Advertising: Information or Manipulation Essay

Advertising, also known as a part of the marketing process, has a rich background. When we talk about marketing the first things that come to our mind are high profit, goods and services and of course consumers. Advertising’s role should only exist in order to help society by real information about products and services. Moreover, it helps consumers decide what to purchase according their actual needs. Advertisements are located everywhere and no one can avoid seeing them. Thus, every individual in exposed to seeing at least one advertisement. Advertising is a form of mass communication with the public. It is a form of communication that typically attempts to persuade the potential customers to purchase or consume more of a particular brand of product/services. We could separate advertising in two categories. Giving information through advertising about a product is the first category that is innocent when facing the costumers. The second category has a manipulative effect on people. Thus, People exposed to specific advertisements are led to buy goods and services or do things that don’t actually want to do. And in order to attract audiences, some advertisers use different extreme technique that does more damage on the consumer’s life then with helping him. Therefore, we can say that advertising is based on manipulation and thus should be limited because it harmful. To start with, advertising reaches the mind of people and is dangerous when it is not real especially on children and youth. By unreal advertising we mean a shallow advertising that focuses on the desire and wants of people so the firms producing this product achieves sales and high profits. Young children are unable to understand advertising messages and the information given by these advertisements, therefore, children may consider these advertisements as the truth and the real world thus it will affect their behavior. According to the Washington post and their researches, â€Å"Federal regulators should restrict television advertising aimed at children 8 and younger because research shows youngsters lack the skills to question a commercial’s claims as anything but fact, the American Psychological Association said yesterday†. (Washington post article). Moreover, children will be affected by cartoons, kids’ shows†¦ Thus, manipulation is being forced on children by using the popular faces in cartoons like Hannah Montana, Dora†¦ For instance, during my childhood, there was a chocolate commercial for Disney (picture of the product) and the same chocolate bar was next to it. The price range was very apart since the chocolate by Disney was a brand name. And as a Disney fan I cried and begged for the chocolate bar that was by Disney. Thus, we can see here that manipulation in advertising is being implemented through the mind of children and is affecting their behavior.

