only one particular person could hear the sound of trickling water at that precise moment, a Master Will Briscoe. He lay peacefully against one of the white blossom trees. His tatty breeches and white shirt flickered around in the wind. His toe poking out of a hole in his sock felt light blossom brush against it tenderly touching the surface. He was drifting off into a deep sleep until â€Å"Ahoy there!† called a certain Tom Davis. He stood around 5 foot 5 inches tall with brown, curly hair tied up in a ponytail that was blowing in the breeze. His shirt was a perfect white and had a pendant poking out the top which looked to be a sharp tooth of some kind. His friend who had arrived with him was of the larger sort of size, so as to speak. He had what looked to have once been food down the front of his shirt. He had chubby cheeks, and wild black hair. His eyes were a friendly kind of brown and he wore odd socks having not been fully awake when dressing that morning. â€Å"Tom, Brown,† Will replied while nodding at each of them in turn. Brown as he was called was the second, larger and grubbier of the two boys, his actual name was Tim, Tim Brown. But his friends felt the name Tim just didn't suit him and with not much brains between the lads Brown seemed like an easy and suitable name. So Brown it was and they had stuck to that name since their first meetings of each other. â€Å"Will, you got a moment?† Tom asked. â€Å"They're wanting hands to help prepare for the festival tonight,† he finished. â€Å"Sure,† Will replied, â€Å"I was only down here to get away from the house.† Brown who was watching the bees fly from flower to flower turned towards Will and asked with a soft tone, â€Å"Trouble at home again?† â€Å"Nah just the landlord being a jerk that's all.† â€Å"Nothing new then, † Tom added. They chuckled on while walking back towards town, the trip from town to the orchards was short, which may have been why Will spent so much time there. Or maybe he just preferred the peace compared to the hustle and bustle of town. As the boys approached the town they could see the outline of another friend of theirs Ray Staines, Ray wasn't small but he wasn't really very tall either. He had short blonde hair and to be honest just usually tagged along with the group. â€Å"Hi Will! Hi Tom! Hi Brown!† Ray shouted enthusiastically. â€Å"Going to help with the festival?† â€Å"Yes,† Will replied while casting quizzical looks at the others. â€Å"We can all go together right?† asked Ray. â€Å"Sure,† Will answered. By the time they had arrived there was only a few hours till the festival begun. They moved over towards the man who seemed to be directing everyone about. â€Å"Hello there,† the man boomed. He was large, balding and his only other distinguishable feature was his button nose. His name was Riordan, Captain Riordan when addressed. â€Å"Sorry lads we've just finished setting up for the evening, so you can't get any discounts for helping to set up, so go home freshen up and spend lots of money tonight,† he said while chuckling to himself. Will, Tom, Brown, and Ray split up. â€Å"See you later guys!† Will called while walking home to prepare for the night's festival.

Lead And Manage A Team Within A Health Care And Social Care Setting

A team is a group of people working together in a related field to achieve an agreed goal, target or objective. In order to attain the overall goal activities and tasks are shared between the team members with give individuals their roles and responsibilities. The feature of an effective team performance include the factors that the describe the team structure and the process that enables goal achievement. Communication : Communication is a process through which information is passed from an encoder to a decoder through and agreed channel, which has a feed back loop.Given that all enabling conditions that eliminates barriers to effective information or date transition and feedback are in place. Effective communication is an important feature of an effective team performance, it enable the definition of the problem or overall goal to every members of the team, it also enable communication that define roles and responsibilities of every member and methods of operation, feedback, suppor t and reassessment of team and individual tasks or needs.An effective team permanence must have a structure, heirachy that enables decision making, delegation of duties, monitoring and motivation channels, support, training and supervision of team members. There must be a chair, leader or manager of the team who takes overall responsibilities and co-ordination of activities. Team cohesion is important to ensure that communication remain sustainable and effective. Therefore there also has to be a good conflict management plan – process and procedure to eliminate break down in work processes.Definition of roles and responsibilities this enables delegated duties to be clear and monitorable. Every individual is clear about what to do, their deadline and how to obtain support when required. Support and supervision a team must have access to training support and supervision available for all members, through meeting that evaluate work processes and individual performances thereby e nabling teams to meet their goal. 1. 2 Identify the challenges experienced by developing teamsTeams that are developing can have problems at the beginning these may include: impact of the feature and structure in team management. Communication Impact of communiction on the team process know what to report, when and in what format to report to the rest of the team. The team has to agree on these elements to facilitate the process for the team. Barriers in communication can affect team cohesion and slow down pace of work. Roles and responsibilities Defning roles and responsibilities how to determing an even share of taskes within the team members.Which one is delegated tasks, how to agree and set deadlines. Overlapping roles can have the problem of deciding who does what and who job it is questions. Team member performances Poorly performing team members can be a challenging in meeting deadlines and achieving the overall goal. The team leader sometimes may need to re-allocate tasks wi thin team, take on extra tasks, training and supervising of members of the team, which can impact on the team leader’s meeting up with his own roles/ tasks. 1. 3 Identify the challenges experiences by established teamsControlling and managing experts and expert opinion. A team with mixed skilled and experts may have difficulties agreeing on opinions and some times reaching a decisions Controlling deviations The team leader or manager has to monitor activities regularly and monitor performances to ensure that target is met and cost and expenditures are within budget. Dealing with risks Monitoring and controlling risks that can impact on the achievement of goals to deadline, assessing and reducing risks and also taking risk actions to ensure achievement of the goal. Dealing with emergencies that impacts on work processThe team has to decide on how to deal with emergencies, risks and uncertainties and how they impact on the overall objective of the team. Changes and re-planning processes Decided on how to implement changes and addressing issues and re-planning implementation plans. Also co-ordinating activities of every member of the team, collating work products into the whole or overall goal can be a big challenge to the team and the leader or manager of the team. 1. 4 Explain how challenges to effective team performance can be overcome Challenges to effective team performance can be overcome by :Increasing communication – team have to meet as often as possible to discuss issues of concern. Team has to clearly define methods and channels of communication to ensure that the right information is available at the right time, in the right form through the right channel for effective use and feed backs give timely. Conflict resolution policy Team has to agree on the methods to which conflicts can be resolved within the group, this has to be addressed as soon as possible to enhance team cohesion and progress team effort towards achieving its goals.The t eam manager has to provide support and supervision to team members, the manager to also ensure that all delegated duties are supervised where necessary, provide training to members in order to facilitate their ability to contribute to team effort in meeting the teams overall objectives. Team to ensure a member of the team is assigned to monitor, reports and and implement risk management plans. Monitor and report all concerns and issues arising timely for team deliberation and decision making. 1. 5 Analyse how different management styles may influence outcomes of team performanceManagement styles are methods used by manager for administration in the work environments, different managers have there preferred approached based on their belief or experience in the use of managerial theories or concepts. The main aim of management is to meet goals and achieve planned targets i. e profit making, therefore approached can be altered depending on the situation and volatility of the environmen t. Management styles include: taylorism, fayolism, the hawthorne effect, needs and motives, complex man, management by objectives.Taylorism – this is scientific management, which concept called is ‘one best way’ to task performance. The idea that is that management make decisions and direct the staff to carry decisions out, without any fear or favor or emotional attachment – thought or input, discretion of staff. This leads to standard method of task performance leading to uniformity of actions and outcomes, speeds up production and increase expertise. Additional advantage is that, it help in the staff selection process thereby ensure that only required skills are sort for and employed.As a result the team will achieve its objectives early enough and a good outcome as the members are expert in the field. Team members are trained to follow only standard procedure for their tasks. b) Fayolism Outcome will differ if the managers have the qualities as describe d by Fayol such as : Health and vigor, Cleverness, Moral qualities, General knowledge (culture), Management capacity and Notions about other functions (activities) and The strongest skills in the function managed If the managers have these qualities they will then be able to meet the required principle such as: Division of work, Authority, Discipline, Unity ofcommand, Unity of direction, Subordination of Individual Interests to the Common Interest, Remuneration of personnel, Centralization, Scalar chain, Order, Equity, Stability of personnel tenure, Initiative and Esprit de corps (Union is strength). The outcome is likely to be more productive, timely and good quality of outcome as every member have common interests and order in the team. Collective sharing of work load and responsibilities help to meet target sooner.The Hawthorne Effect – This is the management style that believe that a happy worker is a good worker. Is concept central on providing a good working environment and opportunity for staff, thereby encouraging them to work harder and give their best. The outcomes of team working in this environment is that the team are happy together working in the environment individual and collective motivation enable people put in their best, and improve performance.

Globalization Essay Example | Topics and Well Written Essays - 750 words - 7

Globalization - Essay Example To justify his claims on the benefits of globalization, the author made use of quantitative data such as reports published by the World Bank and UNDP. The first data cited by the author is the one made by World Bank in 2002 citing that countries that integrated with the world market have experienced rapid growth in terms of GDP ( Wolf p512 ). Similarly, the author also supported this argument by citing the 2003 Human Development Report from UNDP that certain east Asian countries experienced remarkable GDP growth ( p. 511 ). Aside from the secondary data that the author used, he also drew examples from his own first-hand experience as senior divisional economist of World Bank in India during the 70’s. He himself has witnessed the effect of globalization to the standards of living of the people in India. The author tried to present a balanced view of the advantages of globalization not just by citing China but by explaining the growth of even â€Å"hopeless† countries suc h as Bangladesh ( Wolf p.514). The important part of the article dwells on his arguments on why economic integration was not successful in some countries. The author mentioned the interplay of endowments ( natural resources ), institutions ( government ), and policies as obstacles to a country’s development ( Wolfe p 514 ) . The arguments were compelling since he cited Gunnar Myrdal’s theory on underdevelopment regarding â€Å"soft states† or countries that lack political will as manifested by rampant corruption. Consequently, Wolf also linked this factor to the endowment of natural resources as cause of conflicts within since this â€Å"curse resources â€Å" provoke civil wars as in the case of most African states which I disagree with since culture and lack of education may have created this kind of socio-political environment. Lastly, he also cited the importance of choosing the right economic

