The demands being made by the EU on the amount of money that UK has to pay on departure is the least of the woe story stemming from the initiation of Brexit. Economists have been divided as to the impact but the decline in the value of the pound sterling in the wake of the event is evident. Continue reading “The Effects of Brexit may be Ominous but Don’t let it Stop You from starting your own business”
With the volatile economic climate of 2017, and a number of surprising election results, the prospect of making money on the stock markets is becoming increasingly attractive to a wide range of people. However, getting involved in forex trading can be easier said than done. Without an easy to use forex trading platform and a number of tools to help you along the way, it’s likely you will struggle. In this article, we’re going to take a look at some of the points to consider when choosing a forex trading platform as a beginner. Continue reading “How to Choose a Forex Trading Platform”
The beginning of a Trump administration in the US has weakened the strength of the US dollar against other major currencies. The global financial markets have reacted badly to the divisive news of Trump’s travel ban, which in turn has pushed up the price of gold. Continue reading “US Political Instability Affecting Gold Prices”
You might feel fulfilled in the workplace because you contribute to your industry and your company, but sometimes professionals want to do more. If you’re interested in benefiting your community and people in need, you can use your expertise in the nonprofit world. Following are four ways business professionals can give back to others. Continue reading “How to Contribute to the Community”
Budget airline EasyJet has seen its profits fall by 28% amid tough economic conditions. Chief executive Dame Carolyn McCall said that the company would remain “resilient,” despite the setback, which has largely been attributed to the economic uncertainty associated with Brexit as well as the new-found threat of global terrorism affecting what were previously popular holiday destinations. Continue reading “EasyJet Profits Fall in Response to Economic Uncertainty”
Fear is a very powerful form of emotion found in everyone. Some may fear flying in a plane, some have fears of driving, some may find it hard to face decisions, while others just procrastinate and end up doing nothing. Fear for many is a state of mind, in which an individual may find it hard to get things done or think that it is not easy to perform the task. However, since it is only a state of mind, it may be easy to overcome it, as we need only to think on pondering over them, act and see them disappear. Continue reading “These 6 Advices Helped Me Overcome My Fear of Failure”
The current exchange rates for the GBP are, as we all know, very low, the pound is weak compared to other currencies such as the US dollar and the Euro. While this can mean good business for those who manufacture and sell from within the UK, for those who import or sell products abroad, it can mean lower profits.
Using lines of credit can help companies who are facing these challenges – so what are lines of credit and how do they work? Continue reading “How to Use Lines of Credit: Weather the Storm!”
Trading Forex is understanding the art of short term speculation through selling and buying different currencies against others. In ForexSQ we care about traders’ education, thus we remind that Forex trading is far more risky than you can imagine when you 1st come to it and could suggest large losses for the newbie. Why not? All the promotional surrounding FX trading suggests that it’s a simple way to double, triple your money from the comfort of your home and with little effort. Continue reading “What Is FOREX TRADING”
As the saying goes, “home is where the heart is”. While professionals progress in their career endeavours, often the focus on family needs take a step back. Often, with the routine of day to day fire fighting while meeting business requirements, planning for the long term becomes difficult. Many start planning for a car immediately after joining a good job, because it helps in facilitating the travel from home to work and vice versa. However planning for a residential investment takes time due to reasons like large value of the potential investment, availability of alternative (rental, old homes, etc.) and nature of job where one needs to be mobile globally. This video really captures it beautifully. Continue reading “How to plan for your future home?”