Dick’s Sporting Goods, Equity Valuation and Analysis

Table of Contents Executive Summary2 Company Overview2 Economic Analysis GDP Growth3 Inflation3 Interest Rates3 Housing5 Consumer Spending5 Sovereign Debt6 Unemployment6 US Dollar7 Impact of Sporting Goods Stores Industry7 Industry Analysis8 Porter’s 5 Forces8 Big Four Analysis11 Industry Life Cycle13 Dick’s Sporting Goods Analysis Review of Annual Report16 Company SWOT Analysis18 Trend Ratio Analysis20 Cross Sectional Ratio Analysis22 Analyst Analysis/Estimates24 DuPont Ratio Analysis25 Valuation P/E Multiplier26 Valuation FCF to Equity27 Summary of Analyst Reports28Beta Analysis29 Technical Analysis29 Conclusions31 Executive Summary After analyzing Dick’s Sporting Goods and taking into account both positive and negative aspects associated with the stock, I am giving the stock a Moderate Buy Recommendation, with a target price of $46. 50. The recommendation took into account DKS’s recent earnings report, improving financial health, growth estimates, and i ndustry outlook. In this report I will evaluate the current overall economic conditions and how they affect the Sporting Goods Stores industry and the Retail sector in general.The report then focuses on Dick’s Sporting Goods’ key measure of financial health, profitability, and growth compared to historical levels and competitors. A P/E Multiple analysis and a Free Cash Flow to Equity valuation approach was then used to derive an intrinsic value of the stock. Company Overview Dick’s Sporting Goods is the largest Sporting Goods Store in the United States, selling sports equipment, exercise and fitness equipment, apparel and footwear along with outdoor sports equipment and accessories.Dick’s was founded in 1948 and operates 455 stores in 42 states primarily in the eastern part of the United States. Dick’s Sporting Goods controls 13. 4% of the market share within the industry and has the largest market cap at $4. 75 billion. When the most recent fiscal year ended in January of 2011 (FY 2010), Dick’s Sporting Goods generated over $4. 8 billion in sales and had Net Income of just over $182 million. Currently Dick’s Sporting Goods has 120. 72 million shares outstanding. Economic Analysis GDP Growth Recently GDP grew at an annualized rate of 1. % and 2% in the second and third quarters of 2011 respectively. Consumer Spending is one of the key drivers and is a large portion of the US economy and with consumer confidence still below healthy levels. Combined with low consumer spending current monetary and fiscal policy have prevented GDP from getting above the aforementioned growth levels for an extended amount of time. Also contributing to low GDP is the traditionally higher unemployment as of late, lack of confidence in the US government, and low home values as a result of the housing crisis.The low growth in GDP will more than likely continue in the near future as the economy will work out of the recent recession and wi ll therefore keep interest and inflation rates. Once the economy starts to strengthen and expand however, GDP growth rates will increase from their current bleak levels. Inflation Inflation expectations have remained low recently, showing trust in the Red to monitor/control inflation rates when the economy begins to start expanding.With Ben Bernacke and the Fed’s commitment to keep interest rates at their historically low levels, it seems that monetary policy is following a trend of attempting to prevent any policy from causing further struggle to the U. S. economy. In the short term there seems to be no immediate threat/fear of inflation rising in the US. According to an article from Reuters, the Fed wants to keep inflation around its 2% target in order confirm the Federal Reserve’s ability to keep control over inflation levels. Interest RatesInterest rates set by the US Federal Reserve within its over-arching monetary policy are very important in terms of the world e conomy. Recently the Fed pledged to keep the federal funds rate close to zero through mid year 2013. Operation Twist, a plan to buy long-term U. S. debt and sell short-term debt, which will result in a flattening of the yield curve and a drop in long-term debt yields, is a part of the expected future according to the Fed. This means that the historical lows in interest rates that we are seeing will continue in the short run.In the long run however, there looks to be a divergence from that short-run trend. Consumers and businesses in the long-run will get away from the de-leveraging process that we are seeing in the recent past and currently and begin to build up cash that will circulate more unreservedly. This will cause the Fed to set interest rates at higher levels in order to combat against the rise in inflation in the post-deleveraging period. Housing Post-housing/financial crisis of 2007-2009, the housing market seems to be showing signs of improvement after great downturn.With the downturn in housing prices, many homeowners did not have enough equity to avoid taking a loss on the sale of their homes so they are sitting with home loans based off of higher-than-current mortgages. However, in November the National Association of Home Builders’ sentiment index jumped to 20, which is the highest reading in over a year. Demand for mortgages has also seemed to pick up a bit according to the Fed’s 4th quarter loan survey. Construction remains at historically low levels but has increased as of late, and the number of foreclosures has increased this quarter also.These trends do seem to be geared to a more short-term thought process and many analysts believe that in the long run, the housing market will improve and strengthen along with the strengthening of the US economy. Consumer Spending In October personal income increased $48. 1 billion and disposable personal income increased $30. 2 billion according to the Bureau of Economic Analysis. In additi on, personal consumption expenditures increased $8. 2 billion. With consumer spending representing about 70% of total GDP increases in the different income categories translates into more consumer spending.Analysts believe that with continued increasing we can start to return to pre-recession levels of spending. This increase is a positive sign for retailers because there is more disposable income to purchase their products than recently as we continue to move away from recessionary levels. From the chart below you can see the upward trend from the 2008 lows in personal consumption spending. The chart on the next page does a good job portraying the recent trends in consumer spending. Sovereign Debt Foreign currencies have been seen weakening relative to the US dollar due to many debt issues in countries abroad.This has caused investors to flock towards the safest reserve currency, which is the US dollar. Fear in Europe stems from economies that are much too large to be bailed out or allowed to completely default on their debt and the means for a solution have not come about as of yet. Greece, Italy, and Spain are among those countries that are seeing investor fear and are also causing investors to be cautious to the other European economies, even ones that have proved to be more reliable (Germany and France). There have been austerity measures that are aimed at reducing the debt levels of the countries in fear of defaulting however oliticians in the near future must discuss the outlook of the European Union and whether or not there is a need for countries to break apart. These threats significantly reduce the expected growth in forecasted GDP and spending, which could be harmful to worldwide markets that depend on Europe. Unemployment The unemployment rate and the number of unemployed persons have remained stagnant through October ranging around 9%-9. 2% and 13. 9 million respectively. Within retail trade, employment increased in general merchandise stores and the industry has added 156,000 jobs over the past 12 months.The unemployment rate is forecasted to decline as the economy starts to strengthen and pull its way out of recessionary levels. This obviously affects consumer spending and consumer confidence in general. Higher unemployment rates tend to mean less disposable income, which would affect the pricing point of retailers and would hurt big ticket items such as different luxury goods. With dropping unemployment rates predicted for the future, consumer confidence will ultimately increase and consumer spending, therefore benefitting the retail sector. Value of the US DollarAs mentioned before with the fear of default and crisis abroad foreign currencies have weakened in relation to the dollar. Also this chaos in Europe helps support against the loose monetary policy of late, limited growth see in GDP, and large trade deficits, which would otherwise weaken the dollars position. Investors favor the safety that the US dollar provides . This strengthening in comparison to other currencies also gives sentiment to the fact that investors are becoming more and more confident in the US market again and thus moving more and more capital back into it.In the near future I believe that the dollar will remain strong relative to other foreign currencies and that investor confidence from abroad will continue as a direct relation to a strong future currency. Impact on Industry Many of the indicators listed in the Economic Analysis greatly affect the Retail Sector and Sporting Goods Stores Industry as a whole. The most obvious one is the gradual rise in consumer spending and therefore GDP. Both of these are positive signs for the retail sector, who’s profits are directly linked to variations in consumer spending.Consumer spending will also increase when consumer deleveraging process begins to slow down in the next few years. Due to low consumer confidence as a result of the financial crisis people were paying down more debt in order to be more financially healthy (deleveraging. ) As confidence increases consumers will use more disposable income towards consumption and less towards paying down debt. The high unemployment rates that we are currently seeing have negative effects on disposable income and therefore negatively affect the retail sector.However, with the forecast of adding jobs and a declining unemployment rate, the result will be increases in disposable income and therefore increases in consumer spending. The strong dollar in relation to foreign currencies makes US goods more expensive, however this does not have an adverse effect on Dick’s Sporting Goods because it generates the vast majority of its sales domestically. Industry Analysis Dick’s Sporting Goods operates in the Sporting Goods Stores Industry within the Retail Sector.Companies in this industry retail new sporting goods including sports equipment and apparel, exercise and fitness equipment, footwear and other s porting goods and accessories. Dick’s Sporting Goods also owns 81 Golf Galaxy stores in 30 states. DKS operates in off-mall locations and feature an interactive store-within-a-store environment. Revenue growth for the past five years in the industry has been volatile due to drivers such as high volatility in disposable income. Average annual revenue growth over the past five years was just 0. 3% and the forward five years are forecasted for average annual revenue growth of 2. % Porter Five Forces Barriers to Entry The most dominant barrier to potential entrants into the industry has to do with the large start-up costs associated with firms. The initial cost of establishing a retail outlet or acquiring a retail outlet with sufficient inventory to supply customers is a great inhibitor to new entrants. High marketing and advertising costs are also important cost barriers to be dealt with in order to become competitive in the industry. This expenditure increased in the five years to 2011, which was a directly from rises in competition.This has caused massive investment in brand promotion and promotional campaigns in attempts to increase store traffic and differentiate. This is another capital barrier to entry for possible entrants. In addition, the present and well-established channels of distribution between suppliers and the major players of the industry can be a major deterrence. In order to achieve success new entrants would have to need to somehow establish strong relationships with the upstream manufacturers and wholesalers in order to obtain high quality, low-priced stock. CompetitionDespite their low market shares individually the concentration in the Sporting Goods Stores industry is increasing due to increases in M&A as of late. This trend along with the growth in the number of outlets operated by the larger players of the industry create high levels of difficulty for the smaller and specialty firms within the industry. These smaller firms have be en forced to reduce product margins in order to remain competitive. In addition, IBISWorld estimates that through 2016 the number of enterprises within the industry will grow at an average rate of 0. 