Logics Term Paper Example | Topics and Well Written Essays - 1500 words

Logics - Term Paper Example Brow includes the three theories by Professor Rich Savin- Williams which has given a totally different flavor to the article. These theories are used to understand why the concept of gay and lesbian has become so widely accepted today. He blames it on the openness that exists in the work and leisure environment today. Williams believes that since the gay and lesbian members of the community have openly accepted themselves as gays and lesbians, the other members of the society can do little to discriminate against them. The article moves on to describe a very controversial concept which deals with why only the men are accepting their gay nature so openly and why women are still conservative when it comes to this. Brow brings in what he calls the â€Å"ceiling effect† to describe this. Brow concludes that there is no philosophical reasoning to why men are more acceptable to such notions, it is just that men are catching up to women and there may be a time when tables turn over w omen. Towards the end, Brow also touches gay and lesbian marriages and says that even though such members are acceptable in the society; their open relationships are still not welcome in the US. Gay marriages are still a controversial topic in the US and Brow thinks that it would continue to be so until the next few years. Although Brow begins with a very instinctive approach towards gays and lesbians by stating that the topic that he has considered and the facts that he has gathered are â€Å"stunning† just to emphasize how magnificently faulty they are (Bergmann, 1997). It gives the reader a feel that Brow is not very happy with the notion of accepting such members in the society and particularly military in a free fashion. However, as the article proceeds, Brow changes his approach to be a more analytical one. He states theories by Professor Williams and he uses statistics and

Congestive Heart Failure Case Study Example | Topics and Well Written Essays - 1750 words

Congestive Heart Failure - Case Study Example The patient history demonstrates that he smokes 1.5 packs every day. The patient has been smoking for 35 years. The patient’s smoking is one of the risk factors which predisposed him to his heart condition. Moreover, the patient is an occasional drinker which predisposed him to his heart problem. In addition, lack of proper exercise and failure to adhere to a healthy diet. Psychological stress would also be among the risk factors predisposing the patient to his heart condition. The patient is currently on ECASA, Isosorbide dinitrate, Metoprolol, Nitroglycerin, and Glyburide. The current treatment is aimed at relieving of symptoms of the patient’s heart condition, prevention of worsening of the condition. The current treatment is also aimed at treating the condition of the patient. The drug indications for the patient include ECASA which contains aspirin as an active ingredient. This drug is effective and appropriate for the relief of pain related to heart conditions. Mo reover, ECASA is effective in the prevention of possible inflammation to the heart which would worsen the condition of the patient. The indication for isosorbide dinitrate is appropriate for the management of the patient’s condition because this drug is effective in the prevention of chest pain related to heart conditions especially angina. Nonetheless, isosorbide dinitrate has adverse effects such as lightheadedness, flushing, and headache which must be taken into consideration in the management of the condition.  Ã‚  ... Metoprolol acts through blockage of beta-adrenergic receptors of heart muscles. This illustrates that metoprolol is effective in preventing the complication of the patient’s condition into heart failure as a result of adrenergic stimulation. It is however important to note that drug interaction of metoprolol with digoxin and calcium channel blockers would result in excessive reduction of blood pressure. Therefore counter indications must be provided during the prescription of metoprolol for the patient’s condition. Nitroglycerin is an appropriate vasodilator which is indicated for the treatment of the patient’s congestive heart failure. Glyburide which acts to lower the glucose levels in blood is an appropriate indication for the patient’s heart condition. This is because glyburide acts as an adjunct to exercise and diet. Since the patient is short of breath, exercising would not be viable and hence the appropriateness of glyburide as one of the medication s for the management of his heart problem. The dosages of these medications as provided in the indication are appropriate for the adult patient. Nonetheless the condition of the patient would influence possible adjustments to the treatment. In order to ensure that the patient adheres to the medication, the health care provider must ensure compliance by encouraging the patient to take the drugs. This would be achieved by explaining the importance of adhering to the dosages and the possible side effects that are related to the drug. When the patient is presented with the possible side effects, he would be enabled to selective alternative drugs for the management of the

Somebody who changed others lives Research Proposal

Somebody who changed others lives - Research Proposal Example (Dyson) Galileo was one such scientist too who refused to accept the conventional wisdom of his day and propagated ideas and scientific discoveries which clearly challenged the mighty of his days. Galileo was an Italian physicist, astronomer, philosopher as well as inventor who played critical role in the scientific revolution. It is because of his contribution that Galileo is often considered as the father of the modern science. (Reston) His most noteworthy contributions are in the field of astronomy where he not only discovered the four largest satellites of Jupiter but also studied the different phases of the Venus. Above all he invented telescope which allowed physicists to see the cosmos and make important astronomical discoveries. It is also argued that this invention of Galileo was also a start of the era of the technology which has propelled the society to this current level. However, the ideas of the Galileo were considered as rebellious according to the Church and his writings were banned. His ideas on the heliocentrism that earth is not stationary and it revolves around the sun were specially considered as against the religious teachings. In Bible it is written that the world is firm and it cannot be moved therefore the discoveries of Galileo were in direct opposition with the biblical references. It was therefore because of this reason that he was also asked to stand a trial for heresy. During that trial, he was declared in violation of the religious scriptures and therefore was ordered to remain in the house arrest for the rest of his life. His life was saved when he officially retracted his claim that earth is not stationary and indirectly endorsed the claims of the church at that time. The life of the Galileo is truly a life of a rebel because he presented ideas which were vehemently denied yet his ideas decisively shaped the way

History and Swot analyses of Thailand Essay Example | Topics and Well Written Essays - 750 words

History and Swot analyses of Thailand - Essay Example , and later in the 19th century, the Chinese immigrants began to control the rice mills and other trades in Thailand (Baker, Baker and Phongpaichit, 2009, p.33). The Chinese people got perfectly assimilated into Thai culture and the Thai people adopted Chinese culture as a part of Thai culture (Baker, Baker and Phongpaichit, 2009, p.101). A quarter of the Thai population presently is of Chinese origin (Baker, Baker and Phongpaichit, 2009, p.101). The European entry into Thailand had a great impact on Thai culture and life ((Baker, Baker and Phongpaichit, 2009, p.41). The Siamese monarchy and its government had many trade agreements with European traders ((Baker, Baker and Phongpaichit, 2009, p.41). The Thai courts were supplied â€Å"weapons and luxury† by these traders ((Baker, Baker and Phongpaichit, 2009, p.41). The material success that accompanied Christianity was a new idea for Thai people because according to the Thai Budhist religion, people were bound by the eventualities of fate (Baker, Baker and Phongpaichit, 2009, p.41). The European trade mobilized a market economy in Thailand (Baker, Baker and Phongpaichit, 2009, p.43). Though Britain and France had secret plans to accede certain parts of Thailand to their territories, the German expansionist move compelled these two nations to rally together against Germany and the result was a clear demarcation of Thailand’s boundaries by these nations through t reaties signed â€Å"between 1902 and 1909† (Baker, Baker and Phongpaichit, 2009, p.61). More significantly the weapon trade of Europeans acted as a catalyst in replacing the monarchy, and transforming Thailand into a nation ruled by military (Baker, Baker and Phongpaichit, 2009, p.99). The growth of the military was so phenomenal that â€Å"military expenditure rose from 1 million baht in 1898 to 13 million in 1909-1910 (Baker, Baker and Phongpaichit, 2009, p.99). Along with many other effects, the presence of Europeans had a bearing also on the clothing of

Financial analysis Research Paper Example | Topics and Well Written Essays - 4750 words

Financial analysis - Research Paper Example Return on equity is one of the most important ratios used to analyze the performance of the company. Investors and management of the company use returns on equity to analyze the performance and profitability of the company. DuPont ratio analysis is used to decompose the returns on equity of both the companies. By decomposing different elements that influence the returns on equity of companies, this report identifies important areas that help in increasing or decreasing the returns on equity. There are different elements that influence the returns on equity and some of these elements are Tax Burden, Interest Burden, Operating Margin, Asset Turnover and Leverage Ratios. DuPont analysis is applied on the two companies under study; Apple and BlackBerry, but this report also uses the data of other industry important players to analyze the factors that influence the ROE of the company. Industry players that are used in this report are Motorola Solutions, Inc. (MSI) -NYSE, Nokia Corporation (NOK) -NYSE, Microsoft Corporation (MSFT) -NasdaqGS, Hewlett-Packard Company (HPQ) -NYSE, International Business Machines Corporation (IBM) -NYSE). It has been found that Apple has performed the better when compared with Blackberry and average of the industry as ROE of the company has been higher than Blackberry as well as higher than Industry averages. Moreover, it has been found that the returns on equity of Apple have been showing an increasing trend in the last five years whereas the returns on equity of Blackberry have been showing a declining trend. In the years 2008 and 2009, ROE of blackberry was higher than Apple but the ratio was more or less the same in the year 2010. However the returns of Apple kept on increasing and these returns exceeded the returns of Blackberry. Therefore ROE of Apple was higher than ROE of Blackberry in 2011 and 2012. Moody’s Bond Rating criteria are also used to analyze

Psychological Survival - Cohen and Taylor Essay Example for Free

Psychological Survival Cohen and Taylor Essay 1) Aim of the study Obtain a phenomenological picture of long term imprisonment i.e. the analysis of the every day life of long term prisoners. The smooth patterning of every day life is the result of social interactions and learning about routines and the different domains of life. But some situations are outside the routines (death, sense of self or world view threatened). Disturbed orderliness brings meaning of life into question and often individuals rely on a different domain. Long term prisoners cannot do this. Theirs is a life in cold storage. Psychologically hard to deal with life outside. Some people go in when 20 and don’t leave before they’re 40, so a lot has gone on in everyday life and they’ve missed it. 2) Cohen and Taylor not really interested in the crime committed and the moral issues behind it. They are just interested in how prison affects this group of people. Society has been taken away from these people. Some of the people are well known, but they put aside what these people have been convicted on, they just want to know about their psychological survival. 3) Life inside Metaphor of a submarine: Impregnability, empty, claustrophobic, lifeless, bland no natural light, TV cameras. Things we take for granted in normal life, sociability and privacy, are not there. Not many friends you can have or choose to have. Relationships between guards and prisoners, maybe from a similar social backgrounds, have a lot to talk about. In the E-wing case there was a very pronounced geographical divide, north and south. Prisoners have a public profile outside, quite famous and it sets them aside from the guards. A sense of celebrity in some of the prisoners. This creates a division between guards and prisoners. New power dynamic. Not only hard to create and maintain relationships inside hard to do so with the external world. The prisoners were more worried about getting letters rather than receiving them. No physical contact, e.g. members of your family. Not allowed to talk about conditions in the prison maybe that is why they wanted to get their stories heard with Cohen and Taylor. Isolating experience. 5) different people fulfil different social roles. Obviously there was a small pool in prison. One friend had to fulfil many different roles, which made friendship very strong and intense. Some people were moved constantly and losing your one friend can be traumatic. Intensity of relationships and falling out, which will have an impact on the group and on you. No privacy no time. Can’t develop intimacy with other people. Constantly surrounded by others. Interactions regulated within the group to make sure nobody got harmed. 6) time means different things. For us it’s a resource. Living the present they don’t face or think of the 20 years ahead. Marking time in different ways: mood, seasons, unusual markers. Make time pass faster: body building, university courses, etc. promise of a visit. 8 weeks visit for e.g. 7) deterioration obsessive concern about their physical and psychological condition. 8) history of riots, rebellions and security. Cohen and Taylor interested in solidarity. The resentment towards guards held the group together, helped with bonding. Fight back together. 9) authority and unity different situations lead to different types of solidarity 10) fighting back 11) different criminal careers lead to different ways of psychological survival. Notes from a lecture and seminar on Psychological Survival.

