Pest Detection on Leafs Using Robot and Processing Labview

Pest Detection on Leafs Using Robot and Processing Labview ABSTRACT: Recent century is a full of technology. None field cant remain without the use of the technology. Agriculture is one of those fields. Agriculture is the backbone of India. Most of the scientists are doing research to increase the cultivate of crops. But one problem still exist which is a major concern of the cultivation of crop and that is crop pests. Due to these problems, The cultivation decreases and hence all the farmers and in turn the country suffers from lack of cultivation of crop. With the recent advancement in image processing and similar related techniques, it is possible to develop an autonomous system for pest classification. Early detection of pest or the initial presence of a bio aggressor is a key-point for crop management. If we are able to detect it at the initial stage, we can prevent pest on leaves without spreading all over the field, which reduces the loss of crop and money. In recent years, the development of the robots in agriculture has agriculture introduced. These robots should be capable of working 24 hours a day, in all weather condition. So if we use robots instead of farmers for detecting the pests on leafs efficiently, we can reduce the loss of crop and money. I. INTRODUCTION Agriculture is the backbone of India. Most  of the scientists are doing research to increase the cultivity of crops. But one problem still exist which is a major concern of the cultivation of crop and that is crop pests. Due to these problems, the cultivation decreases and hence all the farmers and in turn the country suffers from  lack of cultivation of crop. Different types of pesticides are there in market which are used to avoid the damage to fruit and vegetable, but the amount of pesticides to be used is not known due to which the cost as well as the environmental pollution gets affected. A strong demand now exists in many countries for non-chemical control methods for pests or diseases. Greenhouses are considered as biophysical systems with inputs, outputs and control process loops. Most of these control loops are automatized (e.g., climate and irrigation control). However no automatic methods are available which precisely and periodically detect the pests on plants. In fact, in production conditions, periodically observes plants and search for pests. This manual method is too time consuming. Diagnosis is most difficult task to perform manually as it is a function of a number of parameters such as environment, nutrient, organism etc. With the recent advancement in image processing and similar related techniques, it is possible to develop an autonomous system for pest classification. Early detection of pest or the initial presence of a bio aggressor is a key- point for crop management. The detection of biological objects as small as such insects (dimensions are about 2mm) is a real challenge, especially when considering greenhouses dimensions (10- 100m long). For this purpose different measures are undertaken such as manual observation of plants. This method does not give accurate measures. Hence automatic detection is very much important for ea rly detection of pests. Hence we have to detect the pest at the earlier stage not to spread all over the field. If we are able to detect it at the initial stage, we can prevent pest on leafs without spreading all over the field, which reduces the loss of crop and money.  In recent years, the development of robots in agriculture has introduced. These robots should be capable of working 24 hours a day, in all weather conditions. So if we use robots instead of farmers for detecting the pests on leafs efficiently, we can reduce the loss of crop and money. II.  LITERATURE  SURVEY Recent papers are describing to detect  mainly pests like aphids, whiteflies, thrips, etc using various approaches suggesting the various implementation ways as illustrated and discussed below. [1] Proposed a cognitive vision system that combines image processing, learning and knowledge-based techniques. They only detect mature stage of white fly and count the number of flies on single leaflet. They used 180 images as test dataset .among this images they tested 162 images and each image having 0 to 5 whitefly pest. They calculate false negative rate (FNR) and false positive rate (FPR) for test images with no whiteflies (class 1), at least one white fly (class 2) and for whole test set. [2] Extend implementation of the image processing algorithms and techniques to detect pests in controlled environment like greenhouse. Three kinds of typical features including size, morphological feature (shape of boundary), and color components were considered and investigated to identify the three kinds of adult insects, whiteflies, aphids and trips. [3] Promote early pest detection in green houses based on video analysis. Their goal was to define a decision support system which handles a video camera data. They implemented algorithms for detection of only two bioagressors name as white flies and aphids. The system was able to detect low infestation stages by detecting eggs of white flies thus analyzing behavior of white flies. [4] Proposed pest detection system including four steps name as color conversion, segmentation, reduction in noise and counting whiteflies. A distinct algorithm name as relative difference in pixel intensities (RDI) was proposed  for detecting pest named as white fly affecting various leaves. The algorithm not only works for greenhouse based crops but also agricultural based crops as well. The algorithm was tested over 100 images of white fly pest with an accuracy of 96%. [5] Proposed a new method of pest detection and positioning based on binocular stereo to get the location information of pest, which was used for guiding the robot to spray the pesticides automatically.[14] introduced contextual parameter tuning for adaptive image segmentation, that allows to efficiently tune algorithm parameters with respect to variations in leaf color and contrast. III.EXISTING  SYSTEM In earlier days in order to detect the pest  on leafs they used early pest detection in green houses based on video analysis. Their goal was to define a decision support system which handles a video camera data. They implemented algorithms for detection of only two bioagressors name as white flies and aphids. The system was able to detect low infestation stages by detecting eggs of white flies thus analyzing behavior of white flies. But this project has many limitations like it is time consuming process and also the output will not get accurately. So in order to eliminate these limitations ,we are going to proposed a system named pest detection on leafs by using robot and processing in LabVIEW. IV.PROPOSED  SYSTEM In this proposed system we are making  use of robots in order to take the live images from field section to monitoring section. The images taken by the robot processed and the type of disease is displayed accurately. By using this project we can get the output accurately and the type of disease. As we are making use of LabVIEW (Laboratory Virtual Instrumentation Engineering Workbench) software ,in this software instead of text there are making use of icons in order to create the programs. compared to the other softwares this software as many advantages like it will not show any errors at the time of executing the program, whereas other softwares even a small error is there means we will not get the output showing there is some errors, it eliminates the limitations in the existing system. Once you taken the image and create the class mentioning the type of samples in LabVIEW, definitely we will get the output mentioning the type of diseases. Workload on farmers is minimized by using these type of system. By making a track for robot it will be worked properly in slippery and unequal surfaces. If we use chain instead of wheels in the field, robot can work more effectively on unequal surface of the field. Farmers dont have to go in the field because robots do their work properly and effectively. Time consumed by the robots for detecting the pest on leafs is less than mankind, which can work efficiently. Fig 1:Block Diagram V.WORKING In block diagram we are using the web camera in order to take the live pictures from field section to the monitoring section. We are using high definition web camera model number (jil-2247).This web camera takes the images of affected leaf which are caused due to pests. Generally we prefer this type of web camera because it has high flexibly, as well the cost of this type of web camera is very less. It will send  live pictures from field section to monitoring section up to 10 meters distance. We are using wired web camera and this web camera is connected to system through USB cable. This web camera is generally monitored through the system. Next we are using Arduino UNO. The Arduino Uno is a Microcontroller board based on the ATmega328 (datasheet).it has 14 digital input/output pins(of which 6 can be used as PWM outputs),6 Analog inputs,16 MHZ crystal oscillator , a USB connection , a power jack , an ICSP header , and a reset button. In this project we are making use of only 4 digital input/output pins (i.e. pin nos 8, 9, 10, 11), 5v in and Ground pin. These 4 digital pins acts as output pins and also we are making use of 5v output pin as well as ground Pin. Remaining pins we are not using in this project. These 4pins are connected to 4 relays . Relay is nothing more than a switch. A Relay is an electromechanical switch used for one or more of the four (4) purposes 1. To turn something ON. 2. To turn something or disable something. 3. To change the polarity of a wire. 4. To increase the current supply of a wire. In this project we are using four (4) relays 1. for moving forward 2. for moving backward 3. for moving left side 4. for moving right side The main use of these four relays is to move the robot either forward, backward, left side, right side. Based on our request, the particular relay will be on and move in particular direction. These four relays are connected to the two dc motors. In order to work the dc motors we need power supply, so we are using 5v battery. Based on our request the particular relay will be on and this relay will be connected to dc motors and move in a particular direction. Lastly this dc motors are connected to the wheels to rotate. Instead of wheels we can use chains ,this chains can move in even in uneven flat surfaces. This robot take the live pictures from field section to monitoring section without the use of human effort and it will finds whether the leaf had caused marks and based on the marks it will intimate the type of disease. VI.  SOFTWARE  REQUIREMENTS The following are the software requirements used  in this project i. Virtual instrumentation ii. LabVIEW Virtualinstrumentation Virtual Instrumentation is the use of  customizable software and modular measurement hardware to create user-defined measurement systems, called virtual instruments. The concept of a synthetic instrument is a subset of the virtual instrument concept. A synthetic instrument is a kind of virtual instrument that is purely software defined. A synthetic instrument performs a specific synthesis, analysis, or measurement function on completely generic, measurement agnostic hardware. Virtual instruments can still have measurement specific hardware, and tend to emphasize modular hardware approaches that facilitate this specificity. Hardware supporting synthetic instruments is by definition not specific to the measurement, nor is it necessarily (or usually) modular. Leveraging commercially available technologies, such as the PC and the analog to digital converter, virtual instrumentation has grown significantly since its inception in the late  1970s. Additionally, software packages like National Instruments Lab VIEW and other graphical programming languages helped grow adoption by making it easier for non- programmers to develop systems. LabVIEW Lab VIEW (short for Laboratory Virtual  Instrumentation Engineering Workbench) is a platform and development environment for a visual programming language from National Instruments. Originally released for the Apple Macintosh in 1986, Lab VIEW is commonly used for data acquisition, instrument control, and industrial automation on a variety of platforms including Microsoft Windows, various flavors of  UNIX, Linux, and Mac OS. The programming language used in Lab VIEW, is a dataflow language. Execution is determined by the structure of a graphical block diagram. LabVIEW programs are called virtual instruments (VIs).Controls are inputs and indicators are outputs. Each VI contains three main parts: a. Front panel How the user interacts with the VI b. Block diagram The code that controls the program In LabVIEW, you build a user interface by using a set of tools and objects. The user interface is known as the front panel. You then add code using graphical representations of functions to control the front panel objects. The block diagram contains this code. If organized properly, the block diagram resembles a flowchart. VII.  