What Ethics Means to the Writer Assignment Example | Topics and Well Written Essays - 500 words

What Ethics Means to the Writer - Assignment Example Personally, I believe that ethics involves knowing the difference between wrong and right, specifically through a process in which one figures out whether a certain action should or should not be carried out. For instance, if presented with a chance to shoplift in a supermarket due to a commotion, knowing that shoplifting is wrong and stopping me from doing it is being ethical. However, doing it even in the knowledge that it is wrong would be unethical. Obeying the law is also a part of being ethical, for example, ensuring that one has car insurance is a legal requirement and, therefore, ethical, while failing to acquire car insurance despite being required to do so for safety purposes is unethical. Ethics are also important in one’s career with numerous individual choices in the workplace being made on a daily basis. Whether one is a CEO or an employee, choices related to ethics will have a unique set of circumstances and significance, as well as the potential to produce diverse results. Ethics play a critical and constant role in the corporation and in an individual employee’s career. For example, the code of conduct and ethical behavior materials are obligatory in most corporations and the ability to follow these regulations and rules ensures that the individual is able to further their career without disciplinary issues and, therefore, it is important to follow the required ethics in the workplace. Finally, ethics are also important in society, which can be seen by the number of topics that have given rise to ethical debates in the US, such as organ donation after death and use of non-renewable- fossil fuel. Ethical debates in society normally have wide relevance, do not have definitive answers, and often involve very sensitive areas or topics.

The World Association Of Travel Agencie Tourism Essay

The World Association Of Travel Agencie Tourism Essay With globalization of economy the world wide communication has increased tremendously along with the touring activities. These touring activities may be for recreation business or any other purpose. A travel agency is an agency that makes the necessary arrangements for travelers (Referenced from, Concise Oxford Dictionary 9th addition Page 1485). The travel agent is supposed to be an expert who can make the knowledge of various destination available to his clients regarding mode of travelling paper work like Passport, Visa and money exchange, Hotel Accommodations for stay like hostels etc, Car rental, connectivitys and local tour etc. A new aspect of tour agency has developed recently i.e. Internet Traveling Agencies using the internet facilities. In terms of the business a travel agency can be defined as a retail business selling products and services which are related with the travel activities. A travel agency works on behalf of the suppliers of such facilities like Airlines, Cruise Companies, Car Rental, and Hotels etc. According to the work a travel agency may specialize into holiday package, business tours, educational tours etc. A new dimension of traveling has emerged i.e. Medical tourism related with services provided to a patient. HISTORY Cox and kings is supposed to be the pioneer company in the field of modern touring. It started in 1758 as Recreation Company for the wealthy customers of a private bank. Thomas cook followed Cox and Kings with establishment of the chain of agencies in 19th centaury with a partner i.e. mid land railway. They sold their own product to the public as well as other tour packages from different tour companies. Other pioneers travel agencies include polytechnic tourism association, co- operative wholesale society and Dean Dawson. All these travel agencies are of British origin. In America the pioneers in the field are Brownell Travel. With development of commercial aviation in 1920s the travel agencies become more and more popular in the public further boom was there in the post-war period with development of mass- market packet holidays specially developed for the working class customers in British owned colonies. OPERATONS AND FUNCTIONING A travel agency is mainly an agent which sells products and services relative with the traveling on behalf of the suppliers. They do not have a ready stock in hand unless a customer request for the same. Most of the travel agencies thrive on commissions given to them by the suppliers In uae7% commission is paid by the airlines to the travel agencies. These agencies have direct links with hotel chains cruise lines and airlines for their activities. RESOURCES AND REVENUE STRUCTURE A travel agency has got two means of revenue earnings i.e. commissions and professional fees. Commissions: These are the main source of income for most of the travel agencies. A travel agency is paid commission by the suppliers of the products and services like airlines etc. Usually the commissions are supposed to be given on a fixed ratio basis. However in case of an agency providing higher volume of business to the supplier it may demand a higher percentage for its services. It is called as override. To enhance their business a travel agency may prefer to pass on some part of this commission to its preferred customers in order to fetch more business. This is the reason that some time a ticket of an airlines is available at a higher price when purchase from a open market and at a lesser price with the agency. Travel agencies also help the airlines to fill their empty seats at the last minutes. Professional fee: A travel agency may charge professional fee from its client if it is not getting commission from the service provider. This may be a percentage premium of the total cost of tour or may be charged on a flat rate basis. Other commercial activities: These include travel insurance, providing travel guiding time tables, car rental and on site Bureau de change services provided by the travel agencies of large chains. A standard fee may be charge for the same. Promotional Activities:- Travel agencies have to take help of print and electronic media for their promotions. This constitutes a major expenditure. This may include hoardings, advertisements and other professionals advertising Apart from this the other expenditure are usually administrative and liasoning activities. Liasoning activities are supposed to be vital to get business in bulk. Sales:- There are four stages of sales sequences for a travel agency :- Enquiring about needs of a customer. Development of a personal rapport with the customer. Good presentation of the products and services and their major suppliers. Actual sales. ROLE OF TECHNOLOGY IN PROMOTIONAL ACTIVITIES A better customer satisfaction may be generated if a travel agency uses adequate technologies to provide instance services to its clients. CUSTOMER PROTECTION: SURETY BONDS Like all other business travelling too has a risk of commercial failure so majority of the travel agents have the insurance policies against such calamities. These are called surety bounds and are well advertise by the travel agencies if they have this facility. This means that the clients are guaranteed either the refund of the money or an equivalent holiday according to their preference. These bounds are usually provided by IATA (International Air Transport Association), ATOL ( Air Travel Organizers Licensing), ABTA (Association of British Travel Agents and ASTA (American Society of Travel Agents.) HOLIDAY