Different lawyers have different roles to play. However, the major work by them includes representing their clients and solving certain cases. Be it the state issue, individual or corporate issue, legal advisor or lawyer help out to solve certain issues face by the subject. If you want to get into this profession and need an expert advice then learn about Jonathan Bunge, who is a well-known attorney lawyer who fought many cases for corporate and state. He was also litigation lawyer in some cases. Continue reading “Understanding the Role and Power of Attorney General”
Losses in investment are common, depending on the volatility of the market. Therefore, not all losses are as a result of fraud on the part of the party entrusted with the investment. Stockbroker fraud on the other hand is a direct and intentional deceit orchestrated by a stockbroker for purposes of self-gain. Therefore when an investor places his own interests ahead of a client’s interests, then that constitutes stockbroker fraud. Continue reading “Is Your Stockbroker Pulling Wool Over your Eyes? Contact a Securities Litigation Attorney Before It’s Too Late”
Expanding globally is the ultimate goal for most businesses. Although it can seem quite daunting, going global is easier than you think. Gaining global success is an amazing way to boost your company’s profile and seek out new client bases and opportunities. So how can your business gain global success? Continue reading “How Your Business Can Gain Global Success”
With the start of the new year, business owners should be in the throes of tearing apart last year’s performance in order to make 2016 an even better business year. Even if your company had an unimpressive 2015 or it just didn’t live up to your expectations, reviewing the year should not be a painful task for you. This is your opportunity to learn from your failures, mistakes and missteps, so you can take your business to the next level in 2016. While this isn’t the fun part of being a business owner, it is an integral part to being successful. Plus, if owning a business were easy, everybody would do it. Continue reading “Take Your Business to the Next Level in 2016”
A big part of a country’s exports come from service in the travel industry and tourism. In some cases such as the UK it can account for more than half the exports of others services in the country, according to new research conducted by the World Travel and Tourism Council and World Travel & Tourism Council (WTTC). This goes to show how important work in the travel sector is. Continue reading “The importance of the travel sector to a country’s economy”
The Baltic nations of Estonia, Lithuania and Latvia were some of the hardest hit during the global financial crisis. The region suffered from both economic and political crises that shattered their once booming economy. Faced with few prospects and high rates of unemployment, the Baltic people have taken matters into their own hands and have created one of the most active areas in Europe for startups and entrepreneurs. Continue reading “The Rise Of The Baltics – Home To The Most Active Entrepreneurs In Europe”
Monopolies have been made illegal in the United States as it destroys any chance for competition and creates dependence upon a particular company for goods and services. Throughout the years, monopolies of varying degrees have been attempted and challenged. However, the damage that can be wrought on a global scale is much different than what it would be in a local community. More facets of humanity come into play and could greatly disrupt the way of life for many people. Continue reading “5 Ways that Global Monopolies Can Damage Human Existence”
The landscape of the European Union eServices marketplace is about to change dramatically courtesy of a change in how VAT on eServices is applied. So how does this impact the economy and business? Continue reading “EU wants the digital economy to pay its dues”
The business world is fraught with a variety of challenges, as any business owner would attest. These challenges may come in the form of increased competition, a lack of business exposure, a high cost of raw materials, and the like. But with the right know-how and the right support, your business need not face too many difficulties. Continue reading “All You Need to Know about Invoice Financing for Your Business Growth and Success”
There are a lot of things working against a small company in today’s business world. Government regulation costs far more for smaller companies than medium or large companies, the economy of scale seldom applies so services and products typically cost more leaving margins even more narrow, and when things are going well there is simply not enough manpower in reserve to tap into to take advantage of an upswing in business or the economy. Despite this, small businesses can still flourish by taken advantage of the things that work in their favor. The key to taking advantage of opportunities is to make a great first impression and earn the respect of larger businesses and public when opportunities do present themselves. Continue reading “Big Impressions Help Small Companies Compete”
Every business in the world is thought of as a faceless bunch of suits that want to take advantage and have a pack of attorneys just waiting to step in and start litigating at the first sign of trouble. The truth is that the opposite true. Nobody, particularly a business, wants things to go to the extreme of litigation and legal actions. It is expensive and time consuming and distracts from the daily routine of running a business and providing great value to its customers. If there is actually a fault in the business world it is the reluctance to use legal counsel when it really should. Continue reading “Knowing When It is Time to Get Legal Help”
A comprehensive research conducted by Goldman Sachs titled “The Olympics and Economics 2012” precisely attempts to answer this question. The researchers analyzed the Olympic Games which were conducted in Beijing and Sydney, few years ago, and thus made a few projections for London 2012. What is of significant interest is that a lot of these projections are destined to come true and revitalize the economies, which are somewhat in a sombre mood in early 2012. Even the Prime Minister of United Kingdom, David Cameron, thinks that the Olympics will roll in 13 Billion pounds for the nation (even though that may help little to douse the fire burning within the economy).
