The Impact of War on Business Sustainability, the Versatility of Business Strategies - Myth or Reality - Assignment Example

1. What specific events and aspects of the banking crisis demonstrate that a successful strategy for few can be an unsuccessful strategy for the many? Give specific examples of such a strategy from the banking sector. Use the news stories of the last three months to illustrate your answer. Use quality sources. Business strategy is applicable to all sectors of trade dealing with either goods or services. Banking is seen as service which supports any business. Thus, the significance of banking strategy becomes evident. The advent of 21st century exhibited a crisis in banking sector of UK which was dealt by different persons in a variety of approaches. This was approved by the country as it was sure that banking sector can never succeed with same strategic developments; only a mix of many factors in varied ratios will do well. The universal financial system is still facing crisis in many aspects of economy. But, it is true that banks are still in scene as an integral part of society. Use of banking sector is essential to any person of any economic background or any society across the world. Banks make available a secure place for the investments of persons and companies, they help industrious individual attempting eco­nomic expansion by professionally and successfully assigning finances, and they provide developmental requirements of short term and long term. The universal predicament on banking sector is successful in overcoming critical position just due to the essentiality of banking for the people all around. The shift in banking scenario has been interpreted through change in service requirements of customers nowadays. Both personal as well as associational necessities are pointed to safer and easier investments facilitating simplified contract procedures. Though the requirements of customers with a slight shift remain intact, one has changed considerably in banking sector that is “the environment in which banks operate and compete.” (Wallace & Herrick 2009). This implies that situation of banking sector has changed in the contemporary run of societal life. Government of UK has discussed and forwarded the problems faced due to crisis in banking sector of nation. The predicament faced by banking sector explains the failure of appropriate remunerations exercised by banking sectors of UK, particularly in the savings depository explains paragraph 25 of report named Eighth Special Report of Session 2008–09 submitted by House of Commons Treasury Committee in UK. The defects and inadequacies in remuneration steps widely accepted in UK resulted in crisis according to report stated above. The government identified a major strategy to be adopted by banking sector in UK which identifies the necessity of “remuneration policies which take proper account of risk.” (Banking crisis: Reforming corporate governance and pay in the city: Government, UK financial investments Ltd and financial services authority responses to the ninth report from the committee, 2009, p.1). The discrepancy in recompenses amid singular clusters of workers in the banking trade has to be analysed and further corrective rules are to be administered, says the government of UK, based on the report. The Government takes it obvious about preserving a least lengthy approach in bonus culture in UK as a measure to meet the economy firmly. The universal exertions and flaws are often kept unexplored while executing economic studies which have led to comprehensive condensation in banking sectors, of course including UK. The crisis in banking sector is being identified firmly through the words in Guardian referring to “marking the first anniversary of the banking crisis this September” (Chakrabortty 2009) interpreting accepted situation existing for the past months of banking in UK. The comments on matter with substantial support lead to proper analysis of the situation by economy in UK. This is evident from various examples in banking strategies utilized by different bankers in UK. The different strategies accepted by different bankers become unique approaches towards the revolution against the crisis faced. Guardian recognizes the significance of minute banking strategies developed to make a huge change attained through small steps of individuals across the nation. Even though personal banking appears to be with least consequences in UK banking sector, it can do much when accumulated by the whole nation. The latest news on banking strategy can be analysed as example for our studies on inadequacy of approach of a particular bank to another. Independent reports on the matter with proper insight to banking strategy were adopted by Virgin Money in UK. “Sir Richard Bransons Virgin Money” agreed through “a deal to buy regional bank Church House Trust.” (Lynch 2010). Sir Richard identified a better expansion of business in annexing Church House Trust. Their plan is to pay £12.3 million to Church House and invest £37.3 million as assets for their trade. “Virgin Money aims to bring simplicity to the UK banking market which