SUPER MARKET CONCEPT A new concept known as Holiday Super Market Concept has developed in recent years after low cost no frill airlines started their international operations. This is a mass market package holiday in which the clients choose their holidays from brochures on racks. TYPES OF TRAVEL AGENCY There may be many classifications of travel agencies as follows:- According to their specialization. According to geographical operations. According to size. According to specialization Leisure Travel Agents: These agencies operate like tourism ambassadors of foreign companies. or example A company having its head quarter say in Japan might set up various offices around the world to promote tourism to that country. These travel agency will work to promote the business of their mother company in Japan acting as a general sale agent for that company. Business Travel Agents:- with globalization of the economy a new phenomena of globalization of business has emerged requiring a frequent travelling of higher executives and policy makers of a company to different countries. Their needs may be different from those of holiday tourists. To cater this class of travelers a travel agency will have to specialize in this field so as to guide them to have better deals for their business. Abu Dhabi is a place of interest for both type of travelers due to its world class airport, improved infrastructure, and high connectivity as well as presence of large number of places of tourist interest. Medical Tourism: A new dimension called as Medical Tourism has been added to the tourist activities worldwide. This phenomena has emerged because of the fact that there is considerable differences exist between the cost of medical facilities in developed companies and those of so called developing countries. This is also called Medical Tourism, Health Tourism or Global Health Care. A travel agent specialized in medical tourism should have the working knowledge of specialized surgeries like Joint Replacement , Cardiac Surgeries , Psychiatry, Alternative medicines etc. and should be able to guide its client in this regards. According to Geographical Operations: There are two types of travel agencies depending on their areas of geographical operations :- Out Bound Travel Agency :- These are located in the country of the traveler. These are traditional multi- destination agencies. In Bound Travel Agency:- These are located in the country of destination or more commonly at a place of certain major events like sports events these are usually independent and cater to a special market (Niche Market) they deliver and expertise on that location only. Out bound travel agencies are usually much larger than the in bound agencies, the former being a chain of agencies in most of the cases while the letter are usually small individual travel agency Classification according to size In USA these are classified as under :- Corporate Owned Chains. National / International Franchises. National Membership Associassion. Independent agencies. Corporate Owned Chains:- These are the large chains and usually owned by the international giants like Cox and Kings etc. They have got a consistent policy about their products and services, commissions, fees and their operations. National / International Franchises:- They too have a consistent policy of their operation and their prices. National Membership Association:- These are usually less commissions focused as they rely more on their member ship fee. Independent agencies :- These usually do not have any brand affiliation their policies and operation may vary according to the needs and means of an individual client . Other classes Cargo Travel Agencies:- These travel agencies specialise in shipping cargo from one destination to other. Freighter travel: This may be considered as special class of travelling. Some of the cargo companies may ferry passengers along with the cargo. The clients of such companies / agencies are usually the budget travelers like retired persons, students etc. Who have got plenty of time. Internet Travel Agencies With the development of internet the clients have started planning their own business tours with the help of this facility. These are also called as travel agency this allows the travel agents to let their clients to compare a wide verity of facilities like Hotels, Car Rental Airlines Tickets and need of Paper work according to their destination for example you may not get entry into Arab Countries if you have got Stamp of Israel on your passport for VISA purpose. There is a palpable threat that the traditional travel agencies may be greatly affected because of the introduction of Internet in the business. However this threat is not real. The use of internet for travelling purpose provides you both facilities i.e. convince of self served booking through Internet and that of taking help of a professional person when you need it. Many travel agencies created their own websites with detailed information of their services like online booking. Examples of major online travel agencies are cheap tickets, Voyages sncf.com, Hotwire.com, orbitz and travelocityand expedia etc. A system called as GDS or Global Distributed System is also used for computer reservation. It is a subsidiary of travel port which allows these agencies to book or sale airline tickets, hotel booking and car rentals and other services related with traveling. Travel agencies using GDS facilities include Galileo CRS, Sabre, worldspan etc. While trying online booking with the help of internet travel agency one must keep the following aspects in mind:- Different airline for entire tour Different airlines for different parts of the tour Connectivity and alternative modes of transportation Hotel accommodation or alternative accommodation available at the destination point Positioning Flights. Management of dates of visit with different locations in case of multiple destination tours Different Airports and their connectivity Different routing. Split Ticketing: Consideration of advantages and disadvantages of split ticketing with regard to the period of tour, possible stay time at a particular destination point so as to take maximum advantage of stay. Loop-holes.: These are the unfair means of business i.e. the gross difference between the advertised facilities in a product and the ones actually provideds on the spot. Paperwork and formalities A good online travel agency must be capable of advising its clients over all these issues. A travelogue or travel literature is travel writing with literary value which typically records the experience of its authors touring a place or geographical area. One must take the help of this type of literature while seeking the advice of a web based travel agency. Travel literature may be a cross cultural or transnational in nature. It may also cover a big geographical region within the same countries or different countries. The Tourism Industry is diverse and includes many sectors including: accommodation, transportation, food and beverage, attractions, events and conferences, adventure tourism, travel trade, and tourism services. The Tourism and hospitality industry integrates general management concepts with the professional knowledge that is required by the tourism and hospitality industry. A typical travel agent acquires knowledge and skills in communication, research and analysis of the travel related problems with their solutions and organizations of tours. Examples of typical travel agents are:- Adventure Travel Guide. Events planner. Tour