SCHEMATIC  DIAGRAMS  IN LAB  VIEW Front  Panel: When you have created a new VI or  selected an existing VI, the Front Panel and the Block Diagram for that specific VI will appear as shown in below figure In LabVIEW, you build a user interface, or front panel, with controls and indicators. Controls are knobs, push buttons, dials, and other input devices. Indicators are graphs, LEDs, and other displays. You build the front panel with controls and indicators, which are the interactive input and output terminals of the VI, respectively. Controls are knobs, push buttons, dials, and other input devices. Indicators are graphs, LEDs, and other displays. Controls simulate instrument input devices and supply data to the block diagram of the VI. Indicators simulate instrument output devices and display data the block diagram acquires or generates. Fig 2: Front Panel VIII.  BLOCK  DIAGRAM After you build the user interface, you add  code using VIs and structures to control the front panel objects. The block diagram contains this code. In some ways, the block diagram resembles a flowchart. After you build the front panel, you add code using graphical representations of functions to control the front panel objects. The block diagram contains this graphical source code. Front panel objects appear as terminals, on the block diagram. Block diagram objects include terminals, subVIs, functions, constants, structures, and wires, which transfer data among other block diagram objects. It will accompany the program for the front panel which is shown in below figure Fig 3: Block Diagram IX. WORKING Vision  Acquisition In order to detect the pest in leafs, first we have to acquire the image (i.e. take the image of any one leaf in the field).for taking the image of the leafs we require one web camera. This web camera sends live picture from field section to the monitoring section. The below figure shows the image of the affected leaf which was taken from field Fig4:  Acquiring  the  image  of the  affected leaf Vision  Assistant After acquiring the image of the  affected leaf, assist the image (i.e. mentioning the type of the disease).create a class mentioning the type of disease and take the different samples of the image and store these in particular class. The below figures shows how to create a class, the samples of the different classes and also the samples of the affected leafs created in a particular in a particular class is as shown below Fig 5: a class of the affected leaf Fig 6: Samples of the affected leaf RobotControl After creating a class and storing the samples of the affected leaf in that particular class, take photo of the another leaf which was affected by same pest in another field with the help of robot by moving either forward, backward, left side, right-side in front panel. The below figures represents the field section and monitoring section, photo taken in front panel Fig 7:Image taken with the help of robot Fig 8: Monitoring section and Field section RESULTCONCLUSION By using this project we can detect the pest on affected leafs and also we can detect two or more diseases in one particular leaf. after taking the image in front panel ,it will be displayed on the screen as image is detected and the type of disease is:.the below figure represents the result of the affected leaf mentioning whether the disease is detected or not. Figure represents the image taken for the affected leaf with the help of robot and figure represents the output of the image whether the leaf is detected or not: and also the type of disease is as mentioned in the figure INPUT: Fig 9: Image taken with the help of robot OUTPUT Fig10: screenshot showing the disease of the affected leaf We are taking the image of the affected leaf with the help of web camera using robot by moving either left side, right side, backward, downward and after processing it finds whether the disease is detected, if it is detected the type of disease is displayed on the screen. CONCLUSIONFUTURESCOPE Future scope of this type of robots are  very bright because it is very useful in agriculture and reduce the workload. It reduce the time consumed in spraying the pesticide liquid and works very effectively. It will help the farmers to do work in any season and conditions. It will reduce the danger for the farmers from different breathing and physical problems. This type of robots are being used in bicontrol of avocao posttharvest diseases. This type of robots are used for managing diseases in greenhouse crops as well as many other crops. This type of robots are also used in the  fields to detect the fruit is ripen or not and also used for many other purposes REFERENCES [1]. P. Boissard, V. Martin, S. Moisan A  Cognitive Vision Approach to Early Pest Detection in Greenhouse Crops Computer and Electronics in Agriculture Journal,  62(2):83-93, April 2008. [2]. J. Cho, J. Choi Automatic identification ofwhiteflies, aphids and thrips in greenhouse based on image analysis International journal of mathematics and computers in simulation March 27,2007. [3]. Sanjay B. Patil, Dr. Shrikant K. Bodhe Leaf disease severity measurement using image Processing International Journal of Engineering and Technology Vol.3 (5),  2011, 297-301. [4]. M. T. Maliappis, K. P. Ferentinos, H. C.  Passam And A. B. Sideridis [2008] Gims: A Web based GreenhouseIntelligent Management System,World Journal of AGRICLTURAL Sciences 4(5):640-647. [5]. C. Bauch and T. Rath, Prototype of a Vision Based System for Measurements of White Fly Infestation,Institute of Horticultural and Biosystems Engineering, University of Hannover. [6]. Ganesh Bhadane, Sapana Sharma and Vijay B. Nerkar, Early Pest Identification in Agricultural Crops using Image Processing Techniques, International Journal of Electrical, Electronics and Computer Engineering 2(2): 7782(2013). [7]. Presents an automatic method for classification of the main agents that cause damages to soybean leaflets,i.e., beetles and caterpillars using SVM classifier.[12] proposed Back propagation neural network for recognition of leaves, diseases, pests.

Effect of the Financial Crash on Islamic Banks in the UK

Effect of the Financial Crash on Islamic Banks in the UK Chapter 1: Introduction Introduction to the Subject Background of the Subject General Objective The purpose of this study is to examine how the internal factors of the Islamic Banking affected their performance before, during and after the financial crisis in the GCC in comparison to the conventional banking in the same area. Research Questions This study aims to answer the following questions: How did the financial crisis affect the profitability of Islamic Banks in comparison to Conventional Banks? What are the internal factors (bank specific characteristics) that influence the profitability of Islamic banking for every year from 2006 2009? Did these factors have the same impact on the profitability of Islamic Banking before, during and after the financial crisis? Did these internal factors influence the profitability of Islamic Banking in the same manner as of the Conventional Banking? Need for the Study Significance of the Study Assumptions of the Study Limitations of the Study Although we cannot neglect the importance of the external factors on the profitability of Islamic Banking, they were not included in this study. To understand the reason behind this decision, we need to go through the different types of external factors and how they are classified: Macroeconomic Factors Country Regulation Rules Bank Regulation Rules These factors were not included for the following reasons: Since we are examining the performance of 92 banks (27 Islamic Banks and 65 Conventional Banks) in 6 countries, the number of countries used in the study is not significant enough to study the impact of GDP and inflation accurately on Bank profitability especially when examining each year separately Country Regulation Rules as per the IMF Database, although it differs slightly for the selected countries, did not change over the period from 2006 to 2009. This means that for each bank, these factors remained constant. Data about Bank Regulation Rules could not be obtained for GCC banks Delimitation of the Study This study was delaminated to the Islamic and Conventional Banks in the GCC whose data could be obtained in the Bankscope database. Chapter 2: Literature Review Overview of Islamic Banking Islamic Baking has established as an alternative to conventional interest-based banking. The first stirring of the Islamic Banking movement began in 1963 by Dr. Ahmed Alnajar in a small town in Egypt, called Mit Ghamar. Dr. Alnajar completed his education in Germany and found that it had many saving banks operating on interest. He took the idea from a savings bank in Germany and created his own small Islamic bank that was interest free. After Dr. Alnajars small bank proved successful, the establishment of other Islamic banks followed. In 1971, the Nasser Social Bank was founded in Egypt with the objective of lending out money as a charity on the basis of a profit and loss sharing system and helping people in need. And in 1975, the idea of Islamic banking spread to other Islamic regions such Dubai Islamic bank in United Arab Emirates and The Islamic Development (IDB) Bank in Jeddah, Saudi Arabia (Wilson, 1990). Even though Islamic Banking has only been around for thirty years and is still in an evolving stage, Islamic Banking is the fastest growing segment of the credit markets in the Muslim countries. In 2009, Assets held by Islamic Banking banks rose by 28.6 percent to $822bn from $639bn in 2008, according to The Bankers â€Å"Top 500 Islamic Financial Institutions† survey while conventional banks posted annual asset growth of just 6.8 percent. Furthermore, GCC states accounted for $353.2bn or 42.9 percent of the global aggregate, while Iran remained the largest single market for Shariah-compliant assets, accounting for 35.6 percent of the total. Finally, Islamic banking operations are not limited to Islamic countries but are spreading throughout the world. One reason is the growing trend toward transcending national boundaries, and unifying Muslims into a political and economic entity that could have a significant impact on the pattern of world trade (Abdel-Magid, 1981). Islamic Banking Rules and Principles Islamic banking rules are according to the Islamic Shariah derived from the Quran and prophet Mohameds sayings. The three main practices that are clearly prohibited in the Quran and the prophets sayings are, Riba (Interest), Gharar (Uncertainty), and Maysir (Betting). Prohibition of Riba or any predetermined or fixed rate in financial institutions is the most important factor in the Islamic principles pertaining to banking. As stated in the Quran â€Å"Allah forbids riba†. Riba means an increase and under Shariah the term refers to the premium that must be paid by the borrower to the lender along with the principle amount as a condition for the loan (Omar and Abdel, 1996). Gharar occurs when the purchaser does not know what has been bought and the seller does not know what has been sold. In other words, trading should be clear by stating in a contract the existing actual object(s) to be sold, with a price and time to eliminate confusion and uncertainty between the buyers and the sellers. Maisir is considered in Islam as one form of injustice in the appropriation of others wealth. The act of gambling, sometimes referred to betting on the occurrence of a future event, is prohibited and no reward accrues for the employment of spending of wealth that an individual may gain through means of gambling. Under this prohibition, any contract entered into, should be free from uncertainty, risk and speculation. Contracting parties should have perfect knowledge of the counter values intended to be exchanged as a result of their transactions. Therefore, and according to Ahmed and Hassan (2007), the principles of Islamic banking and finance enshrined from al-Quran and Prophet Mohamed‘s Sayings can be summed up as follows: Any predetermined payment over and above the actual amount of principal is prohibited. The lender must share in the profits or losses arising out of the enterprise for which the money was lent. Making money from money is not acceptable in Islam. Gharar (deception) and Maisir (gambling) are also prohibited. Investments should only support practices or products that are not forbidden or even discouraged by Islam. Islamic Banking Products Islamic Banking products have to be done according to Islamic rules and principles, based on profit and loss sharing as well as avoiding interest. According to BNM statistics 2007, Al Bai Bithaman Ajil financing is the most common in Islamic Banking. There are a lot of Islamic Banking products; however there are some famous Islamic products that will be discussed in this section. 