Overview Of Mitsui OSK Lines Commerce Essay

Overview Of Mitsui OSK Lines Commerce Essay Introduction to Mitsui OSK lines Mitsui OSK lines (MOL) are a Japanese transport company which has wide range of business. OSK lines were a shipping company which was formed in 1884 and Mitsui was formed in 1942. During the major consolidation in Japanese shipping markets Mitsui OSK lines was formed in 1964, following the mergers of two companies OSK lines and Mitsui. (Mitsui OSK lines, 2010). After the formation in 1964 they launched specialised car carrier in 1965 and then full container ships in 1968. Later on they also entered the LNG market and also launched the double hull VLCC in 1995. As a strategy to expand their container services covering North America, Asia and Europe MOL joined a global merger know as The New world alliance (TNWA) with American president lines and Hyundai Merchant Marine. (Panama Canal authority, 2009). In one of the biggest mergers in Japan Mitsui OSK lines (2nd largest in Japan) merged with Navix lines (4th largest in Japan) in 1999. After the merger with Navix lines, MOL became one o f the biggest maritime carriers in the world (Japanese Times, 1998). The groups headquarters are in Tokyo, Japan. The company has in total 533 subsidiaries and affiliated companies in 66 countries with a consolidated work force of 39,864 employees (Annual report, 2009). Its main areas of operations are shipping and shipping related activities. Source: Mitsui OSK lines, 2010. As seen from the above chart MOL has a wide range of ships such as containers, pure car carriers, Bulk carriers, Tankers, LNG carriers, and others. MOLs core business segments are its bulk ships, container ships. (Mitsui OSK lines, 2010). In addition to ships they are in logistics services such as distribution and inventory control, air cargo transport, construction and engineering, real estate, trading and R D. (Mitsui OSK lines, 2010). MOL has 861 ships as of 31st March 2009 with a carrying capacity of 59,643 thousand tons. In terms of number of ships and deadweight MOL ranks the worlds largest shipping company in the world ahead of NYK and COSCO (Mitsui OSK lines, 2010). Source: Mitsui OSK lines, 2010. It has the largest Dry bulk fleet in the world with fleet size of 356 ships with a combined deadweight of 31026 million tons (Mitsui OSK lines, 2010). MOL is ranked first in terms of operation of LNG ships. Even after the financial crisis, the bunker prices at sky high rates and a strong yen in FY 2008 MOL posted their second highest annual income till date. This was more due to the strong performance in first half of 2008. Their revenue for FY 2008 was 18,994,218 thousand dollars with net income of 1292752 thousand dollars. Source: Mitsui OSK lines, 2010. Source: Mitsui OSK lines, 2010. Innovations and other activities In 2001 MOL launched its corporate principles to promote and protect our environment by maintaining strict, safe operation and navigation standards (Mitsui OSK lines, 2010, p.1). As per their principles they launched the 24hour manned (SOSC) Safety Operation Supporting Centre in the Head Office which monitors all MOL vessels position all around the world. MOL is also heavily involved in research and development. In December 2009 it displayed its concept of new generation vessels. The car carrier which is environment friendly they call it a HBRID car carrier, i.e. it uses renewable energy for ships electricity supply. The current president of MOL is Akimitsu says he want to create an excellent and resilient MOL group that contributes to sustainable worldwide growth (Ashida, 2009, p.1) HYBRID CAR CARRIER Source: Mitsui OSK lines, 2010. Theory of SWOT analysis W = WEAKNESS S = STRENGTH T = THREATS O = OPPORTUNITIY Source: Author generated The central purpose of SWOT analysis is to identify strategies that align, fit or match a companys resources and capabilities to the demands of the environment in which the company operates (Hill Jones, 2001). The true sense of SWOT analysis lies in its efficient use of rendering the company with its true picture of internal and external threats to the organisation. The predominant usage of SWOT is by bifurcating it into external and internal factors. Internal factor comprises of strengths and weakness of an organisation and the people who set the organisation standards. External factors are its opportunity and threats that are from its competitors and fellow companies. (Wang, 2008). True analysis helps the company set its agenda and helps excel to sustain in the competitive market. It is the model that helps it restructure the organisation to be able to sustain the competition. SWOT matrix can be used by managers to create various kinds of growth strategies. In the matrix there are four set of combinations which can be used. (Wang, 2008). SWOT MATRIX Opportunities EXTERNAL FACTORS WO SO ST WT Threats Strengths Weakness INTERNAL FACTORS SOURCE: Wang, 2008 SO: It is a combination of using strength of an organisation to grab the opportunities. ST: Using the strength of a company and company members to fight threats. Threats can be internal or external WO: This combination helps fight weakness to open up new opportunities. WT: Weakness and threats; these strategies are defensive in nature and helps to act in the positive direction to accomplish the set targets of the organisation. SWOT Analysis Strengths: Strong revenue growth: Its core shipping business is its bulk shipping. These are primary responsible for the growth of the company. It contributed to 86% of the revenue for the group. This increase in its major divisions will fuel the companys growth and will also help it in expanding its market share (Mitsui OSK lines, 2009). Diversified business portfolio: MOL has a diversified fleet ranging from ship operations to logistics. The logistics division of the fleet supports its shipping division. Due to its diversified fleet it can cope up with short term market fluctuations and also it can influence them. It also helps the group to enter into a market with wider customer base. (Mitsui OSK lines, 2009). Large fleet size: With respect to number of ships MOL has one of the largest fleet sizes. The group has the largest fleet of ships for Bulk and LNG. With this large fleet size it can service its customers better and also it improves the bargaining power in the market (Mitsui OSK lines, 2009). Weaknesses: Geographic concentration: MOLs main trade area is near the Japan coast and it is mainly catering to the Japanese market. For the FY 2007-2008 95% of its revenue was earned from the Japanese market. Over dependence on Japanese market makes its business risky as it is completely depend upon the economy of that country. It faces a competitive disadvantage over other companies due to its absence from the emerging markets in Asia. (Mitsui OSK lines, 2009). Economic downturn will affect the company as it is solely dependent upon Japanese markets. Slow growth and minimum profit margins in container market will affect the companys net income, due to the presence of container market drivers such as Maersk and MSC. High debt burden: MOL suffers from substantial Debt for the year ending 31st March 2009. As MOL has such a high debt it will affect on the groups capacity to obtain funds for future working capital, acquisitions etc. which will hamper the growth of the group (Mitsui OSK lines, 2009). Opportunities Growing volumes of container market: Due to globalisation container market will keep on growing at high rate. Hence they can enter into new trade routes in emerging markets such as Asia and Middle East (Mitsui OSK lines, 2009). Growing demand for natural gas transportation: The demand of natural gas will keep on increasing over the years as industrial, commercial and residential consumption will increase. MOL is already into natural gas transportation, they can benefit themselves with the growth in demand (Mitsui OSK lines, 2009). Well-timed fleet expansion: New regulations in Bulk shipping are coming, which are setting an upper limit on the age of the ships. MOL has got new fleet of carriers and also it can expand its current fleet and make the most of the situation. (Mitsui OSK lines, 2009). Threats Volatile oil prices: As MOL operates such a large fleet size fluctuation in the crude oil prices seriously affects the company. As the market is very competitive increased fuel prices burden cannot be passed on to the customer. This affects the companies operating expenses. (Mitsui OSK lines, 2009). Economic crisis is also a major concern due to major concentration of its trading in Japan. Competitive industry: There is a price war in between companies such as Maersk, NYK lines, MSC, Hanjin etc. Companies are coming up strategies such as low prices and faster delivery of goods. Hence the company has to make long term sustainability strategies which can help them stay in the market. (Mitsui OSK lines, 2009). MOL has a large fleet and in-spite of having policies, proper training and adequate precautions accidents are bound to happen. Oil spill accident can affect the companys image and can wipe out its business (Mitsui OSK lines, 2010). Global strategy Global strategy is a strategy which focuses on the world market and considers it to be a single market. This strategy is mainly adopted by companies which can compete on a global basis and their products are mainly standardized and offer services on a worldwide basis (Laudon