guide. Camp counselor. Naturalist Cruise Director. Travel Planner. Recreation Director. All of them are specialist of their field of travel related activity and help the travelers to organize their tours in a most fruitful manner. Take Over Activities in Travel Business:- Like all other business take over practice is common in this field. Such activities may be of two types:- Vertical Integration. Horizontal Integration. Vertical Integration:- some travel agencies may have large business and may be able to take over the other travel agencies with low value of business. A vertical integration means taking over of a firm having a different but related business. For example A large chain of tour operator may take over an airline with the aim to be benefitted from the lower cost of allocation air travel services to its customers. Sometimes this activity may be very complex and many facts have to be considered before under taking such type of activity. This means that in vertical integrated system of business one organization should be able to offer a travel package to the customers through its own resources with no help from outside. In this type of integration the business will be able to control its cost of operation in a more effective manner. However problems may arise if the business grows too large to be operated efficiently by the available number managers. Many tour operators indulge in wrong business practice by branding different part of the whole business differently and giving each part a different name this is supposed to be un- ethical. It is the right of the customer to know whether a relationship persists between the tour operator and the travel agent. Horizontal Integration:- This is a business activity when an agency of offering one travel product takes over another one which offers the same travel product or service this can be exemplified by taking over of GO by Easy Jet in 2002. Ethics of Travel Agency:- Being a part of the hospitality industry a travel agency must follow the rules of hospitality ethics which may vary from one geographical area to another. Contemporary Ethics:- In modern western world, hospitality is not related with protection and survival. It is associated with etiquette and entertainment. However, it still requires showing respect for guests, providing for their needs and treating them fairly. The hospitality to strangers, personnel friends and relatives may vary according to the culture and sub-culture. South Central Asia:- In south central Asia the hospitality has a strong code of conduct specially in the people called as Pashtus. These people have an ancient set of ethics stressing on Milmastiya or Hospitality. The feeling of hospitality is so great in Pakhtunsitan is such that it is also nick named as The Land of Hospitality . Middle East:- In middle east, it is a cultural to take care of foreigners and strangers. These ethics are reflected in many Biblical commands. Arab World :- In Arab World, there is set of stern obligations for both host and guest. It believes that a bond is formed just by eating salt under one roof. An Arab story tells about the extent of feeling in this regard. It tells us about a thief who tasted something to know if it was suger. He realized that it was salt and thus put back all that he had stolen and left the place. Greco Roman Ethics:- According to the Greco-Roman philosophy hospitality is a divine thing the host is expected to make sure that the needs of his guest are fulfilled. Indian Ethics:- The principle of Atithi Devo Bhava or The Guest is God is the driving force of hospitality for this reason the Indian approach towards guest at home and in all social situations is that of graciousness. Swot Analysis of Travel Agency of Business Being a secondary business activity travel agency business is affected by many factors like boom and crisis in other business activities, war and disturbances, natural calamities etc. Strengths:- The strength of a travel agency lies in its goodwill and a business profile giving distinct market advantage upon which one can capitalize the market plan following is a list of points of strength for a a travel agency:- A thorough knowledge of history and geography of the area of operation. Excellent relationship with product suppliers like airlines, hotels and car rental. Membership with strong association. Strong reputation in the market. Well placed location. Good contact with press and media. Adequate financial resources. Excellent customer list with high customer loyalty. Availability of good destination specialist. Low customer to employee ratio. Customer attentive staff with excellent communication skill. An unique with high end service offering. Weakness:- Being a secondary business activity travel agency business can be affected by many factors like calamities, war or economic slump. Being a comparatively new business activity the exploration of opportunities is still not complete. Finding good employees with necessary skills and customers centric attitude is a difficult and challenging task. Offering new and exiting trips at a regular interval and maintaining high quality is also a task which is difficult to achieve. Many times it is very difficult to find a proper location. For a new business set up financial aspects are also very important as traveling is a business requiring large volume of money. Opportunities:- A good working knowledge of international, national, regional and local trends is a must to fetch the fortune from the existing opportunities in travel agency business. One can find a number of opportunities with the help of ever changing social atmosphere of contemporary world. UAE is called the Land of opportunity .Following is a list of possible opportunities for a new travel agency. It is a growing market that is yet to be adequately explored. Growing numbers of professionals with boom in latest technology of computer science and internet. Globalization of economy. Better Connectivity Abu Dhabi International airport is a well connected transportation hub of the world.It served 9.02 million passengers in 2008 with a growth of 30.2% on 2007.The total number of passengers is expected to reach 50 million as the Abu Dhabi is expected to become a major Transportation hub in Middle East. Improved public transport system :- Public transport system of Abu Dhabi consists of buses, taxis and airplane. There will be a huge expansion of public transportation with completion of 130 km of metro and 340 km of tramway and bus rapid transit(BRT) routes. This is expected to be completed within the government plan called as Surface Transport master Plan DEMOGRAPHY: More than 75% population of Abu Dhabi consists of expatriates from different part of world like UK, India, Pakistan Other countries of South East Asia pacific Asia, Africa and china. This demographical pattern provides an excellent opportunity for travel related business. Business boom resulting into a positive trend of economy with increased spending capacity of general people. Financial capabilities of the management to spread over head expenditure in a number of events. Growing economy after last recession. Affective use of print and electronic media for mass communication. Emerging trend of group travelling and budget travelling involving more and more people in traveling activities. Tax structure of UAE favors business personales Threats:- Being a secondary business activity travel agency business is affected by many factors like boom and crisis in other business activities, war