Joyous comment: I felt like home at once when a friend of mine forwarded your article written on the 13 November regarding the Nottingham Malaysian Games.
As a Malaysian student studying far away from the home soil, any event as such is not the one to be missed by any reasons. While we utilise the exposure in the European life and culture and being out of the comfort zone, the effort to spread the wonders of Malaysians in this part of the world is the natural duty borne within ourselves.
Merci for the article as I know the Malaysians back in the country are aware of what is happening in here, our endless dream to introduce to the world how grand is Malaysia, the one and only.
It's such a horrendous not to gain the wisdom and experience while we are here, even I could learn something by walking along the path with a bed of red and violet leaves in this Elizabeth's soil. As I believe, when I am back in Malaysia I could contribute a golden contributions for a better Malaysia from the 'leaves'. I keep on imagining Robert Frost patting on my back while saying, "I shall be telling this with a sigh somewhere ages and ages hence: Two roads diverged in a wood, and I - I took the one less traveled by, and that has made all the difference".
As Margared Mead said, "As the traveler who has once been from home is wiser than he who has never left his own doorstep, so a knowledge of one other culture should sharpen our ability to scrutinize more steadily, to appreciate more lovingly, our own".
To Catherine, Keith, and the other exchange students, we did enjoy the sunshine in Nottingham Malaysia Campus, didn't we? Even a year ;p
Kudos; keep on writing.
Notts rallies them from all over Britain
By Dzulkifli Razak
13 November, 2006
The Notts Games held in Britain last week for the 21st time brought together Malaysian students studying there for fun, games, food and free exchange of ideas. Three Malaysian ministers took time to be there. MOST Malaysians have not heard of the Notts Games despite it being around for more than two decades.
It stands for the Nottingham Games, an effort by Malaysian students studying at the University of Nottingham. Over the years, students from other universities got involved too.
Their aim was simple: To get as many Malaysian students as possible to interact, especially the new ones who have just set foot on the campus or Britain for that matter.
Year after year, the students have kept at it, with support from various quarters, notably the Malaysian Ministry of Education the Malaysian Students Department ( Britain) and, recently, the Ministry of Higher Education.
Spurred by the collective enthusiasm of the students, the Notts Games has a large gathering, attracting Malaysian students from the length and breath of England, Scotland and Wales.
It is not just sports. The games has also doubled as a Malaysian Food Festival of sorts.
The appetite-whetting menus range from nasi lemak to the diverse types of noodles.
The 21st Notts Games was held at the Nottingham main campus last week, with a record number of 5,200 students attending.
Two Cabinet ministers (Higher Education, Education, Domestic Trade and Consumers Affairs) and two vice-chancellors from Malaysia attended the games.
It was a freezing Saturday morning on Nov 4 when busloads of students began arriving at the Games' venue.
Some had started their journey late night on the day before, others in the wee hours of the morning to be on time for the opening ceremony of the Games.
The temperature hovered just above zero degree Celsius with frost still visible on the ground.
But this couldn't dampen the spirit of the Games, and the warmth and excitement that oozed from the near ecstatic crowd.
As the frost melted away to make way for the enthusiasts and their supporters, the Minister of Higher Education applauded the spirit of Malaysia Boleh in his opening address.
This spirit was on full display, transcending all the artificial borders and barriers that can otherwise fragment Malaysian society.
Such was the spirit that the students decided to come voluntarily and participate despite the rather harsh weather conditions, and the many inconveniences, including journeys lasting up to seven hours.
The minister proudly likened the gathering as a "mini" Malaysia.
A British officer in charge of the sporting facilities that housed the Games noticed the difference with games organised by students from other nations the week before.
By comparison, the games the week before were not only smaller but also less diverse in terms of the number of participants and participation, and of lesser standing if the involvement of dignitaries was taken into account.
This was not all. The intangibles that are innately Malaysian which keep the bond of ties ever so strong and sincere among fellow students was keenly felt.
No doubt things were not perfect, but the staying power of the Notts Games nurtured by such good intentions was never in doubt. And it is getting better.
The outcome can only be positive and healthy for these young generations of potential leaders far away from home.
What made it even more special this time around was the DeepaRaya celebration held after the successful completion of the Games.
The event that took place in the evening resembled another typical Malaysian tradition — the open house.
There was also an intense demonstration of the cultural talent, in a jam-packed "dining hall" of the university.
Here, all the winners were roundly applauded and presented with trophies at a simple yet meaningful ceremony. Not unexpectedly, Nottingham University became the overall champion.
There were other champions too, albeit behind the scene. First, was the group of students who wore bright yellow T-shirts with the letters "vlntr" blazed across the front.
Yes, they were the more-than-willing volunteers who ensured that the events of the day proceeded with as few hiccups as possible.
Another group of champions was the organising committee which had been planning the event tirelessly for months, with every member making sure that everything fell in place on the big day.
Still, there were others, like the groups of intellectual "vlntrs" who had been unselfishly contributing ideas on how to continuously improve the education system back home.
What is most striking is the level of maturity shown by virtually everyone who spoke and aired their concerns during the pre-Games discourse that stretched into the night.
While discussion about education at home often invites some highly charged exchanges, the ones at Nottingham exemplify what we can all learn from each other.
In his closing speech, the Minister of Education was spot on when he expressed how privileged we all were to be part of a a meaningful occasion that will for sure stay fresh in our minds for a very long time to come.