The British economy really needs a boost, thanks to a protracted double-dip recession that has pushed down GDP for three quarters without even an inkling of a break. The Olympic Games hosted in London 2012 (underway currently) have been projected to be extremely profitable for the “British Empire”, and the revenues have been forecasted to exceed the operating cost of hosting the major event. Tickets sales are expected to generate over 500 million pounds or 785 million dollars and generate direct revenue for the management. This itself is a huge amount for a nation trapped in a continent facing rampant economic slowdown at large.In addition, a short-term financial boost in the third quarter of 1.2–1.6 percent of GDP at an annualized rate has been forecasted. This will also generate a lot of employment to a nation strapped with excess workable hands with very little to do. In addition, the tourism industry will get a healthy dosage of fuel to the slumbering embers, and this may just be sufficient to the industry slowly lumbering to a dormant stage.
With such a concern over economic health revision, a public-private partnership to ensure the success of such grand fiestas could be a shot for success. While such boost is sure to affect many sections of the society both directly and indirectly, the long term boon of employing workers for digging a trench and employing another set of workers to fill it up, are also evident in this case, though the analogy may be less fitting. Considering Ireland, which is in dire straits, will the benefits of the Olympic games overflow to Britain’s closest neighbor?
What is more important at this stage that will Brazil also benefit in the same big way, in 2016? With so much focus on her economy, will the benefits boost Brazil’s stake in the cake as an economic superpower? Only time can tell more how this story unfolds itself.
The woes of the economic slowdown and financial crisis in 2011 is largely attributed to the debt crisis in Europe. This is not a recent happening and bubble started growing from as early as 2009. The 3 of the highest exposed countries; namely Greece, Ireland and Portugal, collectively account for six percent of Eurozone’s gross domestic product (GDP). Continue reading “Debt Crisis in Europe”
Globalization is the unification of the economies across the world beyond the barriers forged by the geographies, so as to to stimulate wealth generation, exchange of goods and services and mutual inclusive growth through an division of labor across nations characterized by efficiencies arising from international relations, specialization and competition. Typically the forces of globalization are driven primarily by economic, sociocultural, political, and technological factors although other factors have also played a significant role in the process.
Although the empirical evidence on the benefits of globalization on inclusive development is not very clear, the share in aggregate world exports and in world output of the developing countries has definitely increased due to this phenomenon. The emergence of global markets which has triggered a much wider access to a range of products both for consumers and firms has definitely triggered a kind of major industrial revolution. There has also been a stimulated growth triggered by access to better financial resources due to the liberalization of economies and thus the increased liquidity of financial resources.
A major impact of the globalization has been the stimulation of the Green Revolution, which has managed to address the needs of the burst in population globally. It is felt that without the green revolution, stimulated by the exchange of information, agro-products, fertilizers, seeds, bio-technology and expertise, much of the sudden burst of population growth would have suffered severely from lack of access to food, clothes and medicines. The development of agriculture and agro-based industries has had a major positive effect on the lives of billions of people on this planet directly and even more so indirectly.
The realization of a global market, based on the freedom of exchange of goods, information and capital, and thus setting up the preconditions for perfect market conditions has been one of the major benefits of globalization. This has actually stimulated a shift of monopolistic economic power from the United States (and European nations) to fast developing economies like China, India, Brazil and other similar countries, which are growing at a rate exceeding 8% year on year. The emergence of China and the Eastern tigers (Vietnam, Malaysia, Singapore) as a manufacturing super-power and the emergence of India and Brazil as a services hub has been extremely significant in this shift of political power.