1. Al Bai Bithaman Ajil /BBA This involves the credit sale of goods on a deferred payment basis. In BAA, the Islamic bank will purchase certain assets on a deferred payment basis and then sell the goods back to the customer at an agreed price including some margin or profit. The customer will make payment by installments over an agreed period. A fixed rate BBA is a powerful hedging tool against interest rates (Rosly, 1999). 2. Murabahah Murabahah is a contract of sale. The Islamic Bank acts as a middle man and purchases the goods requested by the customer. The bank will later sell the goods to the customer in a sale and purchase agreement, whereby the lender re-sales to the borrower at a higher price agreed on by both parties. These are more for short term financing 3. Mudharabah According to Kettel (2006), Mudharabah is a basic principle of profit and loss, where instead of lending money at a fixed rate return, the banker forms a partnership with the borrower, thereby sharing in a ventures profit and loss. Mudharabah is an agreement between the lender and entrepreneur, whereby the lender agrees to finance the project on a profit sharing basis according to a predetermined ratio agreed by both parties concerned. If there are any losses the lender will bear all the losses. 4. Musharakah Musharakah means partnership whereby the Islamic institution provides the capital needed by the customer with the understanding that they both share the profit and loss according to a formula agreed before the business transaction is transacted. In Musharakah all partners are entitled to participate in the management of the investment but it is not compulsory. Musharakah can help in providing financing for large investments in modern economic activities 5. Al Ijarah Ijarah means meaning to give something on a rental basis. In Ijarah, the bank acquires ownership based on the promise and leases back to the client for a given period. The customer pays the rental but the ownership still remains with the bank or lender. As the ownership remains with the lessor (bank), it continues to give the service for which it was rented. Under this contract, the lessor has the right to re-negotiate the quantum of the lease payment at every agreed interval to ensure rental remains in line with the market rates (Hume, 2004). 6. Wadiah Wadiah is a trust contract and the bank provides gift (hibah) and various types of benefits to the customer. This is exactly like a normal conventional savings account. 7. Istisna Istisna allows one party buys the goods and the other party undertakes to manufacture them according to agreed specifications. Normally, Istisna is used to finance construction and manufacturing projects. 8. Salam Salam is defined as the forward purchase of specified goods with full forward payment. This contract is normally used for financing agricultural production. According to Hassan (2004), Salam based future contracts for agricultural commodities, supported by Islamic Banks, can help to overcome the agricultural financial problems Table 2.1 lists the products of conventional banking and their correspondent products in Islamic Banking. Source: Obaidullah, 2005 Financial Crisis and the Islamic Banking To be able to compete with conventional banks, Islamic banks have to offer financial products that are comparable to the ones offered by the conventional banks. This exposes the Islamic banks to similar credit, liquidity and risks driven by market instability. Despite that, Islamic banks managed to remain stable at the early phases of the crisis. That was driven by three main Factors. First, Islamic banks financing activities are strongly tied to the real economic activities than their conventional counterpart. Even though Musharakah and Mudharabah both provide better risk sharing while keeping strong link to the real sector, they are used minimally for different reasons. Most financing activities are done through Murabah and Ijarah followed by Istinsa. In the GCC and during 2007, Murabaha comprised of 65.4%, Ijarah 12.78% and Istinsa 2.83%. Both Murabaha and Ijrah transactions require the Islamic bank to know the clients purspose and use of finance as well the ownership of the asset by the bank. This help in ensuring that the funds are used for their stated purposes. On the other hand, conventional banks do not require disclosing the use of funds as long as the client is believed to creditworthy or can post suitable collateral. Second, Islamic banks avoid direct exposure to exotic and toxic financial derivative products. Since Shariah prohibits riba and gharar, the asset portfolio of Islamic banks did not include any CDOs, CMBSs, and CDSs which turned out to be highly toxic for conventional banks and amplifying factor for the crisis. These derivative products, initially used for hedging purposes, became device for highly speculative investments among conventional financial institutions. Unavailability of hedging instruments for Islamic financial institutions, which was perceived as weakness before the crisis, became a strengthening factor for them. However, exposure to other investment risks driven from equity markets, sukuk, real-estate and ownership stakes in other businesses remain a source of concern when overdone or undertaken purely for speculative gains. Third, Islamic banks in general have a larger proportion of their assets in liquid form than their conventional counterparts. This is driven by two main reasons: (1) there is no lender of last resort (LOLR) facility available to Islamic banks, and they do not have access to market liquidity in the form of the interbank market, high liquidity was maintained for risk management purpose. (2) Excess liquidity is required due to lack of interest-free short-term investment opportunities as real economic investments require some development period. As the global financial crisis became a global economic crisis, it started to affect Islamic banks in an indirect manner. The financial crisis has triggered a chain reaction whereby the slowdown in the real economies of the developed countries has started to affect economic growth and investment activities in export driven economies of the developing countries through lower trade in goods and services as well as through the declining commodity prices including that of oil. The economic downturn is not only affecting the investment and financing activities of financial institutions including those of Islamic banks, it is also reducing the funding of these banks through lower personal savings and declining corporate profits. It should be noted that most of the Islamic banking industry comprises of commercial banks whose major funding source are retail deposits, investment banking constitutes only a small portion of the industry. Islamic banks in some regions may face risk on their fina ncing and investment side of the balance sheet due to the crisis induced volatility of equity markets where these banks have large positions. Downturn in the real estate markets where these banks have large direct and indirect exposures is also another source of risk. Similarly, the changing wealth position of their high-net-worth (HNW) clients who also hold financial exposure in the hard-hit conventional financial sector of the West and therefore are now postponing any investment plans is also a factor. The relative importance of each of these factors varies by the region. For example, the banks in the GCC and particularly in the UAE are more exposed to real estate market risk, followed by risk of international equity markets. For the banks in Asia, their investments in domestic and international equity markets are a source of concern as equity markets are showing higher volatility. In some of the countries, the existing fiscal imbalance which has widened after the crisis is also a factor in the increased volatility of the markets Previous Literature The study of bank profitability is an important tool to evaluate bank operation by examining the different factors affecting bank profitability and using these factors for management planning and strategic analysis. In the last four decades, many studies have been conducted to study both bank profitability and the determinants of bank profitability either for particular country or for a panel of countries. These studies normally divide these factors into internal factors and external factors. Internal factors represent the bank-specific characteristics such as bank size, liquidity structure; liabilities†¦etc while external factors can be macroeconomic factors such as inflation and GDP growth or Country-specific regulations rules and practices. In the area of banking profitability, many studies have been conducted to investigate the profitability of conventional banks while only few were conducted in the field of Islamic banking. In this chapter, we will review these studies for conventional banking first and then will focus on studies in the Islamic banking field. Then we will cover the conceptual framework of this research. Conventional Banking Different studies have been conducted in the field of conventional banking profitability. Short (1979), Bourke (1989), Molyneux and Thornton (1992), Goddard, Molyneux, and Wilson (2004), Peters et al. (2004) are some of the researchers in the field. Short (1979) is one of the early scholars who studied the relationship between banking profit rates and concentration for sixty banks in Canada, Western Europe and Japan during the 1970s and he included independent variables including government ownership and concentration by using H index to quantify concentration. Results showed that the government ownership impact on profitability varied throughout the countries studied but expressed an overall negative relationship. He also found evidence that indicated higher concentration rates lead to higher profit rates (Short, 1979). Bourke (1989) also compared concentration to bank profitability but included other determinants. Bourke (1989) covered ninety banks in Australia, Europe, and North America between 1972 and 198 and examined different internal and external factors: internal factors such as staff expenses, capital ratio, liquidity ratio, and loans to deposit ratio; external factors such as regulation, size of economies of scale, competition, concentration, growth in market, interest rate, government ownership, and market power. His results show that increase in government ownership leads to lower profitability in banking. He also found that concentration, interest rates, and money supply are positively related to profitability along with capital and reserves of total assets as well as cash and bank deposits of total assets. Bourke adds that well capitalized banks enjoy cheaper access to sources of funds as they are less risky than less capitalized banks (Bourke, 1989). Later, Molyneux and Thornton (1992) studied the determinants of European banks profitability. The paper examined eighteen counties in Europe between 1986 and 1989. This paper replicated Bourkes (1989) work by using internal and external determinants of bank profitability. However, Molyneux and Thornton (1992) results showed that government ownership expresses a positive coefficient with return on capital (profitability) which contradicts with Bourkes findings. Other results were similar to Bourkes, showing that concentration, interest rate, and money supply were positively related to bank profitability (Molyneux and Thornton, 1992). In one of the recent papers on bank profitability on European banks, Goddard, Molyneux, and Wilson (2004) shows similar findings to the paper by Molyneux and Thornton (1992). It investigates the determinants of profitability in six European countries and it covered 665 banks between 1992 and 1998. The study used cross-sectional and dynamic panel models. The variables used in the regression analysis were ROE, the logarithmic of total assets, Off Balance Sheet (OBS) dividends, Capital to Asset Ratio (CAR). The results from both models were similar: evidence reveals that there is a positive relationship between size (total assets) and profitability. Meanwhile, OBS appears to have a