Corporate governance in Islamic banks Essay Example | Topics and Well Written Essays - 2250 words

Corporate governance in Islamic banks - Essay Example In order to understand the value of this study it would be necessary to refer to the content of corporate governance. Various definition have been given for corporate governance. An indicative one is that of Pedersen who noted that ‘corporate governance - the mechanisms by which companies are controlled and directed - is a complex subject that consists of owner-manager relations, stakeholder relations, board structures and practices, management compensation, capital structure, company law, and other variables’; from another point of view corporate governance is characterized ‘as the top management process that manages and mediates value creation for, and value transference among, various corporate claimants in a context that ensures accountability to these claimants’; in the same context, corporate governance is described as a tool for enhancing the control of stakeholder on a specific organization. It is clear from the above that corporate governance is usu ally developed in accordance with the interests and the perceptions of a firm’s leading team – usually the firm’s board; however, there are specific rules that needs to be applied. OECD presents the legal framework in which a firm’s corporate governance has to be developed. In the context of these rules it is stated that ‘all shareholders should be treated equally’. In the case of banks, the development of corporate governance practices may be differentiated compared to the organizations in other industrial sectors; the high risk involve in banking activities would be the major criterion for the rules including in the corporate governance scheme developed by firms in the banking industry.

Organic Food Industry Analysis Essay Example for Free

Organic Food Industry Analysis Essay The organic products industry has shown consistent growth over the last 25 years, growing 3,400% (Flynn, 2014). The organic industry earned $35 billion in 2014 up from $1 billion in 1990 (Flynn, 2014). Credited with being the primary market force drivers, food safety and health concerns have been driving the industry since the end of the 2009 recession. This research paper examines the organic products industry and identifies how supply and demand affects future prices of organic products. ORGANIC INDUSTRY ANALYSIS 3 Organic Industry Analysis This paper provides a succinct market analysis of the organic food and product industry. The paper provides background and description of the organic product market. The paper examines U. S. and global market trends of the organic food and product industry by examining demand and supply for organic products. This paper identifies key box store retailers and describes their roles in driving the organic food industry. Analyzing various studies from the USDA and its Economic Research Section (ERS) identified the driving market forces behind the popularity of the organic foods and products, which are the improvement of health and reduction of pesticides from individual diets. The purpose of this paper is to identify market trends and the driving forces behind the global organic food and product market. The driving forces behind the organic food market are health conscious millennials and new mothers who want to reduce chemicals from their diet. Background and Description The term organic has been the topic of controversy for academics and business leaders since the 1940s. The controversy involves several sub-topics such as lack of international standards for organics, cross contamination of organic products during transport, genetically modified organisms (GMO), chemicals and pesticides, and costs to produce organic goods. The definition of organic is: made or grown without the use of artificial chemicals (Organic, 2015). The premise of organic food is not new; however, the creation of national standards has objectively standardized what may be considered an organic product. As the global population grows, the demand for food has caused farmers to increase efficacy and reduce crop waste; however, the methodology utilized to preserve crops may be more of a detriment to human health resulting in the higher demand for uncontaminated food sources and products. ORGANIC INDUSTRY ANALYSIS 4 Demand The organic food market was supply driven for many years; however, demand now drives the organic market (Dimitri Oberholtzer, 2009, p. 10). The demand for organic products is increasing every year as people use marginal analysis to justify the higher expense for organic products: Do the benefits out weight the costs? Consumer mistrust in conventional food producers, who add harmful dyes, trans-fats, and high fructose corn syrups to products, is another variable driving the organics market. Environmentalists are also another market force mechanism contributing to the demand for organic products because organic farming reduces environmental pollution. The emergence of organic food is directly linked to an amalgam of food safety and health concerns, which directly relate to ingestion of chemicals used to grow, treat, and preserve foods. The organic food industry has shown consistent global growth over the last two decades and is projected to continue to grow until 2018 (Research and markets adds report: United States organic food market report 2013-2018, 2014). The organic food market has grown 3,400 % in the last 25 years (Flynn, 2014). Organics are divided into several categories such as, fruits and vegetables, dairy, meat, and packaged organic products. In 2014 annual organic food sales, mainly fruits and vegetables, reached $35 billion, $290 billion if packaged products are included, up from $1 billion in 1990s (Flynn, 2014). The United States and Europe have the highest demand for organic products compared to other nations (Lohr, n. d. p. 68). Identifying potential organic product consumers is a challenge, but some market research has shown consumers who choose to purchase organic products are generally well educated, millennials, higher income families, and households with children (Dimitri Oberholtzer, 2009, ORGANIC INDUSTRY ANALYSIS 5 p. 4-5). The United States consumes approximately 44% of the global organics market followed by Europe at 41% (Aggarwal, 2014 p. 3). The remaining countries that contribute to the consumption and export of organic foods may have difficulty in exporting goods due to individual national standards and export acts (Aggarwal, 2014 p. 3). Demand for organic products is not central to one part of the world; many countries and cultures realize the importance of consuming foods free of harmful chemicals. Supply Demand has grown for organic products; however, there is a shortage of organic farming land, which may negatively impact supply. The organic industry is constrained by its supply chain; there are only so many farms to produce organic goods and organic goods can only be shipped so far. According to the 2012 U. S. Census of Agriculture, there are now around 17,000 organic farms in the U. S. out of an estimated 2. 1 million total farms; acreage used for organic agriculture accounts for just 0. 6 percent of all U. S. farmland, while organic food sales make up over 4 percent of the total annual food sales. (Young, 2014) The organic farm shortage is an important variable to the organic industry because consumers who tend to purchase organic products generally want to support local farmers in a grass roots type of movement; excluding climate specific food such as, bananas, coffee, limes, and pineapples (Greene, 2013). Contributing to the supply shortage in the United States are strict national standards set in place by the USDA and strict requirements for potential farmers looking to transition into the organic industry. Also contributing to the shortage in organic food and ORGANIC INDUSTRY ANALYSIS 6 products are large box retail stores, such as Whole Food Markets, Wal-Mart, Tesco, and Target. Wal-Mart is the United States’ largest grocer and is competing for organic goods to remain competitive against its competitors, such as Target, which has made agreements with organic producers to supply products for its stores (Hopkinson, 2014). Partnering with organic companies, large retail box stores have created their own brands of organic products to reduce costs associated with providing customers a wide range of product choice. Price Changes Due to Supply and Demand: Historically, organic food is more expensive than conventional food (Dimitri Oberholtzer, 2009, p. 5). Organic food prices come with a premium due to costs involved in growing and harvesting crops. Prices are set through the suppliers because the organic standards restrict the certification of potential farmers. The certification process slows down potential farmers entering the industry, which