9%, further intensifying competition.There has been recent competition from department stores and other mass merchandisers and IBISWorld predicts that this will be the single biggest threat to the industry in the years to 2016. Because of their great size and buying power, these competitors are able to offer merchandise at considerably lower prices and in bulk quantities. From there department stores and mass merchandisers are able to pass cost savings onto the consumers via lower prices, while still maintaining margins. Large chains like Walmart and Target can also lower prices more readily making it harder to compete on price.This has caused larger Sporting Goods Store Chains to open â€Å"superstores† that allows them to compete more effectively on price with department stores . Substitutes/Compliments In terms of sports equipment, which is the largest product segment in the industry, market share has declined since 2000 and can be attributed to the growth in the rental market. With declining disposable income levels, it became more cost effective for consumers to rent sports equipment then purchasing it outright. Sale of sports equipment by external competitors like department stores has also accounted for this loss in market share.Other substitutes that affect this industry have to do with how people spend their leisure time and competition with products such as toys, crafts, fashion, and music related items exist because of this factor. Home entertainment products also directly compete with sporting and recreational goods depending on how consumers spend their leisure time. With advances in technology the competition for these substitutes increases, which holds true in advances in video game systems, computer games, and online resources to spend leisur e time.Buyer Power Buyer power can be seen mostly through the affects that disposable income takes on industry sales. The products that Sporting Goods Stores would not be generally viewed as necessities and therefore sales are hurt when consumer spending takes a downturn due to tightening of disposable income. Fluctuations in income levels among consumers also alters price levels of goods purchased. In continuing with price, price remains the single largest basis of competition between firms within the industry.Consumers are price conscious and will ensure that they purchase goods at the best possible price. Therefore, buyers have the power to shift pricing points of firms and facilitate competition based on those pricing points. Along with price comes quality and the demand for popular branded items by consumers. Consumer preferences can determine the range of merchandise carried by companies and also the brands that stock the shelves. Therefore changes in consumer preferences grea tly affects the products offered to public by consumers and the quality of products offered. Supplier PowerSupplier power within the industry has come mostly in retailers seeking exclusive contracts with them in the hopes that those retailers gain an advantage over rivals with the types of products they are able to offer. For example, Foot Locker, which is more of a sports apparel retailer but nonetheless, has secured specific partnerships with Adidas and Reebok for the back-to-school period. With the partnership Foot Locker became the exclusive retailer of new-release Adidas and Reebok shoe products. This trend of seeking exclusive contracts with suppliers is forecasted to ontinue in the future in hopes of increasing industry revenue. However, this also gives more power to suppliers in terms of which companies they competitively position themselves with. Big Four Analysis Demographics Sports participation rates by age have a pretty solid effect on industry revenue. Children aged 5 to 17 years old are estimated to represent the key market for the industry, comprising of about 53 million individuals. This age group also has the highest participation rates in sports, thus driving sales for this age demographic.The problem is that as this age group gets older there is a trend of decreases in sports participation in order to focus attention on activities other than sports. The relative size of this market in the five years to 2016 is expected to decrease by 9% because of this changing of activities. Also, as people live longer they want to maintain healthy lifestyles, which is why the aging baby boomers are expected to lead to higher sports participation rates among people 64 years and older. This will have a very favorable effect on the industry given the vast number of individuals that fall within this category.Sporting Goods Stores are also found to greatly position themselves in areas of the United States most densely populated. The industry is largely concent rated in the Southeast and West regions, which account for 24. [email  protected] and 17. 5% of industry establishments. These two regions also account for the largest share of US population at 25. 2% and 17. 0% respectively. Lifestyle Increases in consumer awareness regarding living healthy lifestyles and incorporating regular exercise into their daily lives is a positive factor for the industry.This lifestyle thus boosts sports participation rates resulting in increasing revenue for industry players. There has also been recent rise in popularity for sports activities that strengthen the mind-body spiritual connection, which also has a positive effect on the industry. Another key driving factor that has positive results for the Sporting Goods Stores Industry is the national culture of the United States. Sports are a very important part of our nation’s culture whether it be via the professional sports exposure or the team sport participation driven by association with secon dary and tertiary schools.The exposure and the vast amount that sports are imbedded within our every day life create continued positive figures in terms of sports participation. Legal/Regulatory Sports retailers that sell firearms must comply with the Federal Brady Handgun Violence Prevention Act, requiring retailers to perform presale background checks of consumers who want to purchase hunting rifles. Each background check generates a specific transaction number that is recorded on Form 4473 of the Bureau of Alcohol, Tobacco, and Firearms and retained for 20 years for auditing purposes.In addition retailers must hold a federal firearms license. Retailers are not exposed to tariffs on goods supplied but do have a range of organizations that provide guidance and support to them. Some key examples of such organizations include the National Retail Federation, the American Apparel and Footwear Association, and the National Sporting Goods Association. Technology Some technological advanc es that have made firms more competitive in the industry include, point of sale systems, bar-code scanning and electronic data interchange.These enable firms to control merchandising, distribution, sales, and markdowns. Increases in labor productivity have also been a direct result of such technological advances. Establishments of online means of shopping also have given retailers another channel of product distribution and have created further competition. Some technological threats to the industry have to do with shifts in consumer preferences as far as how they spend their leisure time. Wii Sports for Nintendo is an example of this as consumers have shifted to digital games as opposed to physical sports.The Wii series also offers additions such as Wii Fit and Wii Fit Plus Yoga, which shows the ways in which consumers view sports participation has altered. Technological advances in video and computer games have enhanced the quality, affordability, and experience of undertaking the se leisure activities and continued growth in those areas has a drastically negative effect on traditional sporting activities and the Sporting Goods Stores Industry as a whole. Industry Life Cycle The Sporting Goods Stores Industry is currently in the mature stage of their ife cycle, with growth rates failing to outpace the overall economy, the consolidation of the industries players, and the lack of product innovation significant enough to change the industry’s landscape. Maturity in the industry has been supported by competition from department stores and the lack of change in the key buyers and sellers of sporting goods along with a slowdown in the rate of technological advances. Department store competition has caused contraction within the industry, which is typical of a mature industry.While more affluent firms have been the primary targets for consolidation, the industry also experienced a decline in the number of non-employing operators, such as the small â€Å"mom and pop† stores. Finally, while manufacturers look to continue enhancing product designs and functionality to make products faster, lightweight, more durable, and more versatile, these types of product advancements generally have little impact on the overall growth of the industry. These product advances aren’t the catalyst that can propel this industry into a growth phase.Sporting Goods Stores as % of GDP (in millions) Year| 2006| 2007| 2008| 2009| 2010| Industry Sales| 38,132. 60| 39,980. 40| 39,826. 80| 39,000. 00| 38,385. 70| Sales Growth| -| 4. 8%| -0. 4%| -2. 1%| -1. 6%| Nominal GDP| 13,398,800| 14,061,800| 14,369,100| 14,119,000| 14,582,400| GDP Growth| -| 4. 95%| 2. 19%| -1. 18%| 3. 28%| Sales as % of GDP| . 285%| . 283%| . 271%| . 272%| . 265%| The industry sales chart that is shown above includes all companies that operate within the Sporting Goods Stores Industry, from major players to small and specialty stores.From the data above we can see that revenue gro wth for the industry has lagged behind Nominal GDP growth. Supporting the notion that the industry is in the mature stage. This was most likely caused by the fact that growth in the industry over the previous five years was hit hard by declines in consumer spending and consumer deleveraging. Declines in consumer confidence and consumption levels seemed to affect Industry revenue than Nominal GDP as a whole. Sporting Goods Stores Companies with over $250 million in Sales as % of GDP (in millions) Year| 2006| 2007| 2008| 2009| 2010|Industry Sales| 9,705. 20| 11,404. 40| 11,881. 10| 12,265. 80| 12,838. 50| Sales Growth| -| 17. 5%| 4. 18%| 3. 24%| 4. 67%| Nominal GDP| 13,398,800| 14,061,800| 14,369,100| 14,119,000| 14,582,400| GDP Growth| -| 4. 95%| 2. 19%| -1. 18%| 3. 28%| Sales as % of GDP| . 00072%| . 00081%| . 00083%| . 00087%| . 00088%| The second chart is the same breakdown as the one before, however it is a make up of only the 7 firms in the industry that receive revenue over $25 0 million on an annual basis (Sports Authority is included but is privately held so only basic revenue data was able to be retrieved).What we see now is quite a different story, with industry revenue growth outpacing Nominal GDP growth in all years of the historical breakdown. This suggests that the large cap firms within the industry are not as mature in nature as the broad industry and have ample room for growth in the future. This would suggest that based on the forecasts of increased consumer spending/consumption in the future as the economy strengthens and consumer confidence returns, growth figures for these large cap firms will be even higher. Dick’s Sporting Goods Analysis Review of Annual Report Key Risk FactorsThe following are some of the risk factors presented from management as their biggest threats in terms of influencing sales. : * Economic and financial downturn causes declines in consumer spending, which will adversely affect the company’s operations. * The business is very seasonal and is highly dependent on the success of the 4th quarter. * The industry is very sensitive to general macroeconomic changes that would affect either consumer sentiment or consumer spending. * The terms of their senior secured revolving credit facility impose certain restrictions that may impair their ability of available capital. The lack of acceptable retail store sites on terms acceptable to Dick’s Sporting Goods, rising real estate prices and other costs related to new store openings could limit expansion plans. * Private brand offerings, which are being emphasized more and more, expose DKS to many other risks than more popular brands. * If inflation were to increase it would greatly affect Dick’s Sporting Goods’ operating results unless DKS was able to fully pass on the increases in costs to the consumer via price. Legal Proceedings In 2011 Dick’s Sporting Goods has 14 cases ongoing in litigation, which is down from 20 10 when there was 39.One of the cases that received a lot of notoriety recently was Tamara Barrus vs. Dick’s Sporting Goods in 2010. Barrus was a former employee who was suing her former company on claims that DKS failed to pay her wages and failed to compensate her for overtime. The reason this case got so much attention was because as the case drew on, additional claims were added to the case from 35 other states with the same allegations. The settlement ended up being for approximately $10. 