positive relationship with profitability for UK but neutral or negative for other European countries. Moreover, results also state that CAR has a positive relationship with profitability. Furthermore, the paper touched on ownership type by indicating that there is high competition in banking due to the fact t hat there is foreign bank involvement in domestic banks, and that profitability is not linked to ownership (Goddard, Molyneux, and Wilson, 2004). Peters et al. (2004) studied the characteristics of banks in post-war Lebanon for the years 1993 to 2000 and compared the results to a group of banks from five other countries in the Middle East including UAE, KSA, Kuwait, Bahrain and Oman for the years 1995 through 1999. They used Return on Equity (ROE) measure profitability and leverage and they employed regression models that relate bank profitability ratios to various explanatory variables. This study tests the relationships between bank profitability and size, asset portfolio composition, off-balance sheet items, ownership by a foreign bank, and the ratio of employment to assets. The results show a strong association between economic growth and bank profitability, whether measured by ROE or ROA. They found that Lebanese banks are profitable, but not as profitable as a control group of banks from five other countries located in the Middle East. Islamic Banking In the area of Islamic Banking, Bashir (2000) assessed the performance of Islamic banks in eight Middle Eastern countries. He analyzed important bank characteristics that affect the performance of Islamic banks by controlling economic and financial structure measures. The paper studied fourteen Islamic banks from Bahrain, Egypt, Jordan, Kuwait, Qatar, Sudan, Turkey, and United Arab Emirates between 1993 and 1998. To examining profitability, the paper used Non Interest Margin (NIM), Before Tax Profit (BTP), Return on Assets (ROA), and Return on Equity (ROE) as performance indicators. There were also internal and external variables: internal variables were bank size, leverage, loans, short-term funding, overhead, and ownership; external variables included macroeconomic environment, regulation, and financial market. In general, results from the study confirm previous findings and show that Islamic banks profitability is positively related to equity and loans. Consequently, if loans and equity are high, Islamic banks should be more profitable. If leverage is high and loan to assets is also large, Islamic banks will be more profitable. The results also indicate that favorable macro-economic conditions help profitability (Bashir, 2000). Hassoune (2002) examined Islamic bank profitability in an interest rate cycle. In his paper, compared ROE and ROA Volatility for both Islamic and conventional banks in three GCC region, Kuwait, Saudi Arabia, and Qatar. He states that since Islamic banking is based on profit and loss sharing, managements have to generate sufficient returns for investors given that they are not willing accept no returns (Hassoune, 2002). Bashir and Hassan (2004) studied the determinants of Islamic banking profitability covers 43 Islamic Banks between 1994 and 2001 in 21 countries. Their figures show Islamic banks to have a better capital asset ratio compared to commercial banks which means that Islamic banks are well capitalized. Also, their paper used internal and external banks characteristics to determine profitability as well as economic measures, financial structure variables, and country variables. They used, Net-non Interest Margin (NIM), which is non interest income to the bank such as, bank fees, service charges and foreign exchange to identify profitability. Other profitability indicators adopted were Before Tax Profit divided by total assets (BTP/TA), Return on Assets (ROA), and Return on Equity (ROE). Results obtained by Bashir and Hassan (2004), were similar to the Bashir (2000) results, which found a positive relationship between capital and profitability but a negative relationship between loans and profitability. Bashir and Hassan also found total assets to have a negative relationship with profitability which amazingly means that smaller banks are more profitable. In addition, during an economic boom, banks profitability seems to improve because there are fewer nonperforming loans. Inflation, on the other hand, does not have any effect on Islamic bank profitability. Finally, results also indicate that overhead expenses for Islamic banks have a positive relation with profitability which means if expenses increase, profitability also increases (Bashir and Hassan, 2004). Alkassim (2005) examined the determinants of profitability in the banking sector of the GCC countries and found that asset have a negative impact on profitability of conventional banks but have a positive impact on profitability of Islamic banks. They also observed that positive impact on profitability for conventional but have a negative impact for Islamic banking. Liu and Hung (2006) examined the relationship between service quality and long-term profitability of Taiwans banks and found a positive link between branch number and long-term profitability and also proved that average salaries are detrimental to banks profit. Masood, Aktan and Chaudhary (2009) studied the co-integration and causal relationship between Return on Equity and Return on Assets for 12 banks in KSA for the period between 1999- 2007. For their research, the used time series model of ADF unit-root test, Johansen co-integration test, Granger causality test and graphical comparison model. They found that there are stable long run relationships between the two variables and that it is only a one-direction cause-effect relationship between ROE and ROA. The results show that ROE is a granger cause to ROA but ROA is not a granger cause to ROE that is ROE can affect ROA input but ROA does not affect the ROE in the Saudi Arabian Banking sector. Conceptual Framework Theoretical framework is a basic conceptual structure organized around a theory. It defines the kinds of variables that are going to be used in the analysis. In this research, the theoretical framework consists of seven independent variables that represent four aspects of the Bank Characteristics. Theses aspects are the Bank Size (Total Assets), Capital Structure (Equity and Tangible Equity), Liquidity (Loans and Liquid Assets) and Liabilities (Deposits and Overheads). Bank profitability is the dependent variable and two measures of bank profitability are used in this study, namely return on average equity (ROAE) and return on average assets (ROAA). In this section we develop the hypothesis to be examined in this research paper. Development of Hypotheses This paper attempts to test seven hypotheses. A hypothesis is a claim or assumption about the value of a population parameter. It consists either of a suggested explanation for a phenomenon or of a reasoned proposal suggesting a possible correlation between multiple phenomena. According to Becker (1995), hypothesis testing is the process of judging which of two contradictory statements is correct. Hypothesis 1: Profitability has a positive and significant relationship with the total assets (ASSETS). Total Assets of a company represents its valuables including both tangible assets such as equipments and properties along with its intangible assets such as goodwill and patent. For banks, total assets include loans which are the basis for bank operations either through interest or interest-free practices. Total assets is used as a tool to measure the bank size; banks with higher total assets indicate bigger banks. Molyneux and el (2004) included total assets in their study and found a positive significant relationship between total assets and profitability. Therefore, total assets are expected to have positive relation with profitability which means that bigger banks are expected to be more profitable. Total assets are converted logarithmic to be more consistent with the other ratios Hypothesis 2: Profitability has a positive and significant relationship with equity to asset ratio (EQUITY). Total equity over total assets measures banks capital structure and adequate. It indicated bank ability to withstand losses and handle risk exposure with shareholders. Hassan and Bashir (2004) examined the relationship between EQUITY and bank profitability and found positive relationship. Therefore, EQUITY is included in this stud Effect of the Financial Crash on Islamic Banks in the UK Effect of the Financial Crash on Islamic Banks in the UK Chapter 1: Introduction Introduction to the Subject Background of the Subject General Objective The purpose of this study is to examine how the internal factors of the Islamic Banking affected their performance before, during and after the financial crisis in the GCC in comparison to the conventional banking in the same area. Research Questions This study aims to answer the following questions: How did the financial crisis affect the profitability of Islamic Banks in comparison to Conventional Banks? What are the internal factors (bank specific characteristics) that influence the profitability of Islamic banking for every year from 2006 2009? Did these factors have the same impact on the profitability of Islamic Banking before, during and after the financial crisis? Did these internal factors influence the profitability of Islamic Banking in the same manner as of the Conventional Banking? Need for the Study Significance of the Study Assumptions of the Study Limitations of the Study Although we cannot neglect the importance of the external factors on the profitability of Islamic Banking, they were not included in this study. To understand the reason behind this decision, we need to go through the different types of external factors and how they are classified: Macroeconomic Factors Country Regulation Rules Bank Regulation Rules These factors were not included for the following reasons: Since we are examining the performance of 92 banks (27 Islamic Banks and 65 Conventional Banks) in 6 countries, the number of countries used in the study is not significant enough to study the impact of GDP and inflation accurately on Bank profitability especially when examining each year separately Country Regulation Rules as per the IMF Database, although it differs slightly for the selected countries, did not change over the period from 2006 to 2009. This means that for each bank, these factors remained constant. Data about Bank Regulation Rules could not be obtained for GCC banks Delimitation of the Study This study was delaminated to the Islamic and Conventional Banks in the GCC whose data could be obtained in the Bankscope database. Chapter 2: Literature Review Overview of Islamic Banking Islamic Baking has established as an alternative to conventional interest-based banking. The first stirring of the Islamic Banking movement began in 1963 by Dr. Ahmed Alnajar in a small town in Egypt, called Mit Ghamar. Dr. Alnajar completed his education in Germany and found that it had many saving banks operating on interest. He took the idea from a savings bank in Germany and created his own small Islamic bank that was interest free. After Dr. Alnajars small bank proved successful, the establishment of other Islamic banks followed. In 1971, the Nasser Social Bank was founded in Egypt with the objective of lending out money as a charity on the basis of a profit and loss sharing system and helping people in need. And in 1975, the idea of Islamic banking spread to other Islamic regions such Dubai Islamic bank in United Arab Emirates and The Islamic Development (IDB) Bank in Jeddah, Saudi Arabia (Wilson, 1990). Even though Islamic Banking has only been around for thirty years and is still in an evolving stage, Islamic Banking is the fastest growing segment of the credit markets in the Muslim countries. In 2009, Assets held by Islamic Banking banks rose by 28.6 percent to $822bn from $639bn in 2008, according to The Bankers â€Å"Top 500 Islamic Financial Institutions† survey while conventional banks posted annual asset growth of just 6.8 percent. Furthermore, GCC states accounted for $353.2bn or 42.9 percent of the global aggregate, while Iran remained the largest single market for Shariah-compliant assets, accounting for 35.6 percent of the total. Finally, Islamic banking operations are not limited to Islamic countries but are spreading throughout the world. One reason is the growing trend toward transcending national boundaries, and unifying Muslims into a political and economic entity that could have a significant impact on the pattern of world trade (Abdel-Magid, 1981). Islamic Banking Rules and Principles Islamic banking rules are according to the Islamic