and disturbances, natural calamities etc. The travel industry will be affected in a negative way by a slump in the economy. The terrorist activities in a geographical area will badly affect the travel relative business in that area. Entrance of other service provider in the area of operation Low fair no frill cheap airlines are the threat to the travel agency business as they give facilities for the travelers to make their own arrangements for travel Latest trend of home entertainment like TV watching, etc has a negative impact on travel agency business. Marketing Plan of a Travel Agency To make a marketing plan for a travel agency the study of following factors is considered to be essential:- Situation analysis. Market needs. Market trends. Market growth. Market summary. Situation Analysis:- The analysis of the basic needs of the traveling market according to the situation is the primary need of a travel agency. It must be realized that the trends in the travel activities are ever changing and their analysis is always necessary to make program according to the situation. Market Needs:- The market needs in traveling may vary according to the clients. The needs of a wealthy client may be entirely different from those of a budget traveler. Selection: The selection of services according to the need of the client is a basic and essential recruitment of travel agency business. Accessibility:- The services and products of a travel agent must be accessible for its target client. Customer attention:- Contemporary business ethics follow the principle of customer delight FEE Structure: With emergence of low cost budget airlines commission of travel agency has been affected badly compelling them to impose fee. The service fee of a travel agency should be such that it should not be taken as a bitter pill by the client. MARKET TREND IN TRAVEL AGENCY BUSINESS:- Holiday making is the main reason of travelling worldwide. The second reason of travelling is business tours. For holiday making a traveler usually prefers an inbound tourism while a business tours may be both inbound and outbound according to the need of the business. Emerging medical tourism usually has an outbound dimension. With the growth of economy after last recession tourism is again gaining popularity as a leisure activity globally. Over 922 million international tourist was recorded in 2008 with a growth of 1.8% compared to 2007.However 2009and 2010 have felt a dip due to global slowdown and threat imposed by H1N1 influenza virus. A WTM report in November 2010 has announced a slow recovery of travel industry after the crisis. A report by Euro monitor International, a leading market trend analysis firm gives an insight into the upcoming trend of travelers in near future. There are seven regions of focus in travelling sector. North America UK Europe Middle East Africa Asia Latin America NORTH AMERICA: -The trend in North America is called as that of deprivation holidays The clients enroll themselves in boot camps with an aim to improve their health and balance. This trend has a positive impact on growth of spas and camps. UK: The trend of travelling in UK is that of Middle East Investment. Many companies from Middle East have shown their interests in Brands of UK including Luxury hotels, private jet operators and travel retailers(travel agency) with London emerging as a Hot spot for the luxury travelers . EUROPE: In Europe the business travelers have revolutionalised the tourism business with Smartphones based on GPS . It was their need to take help of mobile travel technology to make last minute change of their schedule which compel them to use mobile applications offering such services like flight booking ,travel guide, tourist information etc. Middle East:- this region is seeing a post Iraq war boom with support by GCC countries . Gulf investors are coming in Iraq with an upward trend in business tourism and revival of travel industry Africa:- South Africa is fast developing as world hub for world class space technology and astronomy. There is a growth potential for astrotourism attracting all classes of travelers from independent ones to families, amateur astronomers to professional ones creating more and more demand for accommodation to observe clear night sky. Latin America:- Latin Americas is characterized by poor infrastructure for travelling and lack of tourism services resulting in a slump of travel agency business . Due to vast territory Latin America has countless opportunities for travel agencies for travelers interested in exploring the interiors of this geographically isolated area. Asia:- Asian countries are characterized by emotional touch in hospitality business creating a special type of brand loyalty. Different hotel locations use different scent s as brands. MARKET GROWTH;- An average 4% growth of tourism industry has been anticipated by World Tourist Organization(UNWTO) . e- commerce has made the tourism products one of the most traded business items on the internet. New products have also been added to the list of high-tech facilities like space tourism ,airship hotels ,space elevators and hydropolis(underwater hotels).All these have a direct and positive impact on travel agencies. GROWTH OF TOURISM IN TOP 10 COUNTRIES (Period 2006-2009) Rank Country Regional Market International Tourism Receipts (2009) Tourism Receipts (2008) Tourism Receipts (2007) Tourism Receipts (2006) 1 USA North America $93.9 bln $110.0 bln $97.1 bln $85.8 bln 2 Spain Europe $53.2 bln $61.6 bln $57.6 bln $51.1 bln 3 France Europe $49.4 bln $55.6 bln $54.3 bln $46.3 bln 4 Italy Europe $40.2 bln $45.7 bln $42.7 bln $38.1 bln 5 China Asia $39.7 bln $40.8 bln $37.2 bln $33.9 bln 6 Germany Europe $34.7 bln $40.0 bln $36.0 bln $32.8 bln 7 UK Europe $30.0 bln $36.0 bln $38.6 bln $34.6 bln 8 Â  Australia Oceania $25.6 bln $24.8 bln $22.3 bln $17.8 bln 9 Â  Turkey Europe $21.3 bln $22.0 bln $18.5 bln $16.9 bln 10 Â  Austria Europe $19.4 bln $21.6 bln $18.9 bln $16.6 bln Source: The world tourism organization report **bln : Billion TOP SPENDER COUNTRIES ON TOURISM Rank Country Regional Market International Tourism Expenditures (2009) International Tourism Expenditures (2008) International Tourism Expenditures (2007) International Tourism Expenditures (2006) 1 Germany Europe $81.2 bln $91.0 bln $83.1 bln $73.9 bln 2 Â  United States North America $73.2 bln $79.7 bln $76.4 bln $72.1 bln 3 Â  United Kingdom Europe $50.3 bln $68.5 bln $71.4 bln $63.1 bln 4 Â  China Asia $43.7 bln $36.2 bln $29.8 bln $24.3 bln 5 Â  France Europe $38.5 bln $41.4 bln $36.7 bln $31.2 bln 6 Â  Italy Europe $27.9 bln $30.8 bln $27.3 bln $23.1 bln 7 Â  Japan Asia $25.1 bln $27.9 bln $26.5 bln $26.9 bln 8 Canada North America $24.2 bln $27.2 bln $24.7 bln $20.6 bln 9 Â  Russia Europe $20.8 bln $23.8 bln $21.2 bln $18.1 bln 10 Â  Netherlands Europe $20.7 bln $21.7 bln $19.1 bln $17.0 bln Organizations of travel agencies For obvious reasons various organizations of travel agencies were formed by their members. Following is a brief account of impotents associations and organizations of travel agencies:- Abu Dhabi Tourism Authority (ADTA):- This is a legal organization establis

Internet Penetration :: Computer Science