8 million before taxes in favor of Barrus and the other defendants.What is important to note is the potential vast negative effect this could have had on DKS’s reputation as well as the losses they had to pay in court. Off Balance Sheet Arrangements The off balance sheet arrangements for Dick’s Sporting Goods relate to operating leases, future minimum guaranteed contractual payments, and letters of credit. In the annual report, Dick’s Sporting Goods holds a firm sta nce that these off balance sheet items do not have any material effect on the financial condition of the company, revenues or expenses, results of operation, liquidity, capital expenditures, or other resources.When looking at the figures however there seem to be a different story. DKS lists $3,717,112,000 in total contractual obligations and $21,527,000 in total other commercial commitments that are not listed on their balance sheets. This would definitely seem to affect their operations and liquidity when looking at the magnitude of those numbers. In addition, DKS lists over $200 million in goodwill on its financial statements but its largest subsidiary Golf Galaxy was determined to have their goodwill unit fully impaired upon further investigation, which calls into question the size of the goodwill figure.DKS lists $130,496,000 in financing leases and $9,524,000 in capital leases, the financing leases do not have to be listed in financial statements but as you can see carry a very large amount. Finally, Dick’s Sporting Goods agreed to new terms on its Credit Agreement that allow DKS to incur unlimited capital lease obligations and indebtedness to finance the acquisition or improvement of any fixed capital assets. The new agreement also allows Dick’s to increase their ability to incur up to $200 million of unsecured indebtedness. ManagementIn examining the upper management of Dick’s Sporting Goods there are only a few things that I would like to point out. Edward Stack, whose father founded Dick's, has served as chairman and CEO since 1984. One area for concern is the board's staggered terms and the firm's dual-class common stock structure, which includes Class B shares with super-voting rights. Stack owns about 26% of the outstanding shares (including 23 million Class B shares) and controls 66% of the voting power. This drastically limits the control of minority shareholders.Dick's also has takeover defenses in place to prevent potential suitors from acquiring the firm. Executive compensation is weighted toward Stack, who received more than $7 million in total compensation over the past two years while the other top four officers received between $3. 8 and $1. 2 million. Salaries, all less than $1 million, are relatively small in the executive compensation system, but stock awards and stock options have been generously given and have consistently increased share counts. The dealings of the CEO and his family are also means for concern.Company SWOT Analysis Strengths Store-within-a-store merchandising concept With this type of merchandising model Dick’s Sporting Goods is able to gain advantages as a large store as well as that of a specialty store. Each of DKS’s large 50,000-75,000 square foot buildings it has specialty stores including: Golf Pro Shops, Footwear Centers, Fitness Centers, Outdoor Centers, and Team Sports. Deep product selection and knowledgeable staff are two advantages that DKS is able to provide with these specialty shops.These stores focus on specific categories and carry very deep products selections within each area of interest. The area that hurts specialty stores is competing on price but since DKS is also a mass merchandiser it is able to be competitive on price in that aspect. The combination of these two types of stores increases the average spend, customer satisfaction, price competitiveness, and product selection. Leading Market Position Garnered from Competitive Pricing Dick’s Sporting Goods is the leader in market share in the industry capturing about 13. 4%.The small number of large cap firms in the industry create an attractive competitive dynamic for these companies, as they have better bargaining power and can pass on the benefits of this large scale to customers in the forms of lower prices and higher quality merchandise. At the end of fiscal year 2011 DKS operated 486 stores and has growth plans set in the motion to increase that number at a staggering rate. A key aspect that has fueled its market position is its price positioning. DKS maintains a policy of matching competitor’s advertised prices and maintains the notion of providing value at each price point.Weaknesses Strained Relationship with the Employees Dick’s Sporting Goods has been involved with labor issue lawsuits over the past few years. Claims by former employees of failing to pay wages and overtime wages and various class action lawsuits. These not only deteriorate the relationships between corporate and lower level employees but also result in financial loss and gives a hit to the company’s overall reputation. Opportunities Increased Health Consciousness As mentioned in the lifestyle section, the health and wellness trend is expected to gain tons of momentum in the coming years.Industry analysis shows that yoga, aerobics, tennis, hiking, and running/jogging were the top five sporting activities that people were involved in 2010. Growing participation in these areas can be attributed to growing public awareness and emphasis on the benefits of a healthy lifestyle. In order to take advantage of this DKS can push its exercise/fitness equipment areas and fitness apparel lines, which would directly benefit in sales from higher participation in those five sporting areas mentioned. Offering Merchandise with Higher Margins in order to Enhance Profitability DKS has been ontinually improving profitability by offering higher margin merchandise such as apparel and footwear. In 2010, DKS incorporated Nike Field House shops at its retail outlets and plans to open 100 Nike Field House shops at its stores by the end of 2011. By partnering with manufacturers who are trying to push these types of products, DKS stands to benefit by way of product differentiation and product exclusivity as it is Nike’s key strategic apparel partner. More initiatives such as this will stand to boost profitability for DKS and will increase its return on investments. Threats Lower Participation in GolfPrimarily due to the economic slowdown there has been a decline in golf participation in the last few years as club members have not been able to afford the high fees charged by golf clubs. According to estimates participation is down 11. 5% from the year before, which has led to sluggish sales growth in that area for DKS. Gold equipment related purchases decreased 14% industry wide last year, which is a threat to Dick’s Sporting Goods as the revenue from the sale of golf equipment forms an important part of DKS’s total revenue. It also hurts the sales revenue of the 81 Golf Galaxy stores that are owned by Dick’s Sporting Goods.Non-replicable Characteristic of Products Demand for particular sporting goods equipment depends heavily on the region of the United States and DKS has limited scope in terms of replicating its products across all of its stores because of this. Climate changes play a significa nt role as well in the merchandising mix to be offered in regions and demands changes in the seasonality of certain products. With these obstacles to deal with, it limits DKS’s ability to have huge gains on inventory even though it is a large retailer. Trend Ratio Analysis Key Growth Ratios, YOY| 2007-01| 2008-01| 2009-01| 2010-01| 2011-01| Revenue %| 18. %| 24. 9%| 6. 2%| 6. 8%| 10. 4%| Net Income %| 3. 6%| 3. 9%| (1. 0%)| 3. 1%| 3. 7%| Dick’s Sporting Goods has had positive growth each of the last five years in terms of revenue, and has had positive growth four of the last five years in terms of their bottom line. This can be attributed to its strong position with the industry in terms of market share and its ability to compete on price as a mass merchandiser and be profitable in terms of its specialty stores. Growth looks to continue in the future for DKS with analysts predicting around 8% growth in fiscal year 2012 and low double digit growth in 2013.Liquidity/Fina ncial Health| 2007-01| 2008-01| 2009-01| 2010-01| 2011-01| Current Ratio| 1. 5x| 1. 4x| 1. 7x| 1. 5x| 1. 8x| Quick Ratio| 0. 3x| 0. 1x| 0. 2x| 0. 3x| 0. 7x| Cash Conversion Cycle| 59. 5| 66. 8| 71. 4| 62. 5| 51. 3| Receivables Turnover| 90. 2x| 76. 5x| 68. 9x| 94. 7x| 138. 4x| Inventory Turnover| 3. 8x| 3. 6x| 3. 4x| 3. 7x| 3. 8x| Dick’s Sporting Goods’ liquidity ratios seem pretty stable over the past five years. However, the quick ratio is very lower compared to the current ratio because inventory represents such a large part of DKS’s current assets.Despite this the quick ratio has been increasing over the past four years of operation. DKS’s cash conversion cycle has declined in recent years after extreme growth in the beginning of the last five years. Inventory turnover has been pretty stagnant for Dick’s Sporting Goods and DKS should look to improve this number in order to reduce inventory costs and storage costs. Finally the receivables turnov er of Dick’s Sporting Goods has seen great growth in the past five years meaning that it has been doing a better job of collecting on its accounts receivable.Profitability| 2007-01| 2008-01| 2009-01| 2010-01| 2011-01| Asset Turnover| 2. 3x| 2. 2x| 2. 1x| 2. 1x| 2. 0x| ROA| 9. 1%| 9. 4%| 7. 5%| 7. 0%| 8. 3%| ROE| 21. 8%| 20. 0%| (4. 5%)| 13. 7%| 14. 9%| ROIC| 17. 7%| 18. 0%| 14. 0%| 12. 8%| 14. 7%| Dick’s Sporting Goods’ profitability ratios are down from their beginning levels in this recent five-year period. These are unfavorable trends in terms of investor confidence. Return on Equity is lower than the beginning of the period by 6. 9% and Return on Invested Capital is at 3% lower than fiscal year 2006 levels.The good note is that all the ratios are improving from the previous year in attempts to return to levels prior to the recession. These ratios will hopefully increase as consumption increases and consumer confidence returns to pre-recessionary levels. Leve rage Ratios| 2007-01| 2008-01| 2009-01| 2010-01| 2011-01| Debt/Equity| 29. 2%| 20. 4%| 20. 3%| 13. 1%| 10. 3%| Long-term Debt/Equity| 29. 1%| 20. 4%| 20. 2%| 13. 0%| 10. 3%| Interest Coverage| 18. 2x| 13. 2x| 13. 7x| 51. 9x| 22. 8x| Financial Leverage| 0. 29| 0. 20| 0. 20| 0. 13| 0. 10| Dick’s Sporting Gods has approximately $. 3 of liabilities for every $1 of assets. Dick’s has also done a very good job of reducing its long-term debt relative to equity in addition to reducing its debt relative to equity. In addition DKS currently covers its interest expenses 22. 8 times with earnings. This is a significant drop from the previous year but it is an overall increase from the beginning of the five years leading to fiscal year 2010. Cross Sectional Ratio Analysis I chose to compare Dick’s Sporting Goods with Cabela’s Inc. and Big 5 Sporting Goods, which are its two biggest publicly owned rivals in the industry.All three are industry leaders in many statistica l and ratio categories. For comparison sake I will use the most recent fiscal year (2010) for the cross sectional ratio analysis of the three firms. Key Growth Ratios, YOY| DKS| CAB| BGFV| Revenue %| 10. 4%| 4. 3%| 0. 1%| Net Income %| 3. 7%| 5. 0%| 2. 3%| In looking at the year-over-year key growth ratios, Dick’s Sporting Goods’ revenue is more than double above Cabela’s and substantially higher than Big 5 in the most recent fiscal year. DKS is only second however in year-over-year net income, losing out to its closest industry competitor Cabela’s Inc.Liquidity/Financial Health| DKS| CAB| BGFV| Current Ratio| 1. 8x| 2. 0x| 1. 8x| Quick Ratio| 0. 7x| 1. 6x| 0. 1x| Cash Conversion Cycle| 51. 3x| 76. 4x| 100. 3x| Receivables Turnover| 138. 4x| 61. 0x| 63. 2x| Inventory Turnover| 3. 8x| 3. 3x| 2. 5x| The current ratios for the industry leaders are pretty similar across the board and CAB is the leader of the three in terms of quick ratio with DKS in second. I n terms of receivables turnover, Dick’s Sporting Goods is much more efficient in collecting on its accounts receivable than either CAB or BGFV, however DKS is last of the three in its average cash conversion cycle.Finally, DKS is has the best inventory turnover among the top three public players of the industry meaning that it is more efficient in reducing its inventory costs and DKS does a better job of getting its products off the shelves and into the customer’s hands. Profitability| DKS| CAB| BGFV| ROA | 8. 3%| 3. 4%| 5. 9%| ROE| 14. 9%| 11. 2%| 14. 6%| ROIC| 14. 7%| 5. 1%| 11. 3%| Profitability measures of the industry’s three largest players shows that Dick’s Sporting Goods earns greater income off of their equity relative to its two competitors.Return on Assets and Return on Invested Capital also favor DKS in comparison to its peers. Leverage Ratios| DKS| CAB| BGFV| Debt/Equity| 10. 3%| 227. 4%| 34. 4%| Long-Term Debt/Equity| 10. 3%| 120. 8%| 33. 1% | Interest Coverage| 22. 8x| 9. 5x| 25. 8x| Financial Leverage| 0. 10| 4. 42| 2. 60| As you can see Dick’s Sporting Goods is a much less levered company in comparison to its two largest competitors. It has drastically lower debt to equity ratios and a dramatically lower financial leverage statistic. This make Dick’s Sporting Goods a less risky company in comparison to Cabela’s Inc. and Big 5 Sporting Goods Inc.However, DKS’s beta is slightly greater than one; around 1. 