Shariah derived from the Quran and prophet Mohameds sayings. The three main practices that are clearly prohibited in the Quran and the prophets sayings are, Riba (Interest), Gharar (Uncertainty), and Maysir (Betting). Prohibition of Riba or any predetermined or fixed rate in financial institutions is the most important factor in the Islamic principles pertaining to banking. As stated in the Quran â€Å"Allah forbids riba†. Riba means an increase and under Shariah the term refers to the premium that must be paid by the borrower to the lender along with the principle amount as a condition for the loan (Omar and Abdel, 1996). Gharar occurs when the purchaser does not know what has been bought and the seller does not know what has been sold. In other words, trading should be clear by stating in a contract the existing actual object(s) to be sold, with a price and time to eliminate confusion and uncertainty between the buyers and the sellers. Maisir is considered in Islam as one form of injustice in the appropriation of others wealth. The act of gambling, sometimes referred to betting on the occurrence of a future event, is prohibited and no reward accrues for the employment of spending of wealth that an individual may gain through means of gambling. Under this prohibition, any contract entered into, should be free from uncertainty, risk and speculation. Contracting parties should have perfect knowledge of the counter values intended to be exchanged as a result of their transactions. Therefore, and according to Ahmed and Hassan (2007), the principles of Islamic banking and finance enshrined from al-Quran and Prophet Mohamed‘s Sayings can be summed up as follows: Any predetermined payment over and above the actual amount of principal is prohibited. The lender must share in the profits or losses arising out of the enterprise for which the money was lent. Making money from money is not acceptable in Islam. Gharar (deception) and Maisir (gambling) are also prohibited. Investments should only support practices or products that are not forbidden or even discouraged by Islam. Islamic Banking Products Islamic Banking products have to be done according to Islamic rules and principles, based on profit and loss sharing as well as avoiding interest. According to BNM statistics 2007, Al Bai Bithaman Ajil financing is the most common in Islamic Banking. There are a lot of Islamic Banking products; however there are some famous Islamic products that will be discussed in this section. 1. Al Bai Bithaman Ajil /BBA This involves the credit sale of goods on a deferred payment basis. In BAA, the Islamic bank will purchase certain assets on a deferred payment basis and then sell the goods back to the customer at an agreed price including some margin or profit. The customer will make payment by installments over an agreed period. A fixed rate BBA is a powerful hedging tool against interest rates (Rosly, 1999). 2. Murabahah Murabahah is a contract of sale. The Islamic Bank acts as a middle man and purchases the goods requested by the customer. The bank will later sell the goods to the customer in a sale and purchase agreement, whereby the lender re-sales to the borrower at a higher price agreed on by both parties. These are more for short term financing 3. Mudharabah According to Kettel (2006), Mudharabah is a basic principle of profit and loss, where instead of lending money at a fixed rate return, the banker forms a partnership with the borrower, thereby sharing in a ventures profit and loss. Mudharabah is an agreement between the lender and entrepreneur, whereby the lender agrees to finance the project on a profit sharing basis according to a predetermined ratio agreed by both parties concerned. If there are any losses the lender will bear all the losses. 4. Musharakah Musharakah means partnership whereby the Islamic institution provides the capital needed by the customer with the understanding that they both share the profit and loss according to a formula agreed before the business transaction is transacted. In Musharakah all partners are entitled to participate in the management of the investment but it is not compulsory. Musharakah can help in providing financing for large investments in modern economic activities 5. Al Ijarah Ijarah means meaning to give something on a rental basis. In Ijarah, the bank acquires ownership based on the promise and leases back to the client for a given period. The customer pays the rental but the ownership still remains with the bank or lender. As the ownership remains with the lessor (bank), it continues to give the service for which it was rented. Under this contract, the lessor has the right to re-negotiate the quantum of the lease payment at every agreed interval to ensure rental remains in line with the market rates (Hume, 2004). 6. Wadiah Wadiah is a trust contract and the bank provides gift (hibah) and various types of benefits to the customer. This is exactly like a normal conventional savings account. 7. Istisna Istisna allows one party buys the goods and the other party undertakes to manufacture them according to agreed specifications. Normally, Istisna is used to finance construction and manufacturing projects. 8. Salam Salam is defined as the forward purchase of specified goods with full forward payment. This contract is normally used for financing agricultural production. According to Hassan (2004), Salam based future contracts for agricultural commodities, supported by Islamic Banks, can help to overcome the agricultural financial problems Table 2.1 lists the products of conventional banking and their correspondent products in Islamic Banking. Source: Obaidullah, 2005 Financial Crisis and the Islamic Banking To be able to compete with conventional banks, Islamic banks have to offer financial products that are comparable to the ones offered by the conventional banks. This exposes the Islamic banks to similar credit, liquidity and risks driven by market instability. Despite that, Islamic banks managed to remain stable at the early phases of the crisis. That was driven by three main Factors. First, Islamic banks financing activities are strongly tied to the real economic activities than their conventional counterpart. Even though Musharakah and Mudharabah both provide better risk sharing while keeping strong link to the real sector, they are used minimally for different reasons. Most financing activities are done through Murabah and Ijarah followed by Istinsa. In the GCC and during 2007, Murabaha comprised of 65.4%, Ijarah 12.78% and Istinsa 2.83%. Both Murabaha and Ijrah transactions require the Islamic bank to know the clients purspose and use of finance as well the ownership of the asset by the bank. This help in ensuring that the funds are used for their stated purposes. On the other hand, conventional banks do not require disclosing the use of funds as long as the client is believed to creditworthy or can post suitable collateral. Second, Islamic banks avoid direct exposure to exotic and toxic financial derivative products. Since Shariah prohibits riba and gharar, the asset portfolio of Islamic banks did not include any CDOs, CMBSs, and CDSs which turned out to be highly toxic for conventional banks and amplifying factor for the crisis. These derivative products, initially used for hedging purposes, became device for highly speculative investments among conventional financial institutions. Unavailability of hedging instruments for Islamic financial institutions, which was perceived as weakness before the crisis, became a strengthening factor for them. However, exposure to other investment risks driven from equity markets, sukuk, real-estate and ownership stakes in other businesses remain a source of concern when overdone or undertaken purely for speculative gains. Third, Islamic banks in general have a larger proportion of their assets in liquid form than their conventional counterparts. This is driven by two main reasons: (1) there is no lender of last resort (LOLR) facility available to Islamic banks, and they do not have access to market liquidity in the form of the interbank market, high liquidity was maintained for risk management purpose. (2) Excess liquidity is required due to lack of interest-free short-term investment opportunities as real economic investments require some development period. As the global financial crisis became a global economic crisis, it started to affect Islamic banks in an indirect manner. The financial crisis has triggered a chain reaction whereby the slowdown in the real economies of the developed countries has started to affect economic growth and investment activities in export driven economies of the developing countries through lower trade in goods and services as well as through the declining commodity prices including that of oil. The economic downturn is not only affecting the investment and financing activities of financial institutions including those of Islamic banks, it is also reducing the funding of these banks through lower personal savings and declining corporate profits. It should be noted that most of the Islamic banking industry comprises of commercial banks whose major funding source are retail deposits, investment banking constitutes only a small portion of the industry. Islamic banks in some regions may face risk on their fina ncing and investment side of the balance sheet due to the crisis induced volatility of equity markets where these banks have large positions. Downturn in the real estate markets where these banks have large direct and indirect exposures is also another source of risk. Similarly, the changing wealth position of their high-net-worth (HNW) clients who also hold financial exposure in the hard-hit conventional financial sector of the West and therefore are now postponing any investment plans is also a factor. The relative importance of each of these factors varies by the region. For example, the banks in the GCC and particularly in the UAE are more exposed to real estate market risk, followed by risk of international equity markets. For the banks in Asia, their investments in domestic and international equity markets are a source of concern as equity markets are showing higher volatility. In some of the countries, the existing fiscal imbalance which has widened after the crisis is also a factor in the increased volatility of the markets Previous Literature The study of bank profitability is an important tool to evaluate bank operation by examining the different factors affecting bank profitability and using these factors for management planning and strategic analysis. In the last four decades, many studies have been conducted to study both bank profitability and the determinants of bank profitability either for particular country or for a panel of countries. These studies normally divide these factors into internal factors and external factors. Internal factors represent the bank-specific characteristics such as bank size, liquidity structure; liabilities†¦etc while external factors can be macroeconomic factors such as inflation and GDP growth or Country-specific regulations rules and practices. In the area of banking profitability, many studies have been conducted to investigate the profitability of conventional banks while only few were conducted in the field of Islamic banking. In this chapter, we will review these studies for conventional banking first and then will focus on studies in the Islamic banking field. Then we will cover the conceptual framework of this research. Conventional Banking Different studies have been conducted in the field of conventional banking profitability. Short (1979), Bourke (1989), Molyneux and Thornton (1992), Goddard, Molyneux, and Wilson (2004), Peters et al. (2004) are some of the researchers in the field. Short (1979) is one of the early scholars who studied the relationship between banking profit rates and concentration for sixty banks in Canada, Western Europe and Japan during the 1970s and he included independent variables including government ownership and concentration by using H index to quantify concentration. Results showed that the government ownership impact on profitability varied throughout the countries studied but expressed an overall negative relationship. He also found evidence that indicated higher concentration rates lead to higher profit rates (Short, 1979). Bourke (1989) also compared concentration to bank profitability but included other determinants. Bourke (1989) covered ninety banks in Australia, Europe, and North America between 1972 and 198 and examined different internal and external factors: internal factors such as staff expenses, capital ratio, liquidity ratio, and loans to deposit ratio; external factors such as