A major trigger in the impact of globalization has been the adoption of internet based products and services. This has triggered a substantial increase in information flows between geographically dispersed locations and stimulated the formation of global markets. Today, consumers of lesser developed economies have access to all the products of developed economies through the establishment of e-markets like Amazon and e-Bay.
The social effects have been significant too in the context of globalization. English, although the third most popular language in the world, after Mandarin and Spanish, has become the Lingua Franca (official language) of the global economies. The access to global information, products and services has triggered the growth of cross-cultural relationships and facilitated the development of a new order consciousness and life-style stimulated from cultural diffusion, improved standards of living and access to foreign products, services and ideas. This development of “World culture” has been most significant among the Netizens triggered by fraternity shared on online forums which has stimulated the exchange and diffusion of ideas.
However, globalization has also triggered the brain drain from developing economies to developed economies to access better employment opportunities and also the formation of Sweatshops by the advanced economies in developing economies to take the benefits of cheap labor. The globalization of the jobs has a negative impact in developed countries where many of the jobs (especially the low knowledge centric ones like BPOs and KPOs) have been outsourced to economies where labor is comparatively much cheaper. Also, many argue that globalization has actually a negative impact on inclusive development of backward economies and the rich gets richer by taking advantage of the resources in the disposal of the poor by utilizing it better. Also, globalization has triggered many illicit trade activities involving drugs and trafficking and this has added to the woes of under-developed economies.
The financial crisis in late 2000, sometimes referred to as the Credit Crunch or the Global Financial Crisis, is generally considered by many economists to be the worst financial crisis since the Great Depression of the 1930s. The financial meltdown resulted in the collapse of super Financial institutions with power status, the bailout of mega-banks by the central governments, and plummeting stock markets around the world. However, in 2011, the world may be witnessing something which may be equally big, or maybe even bigger. The WWII economic crisis and conditions are still extremely fragile. Probably turning short-term debt into long-term loans was the biggest trigger for this economic recession in 2011.
Some may call me to be somewhat more pessimistic in my outlook than is required, but here are my reasons to believe so.
- The economy in US is in dire straits. The housing sector is yet to recover and high unemployment is troubling the super-power. The US is drowning in negative equity and job-less homes. Tax cuts may be short term evasive measure, medium and long term fiscal reforms may be necessary to pull US economy through this period. The recession in 2008-2009 is still making its presence felt in US, by depleting the reserves of the economic super-power. The tremble caused by BNP Paribas and Lehman Brothers is yet to subside full. Recently, US has been downgraded from its rating by Standard and Poor. The economists are suggesting long term reforms in banking, such as raising capital ratios and switching from wholesale to retail funding, while filling in short-term gaps in capital. However, the banking industry would be subjected to a slow recovery in this track.
- Japan has lost its AAA rating long back. The growth prospects for the once economic super-power is pretty poor. Currently Japan’s national debt actually in excess of 200% of its GDP but its bond yields remain extremely low, since the growth prospects are not looking bright. As an effect of this, Japanese production has declined by over 15% in recent times.
- The major debt that Greece is facing and the crisis thereof not cured by the massive Eurozone and IMF bailout. The current bailout support may expire by 2013, and there has been no major financial restructuring in Greece. While the Greece government is sold out to Germany, this is even a bigger cause of concern because now the government will not even be able to print bills to increase inflation to depreciate its own assets. With the huge debt on Greece, the rest of EURO-Nations are equally strapped in the rear to come out with policy changes that may liberate them from this dire straits.
- The crisis in the Irish national banking sector far from over. Even after receiving a staggering level of bailout assistance from the EU and IMF to cover the country’s insolvency, thanks to the Anglo Irish Bank and the other minor Irish banking institutions, the Dublin decision makers were forced to inject nearly $5 billion into Allied Irish Banks, another bankrupt institution. Ireland policy makers really need to figure out how to service this public debt, without triggering a shiver down its economy.