Perhaps the best "independent" testimony to this came from four British students who had the opportunity to study for a year in Malaysia.
They had nothing but words of praise and said they were lucky to have had the opportunity to sample the unique Malaysian phenomena that has further enriched their educational adventure.
Kudos to all who have made the Notts Games a memorable experience.
And, more significantly, it serves to remind us of what lies ahead if only we stay as one people, one nation with one big heart, regardless of where we are.
The writer is the vice-chancellor of Universiti Sains Malaysia. He can be contacted at vc@usm.my
Wednesday, November 29, 2006
Wednesday, November 22, 2006
Sinatra's Advice
What is this life if,
Full of care,
We have no time to stand and stare,
No time to stand beneath the boughs,
And stare as long as sheep or cows,
No time to see,
When woods we pass,
Where squirrels hide their nuts in grass,
No time to see, in broad daylight,
Streams full of stars, like skies at night,
No time to turn at Beauty's glance,
And watch her feet, how they can dance,
No time to wait till her mouth can Enrich that smile her eyes began,
A poor life this if,
Full of care,
We have no time to stand and stare.
By William Henry Davies.
Again, it is why I keep on telling myself that life is not a bed of roses. Also, why the road not taken is my most favourite path in this life.
As Frank Sinatra sang -
I've lived a life thats full,
I've traveled each and evry highway;
And more, much more than this,
I did it my way,
Regrets, I've had a few;
But then again,
Too few to mention,
I did what I had to do,
And saw it through without exemption,
I planned each charted course,
Each careful step along the byway,
But more, much more than this,
I did it my way,
Yes, there were times,
Im sure you knew,
When I bit off more than I could chew,
But through it all,
When there was doubt,
I ate it up and spit it out,
I faced it all and I stood tall;
And did it my way.
Full of care,
We have no time to stand and stare,
No time to stand beneath the boughs,
And stare as long as sheep or cows,
No time to see,
When woods we pass,
Where squirrels hide their nuts in grass,
No time to see, in broad daylight,
Streams full of stars, like skies at night,
No time to turn at Beauty's glance,
And watch her feet, how they can dance,
No time to wait till her mouth can Enrich that smile her eyes began,
A poor life this if,
Full of care,
We have no time to stand and stare.
By William Henry Davies.
Again, it is why I keep on telling myself that life is not a bed of roses. Also, why the road not taken is my most favourite path in this life.
As Frank Sinatra sang -
I've lived a life thats full,
I've traveled each and evry highway;
And more, much more than this,
I did it my way,
Regrets, I've had a few;
But then again,
Too few to mention,
I did what I had to do,
And saw it through without exemption,
I planned each charted course,
Each careful step along the byway,
But more, much more than this,
I did it my way,
Yes, there were times,
Im sure you knew,
When I bit off more than I could chew,
But through it all,
When there was doubt,
I ate it up and spit it out,
I faced it all and I stood tall;
And did it my way.
Tuesday, November 14, 2006
Pen and Paper
My inspiration is the pen as gifts from my parents; Mont Blanc, Waterman Paris, and Parker.
My train of thoughts and opinions from a humble mind will be penned down, as long as my day of tomorrow beckons me.
"My aim is to put down on paper what I see and what I feel in the best and simplest way".
Ernest Hemingway once said.
[Born: July 21, 1899 Oak Park, Illinois
Died: July 2, 1961 Ketchum, Idaho
Occupations: Writer and journalist
Literary Movement: The Lost Generation
Influences: Gertrude Stein, Fyodor Dostoevsky, Pio Baroja, Sherwood Anderson, Theodore Dreiser
Influenced: J.D. Salinger, Jack Kerouac, Hunter S. Thompson, Bret Easton Ellis, Chuck Palahniuk, Douglas Coupland, Charles Bukowski]
And I am looking forward to read a book by J.D. Salinger recommended from a wonderful person, entitled Catcher in the Rye ;p
My train of thoughts and opinions from a humble mind will be penned down, as long as my day of tomorrow beckons me.
"My aim is to put down on paper what I see and what I feel in the best and simplest way".
Ernest Hemingway once said.
[Born: July 21, 1899 Oak Park, Illinois
Died: July 2, 1961 Ketchum, Idaho
Occupations: Writer and journalist
Literary Movement: The Lost Generation
Influences: Gertrude Stein, Fyodor Dostoevsky, Pio Baroja, Sherwood Anderson, Theodore Dreiser
Influenced: J.D. Salinger, Jack Kerouac, Hunter S. Thompson, Bret Easton Ellis, Chuck Palahniuk, Douglas Coupland, Charles Bukowski]
And I am looking forward to read a book by J.D. Salinger recommended from a wonderful person, entitled Catcher in the Rye ;p
Rapport De Force
The Independent UK newspaper stated its headlines on Tuesday 14 November 2006 - Our New Friends in the Middle East.
Mr. Blair, Mr. Bush, and Ehud Olmert are now the lame ducks of the century.
Unable even to survive their own heads above the Middle East water, they invited the hands of Mahmoud Ahmadinejad and Bashar al-Assad for a lift as their only salvations.
I hope the lame ducks are starting to fathom how high is the sky and how low is the land ;)
Mr. Blair, Mr. Bush, and Ehud Olmert are now the lame ducks of the century.
Unable even to survive their own heads above the Middle East water, they invited the hands of Mahmoud Ahmadinejad and Bashar al-Assad for a lift as their only salvations.