regulation, size of economies of scale, competition, concentration, growth in market, interest rate, government ownership, and market power. His results show that increase in government ownership leads to lower profitability in banking. He also found that concentration, interest rates, and money supply are positively related to profitability along with capital and reserves of total assets as well as cash and bank deposits of total assets. Bourke adds that well capitalized banks enjoy cheaper access to sources of funds as they are less risky than less capitalized banks (Bourke, 1989). Later, Molyneux and Thornton (1992) studied the determinants of European banks profitability. The paper examined eighteen counties in Europe between 1986 and 1989. This paper replicated Bourkes (1989) work by using internal and external determinants of bank profitability. However, Molyneux and Thornton (1992) results showed that government ownership expresses a positive coefficient with return on capital (profitability) which contradicts with Bourkes findings. Other results were similar to Bourkes, showing that concentration, interest rate, and money supply were positively related to bank profitability (Molyneux and Thornton, 1992). In one of the recent papers on bank profitability on European banks, Goddard, Molyneux, and Wilson (2004) shows similar findings to the paper by Molyneux and Thornton (1992). It investigates the determinants of profitability in six European countries and it covered 665 banks between 1992 and 1998. The study used cross-sectional and dynamic panel models. The variables used in the regression analysis were ROE, the logarithmic of total assets, Off Balance Sheet (OBS) dividends, Capital to Asset Ratio (CAR). The results from both models were similar: evidence reveals that there is a positive relationship between size (total assets) and profitability. Meanwhile, OBS appears to have a positive relationship with profitability for UK but neutral or negative for other European countries. Moreover, results also state that CAR has a positive relationship with profitability. Furthermore, the paper touched on ownership type by indicating that there is high competition in banking due to the fact t hat there is foreign bank involvement in domestic banks, and that profitability is not linked to ownership (Goddard, Molyneux, and Wilson, 2004). Peters et al. (2004) studied the characteristics of banks in post-war Lebanon for the years 1993 to 2000 and compared the results to a group of banks from five other countries in the Middle East including UAE, KSA, Kuwait, Bahrain and Oman for the years 1995 through 1999. They used Return on Equity (ROE) measure profitability and leverage and they employed regression models that relate bank profitability ratios to various explanatory variables. This study tests the relationships between bank profitability and size, asset portfolio composition, off-balance sheet items, ownership by a foreign bank, and the ratio of employment to assets. The results show a strong association between economic growth and bank profitability, whether measured by ROE or ROA. They found that Lebanese banks are profitable, but not as profitable as a control group of banks from five other countries located in the Middle East. Islamic Banking In the area of Islamic Banking, Bashir (2000) assessed the performance of Islamic banks in eight Middle Eastern countries. He analyzed important bank characteristics that affect the performance of Islamic banks by controlling economic and financial structure measures. The paper studied fourteen Islamic banks from Bahrain, Egypt, Jordan, Kuwait, Qatar, Sudan, Turkey, and United Arab Emirates between 1993 and 1998. To examining profitability, the paper used Non Interest Margin (NIM), Before Tax Profit (BTP), Return on Assets (ROA), and Return on Equity (ROE) as performance indicators. There were also internal and external variables: internal variables were bank size, leverage, loans, short-term funding, overhead, and ownership; external variables included macroeconomic environment, regulation, and financial market. In general, results from the study confirm previous findings and show that Islamic banks profitability is positively related to equity and loans. Consequently, if loans and equity are high, Islamic banks should be more profitable. If leverage is high and loan to assets is also large, Islamic banks will be more profitable. The results also indicate that favorable macro-economic conditions help profitability (Bashir, 2000). Hassoune (2002) examined Islamic bank profitability in an interest rate cycle. In his paper, compared ROE and ROA Volatility for both Islamic and conventional banks in three GCC region, Kuwait, Saudi Arabia, and Qatar. He states that since Islamic banking is based on profit and loss sharing, managements have to generate sufficient returns for investors given that they are not willing accept no returns (Hassoune, 2002). Bashir and Hassan (2004) studied the determinants of Islamic banking profitability covers 43 Islamic Banks between 1994 and 2001 in 21 countries. Their figures show Islamic banks to have a better capital asset ratio compared to commercial banks which means that Islamic banks are well capitalized. Also, their paper used internal and external banks characteristics to determine profitability as well as economic measures, financial structure variables, and country variables. They used, Net-non Interest Margin (NIM), which is non interest income to the bank such as, bank fees, service charges and foreign exchange to identify profitability. Other profitability indicators adopted were Before Tax Profit divided by total assets (BTP/TA), Return on Assets (ROA), and Return on Equity (ROE). Results obtained by Bashir and Hassan (2004), were similar to the Bashir (2000) results, which found a positive relationship between capital and profitability but a negative relationship between loans and profitability. Bashir and Hassan also found total assets to have a negative relationship with profitability which amazingly means that smaller banks are more profitable. In addition, during an economic boom, banks profitability seems to improve because there are fewer nonperforming loans. Inflation, on the other hand, does not have any effect on Islamic bank profitability. Finally, results also indicate that overhead expenses for Islamic banks have a positive relation with profitability which means if expenses increase, profitability also increases (Bashir and Hassan, 2004). Alkassim (2005) examined the determinants of profitability in the banking sector of the GCC countries and found that asset have a negative impact on profitability of conventional banks but have a positive impact on profitability of Islamic banks. They also observed that positive impact on profitability for conventional but have a negative impact for Islamic banking. Liu and Hung (2006) examined the relationship between service quality and long-term profitability of Taiwans banks and found a positive link between branch number and long-term profitability and also proved that average salaries are detrimental to banks profit. Masood, Aktan and Chaudhary (2009) studied the co-integration and causal relationship between Return on Equity and Return on Assets for 12 banks in KSA for the period between 1999- 2007. For their research, the used time series model of ADF unit-root test, Johansen co-integration test, Granger causality test and graphical comparison model. They found that there are stable long run relationships between the two variables and that it is only a one-direction cause-effect relationship between ROE and ROA. The results show that ROE is a granger cause to ROA but ROA is not a granger cause to ROE that is ROE can affect ROA input but ROA does not affect the ROE in the Saudi Arabian Banking sector. Conceptual Framework Theoretical framework is a basic conceptual structure organized around a theory. It defines the kinds of variables that are going to be used in the analysis. In this research, the theoretical framework consists of seven independent variables that represent four aspects of the Bank Characteristics. Theses aspects are the Bank Size (Total Assets), Capital Structure (Equity and Tangible Equity), Liquidity (Loans and Liquid Assets) and Liabilities (Deposits and Overheads). Bank profitability is the dependent variable and two measures of bank profitability are used in this study, namely return on average equity (ROAE) and return on average assets (ROAA). In this section we develop the hypothesis to be examined in this research paper. Development of Hypotheses This paper attempts to test seven hypotheses. A hypothesis is a claim or assumption about the value of a population parameter. It consists either of a suggested explanation for a phenomenon or of a reasoned proposal suggesting a possible correlation between multiple phenomena. According to Becker (1995), hypothesis testing is the process of judging which of two contradictory statements is correct. Hypothesis 1: Profitability has a positive and significant relationship with the total assets (ASSETS). Total Assets of a company represents its valuables including both tangible assets such as equipments and properties along with its intangible assets such as goodwill and patent. For banks, total assets include loans which are the basis for bank operations either through interest or interest-free practices. Total assets is used as a tool to measure the bank size; banks with higher total assets indicate bigger banks. Molyneux and el (2004) included total assets in their study and found a positive significant relationship between total assets and profitability. Therefore, total assets are expected to have positive relation with profitability which means that bigger banks are expected to be more profitable. Total assets are converted logarithmic to be more consistent with the other ratios Hypothesis 2: Profitability has a positive and significant relationship with equity to asset ratio (EQUITY). Total equity over total assets measures banks capital structure and adequate. It indicated bank ability to withstand losses and handle risk exposure with shareholders. Hassan and Bashir (2004) examined the relationship between EQUITY and bank profitability and found positive relationship. Therefore, EQUITY is included in this stud

Anorexia :: essays research papers fc

Anorexia nervosa is an illness that can control the mind. Anorexia nervosa is an illness that usually occurs in teenage girls, but it can also occur in teenage boys as well as adult women and men. People with the disease anorexia are obsessed with being thin. They lose weight excessively and are terrified of gaining weight. They believe they are fat even though in reality they are not fat at all; in fact they are very thin. Anorexia is not just a problem with food or weight. It is an attempt to use food and weight to deal with emotional problems they have with in them.   Ã‚  Ã‚  Ã‚  Ã‚  Most people confuse anorexia nervosa with bulimia. People with anorexia starve themselves, avoid high calorie foods, and exercise constantly. People with bulimia eat huge amounts of food, but they throw up soon after eating, or take laxatives or diuretics to keep from gaining weight. People with bulimia do not usually lose as much weight as people with anorexia. Not to say that bulimia is not as harmful to a person as anorexia is, but anorexia is a disease that attacks the body and mind more than bulimia.   Ã‚  Ã‚  Ã‚  Ã‚  The reason that some people get anorexia is unknown. People with anorexia may believe that they would be happier and more successful if they were thin. They want everything in their lives to be perfect including being thin because that is what society portrays the successful to be. People who suffer from this disorder are usually good students. They usually are all involved in many school and community activities. They blame themselves if they do not get perfect grades, or if other things in life are not perfect.   Ã‚  Ã‚  Ã‚  Ã‚  Girls that suffer from anorexia usually stop having menstrual periods. People with anorexia also have dry skin and thinning hair on their heads. They may have a growth of fine hair all over their body. They may feel cold all the time, and they may get sick quit often. People with anorexia are often in a bad mood. They have a hard time concentrating and are always thinking about food. It is not true that anorexics are never hungry, actually they are always hungry. Feeling hunger gives them a feeling of control over their lives and their bodies. It makes them feel like they are good at something; they are good at losing weight. People with severe anorexia may be at risk of death from starvation.