Internet Penetration Identify the different levels of household penetration by the World Wide Web in each of the following continents – Asia , Africa , North America , South America and Australia . Explore the reasons for this variation. The countries with the highest internet penetration are predominately those Western economies with strong economies and high levels of affluence. Out of the top 10 countries, European countries feature 6 times, with Sweden having the highest penetration at 73.6% of the population have the internet. Other high ranking countries include Hong Kong (70.7%), The United States of America (USA) (68.5%), Australia (67.2%), Canada (63.8%), Korea (63.3%), Japan (60.9%), Taiwan (60.5%), Singapore (60.2%) and New Zealand (56.8%). The United Kingdom compares well at 60%. (Appendix 2 Internet world stats, 2005) World wide, these 25 countries dominate over 64% of their total population; the internet penetration in the rest of the world is just 7.8% of the remaining population. However, percentages can be misleading; whilst they give a good indication of levels of literacy, affluence and behaviour, the percentage of penetration would not give an indication of size of possible market; the USA has the largest market at 202,888,307; the next largest being Japan at 78,050,000 and then the UK and German markets at 35,807,929 and 47,127,725 respectively. Whilst we have seen then that internet penetration is very strong in these affluent societies, there are some interesting developments in the emerging economies. Those countries in Asia that have traditionally had under developed economies, such as China and India , have very different levels of internet penetration; despite both countries attempting to develop their economic wealth. China , with a population of 1,306,313,812 has 94 million internet users (Appendix 1); this however translates to only 7.2% of the population. The Chinese middle class is only 4% of the population i.e. those who have household incomes of more than $20,000 but that translates into a market or 50 million people (Khanna, T) – a huge market for prospective investors in the country. This compares very favourably with internet penetration in India – where the population is very similar to China 's - 1,080,264,388.00 but there are only 18, 481,000 internet users, a penetration of 1.71% of the population. This may be due to Government intervention in China ; in a recent report ‘it has been found that China has nurtured and directed the economy ( Khanna, T 2005). In addition there is a difference in the GDP per capita – in China , the GDP per capita is $5,600, whereas in India it is only $3,100. However, in both countries there is a huge gap between the wealthiest and poorest people, both in

Propoor Tourism in Iran

1. Background of Study Tourism is clearly of large importance for developing countries. Islamic Republic of Iran, by having great natural resources and historical back ground and heritages should be able to make a great use of these potentials to create a healthy and on growing economy. Recently, government of Iran has started to invest more on tourism sector of the country, but it is not easy for government to implement all the strategies they need for growth in the industry.There are many issues which should be taken into consideration before applying those strategies. One of these issues is the population of poor people in the country, which is a great quantity from the overall population, doesn’t have any important role in this implementation and strategies or benefits. Poor in Iran can’t afford to travel and also can’t afford to invest and be dynamic part of industry. Travelling is considered as a luxury facts which not everyone can afford to do it and more over invest on it.There is a need for setting up a new type of tourism in country which everyone can travel and invest and get the benefits of it and more people can participate. However, according to Dilys R (2001), analysis of tourism data in developing a country shows that in most countries with high levels of poverty, tourism is significant and increasing. The poor can participate in the tourism industry in many ways – as workers, entrepreneurs, and neighbors. They gain new opportunities but also face limitation. They earn incomes, but also suffer costs of tourism.These impacts vary enormously from destination to destination. Enhancing the opportunities and impacts for the poor is the concern of this research. Pro-Poor Tourism (PPT) is about how the business of tourism is done. The impacts of tourism on the poor depend very much on the behavior of private companies and individual tourists. At the same time, these are strongly influenced by Government, through its policies , regulations, public investment, expectations, and actions, not only in tourism but in other sectors too (Caroline A, 2006).As mentioned by Dilys R (2001) â€Å"Achieving poverty reduction requires actions on a variety of balancing fronts and scales, but for such to happen it is required a significant progress is pro-poor growth – (growth which benefits the poor)†. Together with that Dilys R (2001) also questioned, â€Å"As an industry that is clearly important in many poor countries, can tourism be one source of such growth? † 1. Country profile: Islamic Republic of Iran Iran, a country slightly larger than Alaska, is located in the Middle East, bordering the Gulf of Oman and the Persian Gulf in the south and the Caspian Sea in the north.It covers an area of 1. 648 million square kilometers (636,296 square miles) and is edged between Iraq, with which it shares a border of 1,458 kilometers (906 miles), and Pakistan and Afghanistan in the east, with which Iran h as 909 kilometers (565 miles) and 936 kilometers (582 miles), respectively, of common borderline. Iran also shares 499 kilometers (310 miles) of borderline with Turkey, 992 kilometers (616 miles) with Turkmenistan, 432 kilometers (268 miles) with Azerbaijan, and some 35 kilometers (22 miles) with Armenia, the latter 3 states formerly being part of the USSR (Encyclopedia of the Nations, Iran, 2009).Most of the 2,440 kilometers (1516 miles) of coastline are on the Persian Gulf and the Gulf of Oman. The two gulfs are connected by the strategic Strait of Hormuz. Iran has dozens of islands in the Persian Gulf, many of which are uninhabited but used as bases for oil exploration. Those that are inhabited—notably Qeshm and Kish—are being developed, attracting investors and tourists. The Iranian coast of the Caspian Sea is some 740 kilometers (460 miles) long.Apart from being home to the sturgeon that provides for the world's best caviar, the Caspian Sea is the world's largest lake, with an area of some 370,000 square kilometers, and is co-owned by Azerbaijan, Russia, Kazakhstan, and Turkmenistan (Encyclopedia of the Nations, Iran, 2009). In general, Iran consists of an interior plateau, 1,000 meters to 1,500 meters (3,000 feet to 3,500 feet) above sea level, ringed on almost all sides by mountain zones. The Elburz range with the Iranian capital, Tehran, at its feet, features the country's highest peak, the snowcapped volcanic cone of Mt. Damavand, at 5,604 meters (18,386 feet).To the north of the range there is a sudden drop to a flat plain occupied by the Caspian Sea, which lies about 27 meters (89 feet) below sea-level and is shrinking alarmingly in size. The larger Zagros mountain range runs from north-west Iran down to the eastern shores of the Persian Gulf, and then eastward, fronting the Arabian Sea, and continuing into Pakistan (Encyclopedia of the Nations, Iran, 2009). Iran has a relatively young population, with 34 percent of the population unde r the age of 14 and 61 percent between 15 and 64 years of age. Thanks to a family planning program, population growth decreased from 3. percent in 1984 to 1. 7 percent in 1998 and further to 0. 