I hope the lame ducks are starting to fathom how high is the sky and how low is the land ;)
One Flag
Perhimpunan Agung UMNO 2006 has commenced in Malaysia.
It should be a meeting of discussions and promising efforts in order to achieve the 9th Malaysia Plan objectives and not to forget, the Vision 2020.
The success of bringing down the 5% budget deficit in the economy to a point of 3.5% since 2003, shall be seen as the cornerstone for the more improvements in the future.
Kudos.
Do not take things for granted, all of you are obliged as khalifahs for the rakyat.
And I shall say, "The people in the glass houses should not throw stones to each other".
Similarly, "The kettle should not be calling the pot black".
Claptrap and shilly-shally, are to be avoided.
I shall say no more.
To the oppositions, grab the opportunity of freedom in giving speech and opinions as a bed of constructive criticisms.
;)
And post-the-heating-discussion of the assembly, Kathiresan wrote -
I HAVE begun looking at earwax in a different light. Some scientists, it appears, are waxing lyrical about that yucky paste’s ability to reveal the route our early ancestors took to reach the lands which they later populated.
A team of 39 researchers started prospecting for earwax to trace a pattern out of Africa where our genus is said to have begun.
After studying the genes in earwax of people in 33 ethnic groups across the globe, they conclude that there are basically two types of earwax: Wet and dry.
Almost all East Asians have dry earwax while almost all Europeans and Africans have the wet variety. Half of those in central and southern Asia have dry earwax while the other half has the wet stuff.
The scientists, led by researchers from the Nagasaki University Graduate School of Biomedical Sciences in Japan, concluded that a gene called ABCC11 caused this difference. Why ABCC11? Perhaps the study was as simple as ABC. Or perhaps digging wax caused their dalliance with Greek and Latin words to wane.
If I understand it rightly, the ABCC11 controls the behaviour of a cell channel which in turn controls the flow of earwax-altering molecules. When, and if, a ABCC11 mutates, it can change the structure of the channel. This affects the type of earwax produced.
The researchers found that the switch in a single DNA in ABCC11 determines whether a person has wet or dry earwax.
They said a change in the channel could have occurred in our ancestors in north or northeast Asia. From there, the dry earwax spread to America.
This, if you are willing to lend them an ear, indicates that native Americans crossed over from the Siberian region, probably some 15,000 years ago.
On the subject of migration, some scientists, are questioning the Out of Africa theory that Homo erectus evolved in Africa and then spread out.
For years, I have read that my ancestors climbed down from the trees and wobbled on the African savannah before migrating — on foot — to India.
My cousins, of course, went their way and populated other parts of the earth such as China, Russia and Europe.
A recent genetic study of certain populations by Oxford University researchers showed that some of the earliest migrants could have travelled to Asia along the coasts of what are now Pakistan and India some 100,000 years or so ago.
But late last year, archaeologists Robin Dennell of the University of Sheffield in England and Wil Roebroeks of Leiden University in the Netherlands suggested that the first human-like beings probably walked in Asia.
They claim that early-human fossil discoveries in Asia are just as ancient as those found in Africa — up to 1.8 million years old.
Paleoanthropologists believed Neanderthals came after Homo erectus to be followed by Homo sapiens. But new dating techniques later showed that Homo Sapiens existed, in some places, at the same time as Neanderthals. It was then felt that Neanderthals and humans occupied different branches of the evolutionary tree. But soon, the hulking Neanderthals disappeared, with most scientists speculating that humans wiped them out.
Some, however, think the Neanderthals did not disappear but interbred with humans.
If you ask me, Neanderthals and other simian-like characters are still in our midst. They have simply put on clothes. Look around and you are sure to find quite a few simians walking among us.
You may not recognise them immediately, though. For one thing, their caudal appendages have shrunk into oblivion. For another, many of them wear coats and ties.
Having mastered language, and possessing an unshakeable belief in their infallibility or point of view, they run riot among us.
Some of them can be seen sitting in air-conditioned comfort discussing ways to pit one person or group against another; some can be seen frothing at the mouth at meetings as they pass incendiary remarks about other religions; and some are so dense, you wonder why they don’t hop onto the nearest tree and swing away to a galaxy far, far away.
Questions about Neanderthals and whether Out of Africa sounds better than Out of Asia may perplex scientists. But they don’t trouble me.
I’m inclined to side with those who say that where we are headed as a species is more important than where we come from. But since our origins will shed light on our present, I think it is wise to learn more.
Whether one believes we were created by God or are descended from apes or were seeded by aliens, everyone agrees that we have a common origin.
So why can’t we see that before we became East or West, before there was Islam or Christianity or Hinduism or Buddhism or Sikhism or any other religion, we were one family?
Religions are infants in our history. The concept of God took root millennia after our species started walking on Earth.
Can we say there was no God until the religions that exist today took shape?
Yes, we left Africa aeons ago, but we have yet to discard our animal heritage. Isn’t it time we behaved as humans?
Let us drink anew to the time when you Were a tadpole and I was a fish. — Langdon Smith
Monkey see monkey do, what say you?
TALKING about monkeys, I’ve decided not to use the phrase "monkey business" anymore. It is not something to be scorned or laughed at.
Monkeys, it appears, do know their business.
Yale University researchers played around with a colony of capuchin monkeys (indigenous to South America) to see how they made economic decisions. They (the scientists, not the monkeys) found that there was much similarity in the behaviour between them (the monkeys, not the scientists) and their Darwinian descendants.