Compare and Contrast how Thomas Hardy and Charlotte Perkins Gilman :: English Literature

Compare and Contrast how Thomas Hardy and Charlotte Perkins Gilman present the situation, behaviour and attitude of the women in the stories The Withered Arm and Turned. Explain what motivates these characters to behave as they do. Thomas Cookes Compare and Contrast how Thomas Hardy and Charlotte Perkins Gilman present the situation, behaviour and attitude of the women in the stories 'The Withered Arm' and 'Turned'. Explain what motivates these characters to behave as they do. Hardy and Gilman both share a similarity of characters and theme in their short stories. Both focus particularly on the female characters and the ways in which the other characters react and behave towards them throughout the stories. Both stories have two strong main female characters and two weaker more naÃÆ'Â ¯ve but also lead female characters. The way these characters interact with each other is very similar in both stories, how Marion and Rhoda seem to almost mother Gerta and Mrs. Lodge as they appear to have a kind of power over the two younger women. Although it can be argued that in the case of Mrs. Lodge, she has Rhoda's ex lover as her husband and this could be looked upon that she has an advantage over Rhoda. She feels as though Gertrude is 'closing doors' between herself and Farmer Lodge that finally there is no chance of rekindling the old flames she once had with him or for Farmer Lodge to make 'any reparation' for what he did to her. Both the elder women also have greater knowledge of men and how the world works, even if Mrs. Lodge is what is called a 'lady complete' she is still unaware of how society works and is treated. Both Rhoda and Marion are women who refuse to conform to how society expects them to act and behave. This is obvious when Marion takes in Gerta after discovering her husband to be having relations with the girl. Most women of the time would have taken back their husband and banished the girl, and although this is Marion's instinct she knows deep down this is wrong. Rhoda is similar to Gerta; she also had a sexual relationship outside of marriage with Mr. Lodge and bore a child from it, but yet still continues to hold her head high and not disappears in society as many women of the time would have done. In a way this difference between these two similar characters is kind of ironic as Marion has to deal with her husband having relations outside marriage with a girl, whereas Rhoda is a woman who had sexual relations outside marriage. Compare and Contrast how Thomas Hardy and Charlotte Perkins Gilman :: English Literature Compare and Contrast how Thomas Hardy and Charlotte Perkins Gilman present the situation, behaviour and attitude of the women in the stories The Withered Arm and Turned. Explain what motivates these characters to behave as they do. Thomas Cookes Compare and Contrast how Thomas Hardy and Charlotte Perkins Gilman present the situation, behaviour and attitude of the women in the stories 'The Withered Arm' and 'Turned'. Explain what motivates these characters to behave as they do. Hardy and Gilman both share a similarity of characters and theme in their short stories. Both focus particularly on the female characters and the ways in which the other characters react and behave towards them throughout the stories. Both stories have two strong main female characters and two weaker more naÃÆ'Â ¯ve but also lead female characters. The way these characters interact with each other is very similar in both stories, how Marion and Rhoda seem to almost mother Gerta and Mrs. Lodge as they appear to have a kind of power over the two younger women. Although it can be argued that in the case of Mrs. Lodge, she has Rhoda's ex lover as her husband and this could be looked upon that she has an advantage over Rhoda. She feels as though Gertrude is 'closing doors' between herself and Farmer Lodge that finally there is no chance of rekindling the old flames she once had with him or for Farmer Lodge to make 'any reparation' for what he did to her. Both the elder women also have greater knowledge of men and how the world works, even if Mrs. Lodge is what is called a 'lady complete' she is still unaware of how society works and is treated. Both Rhoda and Marion are women who refuse to conform to how society expects them to act and behave. This is obvious when Marion takes in Gerta after discovering her husband to be having relations with the girl. Most women of the time would have taken back their husband and banished the girl, and although this is Marion's instinct she knows deep down this is wrong. Rhoda is similar to Gerta; she also had a sexual relationship outside of marriage with Mr. Lodge and bore a child from it, but yet still continues to hold her head high and not disappears in society as many women of the time would have done. In a way this difference between these two similar characters is kind of ironic as Marion has to deal with her husband having relations outside marriage with a girl, whereas Rhoda is a woman who had sexual relations outside marriage.

A Global Theory of Knowledge for the Future :: Philosophy Philosophical Papers

A Global Theory of Knowledge for the Future ABSTRACT: There is too much factual knowledge to grasp even a speck of the whole. This makes for an excessive diversity that lacks in coherent unity. With no coherency in the parts, there will be no coherent truth in the whole. Without coherent truth there is only a relative truth. Relative truth makes for contradiction from different viewpoints, perceptions, and perspectives. Contradictions deny a common definition and meaning of truth, morality, justice, and beauty. They also deny common standards, values, principles, and virtues. Uncommon values lead to personal and social conflict and confusion, to the blocking of learning in education, to the disintegration of social unity. To have common standards and values, that a global theory of knowledge requires, concrete factual knowledge should be unified by abstract concepts that are unified by abstruse principles that are unified by symbolic structures. Such principles ultimately derive from an ultimate unity and structure. This ultim ate unity is the keystone that holds the whole systematic structure of knowledge together. Definitions: Spiritual: Intuitive knowledge. The antithesis of sensual. Rational: Logical knowledge. The synthesis of the spiritual and sensual. Sensual: Sensory knowledge. The antithesis of the spiritual. Progressive Ranges: Hierarchical social levels, like person, group, nation, civilization. There is too much factual knowledge to grasp even a speck of the whole. This makes for an excessive diversity that lacks in coherent unity. With no coherency in the parts, there will be no coherent truth in the whole. Without coherent truth there is only a relative truth. Relative truth makes for contradiction from different viewpoints, perceptions, and perspectives. Contradictions deny a common definition and meaning of truth, morality, justice, and beauty. They also deny common standards, values, principles, and virtues. Uncommon values lead to personal and social conflict and confusion; to the blocking of learning in education, to the disintegration of social unity. Such personal and social problems result from learning only the factual leaves on the Tree of Knowledge. This causes one to lose sight of unifying principles that are the roots, and the unifying concepts that are the branches. To have common standards and values, that a global theory of knowledge requires, concrete factual knowledge should be unified by abstract concepts, that are unified by abstruse principles, that are unified by symbolic structures. Such principles ultimately derive from an ultimate unity and structure. This ultimate unity is the keystone that holds the whole systematic structure of knowledge together.