has traditionally been a complex sector” (Lynch 2010) says Sir Richard. He sees a complicated stratum in UK banking sector which can be lineated easily through the current decision of Virgin Money. That is, a success in the strategy met through the decision of buying Church House Trust. The significance of this particular example is seen if traced back to two years. Northern Rock, which is nationalized recently, was in the agenda of Virgin Money. It turned out to be a flaw; Virgin Money achieved about 2.5 million customers without that. The dropping of strategy of buying Northern Rock dropped at its initial stage has helped Virgin Money to expand to a larger extent; also keeping them tact to buy Church House Trust. Church House Trust has branches at Yeovil, Leeds and London. It is a fact that it was “swallowed up by a series of mergers” (Lynch 2010) but retained and now annexed to Virgin Money. The release of Church House Trust to Virgin Money through sale was due to loss of bank even to meet investments from a profit in 2008 that reached £450,000. That implies strategies of Battens solicitors realized to be timed out while Virgin Money succeeded in what they failed to. The banking strategy applicable and successful for one can never be of positive approach for another. The above example illustrates and illuminates the matter. The relevance of the example of Virgin Money’s annexure of Church House Trust in banking strategy and uniqueness of it in different firms is identified in our discussion. Each bank has its own external and internal limits of business and marketing. Never can they be compared and equated in any of developmental strategies, though some of the common measures across a country may prevail to rule each firm. 2. How does the occupation of Iraq and Afghanistan by Britain and the US demonstrate the strategic reliance of business on the state? Draw in your answer from news stories and analysis on the occupations of Iraq and Afghanistan. Use quality sources. The Afghanistan War has been the centre of concentration from 7th October 2001 which is still carried out as a daily routine. The Iraq attack followed it after 2 years on 1st May, 2003. The occupation of Afghan by US and UK was with an exhibited motto of aggression against terrorism while Iraq invasion was done for making Iraq devoid of WDM (Weapons of Mass Destruction). But, the feel against both invasions is viewed among the natives invaded as well as invading nations supported by people around the globe. Alex Callinicos for the social worker groups speaks on Afghan matter, identifying unfavoured feel for Afghan occupation by Western troops through his words “a large chunk of the already ramshackle case for the Western military occupation of Afghanistan has now collapsed.” (Callinicos 2009) Though at the beginning of war, many thought that reason was genuine, currently it is recognized that there is a false usage of situation by West. Similar is the case of Iraq war, as WDM turned out to be a mock presented by US which was unveiled to exhibit that “there is substantial evidence that Americas interest in Iraq is motivated by oil, not just national security.” (Evidence of a serious conflict of interests in the U.S. government over Iraq, 2002). These disclosures have created a negative expression from people around the globe. The occupation of US and UK is affecting business of invaders to a considerable extent. “The British companies will expect a major share, particularly if Britain joins America in the war without wider UN support.” (Is this war all about oil? 2010). The oil fields of Iraq under western control give US and UK a tremendous opportunity to dig out oil wealth for which they had been depending on Saudi Arabia. They are utilizing the situation in such a way that the whole 11% resource of world oil is being under their control. The oil business strategy which they accomplished through their invasion of Iraq will bring about much increase to their profit though they get world anger as a side product. The expense on trade of oil with Saudi is saved along with additional source from Iraqi oil fields. The US and UK are investing in those fields to tap whole wealth to their economy. Not only in oil business, there is wider extent of investments in Iraq companies and economy by US and UK which bring about financial as well as resource tapping from Iraq. The profit in oil business is evident but the loss in wars cannot be ignored in any approach of discussion. The expense on war accompanied by fall in their market value results in huge fall in US and UK economy. Recession being a recent strategy is probably a virtual donation of wars to Western business and economy. “Market analysts say rising energy prices combined with a falling dollar have already strained the budgets of U.S. companies and consumers, pushing the United States toward a possible recession.” (Teslik 2008). The value of dollar is reduced with considerable increase in expense on other business has led to current economic and trade position of US and UK. The hike in cost of gold and other such commodities is the consequence of war in world economy. The