reduces the number of producers available to farm the produce and make products. The reduction in organic products available reduces supply and increases demand. Market shelf placements of organic foods are fetching premiums and farmers are realizing the advantages of entering the market. As demand rises for organic products, the current producers are not able to sustain sufficient crop production compared to industry growth. In any competitive market, when demand rises so does opportunity. Due to the premium prices associated with producing products in the organic industry, many farmers may potentially conform to industry standards and convert their farms. The potential for commercial organic farms may also increase due to the undeniable growth of the industry. As more competition enters the organic industry, prices will drop. Large retail box stores, such as Whole Food Markets, Wal-Mart, Tesco, and Target may also have a significant effect on the price of organic ORGANIC INDUSTRY ANALYSIS 7 foods and products. Wal-Mart’s expansion into the organic market has the capability to reduce organic food prices alone due to the numbers of stores across the nation. In conclusion, the undeniable growth in the organic industry is a product of consumer mistrust of conventional growers, mainly due to toxic chemicals used in the production of food. The growth of the organic food industry is directly related to food safety and health conscious consumers who do not mind spending more money to consume uncontaminated products. Consumer demand has been the driving force of much of the organic industry since the end of the recession in 2009. The high consumer demand for organic food is part of an initiative from well-educated people, millennials, higher income families, and households with children, resulting in a 3,400% in the last 25 years creating a $35 billion industry (Flynn, 2014). With the high demand for organic goods, suppliers are unable to maintain sustainable level operations due to lack of organic farmland. Many of the problems associated with the organic food industry are centered on strict certifications that are necessary to maintain product integrity; the stringent certifications are creating supply shortages. The strict organic standards hinder potential farmers from entering into the organic industry. For example, farmers must be pesticide free for at least three years before being certified to produce organic food. Large retail box stores are recognizing the growth of the organic food industry and are currently adding more products annually, but even so, demand exceeds supplies. As the organic food industry continues to grow, prices for organic goods should reduce due to the increased competition in the market. ORGANIC INDUSTRY ANALYSIS 8. References Aggarwal, P. (2014). Supply chain management of locally grown organic food: A leap toward sustainable development. Retrieved from http://www. cognizant. com/InsightsWhitepapers/Supply-Chain-Management-of-Locally- grown-Organic-Food-A-Leap-Toward-Sustainable-Development-codex928. pd Dimitri, C. , Oberholtzer, L. (2009). Marketing U. S. organic foods recent trends from farms to consumers. USDA, Economic Research Service, (58). Retrieved from http://www. ers. usda.gov/media/185272/eib58_1_. pdf Flynn, D. (2014). Report: Organic industry achieved 25 years of fast growth through fear and deception, Food Safety News. Retrieved from, http://www. foodsafetynews. com/2014/04/report-fast-growing-organics-industry-is- intentionally-deceptive/#. VL0ILWd0xjo Greene, C. (2013). Growth patterns in the U. S. organic industry. Retrieved from http://search. proquest. com/docview/1518534011? accountid=35796 Hopkinson, J. (2014). Will Wal-Mart gobble up organic food supply? Retrieved from http://www. politico. com/story/2014/04/walmart-organic-food-105631. html Lohr, L. (n.d. ). Factors affecting international demand and trade in organic food products. USDA, Economic Research Service. Retrieved from http://www. ers. usda. gov/media/293617/wrs011j_1_. pdf ORGANIC INDUSTRY ANALYSIS 9 Organic. (2015). In Merriam-Webster. com. Retrieved from http://www. merriam-webster. com/dictionary/organic Research and markets adds report: United States organic food market report 2013-2018. (2014). Manufacturing Close Up, Retrieved from http://search. proquest. com/docview/1498350288? accountid=35796 Young, T. (2014). Organic check-off. Retrieved from https://ota. com/organic-check.

Number Of Variations And The Impact Of Variations

Number Of Variations And The Impact Of Variations Controls for Variations and Variation Orders have been suggested by many researchers (Mokhtar et al., 2000; Ibbs et al., 2001). Below are 30 approach identified from a literature review to reduce number and the impact of Variations. These approach were categorized into three categories: Design stage, Construction stage and Design- Construction interface stage. Design Stage Approach to Control Variations Item Variation Reduction approach Descriptions Source 1 Review of contract documents Comprehensive and balanced Variation clauses would be helpful in improving coordination and communication quality .Conflicts between contract documents can result in misinterpretation of the actual requirement of a project. (CII, 1994a) 2 Freezing design Variations in design can affect a project adversely depending on the timing of the occurrence of the changes. Therefore, freezing the design is a strong control method. Many owners freeze the design and close the door for variations after the completion of the drawings. (CII, 1990a) 3 Value engineering at conceptual phase During the design phase, value engineering can be a cost saving exercise, as at this stage, Variation in any design element would not require rework or demolition at the construction site. Value engineering at the conceptual stage can assist in clarifying project objectives and reducing design discrepancies. (DellIsola, 1982). 4 Involvement of professionals at initial stages of project Involvement of professionals in design may assist in developing better designs by accommodating their creative and practical ideas. This practices would assist in developing a comprehensive design with minimum discrepancies .Practical ideas that are not accommodated during the design phase may affect the project adversely. Variation during the construction phase is a costly activity as it may initiate numerous changes to construction activities. (Arain et al., 2004) (OBrien, 1998). 5 Employers involvement at planning and design phase Involvement of the Employer at the design phase would assist in clarifying the project objectives and identifying noncompliance with their requirements at the early stage .Hence, this may help in eliminating Variations during the construction stage where the impact of the Variations can be severe (Fisk, 1997) 6 Involvement of contractor at planning and scheduling process Involvement of the Employer at the design phase would assist in clarifying the project objectives and identifying noncompliance with their requirements at the early stage .Hence, this may help in eliminating Variations during the construction stage where the impact of the variations can be severe. (Fisk, 1997). 7 Thorough detailing of design A clearer design tends to be comprehended more readily. This would also assist in identifying the errors and omissions in design at an early stage. Eventually, thorough detailing of design can eliminate Variations arising from ambiguities and errors in design. (OBrien, 1998) 8 Clear and thorough project brief A clear and thorough project brief is an important control for Variations in construction projects as it helps in clarifying the project objectives to all the participants. Eventually, this may reduce the design errors and noncompliance with the Employers requirements. (OBrien, 1998) 9 Reducing contingency sum The provision of a large contingency sum may affect the construction team working approaches. This is because the designer may not develop a comprehensive design and would consequently carry out the rectifications in design as Variations during the later stages of the construction project. Therefore, reducing the contingency sum would be helpful in ensuring that the professionals carry out their jobs with diligence. Construction Stage Approach to Control Variations Item Variation Reduction approach Descriptions Source 1 Clarity of Variation Order procedures Clarity of Variation Order procedures is an integral part of effective management of Variation Orders. Early in the project construction stage, the procedures should be identified and made clear to all parties. Clarity of Variation Order procedures would help in reducing the processing time and other mishandling issues. (Mokhtar et al., 2000) (Ibbs et al., 2001). 