Is Strategic Leadership Necessary to Effectively Manage Global Strategy in Today’s Essay

Critically evaluate whether strategic leadership is necessary to effectively manage global strategy in today’s turbulent business environment In today’s environment, companies need more and more flexibility to success in a rapidly changing world which evolves constantly over the year. It is interesting to speculate if a strategic leader is necessary to lead the company to the success and to well manage the global strategy of the firm. The term of leadership is hard to define and there are over 400 definitions of what it really is. Leadership can be in a poetic way, according to Warren Bennis, â€Å"like beauty: it’s hard to define but you know it when you see it†. Or in a more concrete way, we can say that leadership† is a matter of making a difference. It entails changing an organization and making choices among plausible alternatives. It depends on the development of others and mobilizing them to get the job done. â€Å"(Useem, 2001). Consequently, strategic leadership is the vision of the leader, the directions chosen by him to lead the company to the success. Strategic Leadership consists also in persuading the members of the organization in order to build an organizational structure whose aim is the strategic productivity. (managementstudyguide. com, 2010). This concept of strategic leadership is more and more important in a context of global strategy. Indeed, nowadays, it is more and more usual to globalize its company in order to gain in productivity and performance. Thus, the global strategy of a company is somehow, a kind of strategic guide to succeed in the globalization process. This is a guide which permits the company to go ahead the barriers to international trade by gaining competitive advantages according to (quickmba. com, 2010). A global strategy must ask itself some questions like what must be the presence on the market in each country? How to build an international global presence? Regarding to these two important aspects of a business, it is interesting to wonder if the strategic leadership is related to the global strategy and more precisely if the strategic leadership is necessary to success in globalizing its company within this turbulent business environment. The strategic leadership may have an impact on the global strategy of a firm; nevertheless, strategic leadership is sometimes subject to some issues which can impair the viability of the company and its potential success. Indeed, the leaders have a lot of pressure, they have to deliver results and manage the personal, which is more and more complicated in a changing world directed by the development of new technologies which implicated more and more reactivity. And sometimes leaders can make mistakes, Gerald Ratner, CEO of Barclays Bank, has said in front of TV cameras and reporters that he didn’t have a credit card because†¦ it’s too expensive! That wasn’t very professional†¦ Thus, the position of the leader is always a kind of a precarious position because he has to make decisions which will determine the success of the company. Charan and Colvin (The quest for quality of work life: a TQM approach) highlight some strategic mistakes that a leader could make, some misjudgements which can lead to issues in term of strategic leadership. The first one may be people related. Indeed people can’t be underestimating, and sometimes it happens, people of an organization are the glue of this one, so it is necessary to understand people skills to have a harmony in the corporation, especially in terms of relationships, according to Bill Donaldson and Tom O’toole (strategic market relationships: from strategy to implementation, 200), â€Å"personal contact cannot be underestimated†. So it is crucial to have some strategic leadership to make sure that everybody is held at fair value. Moreover, another difficulty for the leader is to fail putting the right people at the right place, this task requires a analysis of each people in the staff in order to place them in the job in which they are the most efficient and in which they will work the best and do their best contribution. According to Buckingham and Coffman (1999) in their book† First, Break All the Rules: What The World’s Greatest Managers Do Differently†, they put forward twelve questions which are really useful to put people in the adapted job (bainvestor. om, 2010). Another people related problem can be the fail to deal with managers who are underperforming. The decision making process is also seen as a issue in strategic Leadership, some decisions are not made which can implied a cost in term of time and money. The leader has to use good tactics to make their decisions. The problem is that, according to Nutt (researchnews. osu. edu, 2010) a good tactic in decision making require time and leaders are looking for quick fixes, but over the long term, theses tactics turn out to be successful. Beyond these issues, the leaders have also to face some challenges in particularly concerning the environment which is changing. Lao Tzu says that â€Å"resisting change is like holding your breath; if you persist, you die†. The challenge that faces the leader is how to adapt them to a changing environment, and more precisely in this context of globalization, because the employee may feel suspicious relative to the change. This kind of barrier has to be destroyed by the leader by setting objectives, having open discussions with employee or showing their commitment. Manage the employee is a challenge, but the nature of the strategic environment is another one. According to (airpower. au. af. mil, 2010), there are four components which can be seen as challenges to the strategic leader: Complexity, Ambiguity, uncertainty and volatility. The leaders have to anticipate scenario to avoid volatility (ex Bosnia/Kosovo), and to highlight the act of the competitors to reduce the uncertainty and the complexity of the interdependence of the components. Moreover, the ambiguity can be solved by working in team; this work will permit not to have multiple interpretation of one problem for example. As said before, the economic world has change over the past few years, with notably the financial crisis which has affect business productivity. This event shows us that the situation can change one day to another. Thus Brigid L. Bechtold explains in his book â€Å"Chaos theory as a model for strategy development†, the necessity of putting in place news strategies to balance a random economic situation. Moreover, the author emphasize the notion of interaction between the company which are now interdependent, a strategic leadership must deals with this situation in order to communicates and acts conscientiously, and notably in the case of corporate parenting. The corporate parenting has to set priority for the strategic leadership. Corporate parenting is a management which is intern to the company, no others actors of the market are taking in account; there are no interaction with others actors such as competitors or buyers. The aim of corporate parenting is to give value to the firm, but these operations require money and generate cost. There are three different types of this kind of management, strategic planning, strategic control and financial control. The strategic planning puts resources together in order to reinforce each business units to achieve a common goal, for example providing central services and resources. The strategic control consist in using the corporate parent ability to build some value for the business and finally under the financial control type the corporate parent evaluate and ontrol the performance of each business unit (scribd. com, 2010 ), and then business units are more independent even if they are subject to performance standards. The corporate parenting provide thus a clear image of the strategy to all the business units, managers can focus on the same goal. Moreover, a corporate parent can interfere and guides its business units if they are underperforming for example. A s an example we can talk about Virgin which is the perfect example of a successful corporate parenting: Robabdul. com, 2010 Virgin was able to understand and institutionalized markets, but also in terms of innovation, by buying and created partnership with good skilled company. Moreover the management is flexible and gives flexibility to business units. (robabdul. com, 2010) But the corporate parenting can also destroy value instead of adding this one. (accessmylibrary. com, 2010), some might say that the destruction of the value is created by the â€Å"level of corporate overhead costs†, but even if these costs are high, it is not the principal cause of failure. The most often, the influence of the parent are bad, because they put in place invalid objectives and unsuitable strategies. Thus, the managers have to use this strategic leadership of the corporate parents to develop the same and adequate strategy within the business units and the strategic leadership must be aware of the objectives given to ensure that they are realizable. In a context of globalization, this corporate parenting can face culture issues which can impact on the global strategy. The globalization is a phenomenon which is more and more spread; it’s a new way of working and in to manage people who come from different countries, some authors had created some dimensions dealing with cultural dimensions and the different value orientations. Indeed the majority of these workers don’t understand the attitude and the reactions of their colleagues because of the culture which includes different ways of thinking or acting. A strategic leadership has to leverage on cultural difference for competitive advantage. To create opportunities of collaboration a strategic leader must understand the management philosophy and the national character, to help this, Greet Hofstede created dimensions (hofstede. com, 2010) which permit to analyze and understand people from a different culture. A good strategic leadership is needed to manage these cultural gaps, because culture can be assimilating to the driving force beyond a man behavior. To succeed in a multicultural environment, the leaders must adopt the concept of global leadership, (Managing cultural differences: global leadership strategies for the 21st century, by Robert T.  Moran,Philip R. Harris,Sarah Virgilia Moran, Butterworth-Heinemann, 2007 ), they have to be capable of operating in the globalized world and being respectful of each culture, he must be flexible and open in order to perceive and understand people reactions. Companies have also to take care of what they said, if they didn’t pay attention to their slogan, they can get into trouble, thus the slogan of American Airlines â€Å"Fly in Leather† has been translated in Spanish by â€Å"fly naked† (brandingstrategyinsider. com, 2010). To have this open-minded spirit, the relationship between management and strategic leaderships must be define The leadership, and more particularly the strategic leadership are the eyes of an organisation, they have to see what is coming, to anticipate the future in order to give the opportunities to the company to create the future. Instead, the management, according to the figure, is more about execution. Indeed, the management deals with organization, they follow and accomplish the mission given by the leadership, they have to â€Å"comprehends the vision and the road map† (relationship-economy. com, 2010). A good example of the relation Leader/manager is the story of the creation of the iMac by Apple. 2-speed. com, 2006) The ex-CEO of Viewlogic relates its anecdote: all the work on the iMac was done, the product was about to be launched when Steve Jobs, a great leader, require that the case for the computer has to be transparent. This resulted in additional cost and engineering work had to be restarted because it has to be pretty either. This story shows well the differences of vision between a leader and a manager; Steve Jobs has seen the importance of the design over the long term and put the base of Apple competitive advantage. Relationship-economy. com, 2010 In this climate of economic uncertainty, the role of the strategic leadership within the global strategy is important notably speaking of the globalization phenomenon which is playing a major role in the business environment of today. Strategic leaders are necessary because they are the inspiration of the company, the guide of the managers. As seen before, in terms of corporate parenting, strategic leadership plays a crucial role in the success of the different business units, but sometimes, it happens that the influence of this one compromise the viability of the different business units. Globally speaking, a company has often resort to internationalize itself, to succeed in this way a strategic leadership must be set, in order to understand and leverage of cultural differences. Concerning the relationship between the relationship between management and strategic leadership, they have a special relationship, on could not function without the other. Whitout the execution of the ideas of the strategic leader, these ones would be useless. These two concepts are interdependent, the management deals with organizing, planning and answers short terms questions, while conversely, the strategic leader responds to long terms issues and determines the position of the company and its strategic direction. The strategic leader must communicate to the company values. He should increase the belief of employees in the company and be transparent and involve them in their role. It must be open in order to speak freely of market information, because employees want to know where the company is going and want to know what the leader knows. It is also important for the leader to take into account the opinions of everyone. Indeed even if the decisions that are not suitable with the wish of the employees, having been listening reinforce their membership to the business. Even if there are bad decisions making by some strategic leaders, (notably speaking of the CEO of the banks which didn’t pay attention to the mistakes that they have done and start the financial crisis), they are necessary in the global strategy of a company but some strategic leadership can be at the origin of failure and being not adapted to some kind of company. Thus strategic leadership is important to manage global strategy to give confidence and to innovate in the turbulent environment. But to avoid some mistake the management can be stricter and let more place to concrete work instead of just ideas in order to stabilize and create a secure environment for the business. References http://www.quickmba.com/strategy/global/ http://www.managementstudyguide.com/strategic-leadership.htm http://www.cmoe.com/strategic-leadership.htm