The scientists conducted experiments to observe how the monkeys mimicked trading and gambling activities. Not surprisingly, they found that the monkeys’ behaviour mirrored that of our businessmen.
The authors of the study, Keith Chen, Venkat Lakshminarayanan and Laurie R. Santos, said the results of the experiment "suggest that loss-aversion extends beyond humans, and may be innate rather than learned".
The lesson perhaps is not to do business with a monkey or monkey around with a businessman.
If we need more proof that we are not too far removed in behaviour from our swinging cousins, let me recount an experiment done by a team led by Gerianne Alexander, a psychologist at Texas A&M University in College Station. The scientists placed a variety of toys in front of 44 male and 44 female vervets, a breed of small African monkeys.
They were surprised to find that male monkeys preferred to play with toy cars while the female monkeys kept company with the dolls. Also, the males liked playing with balls while the females enjoyed knocking around with cooking pots. This led Alexander to conclude: "Vervet monkeys, like human beings, show sex differences in toy preferences. Sex-related object preference appeared early in human evolution."
In another experiment, capuchin monkeys were found to co-operate to obtain food and share the rewards for their efforts.
Primatologists at the Yerkes Primate Centre of Emory University discovered that the monkeys had learnt to do what we often find so difficult: Co-operating for mutual benefit.
The director of Yerkes’ Living Links Centre, Frans de Waal, said: "Society wouldn’t exist without co-operative behaviour. Our lives depend on our ability to co-operate with one another and to reciprocate for the help of others."
Simians are certainly smarter than I thought they were. The smartest of all non-human primates, according to Duke University Medical Centre researchers, are the great apes.
And swinging at the top of the smart pyramid are our very own orang utans — together with chimpanzees and gorillas.
Now I understand why the orang utan is often chosen as our mascot.
It should be a meeting of discussions and promising efforts in order to achieve the 9th Malaysia Plan objectives and not to forget, the Vision 2020.
The success of bringing down the 5% budget deficit in the economy to a point of 3.5% since 2003, shall be seen as the cornerstone for the more improvements in the future.
Kudos.
Do not take things for granted, all of you are obliged as khalifahs for the rakyat.
And I shall say, "The people in the glass houses should not throw stones to each other".
Similarly, "The kettle should not be calling the pot black".
Claptrap and shilly-shally, are to be avoided.
I shall say no more.
To the oppositions, grab the opportunity of freedom in giving speech and opinions as a bed of constructive criticisms.
;)
And post-the-heating-discussion of the assembly, Kathiresan wrote -
I HAVE begun looking at earwax in a different light. Some scientists, it appears, are waxing lyrical about that yucky paste’s ability to reveal the route our early ancestors took to reach the lands which they later populated.
A team of 39 researchers started prospecting for earwax to trace a pattern out of Africa where our genus is said to have begun.
After studying the genes in earwax of people in 33 ethnic groups across the globe, they conclude that there are basically two types of earwax: Wet and dry.
Almost all East Asians have dry earwax while almost all Europeans and Africans have the wet variety. Half of those in central and southern Asia have dry earwax while the other half has the wet stuff.
The scientists, led by researchers from the Nagasaki University Graduate School of Biomedical Sciences in Japan, concluded that a gene called ABCC11 caused this difference. Why ABCC11? Perhaps the study was as simple as ABC. Or perhaps digging wax caused their dalliance with Greek and Latin words to wane.
If I understand it rightly, the ABCC11 controls the behaviour of a cell channel which in turn controls the flow of earwax-altering molecules. When, and if, a ABCC11 mutates, it can change the structure of the channel. This affects the type of earwax produced.
The researchers found that the switch in a single DNA in ABCC11 determines whether a person has wet or dry earwax.
They said a change in the channel could have occurred in our ancestors in north or northeast Asia. From there, the dry earwax spread to America.
This, if you are willing to lend them an ear, indicates that native Americans crossed over from the Siberian region, probably some 15,000 years ago.
On the subject of migration, some scientists, are questioning the Out of Africa theory that Homo erectus evolved in Africa and then spread out.
For years, I have read that my ancestors climbed down from the trees and wobbled on the African savannah before migrating — on foot — to India.
My cousins, of course, went their way and populated other parts of the earth such as China, Russia and Europe.
A recent genetic study of certain populations by Oxford University researchers showed that some of the earliest migrants could have travelled to Asia along the coasts of what are now Pakistan and India some 100,000 years or so ago.
But late last year, archaeologists Robin Dennell of the University of Sheffield in England and Wil Roebroeks of Leiden University in the Netherlands suggested that the first human-like beings probably walked in Asia.
They claim that early-human fossil discoveries in Asia are just as ancient as those found in Africa — up to 1.8 million years old.
Paleoanthropologists believed Neanderthals came after Homo erectus to be followed by Homo sapiens. But new dating techniques later showed that Homo Sapiens existed, in some places, at the same time as Neanderthals. It was then felt that Neanderthals and humans occupied different branches of the evolutionary tree. But soon, the hulking Neanderthals disappeared, with most scientists speculating that humans wiped them out.
Some, however, think the Neanderthals did not disappear but interbred with humans.
If you ask me, Neanderthals and other simian-like characters are still in our midst. They have simply put on clothes. Look around and you are sure to find quite a few simians walking among us.
You may not recognise them immediately, though. For one thing, their caudal appendages have shrunk into oblivion. For another, many of them wear coats and ties.