Laudon, 2007). Global strategy is adopted mainly because of globalisation and liberalisation of trade all over the world. Some of the key drivers of globalisation are: There is a significant amount of reduction of barriers for trade in-between countries. The markets are liberalised and adoption of free market strategy. Industrialisation in developing nations such as India, China. Integration of world markets and cross border transactions have resulted in easy flow of capital. Technological advances are facilitating cross border trade and investments. The key participants in the global business are multinational enterprise (MNEs). MNE is a large company which have offices and subsidiary companies all over the world. Normally MNEs have inter-dependent members located all over the world, and all members work for a single system. MNEs normally carry out RD, manufacturing, procurement and marketing activities in whichever part of the world is economical for their business. Development of Information technology is giving the firms more flexibility to plan their global strategy. (Laudon and Laudon, 2007). Implementation of global strategy in a MNE is not easy at it seems. There is diversity in behaviour of people within countries. Companies when implementing their global strategies have to modify their strategies depending upon the regional markets. (Baird, 2003) Companies should also take into consideration regional differences, different life styles of people, cultures, and values. (Baird, 2003) In under-developed countries there may be other factors such as relation with government officials, language barriers lack of well trained people (Quickmba, 2007). Shipping by its nature is a globalised industry. Most of the large shipping companies operate on a global scale, and the above theory of global strategy fits perfectly for shipping lines. In terms of shipping global strategy means development of business through growth, acquisitions, alliances, creation of new capacity or a mix of all these things (Baird, 2003). The benefits to ship owners from a global strategy should be low cost and high efficiency. To gain the benefits of this strategy the key is to have a central decision making process which can handle such complex organisations (Baird, 2003). To gain competitive and comparative advantage over its rivals buying large vessels in the fleet such as containers or cape size bulk carriers is important. Mergers and alliance with companies is also a good option to increase the size of fleet and to share the risk (Baird, 2003). In container customer satisfaction is an important part of the business. (Baird, 2003) Hence companies tend to add value to their value chain by use of technology such as giving door-to-door service or by giving them faster service. MOL global strategy MOL is a shipping and transport company trading its ships all over the world. MOL has different types of ships and has offices and subsidiaries all over the world. MOL can be termed as a multinational enterprise. MOL launched its Mid-term management plan in 2007 known as MOL ADVANCE Action and Direction at the vanguard of creating excellence (Mitsui OSK lines, 2010).Their main theme is growth with enhance quality- Becoming the biggest and the best (Mitsui OSK lines, 2010,p.1). There are five overall strategies in the plan. One of the strategies in the plan is global strategy Their global strategy is to accelerate globalisation and enhance sales capabilities in emerging markets Develop business on a global scale to meet diversification of trade. To expand the business in emerging markets such as India, Middle east, Russia and Vietnam. To ensure that the fleet expansion is exceeding the growth of sea-borne trade. (Mitsui OSK lines, 2007, p.2). MOL in line with their global strategy has overcome their weakness by entering emerging markets in Asia and also has used their opportunities by investing in many projects such as the LNG market. Below are the detailed points mentioned how MOL has used their strengths, have tried to overcome their weakness, taken their opportunities and minimised threats. MOL expanded their fleet of ships from 2007 to 2009 by adding 196 ships, out of which 22 were container and 172 were bulkships. MOL is targeting the China markets which are importing iron ore from Brazil, Australia and India. Hence they are increasing their cape size bulk carrier fleet. With cape size ships such as Brasil Maru which are largest in the world, they get a competitive advantage in the cape size market. MOL will be building 53 iron ore carriers in future out of which 14 ships will be above 200 000 mt. (Nakanishi, 2008) MOL is also targeting the growth in the domestic coast trade in China and India which is expected to grow by 15% volume. (Open sea 2007) About 50% of small handy max and 20% of handy max fleet all over the world are 20 years and over. With strict regulations in force for old ships, joining of new ships in their fleet will add value to their fleet (Open sea 2007).This well timed expansion of new fleet will help the company to expand more in the bulk carrier market in the developing countries. Source: (Mitsui OSK lines, 2009). MOL will also launch their new class bulk carrier called Handy-Cape type which will be as per the specifications of the new widened Panama Canal. This will give them the versatility to serve ports all over the world (Mitsui OSK lines, 2010). In the container market they are expecting a steady rise in future, in-spite of the worse current market conditions. As a long term strategy they are ordering new container vessels as trade is going to increase because of globalisation and increase in population (Mitsui OSK lines, 2007). In order to increase its bulk fleet they are planning to take over few of the bulk shipping lines which went into bankruptcy because of recession. MOL recons that in-spite of having a high debt ratio funding will not be a problem due to its past record. MOL was one of the few companies which avoided the recession and posted profits in the FY ending 31st March 2009 (Seatrade Asia, 2009). To target the growing container market in India, MOL has just opened 6 new offices in India which will serve the container and car carrier business in India. These offices can respond faster to the needs of the customer and also provide them high service quality (Open Sea, 2007 Mitsui OSK lines, 2007). Global demand for LNG is going to increase many folds in the coming years. LNG will be used as alternative source of fuel as it emits less carbon dioxide than heavy oils. On basis of this future market MOL has grabbed the opportunity and placed order for 6 LNG carriers with an investment of 150 billion yen. (iStockAnalyst, 2010). MOL has launched its new LNG carriers which have a re-gasification system fitted on board. This system will give an advantage over conventional LNG ships as these ships can discharge cargo at off shore terminals. Hence when these ships will join the MOL fleet they will give a competitive advantage over other companies is terms of safety. (Mitsui OSK lines, 2010) MOL car carrier division is suffered losses because of the global recession. Hence in order to sustain in the market, MOL initiated downsizing plan, in which they scrapped 21 ships, sold 4 ships and sent 11 ships in cold layup. While they are scrapping ships they have launched a concept car carrier Hybrid carrier which uses renewable energy. (Mitsui OSK lines, 2010). As a strategy to boost up the market for car carriers MOL are going to transport machinery by dismantling them, and loading onto car carriers using Mafi-load trailers. Hence they are targeting heavy lift market by using car carriers and becoming Niche player. (Mitsui OSK lines, 2010) MOL will restructure its ship management companies so that they can meet the need of expanding fleet and global network. Six ship management companies will be restructured and they will be given individual responsibility as per the type of ship. The headquarters will stay in Tokyo. (MOL Inc, 2010). Source: (MOL Inc, 2010). Conclusion MOL launched its ADVANCE mid-term management strategy which covers the entire operations of MOL. Its global strategy for the next 5 years was to overcome its weakness and to make use of the new opportunities in the emerging markets. MOL has managed to sustain and make profits in the FY 2008 in-spite of economic downturn. This is mainly because of its diversified fleet and its core business which are its bulkships. It has success fully used its strengths to sustain in recession time. Its bulkships revenue has compensated for the loss making container and the car carrier divisions. To keep a strong hold on its bulkships, MOL is continuously striving hard by buying large new ships and phasing out the old ones. MOLs core business is secured and profit making, hence they can venture into other markets and overcome its weakness. MOL main weakness is its over reliance on the Japanese markets. It has overcome the weakness by marking its presence in the emerging markets in India and China. MOL is also increasing its LNG fleet to cope up with the rapid expanding LNG market and now it is the market leader in LNG transportation. MOL is also in the process of restructuring its ship-management offices, so as to keep up with the demands of growing company. With innovative designs for its car carriers and targeting heavy machinery market MOL is trying to gain a competitive advantage.