24, which means that its is riskier than the market. Analyst Analysis/Estimates A key factor in DKS’s merchandising strategy is strong vendor relationships. Most mass merchants and specialty retailers have limited access to sports equipment because they can’t offer the high level of service that manufacturers demand from the firms they supply to. The store-within-a-store layout however Dick’s Sporting Goods provides that high level of service through experienced profess ionals, value-added repairs, maintenance, and assembly services.There is also an interactive shopping experience for customers with them being able to try products out before purchase, which most competitors don’t match. Dick’s has a great opportunity to expand nationwide in terms of number of storefronts and overall market share. Management has identified the potential for at least 900 DKS stores in the US before it nears saturation, which means that as of right now Dick’s is only halfway to its ultimate goal in terms of store base. It’s estimated that Dick’s Sporting Goods will open on average 36 new stores per year in the near future, suggesting a mid/high single digit square footage growth rate.In the long run, analysts expect more M&A similar to the acquisition of Golf Galaxy in order to provide immediate market penetration into several new markets. These types of acquisitions will also give DKS a better understanding of local markets, which w ill allow for DKS to adjust for regional preferences as discussed earlier. Dick’s Sporting Good’s category-leading inventory turns and high profitability within the industry will likely produce enough cash to fund its store growth initiatives in the near future.This will prevent DKS from having to turn to capital markets or the use of levering up. This will allow the firm to remain one of the industry’s healthiest companies financially. Analysts give Dick’s Sporting Goods a Fair Value Estimate of $41 per share, which is an increase from prior estimates based off of longer term operating margin assumptions. In terms of comparable ratios for valuation, analysts’ fair value estimate implies 22 times forward earnings, 9 times enterprise value to EBITDA, and 3% free cash flow yield.In terms of operating margin, analysts estimate that it will be on average between 8%-9%, which is a conservative estimate compared to company estimates of double-digit margi ns in the next three to five years. The model that the Morningstar analysts are using takes into account the growth plans that Dick’s Sporting Goods has in the future in terms of store openings at an average of 35 per year and that the chain reaches a total store count of more than 800 in the next 10 years at the end of the forecast.For fiscal year 2012, the model gives just under 8% growth in revenues, continued leverage of operating margins are to reach 8% on both gross margin improvement and SGA leverage. In 2013, analysts project low double-digit growth on a faster store-opening rate and slightly improved same-store sales along with flat operating margins as percentage of revenue. DuPont Ratio Analysis Over the most recent five-year period, Dick’s Sporting Goods saw drastic decreases in Return on Equity and moderate decreases in Return on Assets.By breaking down these ratios into the Dupont formula we can see what played a part in these decreases. Return of Assets= Net Income/Total Assets= Profit Margin*Asset Turnover | 2007-01| 2008-01| 2009-01| 2010-01| 2011-01| ROA=NI/TA| 9. 1 %| 9. 4 %| 7. 5%| 7. 0%| 8. 3%| Profit Margin= NI/Sales| 20. 93%| 20. 68%| 15. 75%| 14. 7%| 16. 6%| Asset Turnover= Sales/TA| 2. 3| 2. 2| 2. 1| 2. 1| 2. 0| From dissecting Return on Assets further we see that the main contributor to the decreasing ROA was the decreases in profit margin from the beginning of the most recent five-year period.Profit margins were cut because due to decreases in consumer spending during recessionary periods, Dick’s Sporting Goods was forced to cut its prices while input costs remained high, thus narrowing margins. Asset turnover was reduced during this five year period but not at a significant enough rate to be a major contributing factor to the massive decreases in Return on Assets. We now look at the Return on Equity based on the Return on Assets computations. | 2007-01| 2008-01| 2009-01| 2010-01| 2011-01| ROE= ROA*TA/EQ| 21. 8%| 20. 0%| (4. 5%)| 13. 7%| 14. 9%| Fin. Lev= TA/EQ| 0. 29| 0. 0| 0. 20| 0. 13| 0. 10| With the financial leverage decreasing because of there being less equity in the market as the recession continued after 2007, in order for Return on Equity to increase the ROA needed to offset that decrease in financial leverage. As we saw before, due to the drastic drops in profit margin over the period the Return on Equity suffered also. Therefore, variability in ROE can be attributed to volatility in the Return on Assets of Dick’s Sporting Goods. (Some of the values are not exact because of miscalculations in on the part of the Capital IQ database).Valuation P/E Multiplier The current P/E for Dick’s Sporting Goods is 20. 1. Since the economic outlook calls for expansion I will use the average annual growth of earnings from 2002-2007, which was deemed an economic expansion era. The average annual earnings growth rate over this time period is 24. 084%. This is a realistic estimation because if the economic forecast proves correct the we would experience a similar type of growth as we did post Internet bubble crisis, which is right around the beginning of 2002. Dick’s Sporting Good’s current earnings per share is $1. 92.Therefore, in order to get estimated earnings you take the current earnings per share and multiply it by the average annual growth rate of earnings during economic expansionary times. This gives us estimated earnings of $1. 92*(1. 24084)= $2. 3824. From there we multiply expected earnings per share times the current price to earnings ratio in order to get the intrinsic value based on this valuation model. Therefore we take 20. 1*$2. 3824 to get an intrinsic value of $47. 886. The current stock price of DKS is $38. 53 (as of 11/29/11). This would suggest that the market undervalues DKS by about 19. 54%.Free Cash Flow to Equity Approach In using the free cash flow to equity approach there are many inputs in which you need to identify and defend their use. Here are some of those inputs: * WACC=11. 64%; This was based off of a WACC calculator in which total debt and total equity were extracted from the most recent financial statements, corporate tax was 38. 8% based on public information, cost of debt was 7. 0% based on analyst information, and cost of equity was found using CAPM. For risk free rate the 3 year treasury rate was used of . 4% and for market return the 3 year return on the Russell Midcap Growth Index of 10. 8% was used because that is the style of stock DKS is and 3 years after analyst growth estimates for 2012 and 2013 is when we expect economic expansion. * 2012 growth rate is 8% based on analyst estimates and 2013 growth is 11% based on analyst estimates. * From 2014 until 2016 we expect there to be growth but at a decreasing rate of about 1. 5% per annum until after 2016 when we expect growth to mimic economic expansion from 2002-2007 in which the average annual growth rate was 6. 31%. Calculatio n of Intrinsic Value on Following Page Year| FCF/Share| 2002| . 3902| 2003| . 3168| 2004| . 0283| 005| . 3412| 2006| . 0541| 2007| . 7692| 2008| -. 5089| 2009| 2. 2119| 2010| 1. 8934| 2011| 2. 032| 2012| 2. 19456| 8% growth| 2013| 2. 43596| 11% growth| 2014| 2. 66737| 9. 5% growth| 2015| 2. 88077| 8% growth| 2016| 3. 06802| 6. 5% growth| Perpetuity| 61. 1934| 6. 31% growth| Intrinsic Value| $41. 0685| The current stock price is $38. 53 (as of 11/29/11), and based on the intrinsic value this suggests that the market undervalues DKS by about 6. 18%. Summary of Analyst Reports According to Morningstar Investment Research Center, the fair value estimate for Dick’s Sporting Goods is $41. 0. In addition, analysts recommend to consider buying the stock at $24. 60 and consider selling the stock at $63. 60. Morningstar also gives Dick’s Sporting Goods a three star rating. In looking at YahooFinance the mean target for the stock based on analyst estimates is $46. 50 with a high target of $50. 00 and a low target of $36. 00. Accordingly, this month there are 10 Strong Buy recommendations, 7 Buy recommendations, 9 Hold recommendations, and 1 Underperform recommendation. Beta Coefficient Dick’s Sporting Goods has a Beta coefficient of 1. 4, indicating that it is generally more risky than the general market. This risk factor is most likely determined by the high revenue volatility that the industry is exposed to as a direct result of consumer spending and also due to the industry’s mature state. Technical Analysis In examining Dick’s Sporting Goods using technical analysis I chose to pick a few popular technical analysis indicators and use them to assess DKS. First we look at Bollinger Bands, which are variable width bands that become narrower during less volatile periods and wider during more volatile periods.In examining the Bollinger Bands for DKS we can see that as of right now there seems to be low levels of volatility in pricing espe cially compared to August where there was much volatility in pricing for DKS along with the overall market. The recent lower volatility would suggest stable pricing trends to continue in the near future. Next I looked at the Relative Strength Index. The RSI is a calculation where average up and average down are calculated using a simple average method for the initial observation. Subsequent values are computed using these initial values in conjunction with a damping factor to smooth out extreme points.An RSI indicator falling below a value of 30 indicates an oversold condition. A buy signal is triggered when the indicator crosses 30 from below. Similarly, an RSI value greater than 70 indicates an overbought condition. A sell signal is triggered when the indicator crosses 70 from above. If you look at the bottom half of this picture you can see the Relative Strength Index for the current year. In going with the description on the previous page, it seems that in late August/early Sept ember the RSI crossed 30 from below, which would have signaled a buying situation at the time.In looking at other technical analysis trends, financial visualizations or FINVIZ. com, gives distance from simple moving average statistics. The SMA50, or the distance from the 50 day simple moving average is 3. 25%, which according to the site is a favorable statistic. In addition it states that the SMA200 or the distance from the 200 day simple moving average is 2. 28%, which is once again a favorable statistic according to the site. Conclusions * Dick’s Sporting Goods has the leading market share in a mature Sporting Goods Stores industry that’s marked by high levels of pricing competition. The industry is very dependent on consumer spending and disposable income per capita. Decreases in these along with consumer confidence pose huge threats to the industry as we saw with the extremely marginal average annual growth from 2006 to 2011. * DKS is the leader in the golf indust ry with its acquisition of Golf Galaxy and its us of the store-within-a-store model for specialty golf stores. * The industry is seeing decreases in sports participation among children in lieu of other avenues to fulfill leisure time that could put restraints upon growth within the industry. Dick’s Sporting Goods’ high lease expense represents off-balance-sheet financing and means the company is more leveraged than investors realize. * DKS has benefitted from its ability to compete on price as a mass merchandiser and from offering deep product selection and higher margin items within it’s specialty stores. * Management has store expansion plans that on average would open up about 35 new stores per year and would put Dick’s Sporting Goods over 800 stores within the 10 year forecast, which is just under the estimate for number of stores until saturation. ————————————— —- [ 1 ]. Zumbrun, Joshua. â€Å"Fed Says Economy Has Picked Up While Still Detecting ‘Significant’ Risks. † Bloomberg – Business & Financial News, Breaking News Headlines. Bloomberg, 2 Nov. 2011. Web. [ 2 ]. EVANS, KELLY. â€Å"Housing Market May Be Nearing a Bottom. † Business News & Financial News – The Wall Street Journal – Wsj. com. Wall Street Journal, 21 Nov. 2011. Web. [ 3 ]. Bureau of Economic Analysis. Personal Income and Outlays: October 2011. Accessed 11/27/11. [ 4 ]. Bureau of Economic Analysis. Real Personal Consumption Expenditures.Accessed 11/27/11 [ 5 ]. Bureau of Labor Statistics. Employment Situation Summary. October 2011. [ 6 ]. IBISWorld Market Research Industry Report. Sporting Goods Stores. Accessed 11/21/11 [ 7 ]. BizMiner [ 8 ]. Bureau of Economic Analysis [ 9 ]. BizMiner [ 10 ]. Bureau of Economic Analysis [ 11 ]. â€Å"Capital IQ. † Financial Records: DKS. Accessed 11/30/11 [ 12 ]. â€Å"Capita l IQ. † Financial Statements: DKS, CAB, BGFV. Accessed 11/30/11. [ 13 ]. Morningstar Investment Research Center. Swinand, Paul. Analyst Research: DKS. Accessed 11/21/11. [ 14 ]. â€Å"Capital IQ. † Financial Statements: DKS. Accessed 11/30/11.