- Europe in general is under severe economic stress. Without a major restructuring of debt, progress seems almost impossible. Debt burdens may continue to spiral upwards, and in several EURO using nations a debt write-down is very likely. German, French, and British banks hold most of the national debts, and a shiver there may trigger a collapse of the balance which apparently is resting on a spindle.
- China, which seemed apparently less touched by the economic crisis in the west, is suddenly increasing its interest rates in an almost desperate effort to control price inflation. While China, the manufacturing super-power of recent times, strives to control the inflation within, this is almost an indicator of less attractive options to invest, outside the country, and even maybe within the country. Are we witnessing a scenario where the market demand has been saturated and the manufacturing sector is growing wary of the same?
- India, which is evolving as an open market economy is not free from the crisis. Although Agriculture is still India’s most engaging “career”, most of the recent economic growth has been fueled from the services sector (IT, ITeS, Banking, or even tourism in few states). The welfare of these industries thrive heavily on the welfare of the counterparts in USA and to an extent in Europe, whose needs the service. The IT and ITeS alone has an average exposure of exceeding 52% to US markets and 34% to European markets, as per a report in Financial Times. On an average the services sector enjoy an exposure exceeding 82% to European and US markets. The meltdown of the economy in the western powers may be sufficient to trigger one in India.
- With the advanced economies under such severe stress, emerging economies, may be slightly insulated from major impacts, which can cause a huge eruption of their regular life. Worldbank says that the financial stress for the emergent economies may be over. However, since the development in these economies are heavily dependent on foreign direct investments from the economic super-powers, the development is likely to hit a stagnation. Is this an indication that the next financial tremble will arise from the developing economies?
Who knows how deep we actually are in this mess? Commodity prices are coming down, but that is probably the only brighter news in this downcast. Do let us know what you feel.
There is a saying that toomuch of anything isnt good. Coming to thing about it, different people have different needs. But irrespective of whether someone is a lawyer or criminal, a housewife or a CFO, there is one common need which is as defining as the need for food or clothes and that is Recognition. Everybody wants to be recognised be it their work, their way of displaying love or even in silly sibling rivalry. And the strange thing is, unconsciously, what someone wants for self, they start doing the same for others. Its like an indirect signal of the hidden desire. Again when someone is denied of something for too long, something which they consider is their rightful want, they start shying away from it and often do the opposite of what they really want. Yet most people wander why they don’t get back the worth of what they are giving to others. Most people who work too hard in office complain that they are the ones who handle all the pressure while the guy who lazes around has the bonds most with the boss. Or while giving away everything for the sake of love, what most get back is distance. I guess what most people don’t understand is that the law of demand and supply work beyond economics. Whenever we give too much into something, the demand from us automatically decreases. I know its horribly unfair, but its true at the same time. By making too much of us available, we don’t let the other person miss us. When a boss gets more than what he wants for, his expectations keep on increasing, and he just knows that he has someone who can complete everything even without directions. This is why one of the chief reasons we shout first on our mom the moment anything goes wrong, while we cant do that with someone else as we know that mom is always there for us irrespective of how we behave. But if we could always control the way we behaved, then there wont be anything natural with our behaviour. We would be like human robots with just the right smile and the right words. We are the way we are by birth. But at the same time after learning the same lesson repeatedly, its better to check the way we act at times, rather than saying “ this is the way i am..cant help!!!”
Hope i didn’t sound too political.
Signing off for the time being, catch u later frds!!
The past decade was marked by the increasing role of foreign direct investment (FDI) in total capital flows. In the late 90s, FDI accounted for more than 50% of all private capital flows to developing countries. This growing change in the composition of capital flows has been synchronous with a shift in emphasis among policymakers in developing countries to attract more FDI, especially following the 1980s debt crisis and the recent turmoil in emerging economies. The rationale for increased efforts to attract more FDI arises from the belief that FDI has several positive effects which include productivity gains, technology transfers, the introduction of new processes, managerial skills, and know-how in the domestic market, employee training, international production networks, and access to markets.