2 Written approvals Any Variation in the work that involves a change in the original price must be approved in writing by the Employer before a Variation can be executed. Any party signing of behalf of the Employer must have written authorization from the Employer. It is difficult to prove the right for compensation if there is no such authorization from the Employer. In the hectic environment of construction, many verbal agreements can be forgotten, leaving the Contractor without any legal proof to get compensation for the Variations works. (CII, 1990a; Hester et al., 1991; Cox, 1997). 3 Variation Order scope A well defined scope can assist the professional team in recognizing and planning appropriately to minimize the negative impact of the Variation. The original scope should be clear and well defined to distinguish between a Variation of scope and a Variation due to design development. It is common that there are disagreement between parties in a project was about defining the Variation scope. Thus, the effective definition of the scope of work helps us to identify and manage Variations. (Ibbs et al. 2001). (CII ,1994b) 4 Variation logic and justification Variation logic and justification for implementation was one of the principles of effective change management. This principle required a change to be classified as required or elective. Required changes were required to meet original objectives of the project while elective changes were additional features that enhanced the project. Knowing the logic and justification behind the proposed Variations assist the professionals in promoting beneficial Variations and eliminating non-beneficial Variations. Proposed by (Ibbs et al. 2001). 5 Appointment Project manager from an independent firm to manage the project Involvement of a project manager from an independent firm would assist in eliminating Variations that arise due to the lack of coordination among professionals. This practice may assist in reducing design discrepancies through early reviews of the contract documents and drawings. (Arain et al., 2004) 6 Restricted pre-qualification system for awarding projects A restricted pre-qualification system for awarding projects would act as a filter to select only the capable Contractors for project bids. (Chan and Yeong, 1995; Fisk, 1997) 7 Employers involvement during construction phase Involvement of the Employer during the construction phase would assist in identifying noncompliance with the requirements and in approving the Variations promptly .The involvement of the Employer during the construction phase allows to keep him aware of ongoing activities and assist in prompt decision making. (Ibbs et al., 2001). 8 Avoid use of open tendering Competitive open tendering usually encourages the Contractor to price very low to win the contract, especially in bad times when they are in need of jobs. This practice would give rise to the Contractor trying to claim more to compensate for the low price award. Avoiding the use of open tender would help in eliminating the risks of unfair bids. This may also help in reduces Variations that may arise due to the contractors bidding strategy. (Chan and Yeong, 1995) 9 Use of project scheduling/management techniques To manage a Variation means being able to anticipate its effects and to control, or at least monitor, the associated cost and time impact. The most known scheduling techniques in the construction industry are CPM, PERT and Gantt chart; Microsoft Project These techniques are helpful in identifying the critical path of any Variations on subsequent construction activities. Well planned and close monitoring on the schedule plan will helps to reduce the Variations effects on the project. (Hester et al., 1991) (Clough and Sears, 1994). (Mokhtar et al., 2000). 10 Comprehensive documentation of variation order Through timely notification and documentation of Variation Orders, participants will have kept their rights and thereby their option to pursue a subsequent claim or to defend against a claim. One of the most aggravating conditions is the length of time that elapses between the time when a proposed contract modification is first announced and when the matter is finally rejected or approved as a Variation Order. Documentation of Variation and claims had assisted in tracking the effects of the Variation and claim events on time and cost. A documented source of knowledge about previous Variation instructions would be helpful in making decisions concerning the appropriate handling of Variation instructions. (Cox, 1997; OBrien, 1998). (Fisk, 1997) Cox (1997) Design-Construction Interface Stage Approach to Control Variations Item Variation Reduction approach Descriptions Source 1 Prompt approval procedures One of the most aggravating conditions is the length of time that elapses between the time when a proposed contract modification is first announced and when the matter is finally rejected or approved as a Variation .However, the longer the period between recognition and implementation, the more costly the change will be. (Fisk, 1997). 2 Ability to negotiate Variation Ability to negotiate Variation is an important factor for the effective control of Variations. Effective negotiation can assist the professional team in minimizing the negative impacts of the Variation. There are certain skills required for effective negotiation of Variations, i.e., the knowledge of contract terms, project details, technology, labour rates, equipment, methods and communication skills. (Clough and Sears, 1994) (Cushman and Butler, 1994) 3 Valuation of indirect effects Consequential effects can occur later in the downstream phases of a project. Therefore, it is essential to acknowledge this possibility and establish the mechanism to evaluate its consequences. Professionals should thus evaluate the total overall effects a change may have on the later phases of a project, in order to manage the Variations effectively. (Ibbs et al., 2001). 4 Team effort by Employer, consultant and Contractor to control Variation Coordination is important in a multi-participant environment as in most construction projects Detrimental Variations, which affect the projects negatively, can usually be managed at an early stage with due diligence in coordination. (CII, 1994a; Assaf et al., 1995). 5 Utilize work breakdown structure A work breakdown structure (WBS) is a management tool for identifying and defining work. A Contractor should consider using the this as an evaluation tool, especially on large projects. If a Variation involves work not previously included in the WBS, it can be logically added to the WBS and its relationship with the other WBS element can be easily checked. Domino effects can also be traced by the use of WBS. (Hester et al., 1991; Mokhtar et al., 2000). (Hester et al., 1991) 6 Continuous coordination and direct communication coordination, and frequent communication are essential to reduce miscommunication among team members, hence reduce the chances of occurring Variations (Assaf et al., 1995). 7 Control the potential for Variations to arise through contractual clauses Selection of the appropriate standard contract form (JKR, PAM2006 etc) with the necessary and unambiguous Variation clauses would be helpful in the management of Variations. Clear procedures presented in the contract and fair allocation of risks can help in resolving disputes through negotiation rather than litigation. (Cox, 1997) 8 Comprehensive site investigation Comprehensive site investigations assist in proper planning for construction activities. Differing site conditions are an important cause of delays in large building projects. Therefore, a comprehensive site investigation would help in reducing potential Variations in a project. (Fisk, 1997). 9 Use of collected and organized project data compiled by Employer, consultant and Contractor The Variations works should always be documented for future references. Hence, better controls for Variations were achievable by sharing a database compiled by all the team members (Fisk, 1997). 10 Knowledge-base of previous similar projects From the outset, project strategies and philosophies should take advantage of lessons learned from past similar projects. If professionals have a knowledge-base established on past similar projects, it would assist the professional team to plan more effectively before starting a project, both during the design phase as well as during the construction phase, minimize and control Variations and their effects. (CII, 1994b). 11 Comprehensive analysis and prompt decision making through computerized knowledge-based decision support system A Decision Support System (DSS) approach for management decisions seems to be the ideal approach to follow. The system would be helpful in presenting an example scenario of the causes of Variations, their relevant effects and potential controls that would assist in decision making at the early stage of the Variations occurring. (Miresco and Pomerol, 1995).