Fast Food And Health Problem Essay Example | Topics and Well Written Essays - 1000 words

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Patient narrative Essay Example | Topics and Well Written Essays - 3000 words

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Rethinking Graffiti Essay Example | Topics and Well Written Essays - 1000 words

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Reflective Journal Essay Example | Topics and Well Written Essays - 3000 words - 1

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Pocahontas Essay Example | Topics and Well Written Essays - 250 words - 1

Pocahontas - Essay Example In addition, a link for the Morrisville book is provided at the homepage. Most importantly, the site provides contact information for Powhatan Renape Nation. The site depicts numerous interactive features that make it easier to access all the information contained in it. Firstly, the font used to write the information accommodates all individuals within different visibility levels. The background color make the site appear attractive and intriguing, increasing the chances that people may be concerned with the information contained in it. Furthermore, the font and the background color make the reading enjoyable by different age groups. The site menu is located at the bottom of the page. Its location is strategic to ensure that the reader can access more information to know more about the topics examined. The site successfully discusses the Pocahontas story from the beginning to the end; elaborating the origin of the Pocahontas myth. Information is arranged in a succinct manner to make the reading enjoyable. In addition, the website gives a comprehensive account of the Powhatan history. It is interesting to note that Disney produced a movie to explain the Pocahontas myth in an animated version. In addition, the site provides information about upcoming events in relation to the Rankokus Indian festivals. It would be interesting to attend the festivals and visit the American Indian museums to know more about the Powhatan

Establish and Maintain Quality Customer Relations for a Small Business Assignment

Establish and Maintain Quality Customer Relations for a Small Business Enterprise - Assignment Example Research customer needs and preferences a) Briefly outline what your business does, what your products and services are, your target market and how your business operates on a day to day basis. Our company sells a dual SIM handheld mobile device that can go online simultaneously. This celphone has also the functionality of T.V. and is capable of running video games in JAVA. It is coupled with a service center that could also serve as an after sales support if our customers will have an issue with their phones. The primary market for our celphones are the business people and professionals because they are the heavy users of mobile phones and needs to be connected all the time. We believe that our dual SIM celphones will be attractive to them, as market research showed, because they have the convenience of dual connectivity without the inconvenience of carrying an extra phone. We will sell our dual SIM celphone through our outlets located strategically in technology hubs where potentia l customers frequent to avail a celphone. Daily operations involves selling our dual SIM celphones, entertaining inquiries and complaints and servicing defective celphones. b) Part A: Identify the types of formal and informal research and communication channels you will use to identify customer needs and preferences. Ensure both quantitative and qualitative data are obtained. Explain how the research will be carried out. Type of research How will it be carried out 1. Survey 2. Market Research 1. Select randomly from the representatives of the market through a form of a questionnaire where such market samples will be asked for their inclination towards a dual SIM celphone. Answers will then be tabulated to determine if indeed the market has an inclination towards our products. 2. To determine the extent and size of the market, a market research has to be done to determine the celphone usage which will serve as our market. The rate of celphone usage will determine the size of our mark et. The data of the number of celphone users can be done by collating data from the mobile phone carriers. Part B: Collect and analyse the data Findings: Formal research: The answers from the survey will be tabulated to determine our hypothesis that there is a market for a dual SIM celphone. The survey conducted indicated that the market is willing to try a dual SIM celphone and this willingness to try a dual SIM celphone can be cultivated from a growing to a full market to sell our phone. Informal research Our market research indicated as there is almost 100 % subscription to mobile telephone carriers (Vodafone:Â  2,465,000 (46.71%), Telecom:Â   2,192,000 (41.54%), 2degrees: 580,112 (10.99%). Deducing from this, it means that we have a huge market for our dual SIM celphone as almost everybody are celphone users. If we can capture enough market share to this mobile users, our business venture can prove to be profitable. SOUTHERN INSTITUTE OF TECHNOLOGY National Certificate in Smal l Business Management Assignment 2 Communication channels: The communication channel will be in a form of the traditional pen and paper where data will be collected by asking market representative to answer the survey objectively. In the case of informal research, this can be done by obtaining annual

Technology in Healthcare Essay Example | Topics and Well Written Essays - 1500 words

Technology in Healthcare - Essay Example Certainly, medical technology has been useful over the years with profound breakthroughs being achieved but there needs to be an understanding of the impact of technology in healthcare- both positive and negative effects and how the latter can be mitigated. Technology is being adopted in healthcare to develop new treatments for previously untreatable diseases, major progress in clinical ability to treat acute ailments, increase access to healthcare to the patient population, making improvements in existing capabilities and promote efficient delivery of services. Medical technology has been used as a restricted substitute to a treatment, a substitute for an existing treatment or a supplement to an existing treatment. These changes are important to note as they affect the cost of treatment as they determine whether the technology raises or lowers the initial cost of treatment (Prantel). The field of medicine largely uses a number of types of medical technology or is affected by new technology and this had been evidenced for instance by the reduction in overall mortality rate from the heart attack between 1980 and 2000 as the number fell by approximately half. Another instance is with treatment of pre-term babies where in the 1950s it was almost impossible to provide this treatment but by the 1990s, there had been advances in technology; for example, it became possible to have steroids for the mother and/or baby and artificial pulmonary surfactant started being used to help infant's lungs develop. These advances in technology reduced mortality by a third of what it was in the 1950s (â€Å"Snapshots: How Changes†¦Ã¢â‚¬ ). Primarily technology use in healthcare has been opposed for its high-cost implications. However, from the graph above digitizing healthcare is forecasted to save the healthcare approximately 400 billion and 150 billion dollars inpatient and outpatient costs cumulatively by 2018 respectively.  Ã‚  