83 percent in 2000. Of the population, an estimated 38 million Iranians (or 60 percent) live in urban areas, while approximately 27 million live in rural areas (Encyclopedia of the Nations, Iran, 2009). The population density was 37. 6 inhabitants per square kilometer (97 per square mile) in 1998, though many people are concentrated in the Tehran region, and other parts of the country (especially deserts) are basically uninhabited. Basic literacy rates are above the regional average, although uncertain reporting standards give a wide margin for error.In 1997-98 the central bank estimated literacy at 80. 5 percent in those over 6 years old, with 75. 6 percent of women and 85. 3 percent of men judged to be functionally literate, i. e. they were taught to read and write at some point (Encycloped ia of the Nations, Iran, 2009). Iran's infrastructure is relatively poor and inadequate. Part of this stems from the fact that the vast country was never fully developed, but it also experienced considerable setbacks during the Iran-Iraq war of the 1980s, and restoration since then has been slow (Encyclopedia of the Nations, Iran, 2009)Iran has a network of 140,200 kilometers (87,120 miles) of roads, of which 49,440 kilometers (30,722 miles) are paved. The 2,500-kilometer (1,553-mile) A1 highway runs from Bazargan on the Turkish border across Iran to the Afghan border in the east. The A2 runs from the Iraqi border to Mirjaveh on the Pakistani frontier. Tehran is linked to major cities in the vicinity by 470 kilometers (292 miles) of express-ways. A heavy expansion of car use has led to increased demand for fuel, severe overcrowding of roads in metropolitan areas, and mounting pollution problems.Government estimates put the average annual increase in domestic fuel consumption at 5. 5 percent, well above the real economic growth rate. The government has sought to limit motor use by raising domestic fuel prices, but petroleum products in Iran remain heavily subsidized and among the cheapest in the world (Encyclopedia of the Nations, Iran, 2009) Before the revolution Iran had begun to build a reputation as an exotic holiday destination; its ski resorts at Shemshak and Dizin, north of Tehran, attracted international celebrities.After 1979, the Islamic government discouraged tourism, leaving many renowned archaeological and historical sites, including Persepolis, Pasargard, and Esfahan, barely visited by foreigners (Encyclopedia of the Nations, Iran, 2009). Although hardly a booming sector, visitor rates are beginning to rise. The government has begun to issue visas more freely to non-Muslim individuals and groups, and the country is appearing with greater frequency in tourism brochures, but still only around 320,000 foreign tourists actually visit, bringing in reve nue of US$170 million.The bulk of tourism remains to be founded on Shia pilgrimage centers such as Mashhad and Qom. The Bonyad-e Mostazafan (Foundation of the Oppressed), which owns most of Iran's large hotels, plans to increase the number of hotel beds from the current 34,500 to 59,500 by 2002 (Encyclopedia of the Nations, Iran, 2009). 2. Tourism in Iran Currently, Iran is a country covered in political, religious, cultural, social and economic controversy.It is a country that magistrate’s extreme emotional and ideological debate and faces challenges as a tourism destination both because of this controversial context and as a result of its association with conflicts in neighboring countries like Afghanistan and Iraq. Distinction of tourism in Iran is complicated by its position at a cultural crossroads, the time-span over which invasions and migrations have taken place and the present day situation where a large population of recent refugees exists from wars and political un rest in neighboring countries.Iran has enormous cultural diversity on the one hand and a homogeneous religious authority on the other but it is the latter that currently dominates. Furthermore, government which protects and promotes its own brand of Islamic indigenous culture and heritage with a fierce pride and an international image epitomized by US President Bush’s reference to the ‘axis-of-evil’ and you have a situation where indigenous tourism in the normal sense of the phrase is suppressed. Even when used in a conventional sense, the term indigenous tourism is much contested but certain key concerns and debates emerge from the literature.These include: multifaceted host, guest and intermediary relationships; lack of industry knowledge and incorporation of local cultures; lack of local awareness of tourism and ownership of tourism related businesses; and a need for carefully considered policies to avoid degradation of culture and ensure development is sustai nable (Kevin O. G, McLellan L. R & Tom B, 2007). Many of these concerns are relevant in Iran to some extent although it is argued in this chapter that indigenous tourism has been suppressed in Iran. Nevertheless, there are indications that a unique form of local tourism infused with indigenous character has begun to emerge.This local variation of indigenous tourism is taking shape despite the striking homogeneous national image portrayed in the international mass media. The early stage in the tourism development life cycle means that tourism is generally considered as a national phenomenon, at a national scale rather than local. Growing links between tourism and the protection of Iran’s national cultural heritage were reinforced in 2005 with the merger of Iran Touring and Tourism Organization (ITTO) and Iran Cultural Heritage Organization (ICHO) to form the Iran Cultural Heritage and Tourism Organization (ICHTO) (Kevin O. G, McLellan L. R & Tom B, 2007).Although the strong in fluence of the central government is clear with direct authority for the new organization resting with the Vice President of the Islamic Republic of Iran (WTO, 2006), the link between culture heritage and tourism allows vestiges of indigenous tourism to survive but not flourish. 2. Problem Statement How much pro-poor tourism is known by tourism policy makers of Iran? Since, there is no record or papers found about pro-poor tourism in internet or media, According to the research in the internet , there is no evidence to prove Iran’s government are aware of the opportunities and benefits of pro-poor tourism in general.Moreover base on the research, there isn’t any specific actions or strategies done by government to implement pro-poor tourism in Iran. There is a big gap between opportunities and potentials of tourism in Iran and plans and strategies done by the government to make use of these opportunities. As a result there is not much attention to pro-poor tourism in I ran as well as other types of tourism like eco-tourism and medical tourism and etc. But what are the issues of implementing pro-poor tourism strategies in Iran’s society?First problem is lake of knowledge and awareness on this type of tourism. There is no evidence shown that, there are groups or people in government or private sector who think or plan for Po-poor tourism in Iran and it as a big squander for tourism sectors of Iran. Following by first issue, the second will be the lake of planning and strategizing the steps and creating visions and working on that plans. Third is to implement the plans and start educating the poor to use the benefits of it. 3. Research questionsBased on the statement and significance of study presented, the research question will be: 1: Is pro-poor tourism adoptable in Iran’s society? 2: How political and religious issues can effect pro-poor strategies? 