The American Dream vs The American Myth :: Essays on the American Dream

  Ã‚  Ã‚  Ã‚  Ã‚  After being stuck en route for an enormously long period of time, would you think that the destination had better be worth all the time spent getting there? Many people would say yes. Think about it. If you were on a journey which lasted months, possibly years of your life, you would want to arrive at your destination seeing the same thing you had dreamt of during the trip. What if, when you got there, you discovered that the dream was actually a myth? The American settlers discovered just that. Is this not similar to High School? Everybody has a specific view, or dream, of High School that very first day they walk in as a freshman. How often is this dream a realistic one?   Ã‚  Ã‚  Ã‚  Ã‚  Take, for instance, the first settlers in Jamestown. These people came solely for capitalistic purposes. They figured that if they developed settlements, they would surely profit. With this goal taking over all others in their minds, they did not survive. Many factors contributed to this. For example, the settlers were not prepared for the new area. They believed that they could walk right in and succeed. What they did not realize, however, is that they needed to prepare more. They settled on a horrible piece of land, which killed many off due to sickness. They weren’t able to take care of themselves, as they figured that the Indians would provide cheap labor. The settlers were proved wrong, as the Indians rebelled against the Europeans in raids. Settlers in Jamestown were not prepared for America, thus leading to their downfall. High School can be directly related to Jamestown. Every year, many freshmen catch themselves doing a complete turn-around soon after the year begins. Freshmen usually split into different cliques soon after High School starts. These cliques are usually groups of people with similar interests, whether it is fashion, sports, or math club. All through Middle School, the children were guided along by the administration. This leads them to believe that High School will be the same way. Once in High School, many feel lost and unprepared. The first day of High School, many freshman get to the lunch room, sit at their tables, and wait to be called up to the lunch lines. They were pampered all through their earlier schooling, so they figured that they would be told when to go eat.

HRM Compensation

Definition:Compensation is the total amount of the monetary and non-monetary pay provided to an employee by an employer in return for work performed as required.Compensation is based on:Market research about the worth of similar jobs in the marketplace, employee contributions and accomplishments, the availability of employees with like skills in the marketplace, the desire of the employer to attract and retain a particular employee for the value they are perceived to add to the employment relationship, andThe profitability of the company or the funds available in a non-profit or public sector setting, and thus, the ability of an employer to pay market-rate compensation. Compensation also includes payments such as bounces, profit sharing, over time pay, recognition rewards and checks, and sales commission. Compensation can also include non-monetary perks such as a company-paid car, stock options in certain instances, company-paid housing, and other non-monetary, but taxable, income it ems.ADVANTAGES OF COMPENSATION & BENEFITSA well designed compensation and benefits plan helps to attract, motivate and retain talent in your firm (which is myWear). A well designed compensation & benefits plan will benefit your boutique in the following ways. 1. Job satisfaction: Your employees would be happy with their jobs and would love to work for you if they get fair rewards in exchange of their services. 2. Motivation: We all have different kinds of needs. Some of us want money so they work for the company which gives them higher pay. Some value achievement more than money, they would associate themselves with firms which offer greater chances of promotion, learning and development.A compensation plan that hits workers’ needs is more likely to motivate them to act in the desired way. 3. Low Absenteeism: Why would anyone want to skip the day and watch not-so-favorite TV program at home, if they enjoy the office environment and are happy with their salaries and get what t hey need and want? 4. Low Turnover: Would your employees want to work for any other boutique if you offer them fair rewards. Rewards which they thought they deserved?Advantage to Your Employees: 1. Peace of Mind: your offering of several types of insurances to your workers relieves them from certain fears. Your workers as a result now work with relaxed mind. 2. Increases self-confidence: Every human being wants his/her efforts to get acknowledgment. Employees gain more and more confidence in them and in their abilities if they receive just rewards. As a result, their performance level shoot up. Types of Compensation:This includes:Direct financial compensation consisting of pay received in the form of wages, salaries, bonuses and commissions provided at regular and consistent intervals Indirect financial compensation including all financial rewards that are not included in direct compensation and understood to form part of the social contract between the employer and employee such as benefits, leaves, retirement plans, education, and employee services Non-financial compensation referring to topics such as career development and advancement opportunities, opportunities for recognition, as well as work environment and conditions Examples of Financial vs Non-Financial CompensationCompensation can also be categorized as:Base Compensation Variable Compensation Supplementary Compensation Base Compensation and BenefitsBase Compensation is one type of Compensation. It refers to the basic salaries and wages given to he employees. It is normally constant at a given amount irrespective of the difference in work performance. Factors influencing Base Compensation and Benefits One factor that influences Base Compensation is demand and supply of labor in the market. Labor union pressure is also another factor influencing Base Compensation. This is because unions always try their best to fight for their members’ rights. Nature of job as determined by the job description , each employee deserves a different compensation package.Size of the organization and its ability to pay its employees. Product market compensation is yet another factor influencing Base Compensation. Psychological and social factors like employee satisfaction and security. Salaries paid by similar firms are also a factor affecting Base Compensation. Government policies on wage determination Cost of living of the employees. When the employees’ cost of living is very high then they need a higher compensation benefit. Increase in productivity of labor Firms in general; whether competing firms or not.Variable Compensation and BenefitsThis type of compensation as by its name is variable. It means that one gets compensation as per the work done. If one does a remarkable job then he or she deserves a higher compensation package than one whose work is of poor quality. Supplementary Compensation and Benefits Supplementary Compensation is compensation given by an employer when he or she wishes to. It is not compulsory or a routine once one is given the compensation that one will be awarded another time. In this type of Compensation the employer has a right to add, deduct or even withdraw the benefits when he or she wishes to.Compensation AdministrationThe Compensation Administration Department is charged with the task of developing and maintaining a comprehensive compensation and classification system in order to support the mission of the Division of Human Resources.The Compensation Administration Department’s responsibilities include: Developing compensation programs, policies, and procedures to meet the needs of the University administrators as they attract, retain, motivate, develop, and organize their diverse workforce. Ensuring compliance with federal and state compensation laws, statutes, and regulations, Balancing the need for internal equity while recognizing the desire to be market competitive.Evaluating positions consistently and classifying t hem into appropriate job titles ensuring that they are internally equitable, while recognizing the need to be market competitive. Developing and maintaining the classification and compensation structures. Some of the services provided by the Compensation Administration Department include: Providing compensation related information, tools and training to HR Liaisons and University Administrators.Conducting salary surveys and gathering market data to assist University Administrators in making informed salary decisions. Advising HR Liaisons and University Administrators in compensation matters; including establishment of new positions, promotions, transfers, demotions, reorganizations and salary increases. Providing current position descriptions to administrative and staff employees. Providing departments with Organizational Charts. Assisting in departmental re-organizations.Job Evaluation ProcessThis process refers to all components of the university's formal pay program. The staff em ployee's pay at Case results from the following: A. How are jobs evaluated? The job evaluation process established the relative value of jobs throughout the university. There are two steps involved in this process: 1. Job Analysis and Job Description – Using a â€Å"job profile,† the content of each job is analyzed to identify key duties, responsibilities, and qualification necessary to perform the job.Written job descriptions are then prepared to contain this information. 