Having mastered language, and possessing an unshakeable belief in their infallibility or point of view, they run riot among us.
Some of them can be seen sitting in air-conditioned comfort discussing ways to pit one person or group against another; some can be seen frothing at the mouth at meetings as they pass incendiary remarks about other religions; and some are so dense, you wonder why they don’t hop onto the nearest tree and swing away to a galaxy far, far away.
Questions about Neanderthals and whether Out of Africa sounds better than Out of Asia may perplex scientists. But they don’t trouble me.
I’m inclined to side with those who say that where we are headed as a species is more important than where we come from. But since our origins will shed light on our present, I think it is wise to learn more.
Whether one believes we were created by God or are descended from apes or were seeded by aliens, everyone agrees that we have a common origin.
So why can’t we see that before we became East or West, before there was Islam or Christianity or Hinduism or Buddhism or Sikhism or any other religion, we were one family?
Religions are infants in our history. The concept of God took root millennia after our species started walking on Earth.
Can we say there was no God until the religions that exist today took shape?
Yes, we left Africa aeons ago, but we have yet to discard our animal heritage. Isn’t it time we behaved as humans?
Let us drink anew to the time when you Were a tadpole and I was a fish. — Langdon Smith
Monkey see monkey do, what say you?
TALKING about monkeys, I’ve decided not to use the phrase "monkey business" anymore. It is not something to be scorned or laughed at.
Monkeys, it appears, do know their business.
Yale University researchers played around with a colony of capuchin monkeys (indigenous to South America) to see how they made economic decisions. They (the scientists, not the monkeys) found that there was much similarity in the behaviour between them (the monkeys, not the scientists) and their Darwinian descendants.
The scientists conducted experiments to observe how the monkeys mimicked trading and gambling activities. Not surprisingly, they found that the monkeys’ behaviour mirrored that of our businessmen.
The authors of the study, Keith Chen, Venkat Lakshminarayanan and Laurie R. Santos, said the results of the experiment "suggest that loss-aversion extends beyond humans, and may be innate rather than learned".
The lesson perhaps is not to do business with a monkey or monkey around with a businessman.
If we need more proof that we are not too far removed in behaviour from our swinging cousins, let me recount an experiment done by a team led by Gerianne Alexander, a psychologist at Texas A&M University in College Station. The scientists placed a variety of toys in front of 44 male and 44 female vervets, a breed of small African monkeys.
They were surprised to find that male monkeys preferred to play with toy cars while the female monkeys kept company with the dolls. Also, the males liked playing with balls while the females enjoyed knocking around with cooking pots. This led Alexander to conclude: "Vervet monkeys, like human beings, show sex differences in toy preferences. Sex-related object preference appeared early in human evolution."
In another experiment, capuchin monkeys were found to co-operate to obtain food and share the rewards for their efforts.
Primatologists at the Yerkes Primate Centre of Emory University discovered that the monkeys had learnt to do what we often find so difficult: Co-operating for mutual benefit.
The director of Yerkes’ Living Links Centre, Frans de Waal, said: "Society wouldn’t exist without co-operative behaviour. Our lives depend on our ability to co-operate with one another and to reciprocate for the help of others."
Simians are certainly smarter than I thought they were. The smartest of all non-human primates, according to Duke University Medical Centre researchers, are the great apes.
And swinging at the top of the smart pyramid are our very own orang utans — together with chimpanzees and gorillas.
Now I understand why the orang utan is often chosen as our mascot.
Thursday, November 09, 2006
Paperwork: Outsourcing
Module title: Economics of Corporate Strategy
Module Convenor: Jason Lee, Economics Lecturer Nottingham University Business School
Date Work Handed in: 19 April 2006
It is not a new phenomenon for outsourcing, originally called the contracting out of organisational activities, in today's world. In eighteenth and nineteenth century, England public services were serviced by the private sector in the form of street lighting, prison management, road maintenance, the collection of taxes, and other public revenues. Similarly, private operations provided mail delivery in America and Australia, and the construction and management of the railway network was contracted out to commercial companies through competitive tendering in France. As the industrial revolution proceeded, the activities of outsourcing dominated the organisation of production and distribution throught the western world. The mechanism of outsourcing involves contracting with a third party to provide goods and services to the host organisation that would have been available in-house. The basic objective for sourcing out the responsibility for managing particular resources to other parties is that it has become unprofitable for the host organisation to maintain them within the corporate framework.
The Boston Consulting Group concluded that most western companies outsource primarily to save on overheads through short-term cost savings. The 1990's global competition compelled large companies to apply greater discipline over costs and over product to market time cycles, resulting in a smaller product and services portfolio and a loosening of the vertical links in the production process. As a result, firms have divested what they regard as elements peripheral to their business so as to focus upon their 'core' business. Reliance on the vertically driven organisation has been reduced. In turn, greater emphasis has been given to the horizontal relationships so as to improve quality, whilst paying attention to cost effectiveness. In 1999 Unilever, the Anglo-Dutch group, with a portfolio of 1600 food, toiletries, and household products announced that it would focus on a smaller number of 'power brands' (core products) which would have greater worldwide reach in enhancing sales growth and profitability. The aim is to reduce costs and exploit new channels of distribution, such as the internet. The search for greater efficiency, leading to increased specialisation, coupled with attempting to achieve other value adding objectives, added a new dimension to outsourcing, that of attempting to manage multiple, but, at times, ill fitting sourcing strategies. Such managerial gymnastics have masked a more fundamental issue, which is determining what is core to the host organisation so that those processes and activities that are considered peripheral can be passed over to an external service provider.