3: What are the ways to plan effectively for pro-poor tourism in Iran? 4: What are t he stages of implementing pro-poor tourism in Iran? 5: What will be the issues and problems of implementing the pro-poor tourism strategies? 6: How to monitor and review for performance of pro-poor tourism strategies? 4. Research objectives : To find the best understanding of pro-poor tourism The research first objective is to introduce the pro-poor tourism to Iranians Government as well as private tourism organizations, and create an excellent understanding of this type of tourism in Iran. 2: To create a goal and mission One of the requirement for this progress will be creating goals and missions to understand better how to reach our goals and whether we reach the goal of the strategies or not and also to evaluate the progress better. 3: To structure and plan for putting our strategies into actionOnly understanding of Po-poor tourism in not enough to benefit the society, there should be a plan to implement and follow to gain our goals and missions. 4: To implement the strategies co rrect and accurate and controlling the action constantly There should be a way to controlling the progress even during implementing it to find whether strategies are correct or to make sure that there are putting in to action correctly. 5. Theoretical Frame Work In this research, the researcher wishes to find how pro-poor tourism can help Iran’s tourism for further developments and improvements.To gain this goal first need to find out opportunities, challenges and issues related to the research and analyze it. Second step is to create the right strategies and to find how these strategies can help development of tourism in Iran. 6. Conceptual Framework 7. Significances of research 1: How pro-poor tourism can helps in rising economy. 2: How pro-poor tourism’s income can be distributed to the poverty in the society. 3: How pro-poor tourism can help society in other aspect, such as creating more jobs, motivates poor, educate people and etc.This paper will also discuss abou t the economical potentials of pro-poor tourism in Iran. This study believes that Iran have many potentials in tourism industry which never used or discovered by the government and people who works in tourism industry. One of the potentials are implementing pro-poor tourism and developing the tourism in poor or not very developed areas. By developing tourism specifically pro-poor tourism industry, government can decrease unemployment and help poor, by teaching them fishing rather than giving them fish.Poor which most of them don’t have chance to study or build a new business for themselves can be educate by government or by NGOs and social committees and be able to become a part of tourism sector and help themselves and family and also subsequently help the society and government as well. 1. Importance of Tourism Industry Tourism is a leading industry in the service sector at the global level as well as a major provider of jobs and a significant generator of foreign exchange at the national level.Tourism has become one of the largest and fastest growing industries in the global economy. During the period between 1996 and 2006, international tourist arrivals worldwide grew at an average annual rate of about 4. 0 per cent (United Nations Report, 2007, p. 10). According to the report by United Nations in (2007, page 12) about Role of Tourism in Socio-Economic Development, â€Å"The strong growth in tourism arrivals in Asia, particularly the sub regions of North-East Asia, South Asia and South-East Asia is one indicator of the increased significance of tourism for developing countries.Visitors worldwide have clearly recognized the attractiveness of tourism experiences in Asian and Pacific developing countries in terms of the rich cultural heritage and natural environment. Many officials in these countries have seen that tourism can be part of their development strategies, especially in economic terms. † Tourism is considered based on its contribution in the form of receipts; share of gross domestic product (GDP) and exports; and growth rate patterns for the tourism industry, tourism economy, government expenditures and capital investment.The economic impact of the tourism industry is usually assessed at the macroeconomic level and can be measured in several different ways. The most general measurement focuses on tourism receipts and the contribution of tourism to a country’s GDP (United Nations Report, 2007, p. 26). The United Nations Statistics Division and the World Tourism Organization (now UNWTO) developed the tourism satellite account in 2001 as one of the most systematic measurement of the economic impact and contribution of tourism at the national level (United Nations Report, 2007).According to the World Travel & Tourism Council (WTTC), the TSA is â€Å"based on a demand-side concept of economic activity, because the tourism industry does not produce or supply a homogeneous product or service like many tradition al industries. Instead, the travel and tourism industry is defined by a diverse collection of products (durables and non-durables) and services (transportation, accommodation, food and beverage, entertainment, government services, etc) that are delivered to visitors†. It is important for policy-makers at national and local levels to see that this diversity has many complex links to all parts of the economy.This is what makes the economic impact of tourism so significant for development. There are various definitions of social development, and most of them converge around the concepts of improving the well-being of a country’s citizens, promoting higher standards of living, increasing employment and creating conditions of economic and social progress. Employment is one of the most readily available indicators to begin measuring the social impact of tourism, since job creation generally helps create the opportunities for better standards of living and related conditions o f socio-economic progress (United Nations Report, 2007, p. 8). In socioeconomic terms, linkages refer to the connections between the tourism industry and local suppliers of goods and services through both the formal and informal economy. Leakages refer to payments or financial flows made outside the economy of the destination country. For companies in various sectors of the tourism industry, linkages are seen in business terms as the supply chain. Linkages can stimulate increased economic activity and have a positive effect on balance of payments as local products replace imported ones.The positive impact of linkages also relates to the capabilities and competitiveness of domestic firms. Among the direct benefits from effective linkages are increased output of the linked enterprises, increased employment, improved market access, increased knowledge and a broader skill base. In addition this could improve efficiencies in productivity, managerial capabilities and market penetration (U nited Nations Report, 2007, p. 54). 