2. Job Evaluation – A computer assisted job evaluation plan, measuring 17 dimensions of nonexempt work and 28 dimensions of exempt work, is used to evaluate the relative worth of staff positions. This evaluation process focuses on valuing the content of each position in terms of a series of well-defined compensable factors.The factors for clerical, service, technical, and administrative support positions include:a. Knowledge: Minimum required level of specialized training, education, and previ ous related work experience.b. Skill: The manual and physical skills required to perform the duties of the position.c. Work Complexity: The degree and amount of judgment, initiative and ingenuity involved in accomplishing work.d. Contact with Others: The extent to which the work entails dealing with others in the course of one's regular duties, including the frequency and nature of contacts and the likely results of such contacts.e. Property Protection and Use: The extent to which the position has responsibility for university property, including funds, vehicles and confidential information.f. Work Leadership: The responsibility for directing, instructing and training personnel; and for planning controlling and assigning work.g. Working Environment: The physical conditions encountered during a typical work day. Conditions such as heat, cold, dirt, fumes, hazards, etc. are considered.h. Student Relations: The responsibility for dealing with students, including the nature and frequenc y of contacts. The factors for professional, administrative, and managerial positions include responsibility for:i. Programs, Projects or Operations: The level in the organization, scope of activities performed, parameters of authority, complexity or nature of responsibilities, and the minimum credentials required to perform the job upon hire.j. Supervision: The number and variety of employees supervised.k. Employee Relations: Promoting and maintaining satisfactory human relations, morale and effectiveness or subordinates.l. External Contacts: Personally dealing with individuals or organizations outside the university.m. Internal Contacts: Personally dealing with individuals within the university, but outside the direct line of authority of the position, to coordinate activities and task accomplishment.n. Investigation or Fact Finding: Activities undertaken to identify facts, and develop ideas, designs or processes.o. Scheduling, Planning and Forecasting: The complexity, variety and nature of the activities involved in determining and carrying out plans and reports.p. Establishing Objectives, Policies, Standards, Procedures, and Practices: The degree of authority to establish standards, and the scope, nature and complexity or these standards.q. Effects of Decisions: Making decisions and commitments which impact the university's resources.r. Student Relations: Personally dealing with students from routine exchanges of information to more complex activities such as counseling. At the conclusion of the job evaluation process, the compensable factors are weighted. A numerical total is then derived and each position is assigned a salary grade which has a salary range A salary range consists of a: MINIMUM: The lowest wage paid to a new employee with limited or no experience in this specific position. MIDPOINT: The â€Å"market† (or average) wage paid to one who is fully qualified. MAXIMUM: The highest wage paid for jobs in the salary grade.Each salary range h as different jobs, e.g. Clerk and Grounds Worker, because they have the same relative value as determined by job evaluation. Salary ranges (link to lastest Salary Structures for Staff) intentionally overlap from one grade to another. Fully qualified incumbents in a lower salary grade may be at the high end of their salary range, while the salary of a less experienced employee in a higher salary grade may be near the minimum of the range. It is thus possible that the salary of an experienced incumbent in a lower rated position will be the same as or more than the salary of an inexperienced incumbent in a higher rates position.B. How do we establish competitive salaries? Salary surveys are conducted annually and analyzed to establish and maintain competitive pay levels with all the markets in which the university competes and recruits, as summarized in the following exhibit. SURVEY SOURCES Employee GroupMarket Salary Surveys A. Exempt1. Department Head and Above National Customized su rveys with data form selected private research universities2. Below Department Head Regional Customized surveys with data from selected private research universities3. Entry Level Local Local surveys for service employees and salary data from the College Placement Association B. NonexemptAll Jobs LocalLocal surveys of selected manufacturing and service employers (banks, insurance, health care, etc.) Specialized surveys as needed for specific jobs, e.g. plumbers, radiation technicians, etc. This market data is correlated with the job evaluation results and salary ranges are established. These ranges are then periodically reviewed and adjusted to reflect changes in the marketplace. C. How are salaries determined? Starting salaries of new hires are normally placed within the first quartile of the salary range but occasionally may go up to the range midpoint to accommodate special recruiting needs. Salary progression in the range occurs over time, based on the salary budget and employee performance. Subsequent to employment, salaries normally change as a result of a promotion, an annual merit increase or an adjustment to maintain equity.Executive compensationExecutive compensation (also executive pay), is composed of the financial compensation and other non-financial awards received by an executive of a firm. It is typically a mixture of salary, bonuses, shares of and/or call options on the company stock, benefits, and perquisites, ideally configured to take into account government regulations, tax law, the desires of the organization and the executive, and rewards for performance.The three decades starting with the 1980s, saw a dramatic rise in executive pay relative to that of an average worker's wage in the United States,and to a lesser extent in a number of other countries. Observers differ as to whether this rise is a natural and beneficial result of competition for scarce business talent that can add greatly to stockholder value in large companies, or a soci ally harmful phenomenon brought about by social and political changes that have given executives greater control over their own pay. Executive pay is an important part of corporate governance, and is often determined by a company's board of directors.Executive compensation is not only a consideration close to the pocket book of CFOs but also a topic of increasing importance to managements and boards. As major economies show signs of recovering from the 2008 recession, compensation can become more decisive to retaining and motivating critical senior executive talent. But, executive compensation also continues to be scrutinized by major investors, proxy advisory firms and increasingly regulators – given the losses incurred by shareholders over the last couple of years.Thus, companies will have to critically review their existing compensation plans and how they adapt these plans for a changing economy. CFOs can play a critical role in framing the financial impacts of compensatio n plans and influencing the public perception of these plans. This CFO Insights article lays forth some critical considerations for CFOs. Executive Compensation: Components and Trends Executive compensation generally consists of a mix of four components: Annual base salary Annual incentive or bonus plan generally tied to short-term performance measures Long-term incentives consisting of a mix of restricted stock, stock options and other long-term performance plans tied to total shareholder return or financial performance Benefits plan.Compensation and The Role Of CFOWith the changes in the environment around the structure of executive compensation, companies are likely to adopt much more transparent compensation processes. We expect CFOs may play a more active role in implementing these processes, especially in four critical areas: 1. Pay for performance: CFOs can help shape pay for performance structures by getting to know shareholders’ expectations through their interaction s with analysts and major investors. This helps ensure that the company’s performance metrics reflect those expectations when shaping short- and long-term compensation plans. CFOs are also instrumental in shaping business-unit compensation and ensuring unit-level performance metrics are rigorously set and support the achievement of overall company financial metrics.2. Financial discipline: It’s important for CFOs to focus on what is affordable, albeit striking a balance with what is competitive. CFOs, even while struggling with the budget and trying to project out earnings for the next two or three years, should establish acceptable limits on compensation in terms of its dilutive effect on earnings. At the business unit level, CFOs can also establish better financial discipline and controls. They are especially capable of identifying how units may structure budgets that coax the best possible performance out of business unit leaders.3. Risk and internal controls: As ex ecutive compensation plans are key to attracting, retaining and motivating talent, CFOs should establish a rigorous process to understand how incentives influence employee behavior, how those behaviors aggravate risk and what steps or controls should be put in place to minimize the risk. Some examples include proper selection of incentive metrics, stress testing potential payouts under various performance scenarios and implementing additional internal controls, as needed to minimize the risky behavior. 4. Bridging the information gap: Aside from managing risk, CFOs could spend considerable time with both the audit and compensation committees to bridge the potential knowledge gap on compensation and financial performance.One example is how to best treat unusual or non-recurring items when calculating incentives. The audit committee is likely to have an in-depth understanding of these items, whereas the compensation committee more fully understands the impact such adjustments may have on incentive plans. The CFO can help link the two committees in helping decide which adjustments, if any, should be made for incentive plan purposes.