Determining what is core and non-core to the organisation, whilst attempting to attain multiple outcomes through outsourcing, has been a focal point of debate. Some regard core activities as representative of core competences, in that those ares in which the firm is continuously engaged are fundamental to the survival of the firm. Certain writers consider that what is core and what is peripheral is an academic debate, as outsourcing decisions should be driven by the nature of sourcing contracts and the contractual and informal relationships between the purchaser and supplier, which in turn, lead to the development of a new cluster of core competences. Still, others advocate concentrating solely on competitive advantage, arguing that core competences are those activities that offer long-term competitive advantage and thus should be kept in-house. Nike, for example, outsourced shoe production and manufactures only the key elements of its 'Nike Air' system on the basis that Nike creates maximum value by concentrating on what is unique to them, namely, research and development and post-production activities. Other Nike activities like distribution, sales and marketing (exception: advertising) have been outsourced. In a similar vein, Argyle Diamonds, a major diamond producer, has outsourced all aspects of its operations (earth-moving operations, housing and services for workers, distribution) to best-in-class suppliers. However, the separation and the sorting of diamonds (which is considered core) has been kept in-house.
In the IT industry; global competition, downsizing, the move to flatter organisations, the search for greater flexibility, and rapid changes in technology are cites as the causes of the upsurge in IT outsourcing. Data storage capability has dramatically increased in quality and at the same time has become significantly cheaper, to the extent that data storage services are being charged on a cost-per-megabyte-per-month basis, in a similar way that clients pay for utilities like electricity and water. Therefore, IT has acquired more of a 'commodity' status. Consequently, firms in their pursuit of gaining competitive advantage have been increasing their reliance on external suppliers of information services. Thus, the outsourcing of IT has grown at a phenomenal rate over the past decade in North America, United Kingdom, and Australia. Analysis shows that Western Europe, South America, and parts of South East Asia, including Japan, are now following suit, having previously resisted the trend. For example, the IT market analysts, the Gartner Group, have projected a 16.3 per cent growth rate world-wide between 1997 and 2002, estimating a $120 billion IT outsourcing market by 2002.
Outsourcing in the future, as identified by researchers and practitioners like Justin Jewitt (CEO, Nestor Healthcare Group Plc), emphasises that the present trend of effectively managing a number of horizontal contractual relationships with key trusted suppliers, with each supplier in the chain focusing on providing best-in-class service to give the host organisation competitive advantage, will gain momentum. Enabling the host organisation to gain greater competitive advantage and to be repositioned up the value chain is considered as likely to be achieved by simultaneously pursuing a number of outsourcing strategies, like improving service quality whilst striving to attain cost advantage. Such goals will be realised through a variety of outsourcing arrangements, principally with preferred suppliers with whom there exists an established relationship through performance-based contracts. Such efforts to externalise and become an extended enterprise bear a remarkable resemblamce to the Japanese 'keiretsu' model. Historically, a keiretsu (consortium) of independent Japanese companies were created out of the giant, family-owned Sumitomo zaibatsu (business combine), which was broken up after World War II. Keiretsu based enterprises are accustomed to managing long-standing relationships involving explicit (equity holdings) and implicit (reputational) aspects. The relationships are considered to enable greater focus and business discipline for the benefits of the partners by the partners. This is because they create conditions that permit suppliers to make the investments that will help them to accelerate through their learning curve of providing high-quality service, principally through showing them the advantages of having a volume based and lower cost-per-unit-based relationship with the 'mother company'. For example, by the early 21st century, the Sumitomo group comprised several dozen firms, and all of the major firms were large multinational corporations based in Tokyo or Osaka, such as the Sumitomo Mitsui Financial and Sumitomo Chemical Group.
However, a number of elements has to be considered in the light of outsourcing. Transaction cost theory highlights the significance of transaction cost in market exchanges. When relying on market to provide needed products or services, organisations must invest considerable resources in mechanism designed to guard against the opportunistic behaviour by the trading partner, thus incurring transaction costs. The costs include the costs of writing, negotiationg, monitoring, and enforcing contracts as well as the internal costs related with contract management (Poppo and Zenger 1998). For example, OMB Circular A-76 in the United States provides guidance on how to prepare the extensive in-house cost estimate and the team will need detailed costs that are not normally readily available such as personnel costs, expenses for materials and supplies, other attributable cost like depreciation, overhead and administrative costs, and inflation adjustments. From the perspective of transaction cost theory, transaction costs reflect the diseconomy of market and thus directly influence the firm boundary.
In addition, agency problem occurs when the principal and the agent have different goals and different attitude toward risk. While traditional agency model is primarily concerned with preventing the agent's shirking behaviour, critics of agency theory have pointed out that neither risk-aversion nor effort-aversion is as important as the classic agency model suggests. Instead, the real agency conflict has less to do with getting the agent to work harder, but more to do with getting the agent to choose the right combination of actions and decisions that maximises the principal's welfare. This problem would be particularly salient when the agent is faced with multiple objectives competing for finite resources and the optimal solution requires to strike a balance between the different dimensions. In response to this criticism, agency theory has evolved to address the more complex agency issues such as multi-tasking and measurement imperfection in principal-agency relationships (Indejejikian, 1999). From an agency theory perspective, firm governance is no more than an agency contract between employees or divisions and the organisation or senior management. In this sense, insourcing simply substitutes the agency cost related with the employment contract for the agent cost associated with the client-vendor relationship, which has the same underlying contents as the transaction cost defined by transaction cost theory. Therefore, the firm boundary choice is of limited significance in terms of mitigating the agency cost inherent in the delegation relationships (Alchian and Demzetz 1972; Jensen and Meckling 1976; Poppo and Zenger 1998).
