Evaluation of Economic Impacts of FIFA 2010 - Coursework Example

Evaluation of Economic Impacts of FIFA Evaluation of Economic Impacts of FIFA The economic impacts of FIFA world cup can be categorized as primary or secondary. The primary impact is the direct economic impact of the sporting event that is normally measured through surveying participants or a close focus on the business sales. The secondary impact includes the indirect economic benefits accrued from FIFA 2010 world cup in South Africa. These economic impacts can only ascertained through evaluation and analysis. Evaluation should take place in order to realize what worked as planned and should be maintained and what did not work well ands should be improved. The two principle methods that can be used in the evaluation of the economic impacts of FIFA 2010 in South Africa include consumer/participant survey and business sector surveys. The paper below identifies and discusses potential methods of measuring economics impacts, their application in ascertaining the economic impact of FIFA 2010 world cup and the potential benefits of measuring the impacts. Business Sector Surveys This involves the gathering of expenditure data that is crucial in the determination of the economic impacts of the FIFA 2010 event. This approach targets the business community in the extraction of the business data in relation to the economic contribution of the FIFA 2010 world cup (Kikuchi and Hirao, 2008; Swart, Bob, Knott and Salie, 2011). However, the method is faced by various challenges that require to be addressed before application. They include the requirement to formulate a sales benchmark, the unwillingness of the donors and authorities to release data, and the financial costs involved in the undertaking of such an initiative. It is imperative for the researcher to undertake a thorough back research when using the method to ensure that the results are not over-emphasized. However, establishment of the sales benchmark does not overcome the seasonal variation in business. This can distort the true economic impact of FIFA 2010. This means that to provide a valid and reliable data, the survey should be carried out continuously, with data being collected before, during and after the event (Preuss, 2011). Researchers should encourage businesses to release crucial information on the economic impact of the sporting event. They have an obligation of assuring business people of confidentiality to the information they extract from them. Building trust with their respondents ensures that the researchers avoid the complexity and the financial input required in the implementation of a tedious economic Impact assessment through a business survey. Another challenge that can arise is the use of secondary data that in most cases has been collected for other purposes rather than business related purposes. Consumer/Participation Survey This involves the measurement of consumer expenditure through the application of participant surveys. The method is more beneficial because it is easier to ask a consumer about their expenditures rather than inquiring the details of business sales from a trader (Van Hinte, Gunton and Day, 2007). The survey helps the researcher to inquire more detailed information from the consumer that assists in the compilation of the market profile. The data gathered through the application of this method is more reliable and accurate because the researcher is capable of framing the survey specifically to the data required. This helps the researcher to explore new perspectives of the data collection and extract more in-depth information. The main challenge associated with the participant-based surveys relates to the disinterest of the respondents to fill out the research forms. Most of the information provided by the respondents has also been blamed as inaccurate in relation to embellishment and uncertainty. The timing of the questionnaires can also have substantial impact on the response gained from the participants. Many of the responses provided by the participants in this case may be biased if the research is seeking information related the performance of various teams. Follow-Up Phone Call The method is more personal and detailed in terms of the queries and the integrity and the event details. The respondents, which could be businesses people or consumers, are required to provide the required information on the economic gains and/or losses they accrue from the FIFA 2010. Phone calls require disclosure of personal details such as n the phone number as well as the availability (Van Hinte, Gunton and Day, 2007). Although this evaluation method can be applied in the evaluation of this kind of an event, it is normally suitable for smaller events. The major challenge with this method is that many people do not like the election solicitation and may always terminate calls without providing the required in formation on the event being analyzed. Many respondents are also not ready to disclose information related to their contacts to the researchers whom they normally view as strangers. The method is also unreliable because it requires considerable amount of time and resources. Focus Groups Focus group method involve the direct interaction with the participants with an intention of identify their opinions on the economic impact of an event, which in this case is FIFA 2010 (Wood, 2006). The method requires a group setting with space suitable for a many participants. Other requirements include food and beverages for the participants, a person tasked with the role of recording the session, a group leader, researcher tasked with a sole purpose of recording the group movements and some incentives for the participants. Although the method is reliable for collecting firsthand information on the economic impact of the event from the people, it is faced with various challenges that undermine its advantages. It is difficult to convince the general public to attend the forums, time consuming and require numerous resources such as volunteers to run it, tape recorders, tape recorders and hand-outs for the participants. E-Mail Survey This involves communication with the respondents through email. Participants are required to possess the capability and access to the internet services. However, the method may be unreliable because the researcher is required to possess everyone’s email address, not all people responds, the email responses may accumulate leading to congestion. Other Evaluation Approaches Break-Even Analysis This is a short term assessment of the financial stability or insolvency of a business organization. This involves measuring the direct costs and determination of the profit and losses. This provides crucial information emanating from constituents of the backbone of the economy i.e. business people (Allmers and Maennig, 2009). Return on Investment The goals of this approach include showing the benefits of grants or scholarship and calculating the return on investment for the private investors or owners. Computation of the return on investment accounting practices is one of the measures applied in determination of the relationship between grants/scholarship and levels of economic benefits from the FIFA 2010 event (Wood, 2006). The method is reliable because the information is outsourced from the economic drivers i.e. investors and business owners. Benefits Ascertaining the economic impacts enables the host country to realize the effect of the event to the economy of the nation. The results from the measuring methods can be used by other nations to predict on the expected impact of such events to their economies. Focus groups are efficient for obtaining event organizers’ feedback on the economic impact of the event. The method is also useful in allowing the researchers to arrive at a consensus on some of the contentious issues that may bring misunderstandings between the researchers and respondents. The discussion among the research participants assists in bringing both the negative and positive aspects of the topic to the fore. Focus groups allow the researchers to collect the first hand information through reading the body language of the respondents (Wood, 2006). Use of the email survey enables the researchers to reach a wider population of respondents. It also negates the application of the resources such as travelling responses compared to the focus groups and saves time because it requires less time for responses. Use of Return on Investment and Break-Even Analysis methods enables the researchers to focus on the nerve centre of the economic activities that enables. The methods are reliable in the identification any direct changes to the economic caused by the events. Conclusion The prominent methods used in the evaluation of the economic impacts of FIFA 2010 in South Africa include consumer/participant survey and business sector surveys. The information for the above methods is gathered through follow-up phone call, focus groups and email survey. Other evaluation methods that can provide information for simulation purposes include break-even analysis and return on investment. Holding a big sporting event such as FIFA 2010 is economically viable for the host nation. The methods are reliable because they involve the participation of the affected people i.e. consumers and business people. References Allmers, S., and Maennig, W. (2009). Economic impacts of the FIFA Soccer World Cups in France 1998, Germany 2006, and outlook for South Africa 2010. Eastern Economic Journal, 35(4), 500-519. Bob, U., and Majola, M. (2011). Rural community perceptions of the 2010 FIFA World Cup: The Makhowe community in KwaZulu-Natal. Development Southern Africa, 28(3), 387-399. Kikuchi, Y., and Hirao, M. (2008). Practical Method of Assessing Local and Global Impacts for Risk-Based Decision Making: A Case Study of Metal Degreasing Processes. Environmental Science & Technology, 42(12), 4527-4533. Preuss, H. (2011). A method for calculating the crowding-out effect in sport mega-event impact studies: The 2010 FIFA World Cup. Development Southern Africa, 28(3), 367-385. Swart, K., Bob, U., Knott, B., and Salie, M. (2011). A sport and sociocultural legacy beyond 2010: A case study of the Football Foundation of South Africa. Development Southern Africa, 28(3), 415-428. Van Hinte, T., Gunton, T. I., & Day, J. C. (2007). Evaluation of the assessment process for major projects: a case study of oil and gas pipelines in Canada. Impact Assessment & Project Appraisal (Beech Tree Publishing), 25(2), 123-137. Wood, E. H. (2006). Measuring the social impacts of local authority events: a pilot study for a civic pride scale. International Journal of Nonprofit & Voluntary Sector Marketing, 11(3), 165-179. Read More