European Integration

Since the day of its establishment it endeavourers to create prosperity and stability for its citizens – the citizens that are directly or indirectly affected by the Ex.'s policy and its actions. The aim of this Union is a Just society with an attitude of solidarity that promises to support economic prosperity and to create vacancy by making their enterprises more competitive and providing their employers with new abilities and skills. The European Union represents the world's greatest economic power and revised great financial and technical support to poorer countries. The EX. is still in progress when it comes to its composition.There are countries that are – due to their economic situation and their attitudes – a challenge when it comes to integration into the Union. On the other hand there are countries that do not want to be a member. Norway is one of them. The reasons why Norway rejected the membership to the EX., after being asked twice, may be discussed i n the following. The essay shall provide an overview of Norway pros and cons and the reasons why they still have not Joined the EX. as member. WoosГ Kola economies a management Lecturer: Peter Hamlet 2. History The human settlement of Norway goes back at least 11000 years.The first Norwegian lived by fishing, hunting and by farming. (see Allegorists) A period which was significant for expansion is called the Viking Age. During this period, Norwegian sailed to Scotland, England, Ireland, France and also Spain. The Danes and Swedes sailed abroad, too. This is the time when Scandinavia really became a part of Europe. The Vikings were famous for: strong warriors, prisoner taking, slaves dealing, efficient merchants, craftsmen and farmers. In the Freakish Empire they were known as the Northern. This name arose, when Norway and Denmark explored this area for trade and plunder.Norway gained more and more importance in this time. In the middle ages Norwegian population increased (about 400. 000). In the eleventh century the whole country were controlled by the church, the king and the overlords and they converted to Christianity. The inhabitants felt very unhappy in the next century and there were plenty of fighting in the inside of the country, that's why it is called the Civil War Period. Followed by the â€Å"Golden Age†, the king of Norway ever owned more Lana tan ever. One Tanta AT ten population was put on eat the â€Å"Black Death†, a plague in 1349. See Multiple) Between 1396 and 1536 Norway was part of Kalmia Union. The Union was formed in 1397 in the town of Kalmia on the Swedish east coast. A relative to Queen Margaret, Erik of Pomeranian, was elected king over Denmark, Sweden and Norway (see superstring) Sweden broke away 1523, but Norway remained united with Denmark. 1814 Denmark was forced to surrender Norway to Sweden. From now on, 1905, Norway is a free country, the union with Sweden ended and decided to give Prince Carl of Denmark th e throne. During the years 1914 till 1918, First World War period, Norway stayed neutral and also in the first time of the Second World War.In the late asses the Norwegian accepted Marshall Plan and Joined the NATAL, after abandoned their past neutrality. The current king, King Hookah, died and got replaced by Loaf V and he got replaced by his son, King Herald V. , in 1991. The economic policy was very important for the postwar history for Norway. In this time economic planning was introduced and several state-owned enterprises have been established. (see Inconsiderableness) 3. Norway – An Overview 3. 1. Economical With a GAP per capita of Ð ²?64,600 in 2008 (2nd highest in the EYE after Luxembourg) and an estimated national budget surplus the Norwegian economy is very sound.Norway belongs to the leading group of the richest countries in the world measured by GAP per capita. Public finances are boosted by significant revenues from the petroleum sector. Traditional economic a ctivities are shipping (fourth largest fleet in the world), fisheries and fish farming. The oil and gas sector constitutes around 25% of the Norwegian GAP and 52% of Norwegian exports (35 times higher than the export value of fish). Norway is a very important exporter of metals. Norwegian companies are major producers of ferry-alloys and, in particular, of aluminum.Norway is the main source for the EX. of primary aluminum. 60% of our total imports AT alloys Ana AT inwrought metal relegate In Norway. Norway Is rarely anew with natural resources such as oil and gas, hydrophone, fish, Marshall Plan: The Marshall Plan, known officially following its enactment as the European Recovery Program (ERP), was the main plan of the United States for the reconstruction of Europe following World War II. The initiative was named for United States Secretary f State George Marshall. NATO: Military alliance formed between 26 nations to enforce the North Atlantic Treaty of 1949.NATO was originally form ed to combat the spread of communism, but has grown since then to provide a mutual defense from external threats. 2 1 forests and minerals and timber. Despite intensive technological and industrial developments that have taken place in Norway, natural resources still account for the bulk of Norwegian exports. The construction and operation of the largest offshore installations on earth has led to the establishment of a substantial offshore technology industry. Traditional economic activities are shipping (fourth largest fleet in the world) and fisheries, along with fish farming.Shipping represents also an important source of export revenues for Norway. In addition, Norway is one of the top three seafood-exporting nations worldwide. Around 95% of production is exported. In recent decades, Norway has been in the forefront of Western countries' growth performance. Over the last decade, Norway sustained economic expansion was underpinned by strong macro-economic policies, the commitment to low inflation and fiscal restraint, and the strategy of investing the bulk of oil revenues abroad. The adoption of inflation targeting and fiscal policy guidelines, have further strengthened the policy framework.After having experienced a cyclical downturn of its economic growth due mainly to high wages, high interest rates and a strong currency, a very tight monetary policy made Norway recover. As expected, household demand is making a considerable contribution to the cyclical upturn as well as higher petroleum investment. In the period ahead, the global upturn will also stimulate Norway exports of traditional goods. The situation for internationally exposed industries has improved, not least thanks to what appears to be a stabilization of the crone exchange rate and a moderate wage settlement. (see European Commission) 3. . Political As mentioned in the first chapter and like you can extract from the Interpreting â€Å"Encyclopedia of the Nations†, Norway followed a pol icy of strict neutrality from 1905 until 1940. In 1940, Germany invaded Norway and carried out an exacting occupation until 1945. The German occupation left behind a bitter experience. That's the reason of Norway long dominant political sentiment for neutrality and let them Join the North Atlantic Treaty Organization (NATO) in 1949. (see Inconsiderableness) Norway is a constitutional monarchy. In the country the head of the state enjoys not unlimited power.The monarch has the power in the direction of Starting (Applicant), he designates the chief of the government (prime Minster). The parliament has the real power. The Starting has 165 seats, split among eight parties in the elections of 2001. Elections are held every four years. The parliamentary system is not like the most, an election is not called if a government loses a vote of confidence, although the prime minister may change. Due to the large number of parties and a system of proportional representation, coalition government s are the rule in Norwegian politics.Changes of government are a relatively frequent occurrence, even by the standards of European parliamentary systems, because most governments over the past decade have been minority governments. The ability to build consensus is thus a key to success for politicians and for parties. Ideological parties tend, therefore, to be small because they are often exclusive. Women play a greater role in Norwegian politics than in any other European country. For many years, a woman, Grog Harlem Borderland of the Labor Party, dominated Norwegian politics and served intermittently as prime minister. European Integration The following paper will provide an overview on the importance of the regional union of Balkans countries before joining European Union. Initially the paper will describe