Working Capital Management And Profitability

Working Capital Management And Profitability Working capital management (WCM) refers to management of a firms current assets and current liabilities, which is also a primary function that support firm daily operation such as used to funds its stock, credit sales, and credit purchases. The management of working capital is important in order to maintain its liquidity in day-to-day operation; to ensure it operation is running smoothly and meets its obligation (Eljelly, 2004). A firm without sufficient cash flow will have difficulties to survive in the future as it will be unable to pay its obligations. Therefore, if a firm does not manage their liquidity position well, it will affect firms growth, survival and profitability (Shafii, 2010). The trade-off between profitability and liquidity are essential, however most of the firms ultimate objective is to maximise profit, while disregarding the dilemma of liquidity. One objective should not be cost of the other because both of them have their important (Raheman Nasr, 2007). Jose et al. (1996) also point out this fact saying firms with glowing long term prospects and healthy bottom lines do not remain solvent without good liquidity management. For these reason WCM should be given proper consideration. However, the management of working capital is complex as it needs to manage a number of different components which are inter-linked to each others. The management needs to concern on account receivables, account payables, inventories and cash, as altering one component will affect the others. Therefore, firms need to identify the optimal level of working capital that can maximise firms value (Afza and Nazir, 2007). According to Ganesan (2007), optimization of working capita l means minimisation of related costs and maximisation of related income. Efficient WCM will increase firms free cash flow, which in turn increases the firms growth opportunities and return to shareholders. Consequently, efficient WCM is crucial in order to maintaining firms survival, liquidity, solvency and profitability. Thus, WCM has enormous influence to firms performance. Research Question Does the past evidence showing a relationship between WCM and profitability hold true in Malaysian Listed Companies -manufacturing and services industries. 1.2 AIM The aim of this study is to provide empirical evidence of the relationship between WCM and profitability in a sample of Malaysian listed companies by looking at the manufacturing and services industries. The cash conversion cycle (CCC) will be the indicator of firms liquidity which is a comprehensive measure, so that able to identify the most important variable that will affect CCC for two different industries. 1.3 OBJECTIVES OF THIS STUDY Examine the relationship between the CCC and firm profitability. Examine the relationship between CCC components which are account receivables, account payable and inventory turnover period with firms profitability. Investigate whether the two industries have the same effect on the relations. 1.4 RATIONAL OF THIS STUDY Extensive empirical research on WCM has been carried out around the world widely and those researches had given different results on the relationship between WCM and profitability. As the studies on the data undertake from Ernst Young, 2010 reveals that WCM vary across different industries. The study also gives significant evidence that different firms or sectors adopt different approaches to WCM. So, different firms will use different approaches and strategy to manage their working capital, such as those firms that is less competitive will choose to minimise their receivable in order to increase their cash flow. While for those firms that depends on supplier will maximise their payable account. Therefore, the impact of various working capital mechanisms on firms performance from Malaysia perspective might be different due to divergence business environment and culture between other countries. Besides that, there are few factors that may influence firm working capital such as nature of business, production policy, production cycle, credit policy, and availability of supply (Rama, 2009). Nature of Business The nature of business between different industries or firms is different. Thus, working capital requirement needed, also different among different industries or firm. For example, manufacturing is the productions of the product where the inventory can be keep in the warehouse. While services are the services provided to customer which cannot be stored. It also does not have investment in either raw materials, work in progress (WIP) or finished goods. Besides that, it also involves in immediate realization of cash after the services are provided, which means there will be less accounts receivables is exists. In here, it can be believed that services will have lower working capital requirement. [low wc, more risk n return] This is further proven by John Louie Ramos Production Policy The management of hospitality capacity (inventory) is difficult as compared to manufacturing firm due to fluctuating demand pattern. For example, for service industry their inventory is room availability. The number of rooms in a hotel is fixed, once the room is vacant, they will lose the chances of earning money and the inventory during the period is wasted. Meanwhile, the services provided to customer cannot be store. Besides that, if the demand for the room is more than supply, they had to lose the income as they cannot produce the inventory based on demand. While for the manufacturing firm, they can produce their inventory based on the seasonal demand. They can produce more inventories during the peak demand and less during off-seasons. Then, the firm will have low working capital during off-season. While for those firm that have fixed inventory production policy which means produce the same quantity of inventory to meet the peak demand, then the firm will have large accumulation of inventory during the off-seasons. The large accumulation of inventory will increase the amount of working capital. Thus, the production policy will affect the firm and industry working capital requirement. Production Cycle The time and process involved in manufacture of goods will also affect firm working capital requirement as more fund is needed to invest, in order for the goods to be completed in time and in good quality. Credit Policy Credit policy also one of the factors that will affect firm or industry working capital requirements which it determine the firms receivables. For services industry, it will have low working capital as it involved cash sales while for manufacturing the working capital requirement will depend on the firms credit policy. If the firm offer short credit period, then it will only need low working capital and vice versa. Availability of supply The availability of inventory such as raw materials will affect firm working capital requirements. If the availability of raw materials is easily to obtain then firm can maintain low inventory which mean only need low working capital. However, if the level of supply is hard to predict or obtain then the firm had to keep a large amount of inventory in their warehouse in order to avoid the shortage of production. Thus, the firm need large amount of working capital. Therefore, this study is to examine the differences of the WCM between to the two industries and relationship between liquidity and profitability in Malaysia listed company. 2. LITERATURE REVIEW 2.1 WORKING CAPITAL MANAGEMENT Working capital represents safety cushion for providers of short term funds of the firm. Without a proper management of working capital, it will have cash shortages and will result in difficulty in paying its obligations, especially in the competitive business worlds nowadays (FPR, 2010). Besides that nowadays, most companies normally do not think of improving liquidity management until them faces financial crisis or becoming on the edge of bankruptcy. In order to make sound decision and survive in the long term, firm must combine strategic planning with comprehensive data by using both financial and non-financial data. Working capital and liquidity management is important for all businesses either are small, medium or large firm. As cash is the most liquid asset in a firm, therefore efficient liquidity management involves planning and controlling firms current assets meets its current liabilities is essential so that firm will not excessive invest in short term finance and avoid risk of inability to meet its short term obligation. Furthermore an efficient WCM enable firm to minimise the need for external financing as the external financing comprises of financial risk. By referring to the risk and return theory (Pettengill et al, 1995), higher risk investments will result in higher returns and vice versa. Hence, firms with low liquidity of working capital may have higher risk then high profitability. Conversely, high liquidity of working capital may face low risk then low profitability. Therefore, firm must take into consideration all the current assets and current liabilities when making financial decision making and try to balance the risk and return. As a result, in addition to profitability, liquidity management is vital for ongoing concern. Working capital management comprises of inventory management, cash management and credit management. A detailed of those components will be discussed below: 2.1.1 INVENTORY MANAGEMENT Inventory management is essential for businesses, without proper control and management of the inventory will lead to serious issues facing by the firm. For example, if the inventory does not managed properly or in an efficient manner, it may delay firms production process, lost of important customer, customer dissatisfaction, and or result in working capital curtailment (Richard A, 1978). Inventory consists of raw material, WIP and finished goods (Adeyemi, 2010). By referring to (Marilyn, 2006) raw materials are used to make production scheduling easier, to take advantage of price changes and quantity discounts, and to hedge against supply shortages. If raw material inventories were not held, purchases would have to be made continuously at the rate of production. This would not only mean high ordering costs and less quantity discounts, but also production interruptions when raw materials cannot be procured in time. WIP serves to make the production process smoother and more efficien t. Besides that, it will provide a buffer between the various production processes. Finished goods have to be held to provide immediate services to customers and to stabilise production by separating production and sales activities. Firm can improve the inventory turnover or shortening the inventory turnover period by speeding up the WIP into finished goods, however it cannot be fully transformed. While for the raw material and finished goods is depend on management decision. Thus, it can be said every firms inventory turnover level is significantly different from each other. High inventory holding in a firm will reduce the risk of shortage and decrease the ordering cost. However, hold too much inventories on hand there may be a risk of inventory obsolesces (Van Horne, 1995). Therefore, firm must find a trade-off between those risks by discovery an optimal inventory level. An optimal inventory level can be measured using the economic order quantity (EOQ) as it minimise the annual ho lding costs and ordering costs (Adeyemi, 2010). The formula for EOQ is as below: A = Annual demand Cp = Cost to place an order Ch = Cost of holding an inventory in a year Besides that, EOQ can also be explained using graph in the Figure 1. The graph is plotted for total ordering cost, total holding cost and total cost for the quantities ordered. The point at which the line of total ordering cost intersects with the total holding cost is the EOQ. At the point of EOQ, it will show the minimum costs that will incurred when the firm placing the total amount of quantities. The graph also shows that the cost of ordering is decreased when the order quantity is increased. Then, the holding cost will increase when the order quantity is increased. In addition, when the order quantity is increased or decreased, the total cost will increased and decreased as well, where the total cost is the sum of total ordering cost and total holding cost. Hence, the optimal level of inventory cost is at the point of EOQ. According to Abraham (2005) inventory for services industries consists of two kinds of perishable inventory. One is room availability and the other is food beverages. The identification of fast and slowing moving of these inventories is within the total inventory is essential in order to avoid insufficient inventory. He also states that an optimal inventory is important in order to have a proper management of the inventory as those unused inventory will lead the firm suffer a lost. 2.1.2 CASH MANAGEMENT According to Van Horne (1995) cash management is involves managing the monies of the firm in order to maximize cash availability and interest income on any idle funds. Cash management also include the trade receivable of a firm which play an important role in managing working capital. By improving the trade receivable routine more efficient, firm can reached optimal receivables by having adequate credit policy and collection procedure. A credit policy specifies requirements to value the worthiness of customers and a collection procedure provides guidelines to collect unpaid invoices that will reduce delays in outstanding receivables (Richards Laughlin, 1980). An efficient cash management is essential as it can be an instrumental in preventing losing of cash, maintain sufficient cash to made payment and prevents unnecessary large amounts of cash from being held idle in banks account that produce little or no revenue. 2.1.3 CREDIT MANAGEMENT Lastly, the optimal payables can be achieved by extending its trade credit from supplier. Simona and Paul (2007) state that trade credit is a substitute financing choice of short term borrowing, where trade credit is free while short term borrowing is costly as it needs to incur interest cost. For example, when firm extends its credit period from suppliers it will save the cost of short term borrowings. This means that an increased in account payables, will lead to a decrease in the short term borrowing costs. However, by delaying the payments to supplier will damage the firms reputation and loss some of the cash discounts offered by supplier for early settlements. 2.2 LIQUIDITY MEASURES Corporate liquidity is examined from two distinctive dimensions either static or dynamic views (George, 1997; and Lancaster et al., 1999). 2.2.1 CURRENT AND QUICK RATIO The static view is normally based on traditional measure of current ratio and quick ratio which is calculated based on information at the balance sheet and incorporates no cash flow variables. The underlying behind why these two ratios are well-known in used is due to its simplicity. Current ratio is defined as the relationship between currents assets and current liabilities. It is calculated by dividing the total of the current assets by total of the current liabilities. The current ratio represent margin of safety to the firms creditor, an index to the firm stability. While for quick ratio is the ratio of liquid assets to current liabilities. Kamath (1989) argues that the information generated from the ratios is inadequate to measure the liquidity and future cash flow due to their static nature which measures liquidity at a given point of time. George (1997) assert that it will be more appropriate and accurate to evaluate effectiveness of WCM by CCC, rather than the traditional mea sures of liquidity current ratio and quick ratio. 