confrontations in Afghanistan and Iraq struck the U.S. financial system in a mixed line of attack more than the consequence of straight expenditure. World Analysts of economy also argue the unambiguous trade and industrial bang of the existing wars in Iraq and Afghanistan. The cost of war was estimated by CBO and the congressional Democrats on the Joint Economic Committee to trillions of dollars. The trillions can never be ignored for a developed country as well which has created a loss for both US and UK. The matter on war carried out is of unlimited period, and the expense as well remains unlimited. The expense cannot be met at any cost as war never creates but only destructs. Thus, direct consequences are evident in US and UK business sector in this contemporary situation. Specialists conflict on the major basic point on destruction of nationwide trade and industrial forecasts. Most of the analysts of national economy anticipate the UK financial system to smack the length of on insignificant expansion percent for the subsequent five years. The 6.5% reduction in production capacity of UK was observed during the year 2009. Also, they expect a zero growth probability in current year 2010. The expectations for upcoming years are just 1% which illuminate the single possibility of prevalence of existing economy for next 5 years. The recession period can never be easily knocked out at current situations of UK. The business sector thus poses a real tragic status. Colin Fox addresses these ideas through his words on “The economy and Afghanistan continue to dominate UK politics.” (Fox 2010). He sought out various unveiled economic and trade facts kept hidden by authorities of UK and US on the matter of Iraq and Afghan invasions. The economy and business sectors of a country are usually influenced by politics of that nation and so it becomes clear about business and trade situation expected. The majority of analysts put forward a fact that joblessness can rupture UK business and economy with about 3 million unemployed people by the next election expected around May and age range of unemployed is from 18 to 25 year natives. Moreover, the employed ones are not full time employees. Though the country is developed, this can lead to severe crisis in UK. To make clear on the matter of wars against Iraq and Afghanistan, U.S and UK have made tremendous shift in their economy and trade. The business has a threat from current and expected economic positions of those developed countries. Also, recession faced in this period of time is expected to exist in current as well as coming years. Already UK and US authorities have declared the occurrence of their troops invading nations for next five years, which will again add to their war expenses, thus affecting the economy of both the nations. If it continues, though profit from oil can be achieved from Iraq, severe drawbacks in national trade and commerce will result. Unemployment becomes evident and business and economy may collapse which will be accompanied by utter negative feel of whole world. Reference List Banking crisis: Reforming corporate governance and pay in the city: Government, UK financial investments Ltd and financial services authority responses to the ninth report from the committee, 2009. [Online] Authority of the House of Commons, London: The Stationery Office Limited, p.1. Available at: http://www.parliament.the-stationery-office.co.uk/pa/cm200809/cmselect/cmtreasy/462/462.pdf [Accessed 10 January 2010]. Callinicos, A., 2009. Justification for Afghan war is collapsing. [Online] SocialistWorkerOnline. Available at: http://www.socialistworker.co.uk/art.php?id=19000 [Accessed 10 January 2010]. Chakrabortty, A., 2009. The banking crisis is not about blofeld in a business suit. [Online] Guardian.co.uk. Available at: http://www.guardian.co.uk/commentisfree/2009/dec/23/financial-crisis-writing-literature-drama [Accessed 10 January 2010]. Evidence of a serious conflict of interests in the U.S. government over Iraq, 2002. [Online] The Debat. Available at: http://www.thedebate.org/thedebate/iraq.asp [Accessed 10 January 2010]. Fox, C., 2010. The economy and Afghanistan continue to dominate UK politics. [Online] Scottish Socialist. Available at: http://www.scottishsocialistparty.org/new_stories/issues/politics-2010.html [Accessed 10 January 2010]. Is this war all about oil? 2010. [Online] London Evening Standard. Available at: http://www.thisislondon.co.uk/news/article-3759150-is-this-war-all-about-oil.do [Accessed 10 January 2010]. Lynch, R., 2010. Virgin money buys regional bank. [Online] The Independent. Available at: http://www.independent.co.uk/news/business/news/virgin-money-buys-regional-bank-1861649.html [Accessed 10 January 2010]. Teslik, L.H., 2008. Backgrounder: Iraq, Afghanistan and the U.S. economy. [Online] Council on Foreign Relation. Available at: http://www.cfr.org/publication/15404/ [Accessed 10 January 2010]. Wallace, V. & Herrick, A., 2009. Strategy + business: What banking needs to become. [Online] Booz & Company, Inc. Available at: http://www.strategy-business.com/article/09405?gko=cd884 [Accessed 10 January 2010]. Read More