the main forms of integration and the main benefit for each of them. Furthermore, the paper will explain the main barriers of political integration of the Albania, Macedonia, Kosova and Montenegro. The essay will be based in the daily political development of the region and the theory given from deferent scholars of economics and business. Regional integration principlesRegional alliances to promote liberalization trade are important features in the second half of the 20th century. Today there are close to 100 agreements although not all of them have a practical implementation. Countries are trying to integrate their economies and open to new markets for their domestic firms and lower prices for their customers. According to Lundby & Jeffrey (2010), the characteristics of most important of international business are the extent of economic integration among the member countries.The economic integration affects exporting and investment opportunities among members and non-member countries. According to Warne &Nicholas (2005), there five different economic integration like free trade area, custom union, common market, economic union and political union. Following Bennett (2002), free trade area eliminates trade barriers among member countries like the NAFTA agreements between Canada, Mexico and United state. Custom union refers to the elimination of the trading barriers among members with common external trade policies for non-member countries.The best example of the custom union is the agreement between Argentina, Brazil, Paraguay and Uruguay. According to Gelfand, & Brett (2004), common union has the same characteristics as the custom union with the additional element the elimination of the barriers that inhibit the movement of production factors labor, capital and technology among members. Econ omic union represents full integration among countries. It includes the common union integration with additional economic policies integration among members. The best example of economic integration is the European union.The last form of integration is the political integration where countries follow a full political and economic integration. The best example of political union is the united state of America. Regional integration between Albania, Montenegro, Kosova and Macedonia. Albania has a favorable geographical position since it links the west developed Europe with the postcommunist European countries, East Europe. According to INSTAT (2009), Albanian population is close to 2. 8 million inhabitants.Neighbor countries are Montenegro with 0. 7 million inhabitants; Kosova with 1.8 million inhabitants; Macedonia with 2 million inhabitants. All these countries separately are not attractive from global companies because of their small size. According to Krishna (2005), economic integ ration or trade blocs are preferential trade agreements between numbers of countries to reduce or completely remove the barriers between members. Trade blocs increase the market power for each of the trading members. It increases productivity and companies take advantage of economies of scale. Also, it increases the competition between members of the market.Low costs will make the member countries firms more competitive in the non-member countries market. Small countries are the ones who take more advantage from the trading blocs than the large members of the agreement, by opening their product to a larger market. Companies take the decision to expand the business in foreign countries by considering the trading blocs and its main benefits. However, elimination of the trade barriers exposes the firm's home market to competition of other member and non-member countries, thus threatening the less efficient firms.A regional economic integration attracts the foreign investments from non- member countries as firms outside the bloc seek the benefits of insider status by establishing manufacturing facilities within the bloc. In order for these countries, to attract global companies and increase the foreign direct investments needs and economic integration among all countries and effectively make them one country. Integration of Albania, Montenegro, Kosova and Macedonia will create a market of 6. 2 million customers.Also, the integration will standardize the import and taxation policy toward the non-member countries by eliminating the differences among countries. According to Yoshino & Rangan (1995), economic integration and opening to new markets there are challenges like differences in culture, political and economic environment, and regulation between countries. Cultural and economic changes product customization. In case of the economic integration between Albania and its neighbor countries, there are limited cultural differences. All countries have almost the same philosophy of the living, tradition and customs.The similarities between countries will help companies to minimize their costs by using the same brand, same advertising strategy and message across markets. Furthermore, countries show similarities in the economic situation. They are all low-income countries with the same needs and resources to accommodate those needs. This situation increases the demand for fast moving goods by representing big opportunities for global companies operating in these industries. There is not much to say about legal restriction since they do not exist.Legal and regulatory framework is in favor of foreign investment in the region. Typically, each form of economic integration confers benefits on the national economy but hurts particular sectors and communities within that economy. As a result, negotiating any form of the economic integration is not easy. According to Koyuturk et al. (2012), strategic alignments within a company are production, marketing, f inancial and research and development alliances. Production alliances happen when two different companies create a joint venture to produce a common product or facility.Marketing alliances between companies consist in sharing of the marketing services or consultancies. Financial alliances consist in sharing the risk of investment with other partners. R&D alliances refer to joint research with partners for developing new product or services. The above strategic alignment can be managed through shared management agreements where all the involved parties participate in the shared agreement fully and actively. Strategic alignments will decrease the company cost but will have an issue for the employees.Therefore, sharing of some of the functional services many companies will cut their labor force. Local government should create defense policies to mitigate the risks of the integration. Also, political instability, high level of corruption and previous conflicts are the most difficult int egration barriers. The suggested form of integration that will strengthen the position of these countries in the region and drive a competitive advantage is the political integration. It relates to cooperation between states and formation of state based regime.Also, it refers to the constitution of new political entities with a certain degree of independent from the individual states. Regional integration strengthens the political system the scope and the capacity of its decision making process. Furthermore, legal integration it is closely related to the political integration and involves the establishment of common legal rules and common legal systems for citizens of different states. The disadvantages of regional integration are, to begin with that to achieve it, you must sacrifice some degree of sovereignty.This could negatively affect conflict resolution. This loss of flexibility in creating solutions to problems is a huge disadvantage. Conclusion Following the main forms of int egration the political integration is the most efficient one for the analyzed countries. Political integration of Albania, Kosova, Macedonia, and Montenegro will create new opportunities for these countries. It will increase the market power for each of the trading members and increase productivity and companies take advantage of economies of scale.Also, it increases the competition between members of the market. Lower costs for the member countries will make the member countries firms more competitive than the non-member countries market. Also, regional integration allows strategic alignments within a company in production, marketing, financial and research and development alliances. However, the political integration will strengthen the position of these countries in the region and drive a competitive advantage for the group of countries. European Integration IntroductionThe following paper will provide an overview on the importance