Other element is asset specificity; defined as the degree to which the assests in an exchange are more valuable in their current application than in their next best use (Leiblein and Miller 2003). Vis-a-vis transaction cost theory, specific assets create the incentives for trading partners to appropriate returns from the specialised investments through post-contractual bargaining or threats of termination (Poppo and Zenger 1998; Klein et al. 1978). To safeguard this possibility of 'opportunistic expropriation', organisations have to invest more resources in contract negotiation, enforcement and management, thus leading to increased transaction costs.
In today's business world. it is crucial for a firm to practice 'smart' sourcing, in the sense of weighing up circumstances and being both efficient in the use of resources and delivering the desired outcomes. In outsourcing, 'smart' denotes having considered how to gain advantage through repositioning of enterprise resources and then effectively managing a number of supplier relationships. It focuses as much on the transformational capabilities of identifying ways forward and being effective at the motivation of and communication with people, as on the transactional skills of managing the detailed aspects of business and the routine application of technology. A general manager in a business consultancy firm explains "a smart company anticipates the challenges associated with the outsourcing of its activities and for example takes an active approach to minimise the discomfort of its employees. My experience shows that it is impossible to avoid some dip in employee morale when a company makes an outsourcing announcement, but it is possible to avoid its long term effects. Human Resource arrangements can make or break an outsourcing initiative".
Module Convenor: Jason Lee, Economics Lecturer Nottingham University Business School
Date Work Handed in: 19 April 2006
It is not a new phenomenon for outsourcing, originally called the contracting out of organisational activities, in today's world. In eighteenth and nineteenth century, England public services were serviced by the private sector in the form of street lighting, prison management, road maintenance, the collection of taxes, and other public revenues. Similarly, private operations provided mail delivery in America and Australia, and the construction and management of the railway network was contracted out to commercial companies through competitive tendering in France. As the industrial revolution proceeded, the activities of outsourcing dominated the organisation of production and distribution throught the western world. The mechanism of outsourcing involves contracting with a third party to provide goods and services to the host organisation that would have been available in-house. The basic objective for sourcing out the responsibility for managing particular resources to other parties is that it has become unprofitable for the host organisation to maintain them within the corporate framework.
The Boston Consulting Group concluded that most western companies outsource primarily to save on overheads through short-term cost savings. The 1990's global competition compelled large companies to apply greater discipline over costs and over product to market time cycles, resulting in a smaller product and services portfolio and a loosening of the vertical links in the production process. As a result, firms have divested what they regard as elements peripheral to their business so as to focus upon their 'core' business. Reliance on the vertically driven organisation has been reduced. In turn, greater emphasis has been given to the horizontal relationships so as to improve quality, whilst paying attention to cost effectiveness. In 1999 Unilever, the Anglo-Dutch group, with a portfolio of 1600 food, toiletries, and household products announced that it would focus on a smaller number of 'power brands' (core products) which would have greater worldwide reach in enhancing sales growth and profitability. The aim is to reduce costs and exploit new channels of distribution, such as the internet. The search for greater efficiency, leading to increased specialisation, coupled with attempting to achieve other value adding objectives, added a new dimension to outsourcing, that of attempting to manage multiple, but, at times, ill fitting sourcing strategies. Such managerial gymnastics have masked a more fundamental issue, which is determining what is core to the host organisation so that those processes and activities that are considered peripheral can be passed over to an external service provider.
Determining what is core and non-core to the organisation, whilst attempting to attain multiple outcomes through outsourcing, has been a focal point of debate. Some regard core activities as representative of core competences, in that those ares in which the firm is continuously engaged are fundamental to the survival of the firm. Certain writers consider that what is core and what is peripheral is an academic debate, as outsourcing decisions should be driven by the nature of sourcing contracts and the contractual and informal relationships between the purchaser and supplier, which in turn, lead to the development of a new cluster of core competences. Still, others advocate concentrating solely on competitive advantage, arguing that core competences are those activities that offer long-term competitive advantage and thus should be kept in-house. Nike, for example, outsourced shoe production and manufactures only the key elements of its 'Nike Air' system on the basis that Nike creates maximum value by concentrating on what is unique to them, namely, research and development and post-production activities. Other Nike activities like distribution, sales and marketing (exception: advertising) have been outsourced. In a similar vein, Argyle Diamonds, a major diamond producer, has outsourced all aspects of its operations (earth-moving operations, housing and services for workers, distribution) to best-in-class suppliers. However, the separation and the sorting of diamonds (which is considered core) has been kept in-house.