2.2.2 CASH CONVERSION CYCLE (CCC) Whereas dynamic CCC measures ongoing liquidity from the firms operation is define as more comprehensive measure of working capital and as a supplement to current ratio and quick ratio (Richards and Laughlin, 1980). CCC shows the time lag between expenditure for the purchases of raw materials and the collection of sales of finished goods (Schilling, 1996). This CCC measures also has been highly recommended by Kamath (1989), and others. CCC is a measure for the efficiency of WCM as it indicates how quickly the current assets are converting into cash. CCC comprise three components of days inventory outstanding (DIO), days sales outstanding (DSO) and days payables outstanding (DPO) [CCC = DIO+DSO-DPO]. DIO is a key figure that measures the average amount of time that a firm hold its inventory. It is calculated by inventory/cost of sales x 365 days. A decrease in the DIO represent an improvement, increase is deterioration (Ross et al, 2005). DSO is the key figure that measures the average amount of time that a firm hold its account receivables. It formula to calculate is account receivables/sales x 365days. A decrease in DSO represents an improvement, whereas increase represents deterioration (Ross et al, 2005). DPO is the key figure that measures the average amount of time that a firm hold its trade payables. It is calculated by trade payable/cost of sales x 365days. For DPO, an increase in days represents an improvement, whereas decrease indicates deterioration (Ross et al, 2005). The traditional view on CCC and profitability highlight that the shorter the CCC, the superior the firm profitability. The firm can shorten their CCC by improving the inventory turnover, collects cash from receivables more quickly and slowing down the payments to suppliers. This will increase the efficiency of firm internal operation and result in greater profitability (Mohammad, 2010). This can be seen in the case of Dell manufacturer in American, which it mainly business is sales of its own brand (Dell) computer and computer accessories through internet and open door sales. Their primary focus is on student market and home user. Richard (2003) had analyse on the Dells working capital showing that the increase in inventory turnover and receivable turnover days were affect Dells overall profitability. Later in the year 1997, Dell had made some changes on its business operation by only producing those computers when the order is placing by customers and thus, the company able to reduc e its CCC to negative working capital due to low inventory turnover. The negative CCC show that Dell able to collect payments from customers before they made payment to their supplier. On the other hand, shortening the CCC could harm firms profitability as reducing the inventory conversion period could increase the shortage cost, reducing the receivable collection periods could makes the companys lousing its good credit customers, and lengthening the payable period could damage the firms credit reputation. Therefore, shorter cash conversion cycle associated with high opportunity cost, and longer cash conversion cycle associated with high carrying cost. By achieving the optimal levels of inventory, receivable, and payable will minimize both carrying cost and opportunity cost of inventory, receivable, and payable and maximises sales, and profitability of firms. In this regards, an optimal cash conversion cycle as more accurate and comprehensive measure of working capital management. Schilling (1996) mentions optimum liquidity position, which is minimum level of liquidity necessary to support a given level of business activity. Briefly, he says it is critical to deplo y resources between working capital and capital investment, because the return on investment is usually less than the return on capital investment. Therefore, deploying resources on working capital as much as to maintain optimum liquidity position is necessary. Then he sets up the relationship between CCC and minimum liquidity required such that if the CCC lengthens, the minimum liquidity required increases; conversely, that if the CCC shortens, the minimum liquidity required decreases. 2.3 EMPIRICAL EVIDENCE There are numerous empirical research had done on the relationship between WCM and profitability in different countries and industries by using different variable selection for analysis. Some of the research prove that there is a positive relationship between profitability and CCC such as Dell, however there also had research shows that there are negatively related. Richards and Laughlin (1980) concluded that there is a positive relationship between the current and quick ratios and the cash conversion cycle. Besides that, Chowdhury and Amin (2007) also had found positive correlation between working capital and profitability which examine on the pharmaceutical industry in Bangladesh. The study done by Lazaridis and Tryfonidis (2006) using the sample of listed company from Athens Stock Exchange for the period 2001-2004 showed that there is a significant relationship between CCC and profitability, which use gross operating profit as a measure of profitability. It same apply for Ganesan (2007), analysis on the WCM efficiency in telecommunication equipment industry, found that there is negative relationship between working capital and profitability. It can be said that management of working capital have significant impact on profitability and liquidity in different countries and industries. Besides that, an empirical research on Pakistani firms done by Raheman and Nasr, (2007) with a sample of 94 firms listed on Karachi Stock Exchange from period 1999-2004, shows that there is a negative relationship between variables of WCM and debt with profitability of the firm. In addition, a study in Indias hospital for the period 2005-2006 by Christopher and Kamalavalli, (2010) the correlations and regression analysis signifying that working capital component namely current ratio, cash turnover ratio, current assets to operating income and leverage negatively influence profitability of the firms. Lastly, the recent study in 2009 by Uyar (2009), he used the ANOVA and Pearson correlation to analyse the relationship between CCC and return on asset for the firm listed in the Istanbul Stock Exchange for the year 2007. The research showed that there is a significant negative correlation between those two variables. Belt (1985) examined for US companies the trends of cash conversion cycle and its components during the period 1950-1983, for those lines of businesses for which Quarterly Financial Report for Manufacturing, Mining and Trade Corporations (QFR) . He found that retailing and wholesaling firms both had cash conversion cycles shorter than those of manufacturing firms. Mining firms had the shortest cash conversion cycle because this type of industry has the longest payment deferral period of all the major business types. Besley and Meyer (1987) evaluated empirically the interrelationships among the working capital accounts and cash conversion cycle, the firms industry classification and the rate of inflation for US companies for the period 1969-1983. Using the Spearman rank correlation coefficient they found that the cash conversion cycle was most correlated with the average age of inventory and least correlated with the age of spontaneous credit. The conclusion suggests that inventory ac tivity is the most important input to the cash conversion cycle. The age of inventory, the average collection period and the age of spontaneous credit proved to be highly correlated. The cash conversion cycle and its components for the examination period differed from industry to industry, but did not vary from year to year. By looking at the empirical literature on WCM, there is limited research study on the consequences of WCM from Malaysias firm perspectives. Irene Lee (2007) research results show that the Malaysian public listed firms have positive relationship between profitability and working capital to a certain extent. Besides that, the recent study by Mohammad (2010) explores the relation between WCM and firms performance. He measures the relationship by selecting 172 listed companies in Bursa Malaysia for the period 2003-2007. Using the Pearson correlation and multiple regression analysis, he found significant negative associations between working capital variables with firms market value and profitability. Therefore, he highlights the importance of managing working capital requirements to ensure an improvement in firms market value and profitability and must consider the working capital when making companys strategic. It can be seen from the above that many studies have done on the WCM, its component and profitability by using different variable to test those relationship. From those studies, different countries, industries and strategies gives different results, some are positively related between WCM and profitability while some are negatively related. Since the previous studies of WCM in Malaysia, is focusing on the relationship between WCM and profitability. Therefore, in studies will further study on the relation of the both variables by making comparison on the two listed industries of manufacturing and services industries in Malaysia. 3. RESEARCH METHODOLOGY The objective of this study is to look at one parts of financial management which known as WCM with reference to Malaysia. Here, will see the relationship between WCM practices and its effects on profitability of two industries in Malaysia; 16 firms listed on main board of Bursa Malaysia for the period of three years from 2007 to 2009. This section of the study will discuss on the sample selection, variables, and statistical techniques that will be used to examine the relationship between firms WCM and profitability. 3.1 DATA SET SAMPLE In this study secondary data; firms financial statements will be used to examine the research question. Those secondary data will be collected from Bursa Malaysia. A sample of eight companies will be randomly select for both manufacturing and services industries for the period of three years from 2007-2009. The reason for selecting this period was that latest data that will be available for investigation. Manufacturing and services industries are selected for this study because they reveal district difference in term of nature and management of the business. The services industries have a seasonal period and profit as they unable to predict the sales and demand from customers as services industries are people-oriented and people-driven, it is more difficult to effectively automate and control the service costs than in other non-services business sectors. Whereas the inventory for the manufacturing can be stored in the warehouse in order to avoid shortage but for the services industri es unable to stored their capacity (inventory) as it will affect their firms profitability. Therefore, a comparison of the WCM between the two industries will be look at in this study. Primary data will not be used as the data that has not been gathered before and the collection of data is time consuming, and high cost. Besides that, the primary data is not able to measure the firms financial strength and weaknesses. The measurement of firms financial wealth can only be measures and compare by using quantitative data. In addition, this study is to examine the relationship between WCM and profitability which required the quantitative information. 3.2 VARIABES This study had identified key variables that will influence Malaysia firms WCM. Choice of variables is influenced by previous study on WCM and also to further study on the previous study on Belgians WCM by Deloof. CCC will be used as a comprehensive measure of WCM which also used as independent variables. CCC is simply DSO plus DIO  less  DPO. Profitability is measured by gross operating income (GOI), which is defined as sales minus cost of sales, and divided by total assets minus financial assets. Why it was divided by total assets minus financial assets? As from the list of companies that are randomly selected from Bursa Malaysia, their financial asset is a significant part of its total assets, where financial asset include cash and bank balances, stock and securities that can be readily converted into cash. This also the reason why return on assets is not considered as a measure of profitability in this research, as if firm has mainly financial assets in its balance sheet; its operating activities will contribute little to the overall return on its assets. Besides that, sales growth ([this years sales previous years sales]/previous years sales) will be used as control variable in the regression analysis. 3.3 HYPOTHESIS TESTING As the objectives of this study are: Examine the relationship between WCM and profitability. Examine relationship between the DSO, DIO, DPO and firms profitability. Investigate whether the two industries have the same effect on the relations. The following hypothesis will be formulated and attempt to find statistical evidence for the two industries to support those hypothesis. Hypothesis H1: The CCC is negatively related to firms profitability (ROA) higher CCC, lower the firm profitability and vice versa. Hypothesis H2: Shortening the DSO will increased firms profitability. Hypothesis H3: Shortening the DIO will increased firms profitability. Hypothesis H4: Lengthening the DPO will increased firms profitability. 3.4 ANALYSIS USED IN STUDY In this study, two types of analysis are performed; there are descriptive and quantitative analyses. 3.4.1 DESCRIPTIVE ANALYSIS The initial analysis in this study is descriptive statistic, which will provide detailed information of each relevant variable and describe the relevant aspects of cash conversion cycle. All the relevant variables were calculated using balance sheet value, rather than using market value, it is because the firms financial statement did not provided market value on the variables that is required in this study. Besides that, the measurement of profitability GOI could only be based on value in income statement values as there is no way to measure it at so-called market values. In addition, if the market values are used, there will a question on which date the à ¢Ã¢â€š ¬Ã‹Å"market values are referred to. Thus, in this study the book values of the variables in the firms financial statement will be used. 3.4.2 QUANTITATIVE ANALYSIS Two methods had been applied in quantitative analysis. Firstly, correlation analysis is carried out, which specifically to measure the possible linear relationship between different variables under consideration. Secondly, is regression analysis, which is to estimate the relationship between liquidity, profitability and other selected variables. We have used Pooled Ordinary Least Squares and Generalized Least Squares (cross section weights) methods for analysis. We used panel data in a pooled regression, where time-series and cross-sectional observations were combined and estimated. In other words, several cross-sectional units were observed over a period of time in a panel data setting. For this purpose of analysis the E views software was used to analyze financial data and especially in case of pooled data. 4. DATA ANALYSIS AND DISCUSSION The results of the two types of analysis will be discussed below. 