If foreign firms introduce new products or processes to the domestic market, domestic firms may benefit from accelerated diffusion of new technology. In other situations, technology diffusion might occur from labor turnover as domestic employees move from foreign to domestic firms. These benefits, in addition to the direct capital financing it generates, suggest that FDI can play an important role in modernizing the national economy and promoting growth. Based on these arguments, governments often have provided special incentives to foreign firms to set up companies in their country.
While it may seem natural to argue that FDI can convey greater knowledge spillovers, a country’s capacity to take advantage of these externalities might be limited by local conditions. In an effort to further examine the effects of FDI on economic growth, research indicates the same from the recent emphasis on the role of institutions in the growth. In particular, there is great emphasis on the role of financial institutions and many economists argue that the lack of development of local financial markets can limit the economy’s ability to take advantage of potential FDI spillovers.
This article had been written by Rajeev Malhotra and edited by Arpan Kar. Rajeev has done his Masters in Financial Engineering from an Ivy League B-School from the United States. Besides his MBA, he also holds a CA and a CFA degree. He is currently working with DSP Meryll Lynch, USA.
The energy sources of China are extremely rich in natural gas and coal, but relatively sources are lower in petroleum. Thus, today China is over increasingly getting more an more dependent on coal, which accounts for 68.7% of total energy that is consumed in the country.On the positive side, the renewable energy segment has increased from 8.8% in 2008 to 9.9% in 2009, but coal is still an essential player and irreplaceable in the Chinese energy market. (Source: Frost and Sullivan Research)
The global economic recession impacted the Chinese energy markets in multiple ways. Demand and supply was affected as the Chinese were forced to change their coal export policies in line with the slump. By reducing the degree of coal exports, the stock and the supply side of coal developed a large surplus over the demand, which decreased the price of coal in the Chinese markets for local consumption. These pulses left by the economic recession have been felt by other industries that are also related to the coal industry, like the thermal power generation and cement industries. Due to this recession in the energy markets and the decrease of the profitability of those 2 industries, China was forced to limit production, thus reducing the use of coal.
Our verdict is in order to follow the rest of the world in energy development, China has to make more use of sustainable energy.
Economic recession’s impact on Chinese solar power market
With the support of the Chinese government, the solar power industry has rapidly grown into the one of the largest industries in the world. However, the solar power industry’s structure and technology have not kept up with the rapid growth. As a result, problems have creeped into this sector in China. Thus surprisingly, cost is high in China for the generation of solar electrical energy. Furthermore, a minuscule civil market exists and the technology is grossly outdated. Thus the Chinese solar power market may face several industrial problems due to the economic situation.
The biggest barrier to further development as faced by local Chinese solar power companies is financing. Although the solar power sector in China is among the fastest growing sector in the world, to develop this emerging sector, the country needs to dedicate a lot of financial resources. Many different solar power projects can only continue with a large dedicated monetary commitments in R&D. The economic recession badly affected the solar power companies. The securities market and banks are the major financial source for such high technology companies. After the economic crisis, the level of supervision and control for Chinese securities market was promoted for issuing IPO and the banks also increased the requirements for credit. This will continue to impact the supply side of the Chinese solar power market. If companies cannot keep their liquidity, they will face bankruptcy.
Another impact of the economic recession is the reduction of foreign dependencies in the solar market. Chinese solar power industry is mainly dependent on foreign sales. The economic slowdown has influenced the sales of Chinese manufacturers. When the USA entered the economic downturn, foreign trade with other countries decreased, specifically for China and the export of solar power products. Additionally, other factors to slow down Chinese solar power market developing speed are the inferior technology and high production price.