Electrochemical Cell Essay Example for Free

Electrochemical Cell Essay Introduction To investigate the effect of change in temperature of the solutions on the voltage of an electrochemical cell. How does increase in temperature of the electrolytes in en electrochemical cell affect the voltage? An electrochemical cell produces electrical energy from chemical energy, where the chemical energy comes from the reactions in the cell. An electrochemical cell consists of two half-cells. Each half-cell consists of an electrode, and an electrolyte (salt solution). A salt bridge is used that connects the two solutions in the containers to allow flow of ions so there is no charge build up in either solution. Charge build-up would shift the equilibrium and the reaction would cease. When the two half cells, consisting of a metal electrode and a conducting solution are connected with an external wire, the strongest oxidizing agent will undergo a reduction in one half cell and the strongest reducing agent will undergo an oxidation in the other half cell. An electrochemical cell makes use of a redox reaction and uses the chemical reaction to produce an electric current. The two metals that will be used in this experiment are Copper and Zinc, and their salts are used in an aqueous form in the container, being CuSO4 and ZnSO4. A salt bridge that is dipped in KNO3 will be used. The following reaction takes place in each half cell: Cu (s) Cu2+ (aq) + 2e- Zn (s) Zn2- (aq) + 2e- Independent Variable: Temperature of the electrolytes (à ¯Ã‚ ¿Ã‚ ½C) Dependant Variable: Voltage (V) Controlled Variables: Nature of electrodes: The electrodes will be of the same elements i.e. Copper and Zinc. Changing the nature of the electrodes will change the voltage since different elements produce different forms of ions which then affects the voltage of the cell. Size of electrodes: The size of electrodes will be kept constant to 6cm x 1cm. Increasing the size of electrodes means that the electrodes will react produce more ions hence increasing the voltage of the cell. Nature of ion transfer: A salt bridge (dipped in KNO3) will be used as a pathway for the ion transfer between the two half cells. Changing the nature of ion transfer will change the amount of ions are transferred between the half cells hence affecting the voltage. The concentration of the electrolytes: is kept constant. A constant amount of metal salt will be added to make each electrolyte. Having a varying concentration will affect the amount of ions produced hence varying the voltage accordingly. Voltmeter: The voltmeter is kept constant since changing the voltmeter can affect the voltage since different voltmeters may have different resistance which may affect the readings. Materials required * Copper strip, 6cm x 1cm * Zinc strip, 6cm x 1cm * CuSO4 solution, 0.99M à ¯Ã‚ ¿Ã‚ ½ 0.01M * ZnSO4 solution, 0.99M à ¯Ã‚ ¿Ã‚ ½ 0.01M * KNO3 solution, 1.99M à ¯Ã‚ ¿Ã‚ ½ 0.01M * Distilled water, 300mL à ¯Ã‚ ¿Ã‚ ½ 1mL * Beakers (3), 250mL à ¯Ã‚ ¿Ã‚ ½ 50mL * Graduated cylinder (100mL à ¯Ã‚ ¿Ã‚ ½ 1mL) * Digital Voltmeter with crocodile wires * Hot plate * Thermometers (2), à ¯Ã‚ ¿Ã‚ ½ 1à ¯Ã‚ ¿Ã‚ ½C * Paper strips, 10cm x 1cm * Magnetic stirrer * Rubber gloves * Apron * Safety Goggles Method Method to prepare solutions 1. Concentration required (CuSO4): 0.99M AMU of CuSO4: 159.61 So, 1.00M of CuSO4 has 159.61g of CuSO4 Hence 0.99M has: 159.61 x 0.99 = 158.01g à ¯Ã‚ ¿Ã‚ ½ 0.01g Mix 158.01g à ¯Ã‚ ¿Ã‚ ½ 0.01g of CuSO4 in 100mL of distilled water. Use a magnetic stirrer if necessary == Use 100mL à ¯Ã‚ ¿Ã‚ ½ 1mL of 0.99M à ¯Ã‚ ¿Ã‚ ½ 0.01M of CuSO4 solution. 2. Concentration required (ZnSO4): 0.99M AMU of ZnSO4: 161.44 So, 1.00M of CuSO4 has 161.44g of ZnSO4 Hence 0.99M has: 161.44 x 0.99 = 159.83g à ¯Ã‚ ¿Ã‚ ½ 0.01g Mix 159.83g à ¯Ã‚ ¿Ã‚ ½ 0.01g of ZnSO4 in 100mL of distilled water. Use a magnetic stirrer if necessary == Use 100mL à ¯Ã‚ ¿Ã‚ ½ 1mL of 0.99M à ¯Ã‚ ¿Ã‚ ½ 0.01M of ZnSO4 solution. 3. Concentration required (KNO3): 1.99M AMU of CuSO4: 101.11 So, 1.0M of CuSO4 has 101.11g of KNO3 Hence 1.99M has: 101.11 x 1.99 = 201.21g à ¯Ã‚ ¿Ã‚ ½ 0.01g Mix 201.21g à ¯Ã‚ ¿Ã‚ ½ 0.01g of KNO3 in 100mL of distilled water. Use a magnetic stirrer if necessary == Use 30mL à ¯Ã‚ ¿Ã‚ ½ 1mL of 1.99M à ¯Ã‚ ¿Ã‚ ½ 0.01M of KNO3 solution. 4. Now put the paper strip (salt bridge) in the KNO3 solution and leave it for 30 seconds. Method for investigation 1. Before starting the experiments, all the materials should be acquired with all safety precautions 2. Put the two beakers that have electrolytes on the hot plate. 3. Now put the salt bridge between the beakers. Also, put the two thermometers in each container 4. Connect the crocodile wires from the voltmeter to each electrode, but dont put it in the half cells yet. 5. Now turn on the hot plate and let the temperature increase from room temperature to 30à ¯Ã‚ ¿Ã‚ ½C 6. As soon as the temperature increases to 30à ¯Ã‚ ¿Ã‚ ½C, quickly insert the electrodes in the respective solutions (Cu in CuSO4 and Zn in ZnSO4) and record the voltage 7. Remove the electrodes and clean and dry them. 8. Now increase the temperature by a difference of 10à ¯Ã‚ ¿Ã‚ ½C i.e. 40à ¯Ã‚ ¿Ã‚ ½C, 50à ¯Ã‚ ¿Ã‚ ½C, 60à ¯Ã‚ ¿Ã‚ ½C, 70à ¯Ã‚ ¿Ã‚ ½C, 80à ¯Ã‚ ¿Ã‚ ½C and 90à ¯Ã‚ ¿Ã‚ ½C and repeat steps 5-7. 9. After the experiment has been completed, put the cleaned materials back to their original place. Raw Data Table Volume of each electrolyte (mL à ¯Ã‚ ¿Ã‚ ½ 1mL) Length of salt bridge (cm à ¯Ã‚ ¿Ã‚ ½ 0.01 cm) Length of each electrode (cm à ¯Ã‚ ¿Ã‚ ½ 0.01 cm)

Online learning versus traditional classroom learning

Online learning versus traditional classroom learning Distance learning is a set of technologies that provide students with the basic delivery of study material, interactive communication between students and teachers in learning process, providing students with the possibility of independent work on development of study material, as well as in the learning process. Now the term distance learning has become synonymous with e-learning or online learning, meaning, in fact, not only learning via the Internet. Prerequisite for the emergence and subsequent development of distance learning was the expansion of the Internet technologies usage in all spheres of life and activities, including in education. Study of Internet technologies and software for the Internet is an indispensable part of any high school (and sometimes school) program. Over time, the Internet has become not only an object of study, but also turned into an environment where you can enjoy full training applicants. According to The Differences Between Online and Traditional Classroom Educations (2010), modern computer telecommunications are able to provide knowledge transfer and access to a variety of educational information on a par, and sometimes much more effective than traditional teaching tools. Experiments have confirmed that the quality and structure of training courses, as well as the quality of teaching in distance education is often much better than traditional forms of education. New electronic technologies such as interactive CDs CD-ROM, electronic bulletin boards, multimedia hypertext, accessible via the Internet, can not only ensure the active involvement of students in the learning process, but also allow you to manage this process in contrast from most traditional learning environments. The integration of sound, movement, image and text creates a new unusually rich in its capabilities learning environment with the development of which will increase and the degree of students inv olvement in the learning process. Interactive features used in the LMS programs and delivery systems allow the information to adjust and even stimulate feedback, dialogue, and provide ongoing support, which is impossible in most traditional systems of education. According to E-learning vs Traditional Classroom Instruction (2010), distance learning allows solve several problems inherent in traditional teaching methods. Its main advantage is in solving the problem of access to education, which means general availability of educational resources regardless of geographic location. In addition to the advantages of geographical freedom in choosing the place of study, will solve the problem of availability, remote technology has many other virtues. Pedagogical features of this technology include mainly independent work student at a convenient time for him. Thus, self-management training schedule makes it attractive for busy people who wish to obtain a second degree, or improve their skills. It should be mentioned that the same advantage is also a trap for those who believe that by studying distantly, you can work on educational material occasionally, from time to time. Typically, learning is constructed in such a way: the student periodically receives from the teachers assignment for the review of the theoretical material, passing the final test, based on the theory and also, perhaps, practical tasks. If the assignments and tests will not be delivered on time, the next stage lessons will not be sent to student. Besides that there are a number of distance learning advantages among them: Flexible schedule for student, it can even change the student himself, combining education with work and other activities, saving time on the road to the school or university. Typically, students are given the opportunity to communicate with an individual teacher or the author of the curriculum. Illustrations, diagrams, charts, presentations, online tests to increase the visibility of information, making learning fun. Often the cost of Internet education is much lower compared to full-time. There is also a unique proposition. Thus, the Internet University of Computer Science gives everyone a free education (choice of courses is also quite broad more than 180). Many institutions that provide services to distance education, after school has issued the relevant document. According to Somer Flaherty (2010), distance education (as, perhaps, any other) have its disadvantages: The choice of specialties as long as enough is extensive most of them are related to computer technology or commerce. If you are more receptive to hearing information, distance learning, you may find it boring and difficult. If you cannot change live communication with the teacher and other students to correspond via email, online education is hardly suiting you. Due to the fact that distance education is gaining momentum, it is not always compete with the traditional. In the distance learning student only uses Internet technology in all types of training activities. A user to login, get access to learning materials (sometimes after the payment of course). Modern technologies allow place not only textual information but also pictures, video and audio. All of this is provided with convenient navigation system on sections of the course. There is typically in distance learning when student receives not only the layout of educational materials, and testing, but also communication with the teacher and other students. According to Somer Flaherty (2010), distance learning can be group or individual. There is not entirely correct view that distance learning students are not available techniques and teaching methods of group learning that, say, the students, being away from each other, cannot fully communicate and engage in collaborative work. In fact, modern system to the proposed number of communication: the same forums and chat rooms have become an integral part of the methodology. Another important point in the organization learning process is a way student and teacher communicating each other. Such interaction is organized synchronously or asynchronously. The first method provides for communication of students and teachers in real time. Basically, this uses the internal chat systems of distance learning. Sometimes, the system also contains tools for video conferencing. Asynchronous learning is carried out when the student and the teacher cannot communicate in real time, and then up to the organized, mainly through e-mail correspondence. It should be noted that teachers consultations (both synchronous and asynchronous) is a prerequisite of successful distance learning course, and without it learning will not be complete. In my opinion distance learning system give equal opportunities to pupils, students, civil and military professionals, the unemployed in all regions of the country and abroad to realize their human right to education and information. This system can be most adequately and flexibly respond to the needs of society and ensure the implementation of the constitutional right to education of every citizen. I am very sympathetic to the fact that in the heart of distance learning is the student. Considering my experience I can say that most information is remembered by a student with self-learning, independently. I strongly believe that distant learning is the future of education system.