4.1 DESCRIPTIVE ANALYSIS Initially, descriptive statistics is the first step analysis in this research. It will provide a useful summary of central tendency; mean and median, and variability such as standard deviation, minimum and maximum. Table 1 and Table 2 presents descriptive statistics for the components of working capital efficiency for eight manufacturing firms and s Working Capital Management And Profitability Working Capital Management And Profitability Working capital management (WCM) refers to management of a firms current assets and current liabilities, which is also a primary function that support firm daily operation such as used to funds its stock, credit sales, and credit purchases. The management of working capital is important in order to maintain its liquidity in day-to-day operation; to ensure it operation is running smoothly and meets its obligation (Eljelly, 2004). A firm without sufficient cash flow will have difficulties to survive in the future as it will be unable to pay its obligations. Therefore, if a firm does not manage their liquidity position well, it will affect firms growth, survival and profitability (Shafii, 2010). The trade-off between profitability and liquidity are essential, however most of the firms ultimate objective is to maximise profit, while disregarding the dilemma of liquidity. One objective should not be cost of the other because both of them have their important (Raheman Nasr, 2007). Jose et al. (1996) also point out this fact saying firms with glowing long term prospects and healthy bottom lines do not remain solvent without good liquidity management. For these reason WCM should be given proper consideration. However, the management of working capital is complex as it needs to manage a number of different components which are inter-linked to each others. The management needs to concern on account receivables, account payables, inventories and cash, as altering one component will affect the others. Therefore, firms need to identify the optimal level of working capital that can maximise firms value (Afza and Nazir, 2007). According to Ganesan (2007), optimization of working capita l means minimisation of related costs and maximisation of related income. Efficient WCM will increase firms free cash flow, which in turn increases the firms growth opportunities and return to shareholders. Consequently, efficient WCM is crucial in order to maintaining firms survival, liquidity, solvency and profitability. Thus, WCM has enormous influence to firms performance. Research Question Does the past evidence showing a relationship between WCM and profitability hold true in Malaysian Listed Companies -manufacturing and services industries. 1.2 AIM The aim of this study is to provide empirical evidence of the relationship between WCM and profitability in a sample of Malaysian listed companies by looking at the manufacturing and services industries. The cash conversion cycle (CCC) will be the indicator of firms liquidity which is a comprehensive measure, so that able to identify the most important variable that will affect CCC for two different industries. 1.3 OBJECTIVES OF THIS STUDY Examine the relationship between the CCC and firm profitability. Examine the relationship between CCC components which are account receivables, account payable and inventory turnover period with firms profitability. Investigate whether the two industries have the same effect on the relations. 1.4 RATIONAL OF THIS STUDY Extensive empirical research on WCM has been carried out around the world widely and those researches had given different results on the relationship between WCM and profitability. As the studies on the data undertake from Ernst Young, 2010 reveals that WCM vary across different industries. The study also gives significant evidence that different firms or sectors adopt different approaches to WCM. So, different firms will use different approaches and strategy to manage their working capital, such as those firms that is less competitive will choose to minimise their receivable in order to increase their cash flow. While for those firms that depends on supplier will maximise their payable account. Therefore, the impact of various working capital mechanisms on firms performance from Malaysia perspective might be different due to divergence business environment and culture between other countries. Besides that, there are few factors that may influence firm working capital such as nature of business, production policy, production cycle, credit policy, and availability of supply (Rama, 2009). Nature of Business The nature of business between different industries or firms is different. Thus, working capital requirement needed, also different among different industries or firm. For example, manufacturing is the productions of the product where the inventory can be keep in the warehouse. While services are the services provided to customer which cannot be stored. It also does not have investment in either raw materials, work in progress (WIP) or finished goods. Besides that, it also involves in immediate realization of cash after the services are provided, which means there will be less accounts receivables is exists. In here, it can be believed that services will have lower working capital requirement. [low wc, more risk n return] This is further proven by John Louie Ramos Production Policy The management of hospitality capacity (inventory) is difficult as compared to manufacturing firm due to fluctuating demand pattern. For example, for service industry their inventory is room availability. The number of rooms in a hotel is fixed, once the room is vacant, they will lose the chances of earning money and the inventory during the period is wasted. Meanwhile, the services provided to customer cannot be store. Besides that, if the demand for the room is more than supply, they had to lose the income as they cannot produce the inventory based on demand. While for the manufacturing firm, they can produce their inventory based on the seasonal demand. They can produce more inventories during the peak demand and less during off-seasons. Then, the firm will have low working capital during off-season. While for those firm that have fixed inventory production policy which means produce the same quantity of inventory to meet the peak demand, then the firm will have large accumulation of inventory during the off-seasons. The large accumulation of inventory will increase the amount of working capital. Thus, the production policy will affect the firm and industry working capital requirement. Production Cycle The time and process involved in manufacture of goods will also affect firm working capital requirement as more fund is needed to invest, in order for the goods to be completed in time and in good quality. Credit Policy Credit policy also one of the factors that will affect firm or industry working capital requirements which it determine the firms receivables. For services industry, it will have low working capital as it involved cash sales while for manufacturing the working capital requirement will depend on the firms credit policy. If the firm offer short credit period, then it will only need low working capital and vice versa. Availability of supply The availability of inventory such as raw materials will affect firm working capital requirements. If the availability of raw materials is easily to obtain then firm can maintain low inventory which mean only need low working capital. However, if the level of supply is hard to predict or obtain then the firm had to keep a large amount of inventory in their warehouse in order to avoid the shortage of production. Thus, the firm need large amount of working capital. Therefore, this study is to examine the differences of the WCM between to the two industries and relationship between liquidity and profitability in Malaysia listed company. 2. LITERATURE REVIEW 2.1 WORKING CAPITAL MANAGEMENT Working capital represents safety cushion for providers of short term funds of the firm. Without a proper management of working capital, it will have cash shortages and will result in difficulty in paying its obligations, especially in the competitive business worlds nowadays (FPR, 2010). Besides that nowadays, most companies normally do not think of improving liquidity management until them faces financial crisis or becoming on the edge of bankruptcy. In order to make sound decision and survive in the long term, firm must combine strategic planning with comprehensive data by using both financial and non-financial data. Working capital and liquidity management is important for all businesses either are small, medium or large firm. As cash is the most liquid asset in a firm, therefore efficient liquidity management involves planning and controlling firms current assets meets its current liabilities is essential so that firm will not excessive invest in short term finance and avoid risk of inability to meet its short term obligation. Furthermore an efficient WCM enable firm to minimise the need for external financing as the external financing comprises of financial risk. By referring to the risk and return theory (Pettengill et al, 1995), higher risk investments will result in higher returns and vice versa. Hence, firms with low liquidity of working capital may have higher risk then high profitability. Conversely, high liquidity of working capital may face low risk then low profitability. Therefore, firm must take into consideration all the current assets and current liabilities when making financial decision making and try to balance the risk and return. As a result, in addition to profitability, liquidity management is vital for ongoing concern. Working capital management comprises of inventory management, cash management and credit management. A detailed of those components will be discussed below: 2.1.1 INVENTORY MANAGEMENT Inventory management is essential for businesses, without proper control and management of the inventory will lead to serious issues facing by the firm. For example, if the inventory does not managed properly or in an efficient manner, it may delay firms production process, lost of important customer, customer dissatisfaction, and or result in working capital curtailment (Richard A, 1978). Inventory consists of raw material, WIP and finished goods (Adeyemi, 2010). By referring to (Marilyn, 2006) raw materials are used to make production scheduling easier, to take advantage of price changes and quantity discounts, and to hedge against supply shortages. If raw material inventories were not held, purchases would have to be made continuously at the rate of production. This would not only mean high ordering costs and less quantity discounts, but also production interruptions when raw materials cannot be procured in time. WIP serves to make the production process smoother and more efficien t. Besides that, it will provide a buffer between the various production processes. Finished goods have to be held to provide immediate services to customers and to stabilise production by separating production and sales activities. Firm can improve the inventory turnover or shortening the inventory turnover period by speeding up the WIP into finished goods, however it cannot be fully transformed. While for the raw material and finished goods is depend on management decision. Thus, it can be said every firms inventory turnover level is significantly different from each other. High inventory holding in a firm will reduce the risk of shortage and decrease the ordering cost. However, hold too much inventories on hand there may be a risk of inventory obsolesces (Van Horne, 1995). Therefore, firm must find a trade-off between those risks by discovery an optimal inventory level. An optimal inventory level can be measured using the economic order quantity (EOQ) as it minimise the annual ho lding costs and ordering costs (Adeyemi, 2010). The formula for EOQ is as below: A = Annual demand Cp = Cost to place an order Ch = Cost of holding an inventory in a year Besides that, EOQ can also be explained using graph in the Figure 1. The graph is plotted for total ordering cost, total holding cost and total cost for the quantities ordered. The point at which the line of total ordering cost intersects with the total holding cost is the EOQ. At the point of EOQ, it will show the minimum costs that will incurred when the firm placing the total amount of quantities. The graph also shows that the cost of ordering is decreased when the order quantity is increased. Then, the holding cost will increase when the order quantity is increased. In addition, when the order quantity is increased or decreased, the total cost will increased and decreased as well, where the total cost is the sum of total ordering cost and total holding cost. Hence, the optimal level of inventory cost is at the point of EOQ. According to Abraham (2005) inventory for services industries consists of two kinds of perishable inventory. One is room availability and the other is food beverages. The identification of fast and slowing moving of these inventories is within the total inventory is essential in order to avoid insufficient inventory. He also states that an optimal inventory is important in order to have a proper management of the inventory as those unused inventory will lead the firm suffer a lost. 2.1.2 CASH MANAGEMENT According to Van Horne (1995) cash management is involves managing the monies of the firm in order to maximize cash availability and interest income on any idle funds. Cash management also include the trade receivable of a firm which play an important role in managing working capital. By improving the trade receivable routine more efficient, firm can reached optimal receivables by having adequate credit policy and collection procedure. A credit policy specifies requirements to value the worthiness of customers and a collection procedure provides guidelines to collect unpaid invoices that will reduce delays in outstanding receivables (Richards Laughlin, 1980). An efficient cash management is essential as it can be an instrumental in preventing losing of cash, maintain sufficient cash to made payment and prevents unnecessary large amounts of cash from being held idle in banks account that produce little or no revenue. 2.1.3 CREDIT MANAGEMENT Lastly, the optimal payables can be achieved by extending its trade credit from supplier. Simona and Paul (2007) state that trade credit is a substitute financing choice of short term borrowing, where trade credit is free while short term borrowing is costly as it needs to incur interest cost. For example, when firm extends its credit period from suppliers it will save the cost of short term borrowings. This means that an increased in account payables, will lead to a decrease in the short term borrowing costs. However, by delaying the payments to supplier will damage the firms reputation and loss some of the cash discounts offered by supplier for early settlements. 2.2 LIQUIDITY MEASURES Corporate liquidity is examined from two distinctive dimensions either static or dynamic views (George, 1997; and Lancaster et al., 1999). 2.2.1 CURRENT AND QUICK RATIO The static view is normally based on traditional measure of current ratio and quick ratio which is calculated based on information at the balance sheet and incorporates no cash flow variables. The underlying behind why these two ratios are well-known in used is due to its simplicity. Current ratio is defined as the relationship between currents assets and current liabilities. It is calculated by dividing the total of the current assets by total of the current liabilities. The current ratio represent margin of safety to the firms creditor, an index to the firm stability. While for quick ratio is the ratio of liquid assets to current liabilities. Kamath (1989) argues that the information generated from the ratios is inadequate to measure the liquidity and future cash flow due to their static nature which measures liquidity at a given point of time. George (1997) assert that it will be more appropriate and accurate to evaluate effectiveness of WCM by CCC, rather than the traditional mea sures of liquidity current ratio and quick ratio. 