of the regional union of Balkans countries before joining European Union. Initially the paper will describe the main forms of integration and the main benefit for each of them. Furthermore, the paper will explain the main barriers of political integration of the Albania, Macedonia, Kosova and Montenegro. The essay will be based in the daily political development of the region and the theory given from deferent scholars of economics and business.Regional integration principlesRegional alliances to promote liberalization trade are important features in the second half of the 20th century. Today there are close to 100 agreements although not all of them have a practical implementation. Countries are trying to integrate their economies and open to new markets for their domestic firms and lower prices for their customers. According to Lundby & Jeffrey (2010), the characteristics of most important of international b usiness are the extent of economic integration among the member countries. The economic integration affects exporting and investment opportunities among members and non-member countries. According to Warne &Nicholas (2005), there five different economic integration like free trade area, custom union, common market, economic union and political union.Following Bennett (2002), free trade area eliminates trade barriers among member countries like the NAFTA agreements between Canada, Mexico and United state. Custom union refers to the elimination of the trading barriers among members with common external trade policies for non-member countries. The best example of the custom union is the agreement between Argentina, Brazil, Paraguay and Uruguay.According to Gelfand, & Brett (2004), common union has the same characteristics as the custom union with the additional element the elimination of the barriers that inhibit the movement of production factors  labor, capital and technology among members.Economic union represents full integration among countries. It includes the common union integration with additional economic policies integration among members. The best example of economic integration is the European union. The last form of integration is the political integration where countries follow a full political and economic integration. The best example of political union is the united state of America.Regional integration between Albania, Montenegro, Kosova and Macedonia. Albania has a favorable geographical position since it links the west developed Europe with the postcommunist European countries, East Europe. According to INSTAT (2009), Albanian population is close to 2.8 million inhabitants. Neighbor countries are Montenegro with 0.7 million inhabitants; Kosova with 1.8 million inhabitants; Macedonia with 2 million inhabitants. All these countries separately are not attractive from global companies because of their small size.According to Krishna (2005), eco nomic integration or trade blocs are preferential trade agreements between numbers of countries to reduce or completely remove the barriers between members. Trade blocs increase the market power for each of the trading members. It increases productivity and companies take advantage of economies of scale. Also, it increases the competition between members of the market. Low costs will make the member countries firms more competitive in the non-member countries market. Small countries are the ones who take more advantage from the trading blocs than the large members of the agreement, by opening their product to a larger market. Companies take the decision to expand the business in foreign countries by considering the trading blocs and its main benefits.However, elimination of the trade barriers exposes the firm's home market to competition of other member and non-member countries, thus threatening the less efficient firms. A regional economic integration attracts the foreign investmen ts from non-member countries as firms outside the bloc seek the benefits of insider status by establishing manufacturing facilities within the bloc. In order for these countries, to attract global companies and increase the foreign direct investments needs and economic integration among all countries and effectively make them one country.Integration of Albania, Montenegro, Kosova and Macedonia will  create a market of 6.2 million customers. Also, the integration will standardize the import and taxation policy toward the non-member countries by eliminating the differences among countries.According to Yoshino & Rangan (1995), economic integration and opening to new markets there are challenges like differences in culture, political and economic environment, and regulation between countries. Cultural and economic changes product customization. In case of the economic integration between Albania and its neighbor countries, there are limited cultural differences. All countries have alm ost the same philosophy of the living, tradition and customs. The similarities between countries will help companies to minimize their costs by using the same brand, same advertising strategy and message across markets.Furthermore, countries show similarities in the economic situation.They are all low-income countries with the same needs and resources to accommodate those needs. This situation increases the demand for fast moving goods by representing big opportunities for global companies operating in these industries. There is not much to say about legal restriction since they do not exist. Legal and regulatory framework is in favor of foreign investment in the region.Typically, each form of economic integration confers benefits on the national economy but hurts particular sectors and communities within that economy. As a result, negotiating any form of the economic integration is not easy. According to Koyuturk et al. (2012), strategic alignments within a company are production, marketing, financial and research and development alliances.Production alliances happen when two different companies create a joint venture to produce a common product or facility. Marketing alliances between companies consist in sharing of the marketing services or consultancies. Financial alliances consist in sharing the risk of investment with other partners. R&D alliances refer to joint research with partners for developing new product or services. The above strategic alignment can be managed through shared management agreements where all the involved parties participate in the shared agreement fully and actively.Strategic alignments will decrease the company cost but will have an issue for the employees. Therefore, sharing of some of the functional services many companies will cut their labor force. Local government should create defense policies to mitigate the risks of the integration.Also, political  instability, high level of corruption and previous conflicts are the most difficult integration barriers.The suggested form of integration that will strengthen the position of these countries in the region and drive a competitive advantage is the political integration. It relates to cooperation between states and formation of state based regime. Also, it refers to the constitution of new political entities with a certain degree of independent from the individual states.Regional integration strengthens the political system the scope and the capacity of its decision making process. Furthermore, legal integration it is closely related to the political integration and involves the establishment of common legal rules and common legal systems for citizens of different states. The disadvantages of regional integration are, to begin with that to achieve it, you must sacrifice some degree of sovereignty. This could negatively affect conflict resolution. This loss of flexibility in creating solutions to problems is a huge disadvantage.ConclusionFollowing the main forms of integration the political integration is the most efficient one for the analyzed countries. Political integration of Albania, Kosova, Macedonia, and Montenegro will create new opportunities for these countries. It will increase the market power for each of the trading members and increase productivity and companies take advantage of economies of scale. Also, it increases the competition between members of the market.Lower costs for the member countries will make the member countries firms more competitive than the non-member countries market. Also, regional integration allows strategic alignments within a company in production, marketing, financial and research and development alliances. However, the political integration will strengthen the position of these countries in the region and drive a competitive advantage for the group of countries.