In the IT industry; global competition, downsizing, the move to flatter organisations, the search for greater flexibility, and rapid changes in technology are cites as the causes of the upsurge in IT outsourcing. Data storage capability has dramatically increased in quality and at the same time has become significantly cheaper, to the extent that data storage services are being charged on a cost-per-megabyte-per-month basis, in a similar way that clients pay for utilities like electricity and water. Therefore, IT has acquired more of a 'commodity' status. Consequently, firms in their pursuit of gaining competitive advantage have been increasing their reliance on external suppliers of information services. Thus, the outsourcing of IT has grown at a phenomenal rate over the past decade in North America, United Kingdom, and Australia. Analysis shows that Western Europe, South America, and parts of South East Asia, including Japan, are now following suit, having previously resisted the trend. For example, the IT market analysts, the Gartner Group, have projected a 16.3 per cent growth rate world-wide between 1997 and 2002, estimating a $120 billion IT outsourcing market by 2002.
Outsourcing in the future, as identified by researchers and practitioners like Justin Jewitt (CEO, Nestor Healthcare Group Plc), emphasises that the present trend of effectively managing a number of horizontal contractual relationships with key trusted suppliers, with each supplier in the chain focusing on providing best-in-class service to give the host organisation competitive advantage, will gain momentum. Enabling the host organisation to gain greater competitive advantage and to be repositioned up the value chain is considered as likely to be achieved by simultaneously pursuing a number of outsourcing strategies, like improving service quality whilst striving to attain cost advantage. Such goals will be realised through a variety of outsourcing arrangements, principally with preferred suppliers with whom there exists an established relationship through performance-based contracts. Such efforts to externalise and become an extended enterprise bear a remarkable resemblamce to the Japanese 'keiretsu' model. Historically, a keiretsu (consortium) of independent Japanese companies were created out of the giant, family-owned Sumitomo zaibatsu (business combine), which was broken up after World War II. Keiretsu based enterprises are accustomed to managing long-standing relationships involving explicit (equity holdings) and implicit (reputational) aspects. The relationships are considered to enable greater focus and business discipline for the benefits of the partners by the partners. This is because they create conditions that permit suppliers to make the investments that will help them to accelerate through their learning curve of providing high-quality service, principally through showing them the advantages of having a volume based and lower cost-per-unit-based relationship with the 'mother company'. For example, by the early 21st century, the Sumitomo group comprised several dozen firms, and all of the major firms were large multinational corporations based in Tokyo or Osaka, such as the Sumitomo Mitsui Financial and Sumitomo Chemical Group.
However, a number of elements has to be considered in the light of outsourcing. Transaction cost theory highlights the significance of transaction cost in market exchanges. When relying on market to provide needed products or services, organisations must invest considerable resources in mechanism designed to guard against the opportunistic behaviour by the trading partner, thus incurring transaction costs. The costs include the costs of writing, negotiationg, monitoring, and enforcing contracts as well as the internal costs related with contract management (Poppo and Zenger 1998). For example, OMB Circular A-76 in the United States provides guidance on how to prepare the extensive in-house cost estimate and the team will need detailed costs that are not normally readily available such as personnel costs, expenses for materials and supplies, other attributable cost like depreciation, overhead and administrative costs, and inflation adjustments. From the perspective of transaction cost theory, transaction costs reflect the diseconomy of market and thus directly influence the firm boundary.
In addition, agency problem occurs when the principal and the agent have different goals and different attitude toward risk. While traditional agency model is primarily concerned with preventing the agent's shirking behaviour, critics of agency theory have pointed out that neither risk-aversion nor effort-aversion is as important as the classic agency model suggests. Instead, the real agency conflict has less to do with getting the agent to work harder, but more to do with getting the agent to choose the right combination of actions and decisions that maximises the principal's welfare. This problem would be particularly salient when the agent is faced with multiple objectives competing for finite resources and the optimal solution requires to strike a balance between the different dimensions. In response to this criticism, agency theory has evolved to address the more complex agency issues such as multi-tasking and measurement imperfection in principal-agency relationships (Indejejikian, 1999). From an agency theory perspective, firm governance is no more than an agency contract between employees or divisions and the organisation or senior management. In this sense, insourcing simply substitutes the agency cost related with the employment contract for the agent cost associated with the client-vendor relationship, which has the same underlying contents as the transaction cost defined by transaction cost theory. Therefore, the firm boundary choice is of limited significance in terms of mitigating the agency cost inherent in the delegation relationships (Alchian and Demzetz 1972; Jensen and Meckling 1976; Poppo and Zenger 1998).
Other element is asset specificity; defined as the degree to which the assests in an exchange are more valuable in their current application than in their next best use (Leiblein and Miller 2003). Vis-a-vis transaction cost theory, specific assets create the incentives for trading partners to appropriate returns from the specialised investments through post-contractual bargaining or threats of termination (Poppo and Zenger 1998; Klein et al. 1978). To safeguard this possibility of 'opportunistic expropriation', organisations have to invest more resources in contract negotiation, enforcement and management, thus leading to increased transaction costs.
In today's business world. it is crucial for a firm to practice 'smart' sourcing, in the sense of weighing up circumstances and being both efficient in the use of resources and delivering the desired outcomes. In outsourcing, 'smart' denotes having considered how to gain advantage through repositioning of enterprise resources and then effectively managing a number of supplier relationships. It focuses as much on the transformational capabilities of identifying ways forward and being effective at the motivation of and communication with people, as on the transactional skills of managing the detailed aspects of business and the routine application of technology. A general manager in a business consultancy firm explains "a smart company anticipates the challenges associated with the outsourcing of its activities and for example takes an active approach to minimise the discomfort of its employees. My experience shows that it is impossible to avoid some dip in employee morale when a company makes an outsourcing announcement, but it is possible to avoid its long term effects. Human Resource arrangements can make or break an outsourcing initiative".
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