2.2.2 CASH CONVERSION CYCLE (CCC) Whereas dynamic CCC measures ongoing liquidity from the firms operation is define as more comprehensive measure of working capital and as a supplement to current ratio and quick ratio (Richards and Laughlin, 1980). CCC shows the time lag between expenditure for the purchases of raw materials and the collection of sales of finished goods (Schilling, 1996). This CCC measures also has been highly recommended by Kamath (1989), and others. CCC is a measure for the efficiency of WCM as it indicates how quickly the current assets are converting into cash. CCC comprise three components of days inventory outstanding (DIO), days sales outstanding (DSO) and days payables outstanding (DPO) [CCC = DIO+DSO-DPO]. DIO is a key figure that measures the average amount of time that a firm hold its inventory. It is calculated by inventory/cost of sales x 365 days. A decrease in the DIO represent an improvement, increase is deterioration (Ross et al, 2005). DSO is the key figure that measures the average amount of time that a firm hold its account receivables. It formula to calculate is account receivables/sales x 365days. A decrease in DSO represents an improvement, whereas increase represents deterioration (Ross et al, 2005). DPO is the key figure that measures the average amount of time that a firm hold its trade payables. It is calculated by trade payable/cost of sales x 365days. For DPO, an increase in days represents an improvement, whereas decrease indicates deterioration (Ross et al, 2005). The traditional view on CCC and profitability highlight that the shorter the CCC, the superior the firm profitability. The firm can shorten their CCC by improving the inventory turnover, collects cash from receivables more quickly and slowing down the payments to suppliers. This will increase the efficiency of firm internal operation and result in greater profitability (Mohammad, 2010). This can be seen in the case of Dell manufacturer in American, which it mainly business is sales of its own brand (Dell) computer and computer accessories through internet and open door sales. Their primary focus is on student market and home user. Richard (2003) had analyse on the Dells working capital showing that the increase in inventory turnover and receivable turnover days were affect Dells overall profitability. Later in the year 1997, Dell had made some changes on its business operation by only producing those computers when the order is placing by customers and thus, the company able to reduc e its CCC to negative working capital due to low inventory turnover. The negative CCC show that Dell able to collect payments from customers before they made payment to their supplier. On the other hand, shortening the CCC could harm firms profitability as reducing the inventory conversion period could increase the shortage cost, reducing the receivable collection periods could makes the companys lousing its good credit customers, and lengthening the payable period could damage the firms credit reputation. Therefore, shorter cash conversion cycle associated with high opportunity cost, and longer cash conversion cycle associated with high carrying cost. By achieving the optimal levels of inventory, receivable, and payable will minimize both carrying cost and opportunity cost of inventory, receivable, and payable and maximises sales, and profitability of firms. In this regards, an optimal cash conversion cycle as more accurate and comprehensive measure of working capital management. Schilling (1996) mentions optimum liquidity position, which is minimum level of liquidity necessary to support a given level of business activity. Briefly, he says it is critical to deplo y resources between working capital and capital investment, because the return on investment is usually less than the return on capital investment. Therefore, deploying resources on working capital as much as to maintain optimum liquidity position is necessary. Then he sets up the relationship between CCC and minimum liquidity required such that if the CCC lengthens, the minimum liquidity required increases; conversely, that if the CCC shortens, the minimum liquidity required decreases. 2.3 EMPIRICAL EVIDENCE There are numerous empirical research had done on the relationship between WCM and profitability in different countries and industries by using different variable selection for analysis. Some of the research prove that there is a positive relationship between profitability and CCC such as Dell, however there also had research shows that there are negatively related. Richards and Laughlin (1980) concluded that there is a positive relationship between the current and quick ratios and the cash conversion cycle. Besides that, Chowdhury and Amin (2007) also had found positive correlation between working capital and profitability which examine on the pharmaceutical industry in Bangladesh. The study done by Lazaridis and Tryfonidis (2006) using the sample of listed company from Athens Stock Exchange for the period 2001-2004 showed that there is a significant relationship between CCC and profitability, which use gross operating profit as a measure of profitability. It same apply for Ganesan (2007), analysis on the WCM efficiency in telecommunication equipment industry, found that there is negative relationship between working capital and profitability. It can be said that management of working capital have significant impact on profitability and liquidity in different countries and industries. Besides that, an empirical research on Pakistani firms done by Raheman and Nasr, (2007) with a sample of 94 firms listed on Karachi Stock Exchange from period 1999-2004, shows that there is a negative relationship between variables of WCM and debt with profitability of the firm. In addition, a study in Indias hospital for the period 2005-2006 by Christopher and Kamalavalli, (2010) the correlations and regression analysis signifying that working capital component namely current ratio, cash turnover ratio, current assets to operating income and leverage negatively influence profitability of the firms. Lastly, the recent study in 2009 by Uyar (2009), he used the ANOVA and Pearson correlation to analyse the relationship between CCC and return on asset for the firm listed in the Istanbul Stock Exchange for the year 2007. The research showed that there is a significant negative correlation between those two variables. Belt (1985) examined for US companies the trends of cash conversion cycle and its components during the period 1950-1983, for those lines of businesses for which Quarterly Financial Report for Manufacturing, Mining and Trade Corporations (QFR) . He found that retailing and wholesaling firms both had cash conversion cycles shorter than those of manufacturing firms. Mining firms had the shortest cash conversion cycle because this type of industry has the longest payment deferral period of all the major business types. Besley and Meyer (1987) evaluated empirically the interrelationships among the working capital accounts and cash conversion cycle, the firms industry classification and the rate of inflation for US companies for the period 1969-1983. Using the Spearman rank correlation coefficient they found that the cash conversion cycle was most correlated with the average age of inventory and least correlated with the age of spontaneous credit. The conclusion suggests that inventory ac tivity is the most important input to the cash conversion cycle. The age of inventory, the average collection period and the age of spontaneous credit proved to be highly correlated. The cash conversion cycle and its components for the examination period differed from industry to industry, but did not vary from year to year. By looking at the empirical literature on WCM, there is limited research study on the consequences of WCM from Malaysias firm perspectives. Irene Lee (2007) research results show that the Malaysian public listed firms have positive relationship between profitability and working capital to a certain extent. Besides that, the recent study by Mohammad (2010) explores the relation between WCM and firms performance. He measures the relationship by selecting 172 listed companies in Bursa Malaysia for the period 2003-2007. Using the Pearson correlation and multiple regression analysis, he found significant negative associations between working capital variables with firms market value and profitability. Therefore, he highlights the importance of managing working capital requirements to ensure an improvement in firms market value and profitability and must consider the working capital when making companys strategic. It can be seen from the above that many studies have done on the WCM, its component and profitability by using different variable to test those relationship. From those studies, different countries, industries and strategies gives different results, some are positively related between WCM and profitability while some are negatively related. Since the previous studies of WCM in Malaysia, is focusing on the relationship between WCM and profitability. Therefore, in studies will further study on the relation of the both variables by making comparison on the two listed industries of manufacturing and services industries in Malaysia. 3. RESEARCH METHODOLOGY The objective of this study is to look at one parts of financial management which known as WCM with reference to Malaysia. Here, will see the relationship between WCM practices and its effects on profitability of two industries in Malaysia; 16 firms listed on main board of Bursa Malaysia for the period of three years from 2007 to 2009. This section of the study will discuss on the sample selection, variables, and statistical techniques that will be used to examine the relationship between firms WCM and profitability. 3.1 DATA SET SAMPLE In this study secondary data; firms financial statements will be used to examine the research question. Those secondary data will be collected from Bursa Malaysia. A sample of eight companies will be randomly select for both manufacturing and services industries for the period of three years from 2007-2009. The reason for selecting this period was that latest data that will be available for investigation. Manufacturing and services industries are selected for this study because they reveal district difference in term of nature and management of the business. The services industries have a seasonal period and profit as they unable to predict the sales and demand from customers as services industries are people-oriented and people-driven, it is more difficult to effectively automate and control the service costs than in other non-services business sectors. Whereas the inventory for the manufacturing can be stored in the warehouse in order to avoid shortage but for the services industri es unable to stored their capacity (inventory) as it will affect their firms profitability. Therefore, a comparison of the WCM between the two industries will be look at in this study. Primary data will not be used as the data that has not been gathered before and the collection of data is time consuming, and high cost. Besides that, the primary data is not able to measure the firms financial strength and weaknesses. The measurement of firms financial wealth can only be measures and compare by using quantitative data. In addition, this study is to examine the relationship between WCM and profitability which required the quantitative information. 3.2 VARIABES This study had identified key variables that will influence Malaysia firms WCM. Choice of variables is influenced by previous study on WCM and also to further study on the previous study on Belgians WCM by Deloof. CCC will be used as a comprehensive measure of WCM which also used as independent variables. CCC is simply DSO plus DIO  less  DPO. Profitability is measured by gross operating income (GOI), which is defined as sales minus cost of sales, and divided by total assets minus financial assets. Why it was divided by total assets minus financial assets? As from the list of companies that are randomly selected from Bursa Malaysia, their financial asset is a significant part of its total assets, where financial asset include cash and bank balances, stock and securities that can be readily converted into cash. This also the reason why return on assets is not considered as a measure of profitability in this research, as if firm has mainly financial assets in its balance sheet; its operating activities will contribute little to the overall return on its assets. Besides that, sales growth ([this years sales previous years sales]/previous years sales) will be used as control variable in the regression analysis. 3.3 HYPOTHESIS TESTING As the objectives of this study are: Examine the relationship between WCM and profitability. Examine relationship between the DSO, DIO, DPO and firms profitability. Investigate whether the two industries have the same effect on the relations. The following hypothesis will be formulated and attempt to find statistical evidence for the two industries to support those hypothesis. Hypothesis H1: The CCC is negatively related to firms profitability (ROA) higher CCC, lower the firm profitability and vice versa. Hypothesis H2: Shortening the DSO will increased firms profitability. Hypothesis H3: Shortening the DIO will increased firms profitability. Hypothesis H4: Lengthening the DPO will increased firms profitability. 3.4 ANALYSIS USED IN STUDY In this study, two types of analysis are performed; there are descriptive and quantitative analyses. 3.4.1 DESCRIPTIVE ANALYSIS The initial analysis in this study is descriptive statistic, which will provide detailed information of each relevant variable and describe the relevant aspects of cash conversion cycle. All the relevant variables were calculated using balance sheet value, rather than using market value, it is because the firms financial statement did not provided market value on the variables that is required in this study. Besides that, the measurement of profitability GOI could only be based on value in income statement values as there is no way to measure it at so-called market values. In addition, if the market values are used, there will a question on which date the à ¢Ã¢â€š ¬Ã‹Å"market values are referred to. Thus, in this study the book values of the variables in the firms financial statement will be used. 3.4.2 QUANTITATIVE ANALYSIS Two methods had been applied in quantitative analysis. Firstly, correlation analysis is carried out, which specifically to measure the possible linear relationship between different variables under consideration. Secondly, is regression analysis, which is to estimate the relationship between liquidity, profitability and other selected variables. We have used Pooled Ordinary Least Squares and Generalized Least Squares (cross section weights) methods for analysis. We used panel data in a pooled regression, where time-series and cross-sectional observations were combined and estimated. In other words, several cross-sectional units were observed over a period of time in a panel data setting. For this purpose of analysis the E views software was used to analyze financial data and especially in case of pooled data. 4. DATA ANALYSIS AND DISCUSSION The results of the two types of analysis will be discussed below. 4.1 DESCRIPTIVE ANALYSIS Initially, descriptive statistics is the first step analysis in this research. It will provide a useful summary of central tendency; mean and median, and variability such as standard deviation, minimum and maximum. Table 1 and Table 2 presents descriptive statistics for the components of working capital efficiency for eight manufacturing firms and s