Causes of Social, Emotional and Behavioural Difficulties

Causes of Social, Emotional and Behavioural Difficulties Understanding the cause of an individuals social, emotional and behavioural difficulties is essential before you can make a successful intervention. Critically assess this assertion in the light of an activity you have undertaken as part of this module. Introduction Delinquents, moral imbeciles and maladjusted children are just some of the labels historically attributed to individuals presenting the difficulties later termed as emotional and behavioural difficulties (Ministry of Education 1995). In this essay the importance of understanding the causes of an individuals social, emotional and behavioural difficulties (SEBD) is explored in relation to whether this understanding is critical for the implementation of successful interventions. This essay primarily considers individuals within the UK educational system which covers children/young people between the ages of 4 and 16. In the study and education of individuals with SEBD there seems to be a lack of uniformity in how the label is interpreted and applied; the descriptors and definitions of SEBD will therefore be considered along with current trends in the number of school age individuals diagnosed as SEBD in order to give context to this area of discussion. Another key area of disparity is the theoretical perspective adopted when assessing and treating an individual with SEBD. The theoretical perspectives each present a different approach to aetiology and interventions, these will be considered in relation to importance of cause in the basis of each and how they lead to interventions. The key argument will then focus on the importance of understanding cause and examine evidence from published literature, research and policies to support this followed by discussion of why understanding cause may not be essential in order to implement successful interventions. The overall aim is to ascertain whether interventions are mainly based on consideration of the aetiology of behaviour and whether there is evidence to indicate their success. Indeed Harden (2003) concluded that there was insufficient evidence for strategy effectiveness in behavioural difficulties. The subject of cause and interventions was discussed with fellow professionals in a web based discussion (Vygotsky, Skinner and Montessori discussion group October 2010 November 2010) and reference will be made to the two fictional case studies which formed the basis of these virtual discussions. In the first a boy, Ronnie, no information was given on his background so the focus was on the observed disruptive behaviour in school and the teacher believing he has SEBD. In the second an 11 year old girl, Vicki, far more detail was given including her recent transfer to secondary school; above average reading skills, parents separated and with new partners, the possibility of epilepsy, refusal to do homework and getting into trouble at school. These discussions elicited a range of views on aetiology, the need for information possibly relating to cause and the nature of assessment and interventions. In general the contributing professionals showed a desire to have more information about each child and to interpret the impact of background factors on the difficulties being observed although there was little acknowledgement of why this information was needed (Farrugia, 2010). What is understood by social, emotional and behaviour difficulties (SEBD)? One of the overriding issues in the field of SEBD is the ambiguity in understanding and identification of individuals who may have social, emotional and behavioural difficulties with those who have less severe discipline problems (Evan, Harden, Thomas 2004). This introduces the first difficulty as the decision to classify an individual as having SEBD is with the person who identifies some aspect of behaviour as problematic and is reliant on that persons constructs. Government publications have provided several descriptions of which two are considered in this essay. In Circular 9/94 (DfE 1994) Emotional and Behavioural Difficulty (EBD) is described as being between: behaviour which challenges the teacher but is within normal, albeit unacceptable, bounds and that which is indicative of serious mental illness. The distinction between normal but stressed behaviour, emotional and behavioural difficulties arising from mental illness is important because each needs to be treated differently. (p.4) The definition focuses on the behavioural aspect rather than emotional and indicates it is a problem for the teachers thereby restricting the difficulties to educational settings. Interpretation of what may be considered unacceptable is therefore likely to result in inconsistent identification of the types of children teachers identify as having EBD (Soles, Bloom, Heath, Karagiannakis 2008). In The Special Educational Needs (SEN) Code of Practice (2001), the definition was amended to incorporate social difficulties and so expanded to social, emotional and behavioural difficulties (SEBD), the code defines those with social, emotional and behavioural difficulties (SEBD) as: Children and young people who demonstrate features of emotional and behavioural difficulties, who are withdrawn or isolated, disruptive and disturbing, hyperactive and lack concentration; those with immature social skills; and those presenting challenging behaviours arising from other complex special needs ( Paragraph 7:60) This description describes a range of characteristics associated with this disorder and recognises that such behaviours can evolve from other special educational needs. This presents a broader spectrum of behaviours linked with emotional and social difficulties and remains open to the personal interpretation of those interacting with such children. The lack of clarity of the descriptors could be linked to the increasing number of children diagnosed as having SEBD being recorded in English schools. In 2008 149,040 children had a need of EBD on school action plus or statemented at primary, secondary and special state funded schools, this was an increase of 6.98% year on year (DCSF 2008), EBD represented the second highest need after moderate learning difficulties. This could be due to an actual increase in the number of children experiencing difficulties or to the wider interpretation of the definition leading to more children being recorded with this difficulty who might otherwise hav e remained at a school action stage. Whichever the reason, it is apparent that increasing number of children within the UK education system are being identified as having a need of SEBD and this in turn has led to increasing focus on interventions in particular for behavioural difficulties as seen in the recent white paper (DfE 2010). The descriptions given in Circular 9/94 (DfE 1994) and the SEN Code of Practice (2001) make no direct reference to aetiology or the necessity to acknowledge this although The SEN Code of Practise (2001) recognises that SEBD may have co-morbidity with other biological or medical conditions (7.52, 7.53, 7.58) and links with mental health (10.27) yet guidance for specific assessment and interventions is not detailed. This could be seen as indicative of the lack of unity on the understanding of causes and interventions for those with SEBD. Which theoretical perspective of cause of SEBD? In 1829 a 20 year poet wrote these lines: From childhoods hour I have not been As others were-I have not seen As others saw-I could not bring My passions from a common spring- From the same source I have not taken My sorrow-I could not awaken My heart to joy at the same tone- And all I lovd-I lovd alone (from Alone by Edgar Allen Poe 1829) The poet was Edgar Allen Poe. Poe was taken into foster care at the age of 3 following the death of his parents and at the age of 6 his foster family moved to London. Poe was said to be talented academically yet a difficult character (Poe Museum n.d.); the poem Alone suggests a troubled child who considers himself to be different. In todays educational climate he may well have been identified as a child with SEBD. Would an understanding of his early life have been important in development of successful interventions? From a behavioural perspective it could be suggested that only his observable difficult behaviour was of importance and thus treatable. The causes could not be speculated upon as they could not be scientifically measured. Bowlby, from a psychodynamic approach might have disagreed; Poes early childhood experiences, most notably the death of his parents and being taken into foster care, may have suppressed his inner desires and drives leading to internal conflicts. Bowlby might have been interested in the repression of Poes feelings following the death of his parents (Bowlby 1988). An ecosystemic perspective may have considered the effects of the changes of the family systems and the move to a different society in England as impacting on his interactions with the systems around him. In a same vein, the web based discussions of Ronnie and Vicki (Vygotsky, Skinner and Montessori discussion group October 2010 November 2010) led to similar questions. In the case of Vicki, fellow professionals mostly concurred on the adoption of an ecosystemic perspective for assessment based on the information given concerning the breakdown of the systems in her life; some believed that a psychodynamic approach to establish her unconscious processes and a biological perspective to examine the possible epilepsy should also be considered. However, the intervention strategies proposed were based on a humanistic approach rather than linked to the diagnostic perspectives. As noted earlier for the Ronnie discussion there appears little acknowledgement of why the information was needed and how information may link to interventions. In the case of Ronnie, discussions indicated that more information on areas such as his family background, his learning difficulties, incidences of observed be haviour at school and the relationships within his family would be valuable in order to make a more informed recommendation for intervention strategies. This desire for more information showed an amalgamation of perspectives including social learning, psychodynamic and behavioural. Most interesting is that fellow professionals adopted a behavioural approach to interventions in the absence of further information about Ronnie. It could be that this was within the realms of their experience of available strategies in education. The question of which theoretical understanding of cause is the correct one cannot be fully answered. Professionals in the field of educational research tend to support a particular perspective; there are differences of opinion between psychological, medical and sociological perspectives, this is further compounded by newer perspectives such as eco-systemic and humanist which have evolved from earlier theories. As Visser (2000) notes most do acknowledge that it is a mixture of perspectives which can provide insights into understanding and explaining that behaviour. (p.33). The trend for which cause can be seen in the changing descriptors given for SEBD as noted previously (DfE 1994 SEN Code of Practice 2001) and also in approaches to behavioural difficulties adopted by schools. The trend towards a behavioural psychology approach of operant conditioning and behaviour modification as a strategy for treating children with SEBD has been seen since 1975 (Cooper 1999). Children are seen a s making a choice not to behave and through use of behavioural approaches such as consequence and reward they can be taught to want to behave so a new behaviour is learnt (Greene 2008). From this perspective, aetiology is not a considered factor and emphasis is on implementing a system of rewards and consequences which aim to reduce unacceptable behaviour and encourage a re-learning of acceptable behaviour. The blanket approach of many behavioural policies, in part dictated to schools through government directives, suggest that policy makers and educationalists do not consider there is a need to understand causes of SEBD. Behaviour is assumed to be within the control of the child and the school is assumed to be able to influence and change the behaviour. Recent years have seen a change in approach with prominence given to systemic approaches taking into account the interaction of systems and environments surrounding the child as key factors impacting on their social, emotional and behavioural difficulties (Evans, Harden and Thomas 2004). From this perspective there is a need to understand cause in terms of the environments of the individual. This was evident in the web based discussion on Vicki (Vygotsky, Skinner and Montessori November 2010) where contributors were mostly united in adoption of an ecosystemic approach and attributed the cause of the difficulties to disruption in Vickis home and school life. Understanding the cause of the SEBD is essential before making a successful intervention. In the previous section a number of theoretical approaches to identifying cause were examined and it is concluded that there are difficulties in finding consensus on one approach and one understanding of cause. Despite the difference of opinions of the likely origins of the SEBD, there is widespread support of the need for understanding the cause. Visser (2005) is opposed to a prescriptive approach to dealing with behavioural difficulties and thus supports the case for recognising that each child with SEBD may have a different cause of SEBD although he previously acknowledged that there are still gaps in understanding of both causes and of approaches used in children with EBD (Visser 2002). Others in this field also advocate the benefits to teachers having understanding of pupils with SEBD; Cole, Visser and Daniels (1999) in a paper examining effective EBD practices in mainstream schools promote the need for school staff to understand the complex causation and the varied aetiology of EBD in order to be able to match apposite interventions. Another way of considering cause is to examine underlying difficulties which may be causing SEBD, not from a theoretical perspective but from a possible medical or other difficulty so the behaviour is not directly linked to a psychological or systemic root but rather from some other difficulty which leads to the behaviour emerging as a symptom. Cross (2004) believes that a relationship exists between communication difficulties and emotional and behavioural difficulties. Communication difficulties may arise from biological causes such as Pervasive Development Disorder, Attention Deficit Hyperactivity Disorder or from environmental factors such as child abuse and neglect, or from learning difficulties. Cross maintains that whatever the origin, it is the communication difficulty which must be addressed as a priority as weak communication skills can have a negative impact on a childs ability to interact and socialise, this can aggravate emotional and behavioural difficulties. In this sen se the observed behavioural difficulties could be masking underlying communication difficulties which, if not treated, will not improve the behaviour. In the web discussion on Ronnie (Vygotsky, Skinner and Montessori discussion group October 2010) fellow professionals concurred that a link was likely between his possible learning difficulties and his behavioural difficulties and that this should form a key part of any interventions. In his book, Lost At School, Greene (2008) maintains that teachers cannot know what to do with challenging behaviour unless the reasons for it are understood, referring to these reasons as lagging skills; those skills which are lacking irrespective of diagnosis. Staff need to identify and understand the skill lacking as this is pivotal to implementing a successful intervention. Greene (2008) lists many lagging skills, including difficulties with maintaining focus, considering likely outcomes, managing emotional responses, which professionals may attribute to a range of disorders such as learning difficulties, autistic spectrum disorder, cognitive difficulties, or anxiety. It is identification of the specific lagging skills which are of more importance than the actual diagnosis as the diagnostic label does not in itself indicate which skills are lacking. Emphasis should therefore be on identifying the specific aspects which are lacking; the lack of a skill alongside an environment whi ch demands these skills is the trigger to there being a problem (Greene 2008). This is in line with an ecological perspective as the behaviour is an outcome of the lagging skill conflicting with the environment. Support for the importance of understanding aetiology is also found in educational guidance; the School Discipline and Pupil Behaviour Policies (DCSF 2010) advises that it is essential to ensure correct assessment of possible reasons for children not behaving appropriately and acknowledges that behavioural difficulties may be caused by learning difficulties, environmental factors or other cognitive, social or emotional difficulties (paras 3.9.29 -3.9.33); yet a subsequent subheading is Pupils who can behave but choose not to (p.58). This takes the school back to the descriptors of SEBD and places interpretation back in a subjective framework where the school has to distinguish between the former and the latter. In much the same way as seen in the SEN Code of Practice (2001) there is a lack of clarity in how cause should be identified and how this knowledge should guide interventions. A recent report entitled Not Present and Not Correct (Evans, 2010) examined the efficacy of fixed term exclusions in curing behavioural problems. The report concluded this was not an effective strategy based on the number of fixed term exclusions having increased by 5.4% since 2003-4. Persistent disruptive behaviour was the reason for the majority of fixed term exclusions (23.3%) and permanent exclusions (29.6%) in 2008-9. These numbers have not shown significant change year on year indicating that current interventions are not effective. The report recommends that a trigger is needed to prompt a needs assessment where fixed-term exclusions are used continually. Yet, in the SEN Code of Practice (2001) this trigger should be happening for pupils who do not respond to standard behaviour management strategies or individualised behaviour management programme moving them to a School Action Plus stage. This could suggest that either appropriate referrals are not taking place or, if they ar e, the resulting interventions are not successful. If the latter is the case then it may indicate that either causes are not being considered or, if considered, are not leading to successful interventions. The American based Assertive Discipline approach to managing behaviour in schools is rooted in a behavioural perspective. A study by Jones and Smith (2004) concluded that the this approach was effective in improving minor mis-behaviour and led to overall benefits for teaching and learning in the school at the centre of the study; yet, a small but significant group did not benefit from the approach. This group may therefore have required further personalised assessment of the cause of their SEBD with individual strategies being put in place. This lends support to the necessity of understanding cause in those specific situations where the standard strategies employed in mainstream schools are not resolving social, emotional or behavioural difficulties. It also suggests that the importance of cause is not essential at initial stages of identification of behavioural difficulties, but may need to be understood if current intervention strategies are not achieving the desired outcome. A key factor in identifying the cause of the SEBD lies in the choice of the perspective adopted. As seen in the web based discussions for Vicki (Vygotsky, Skinner and Montessori November 2010) causes could be attributed to several aspects of the individuals life. Depending on the approach taken, the diagnosis and intervention will vary which means that successful intervention cannot be guaranteed. Overall, whilst there is much debate and research on causality and at the same time growing emphasis on the rise in behavioural difficulties in the classroom, classroom based research for children with SEBD tends not to link theory to identification, policy and effective interventions (Maras and Kutnick 1999). Understanding the cause of the SEBD is not essential before making a successful intervention. All perspectives consider cause to some extent although a behavioural approach is founded mainly on observed behaviour. There is little research advocating that identifying cause is not essential or important in terms of implementing interventions. The argument against the value of understanding cause is mainly one of whether knowing the cause can actually lead to a specific and effective intervention. Whilst Visser (2002) advocates the importance of understanding cause, it has proved difficult to find evidence which gives clear guidance for a link between cause and effective intervention strategies. In discussing the Individual, Medical or Deficit Model (IMD), Macleod and Munn (2004) suggest that the implication of causation should be rejected which is the reverse of the consideration of disabilities with a bio-medical root. This view is based on the belief that the biggest difficulty in identifying cause is the lack of agreement in what SEBD actually is, as seen in the earlier disc ussion on the interpretations of definitions. It could be argued that focus should be on strategies and not on cause as interpretations of the cause are too subjective. The web based discussions on Ronnie and Vicki, despite consisting of differing views for diagnosis and cause, saw a commonality in the recommendations for a multi agency approach. This is also seen in Diagram 8 model (Cole, Visser and Daniels1999) in which consultation with the Local Education Authority (LEA) and relevant agencies, such as Child and Adolescent Mental Health Services (CAMHS), is seen as an important factor in schools which are successful in the inclusion of children with SEBD. Whilst Visser (2005) has been cited earlier as an advocate of the need to understand aetiology, in a talk based on a term he encountered in his professional work, eternal verities, he looked at factors which may be universal in implementation of successful interventions for SEBD (Visser, 2002). Understanding cause of the SEBD was not a factor given which lends support to the view that, whilst understanding cause may be desirable and informative, there are more important factors necessary for suc cessful intervention. Only a third of secondary schools were deemed as effective in meeting the needs of pupils with SEBD (Ofsted 2004), which suggests that focus should be on identifying effective strategies. Research carried out by Evans, Harden, Thomas (2004) concluded that there was a limited evidence base of recommended strategies which were effective for children with EBD and they recommended a focus for more strategic commissioning of future primary research (p.8). In the case of Ronnie (Vygotsky, Skinner and Montessori discussion group October 2010), there was a quest to know more from those assessing the situation. Was it not enough that his behaviour was disruptive and so class room based behavioural strategies should be put in place to make Ronnie learn appropriate behaviour? The answer in this case seems to lie in the understanding of cause. If Ronnie had a learning difficulty, there was support for this being addressed first/or in conjunction with the behaviour interventions. If it then emerged that Ronnie was having problems at home, such as parental conflict or neglect, this may have required another form of intervention. In the case of Vicki (Vygotsky, Skinner and Montessori discussion group November 2010) there was more information on her background situation; this meant some probable causes could be explored which could then lead to a range of possible interventions. Having more information still led to a discussion on which perspect ive may be more applicable and in fact the interventions proposed were mostly similar to those for Ronnie. Although the participants suggestions for interventions for Ronnie tended to be school based whereas those discussed for Vicki were both within school and outside with a wider multi agency approach. Professionals such as teachers, educational psychologists, CAHMS practitioners and behaviour support specialists will all bring their own approaches to the SEBD table. It could be that attempts to understand the cause through a multi-agency strategy may lead to disjointed and confusing interventions at worst and a prolonged period of assessments and treatments at best, neither of which presents an ideal situation for a child (Rayner 1999). The range of interpretations, social constructs and perspectives makes a case for a scientific approach to developing interventions for children with SEBD. The aetiology is acknowledged but it is the present symptomatic patterns which are the key to successful interventions. Conclusion Is it essential to understand the cause of an individuals social, emotional and behavioural difficulties making a successful intervention? In seeking an answer to this question, much of the published research advocates the need to establish the cause of SEBD before implementing intervention thereby assuming the intervention will be more successful. The difficulty in this belief is twofold; firstly the definition of what constitutes social, emotional and behaviour difficulties and in particular at what point the severity requires specific interventions and secondly, which perspectives should be adopted to correctly identify the cause(s) and thus which interventions are most suitable. With the definition of SEBD including a wide range of characteristics, it seems most likely that there is also a wide range of causes and thus a wide range of interventions. Most evidence supports the desire to investigate and define the cause; this is also reflected in government and SEN policy and guidelines. Yet evidence to support the importance of this in securing successful intervention is sparse. Overall, whilst the need to understand the cause seems to be supported in research and advocated in government guidelines, the interventions put in place within educational settings are predominantly based on a behavioural approach where it is the observable behaviour which is addressed, measured and evaluated; this is where an anomaly exists. Over time, more responsibility and accountability has been awarded to schools and local authorities for children with SEN including SEBD. This in itself appears to have reduced the focus on understanding cause as schools have to manage this responsibility alongside government directives for improving behaviour in schools. With increasing emphasis on schools primary accountability being for student achievement in academic terms and the move to reduce the number of statements, there is likely to be less emphasis on aetiology in favour of interventions based on controlling children with SEBD certainly in mainstream education. The current governments support of academies may also magnify this as the removal of local authority involvement means that schools can decide whether there is economic value in seeking input from agencies that may have more concern with aetiology. It may be that there are other factors necessary in implementing successful strategies aside from understanding cause such as the necessity for a positive ethos within the school itself (Cole, Visser, Daniels 1999). It is concluded that understanding the cause of an individuals SEBD is part of the equation for successful intervention but unless the adults responsible acknowledge the cause and seek to promote appropriate and differentiated solutions which can be proven to be successful, then understanding on its own is not sufficient.