Economic recession’s impact on Chinese wind power market
The Chinese wind power market has not been heavily influenced by the world economic recession. The wind power market can be considered the most mature among the renewable energy sectors because of its early development, relatively mature technology, and widespread application.
Still it was seen that the economic recession did have significant impact on international market demand; but the market for Chinese wind power is mainly local and the percentage of wind power produced is relatively small when compared with total electricity production using thermal power and hydro-power. Thus the situation for the Chinese wind power market is different from the solar power market, which is mainly located at the beginning of the value chain. The margin for Chinese solar power manufacturers is low enough that the solar power manufacturers could easily go bankrupt due to a poor economic situation. Also the major source of capital investment in the Chinese wind power market is from government funding. Even if many foreign investments quickly drew out from Chinese companies, it would not impact the entities’ normal operations. Overall, the wind power market would likely keep growing, but at a lower speed than before due to the influence of economic recession.
From the whole renewable energy sector point of view, the economic recession had some impact on the development of the renewable energy, but it was a relatively small effect because using renewable energy has been recognized as the best known practice to ensure sustainability worldwide. The Chinese government pushed out more and more stimulus and subsidies policies to encourage investment in renewable energy. Also, the particular nature of the Chinese renewable energy sector have played a part in helping China avoid serious pressures from the economic slowdown. For those reasons, the issues of how to help China maintain their strength in this segment should be the core for the future development of Chinese renewable energy sector.
In order for China to remain a strong market player in the renewable energy industry the following strategies are suggested:
- First, the manufacturers must increase innovation in an effort to move into a more profitable area on the value chain.
- Meanwhile, the standards and regulations will play an important role in protecting and regulating the industrial participants.
- Finally, the government stimulus and subsidies will aid in attracting more FDI, venture capital investment, etc. Chinese manufacturers will have to enhance enterprise competitiveness, especially technologies with proprietary intellectual property rights, to prevail in the intensive competition with foreign companies for Chinese renewable energy market, because enterprise competitiveness is the basis of the survival and development.
This Article is authored by Jake Mazan, who is a guest author at Business Fundas. He is a Senior Research Analyst at Frost and Sullivan. He takes a keen interest on Asian Markets and their impacts on Global Markets.
USA, the largest economy in the world is facing a fiscal crisis, even now. Ever since 2003, its major economy bearer states like California, there was a major projected budget deficit. The Government took adequate care to approach the problem and to tackle the imminent crisis, but even though the black ages are gone, the repercussions from the shock still exists. The goverment launched many programs, one of which is the majorly popular California Strategic Sourcing Initiative, to control spending and stimulate the revamp of the economy. These focused primarily on the way the state purchased goods and services.
These programs aimed to identify saving opportunities. The focus to do so was through strategic sourcing. This was achieved by establishing new contracts or renegotiating existing ones. A team consisting of key professional procurement staff was created to achieve this goal, and not only at a short term goal, but to look towards achieving this as a sustainable long term process. Rather than a one time program, these initiatives were designed as an ongoing program to save money in the long term and position the United States to com out of the economic slump.
e-Governance played a crucial role in the revamp of the economies. Information Technology was widely used to issue electronic RFPs and conduct reverse auctions. The usage of these technologies also helped to streamline processes and speeded up the savings potential. Consulting firms like A.T. Kearney helped in the processes by developing cross-agency and departmental training programs, in which the procurement staff members were taught new skills in the area of spend analysis, e-sourcing, reverse auctions and e-negotiations. This training, which took place in classrooms and on hands, ensured that the team was well positioned for the change. Change management was the crucial success factor in this initiative.
In the coming few years, these strategic sourcing initiatives are expected to create savings in the tune of billions of dollars. The first wave of the program is already completed, and thus the spend categories have been identified, addressed and initial savings have been achieved which helped to forecast future savings. This e-governance strategic sourcing initiative has demonstrated how economies can be revamped using e-governance and information technology.