2. Historical evidence of tourism in Iran Iran is a country that is rich in diversity in cultural and historic terms, representing a recorded human history that stretches back some 10,000 years.The people who inhabit this country have a long history of involvement in tourism. There is considerable evidence for hostels that dates back to at least 2000 BC. These hostels supplied drinks, sex and accommodation for travelers. Drinks included date palm wine and barley beer, and there were strict regulations against diluting them (Gorman O. K & McLellan L. R, 2007, p. 303). â€Å"The application of strict Islamic law and a consequent political ambivalence to international tourism is not universal in predominantly Muslim countries† (Gorman O. K & McLellan L. R, 2007, p. 03). Today, Iran’s heritage draws both on native histories and cultures as well as the impact of waves of raider, notably the Greeks of Alexander the Great, the Arabs who int roduced Islam to the country, the Mongols from the east and in the twentieth century, the influence of the oil hungry west (Britain, France and the US). Iran’s solid cultural assets include seven ancient locations recognized by United Nations Educational, Scientific and Cultural Organization (UNESCO) as World Heritage Sites as well as a range of renowned Islamic shrines and cultural sites.Iran’s natural heritage is also diverse, including desert, mountains and coasts across climatic zones from temperate to sub-tropical (Gorman O. K & McLellan L. R, 2007, p. 303). In actual fact, what have generated particular interest in Iran as a host country for domestic and international tourism are the â€Å"effect of religious interpretation by the country’s brand of contemporary Islam on the political, religious, cultural, social and economic environment and the everyday lives of citizens and visitors alike†.Iran adheres to strict standards of observance and the app lication of stringent penalties for non-compliance with respect to social and cultural behavior impacting upon personal association, dress and the consumption of alcohol and other recreational drugs. Certainly, these rules impact upon Iran’s image, market potential as a destination for international tourism and the role of indigenous people in tourism. 3. Definition of Pro-poor tourism What is Pro-poor Tourism (PPT)? Pro-poor tourism is about increasing the positive impacts of tourism on poor people. PPT is not a specific product but an approach to the industry.It is an approach that seeks to increase participation of poor people at many points in the sector, and that aims to increase their economic and social benefits from tourism while reducing the negative impacts on the poor. (www. propoortourism. org. uk) PPT is the kind of tourism that contributes to the reduction of poverty. It is neither a specific product nor a niche market. It is multi-level, multi-dimensional and a ny tourism can be made pro-poor. There are many NGOs and government organizations involved in PPT but the driving force for change will be the private sector.There is an increasing realization that to be sustainable, PPT initiatives must involve the private sector in reducing poverty through business activity, rather than alleviating it through philanthropy. PPT initiatives work well when access to natural resources is maintained and exposure to risk is minimized. PPT can also bring important benefits such as more jobs, business opportunities, and improved access to infrastructure and services (Pro poor Brochure FINAL, 2006). 2. 3. 1 Why Pro-Poor Tourism? Tourism is a major economic sector worldwide and especially in developing countries.According to the World Bank’s World Development Indicators Report (2002), more than 70% of the world’s poorest countries rely on tourism as a key engine of economic growth. Poorer countries have the most to gain from PPT initiatives. B ut they are also the most vulnerable to the negative effects of mass tourism, in terms of social, environmental and cultural degradation. Furthermore, the distribution of benefits and income from tourism is often not equal. Financial benefits usually end up at the big hotels, tour companies and airlines.Poorer people too often suffer the negative costs of tourism. PPT engages poorer people and seeks to empower them so that they too share in the benefits from tourism (Pro poor Brochure FINAL, 2006). 4. Challenges of Pro-poor tourism in the World According to the World Trade Organization, international tourist arrivals in 2005 reached an all-time high of over 800 million. By 2020, arrivals are expected to reach 1. 6 billion, generating US$2 trillion. While global tourism numbers increase, this does not necessarily translate into increased revenue for citizens of many developing countries.A few factors typically prevent the disadvantaged from sharing in the tourism dollar. (Pro poor Br ochure FINAL, 2006). Most tourism dollars end up off-shore. Typically, only US$10-20 of every US$100 spent by the tourist remains in the developing country. According to United Nations Environment Program, of each US$100 spent on a package tour, only around US$5 actually stays in a developing country’s economy (Pro-poor Brochure FINAL, 2006). The Pro-Poor Tourism Partnership says, â€Å"One of the critical issues for poor producers is often access to the market – access to the established industry and to tourists. Smaller hotels and guest houses and local NGOs have little or no opportunity to market to tourists via the Internet, thus they gain little share of the dollars tourists spend. Some would question the very starting point – engagement with companies to promote pro-poor change. Tourism companies, after all, are profit-seekers, whose business is commercial tourism, not development. But the assumption reinforced to the work presented here is that ‘we ’ (as society) should seek to reduce the impact of tourism business (Caroline A and Gareth H 2004). . 4. 1 The argument goes as follows: †¢ Poverty is widespread and direct approaches to poverty reduction are making insufficient progress – thus ‘pro-poor growth’ is also needed, i. e. growth which is inclusive of the poor. †¢ Tourism is a major economic sector worldwide, with particularly rapid relative growth in poor countries, thus is potentially very important for pro-poor growth. †¢ (Limited) evidence shows tourism can be developed in ways that increase net benefits for the poor.Furthermore, one approach to this is for companies to do business differently, and evidence indicates that doing business in pro-poor ways can make commercial sense. This should, therefore be promoted (Caroline A and Gareth H 2004). 5. Pro-poor tourism practice’s in the world Nowadays, as world is emerging into globalization, Tourism Industry has become one of the main income resources of many developed and some developing countries. As Tourism booming, they are several practices done to gain exposure, especially in the context of this research.One example is in Nepal where the Ministry of Culture, Tourism and Civil Aviation initiated the Tourism for Rural Poverty Alleviation Program (TRPAP) from 2001 to 2005. The immediate objectives were to demonstrate sustainable tourism development models, review and improve policy formulation and strategic planning, adapt institutional mechanisms, including decentralization, in order to achieve sustainable tourism development that would be pro-poor, pro-environment, pro-rural communities and pro-women (New York: United Nations, 2005).Another example is; The Mekong Tourism Development Project of the Lao National Tourism Authority and Asian Development Bank focuses on improving tourism related infrastructure, promoting pro-poor, community-based sustainable tourism in rural areas, and strengthening sub-regional cooperation. The project provides training to local people on guiding, hospitality, cooking, tourism management, and marketing. Technical and financial assistance is also provided to help communities build tourism infrastructure such as guest houses, toilets, rest areas and nature trails Steven S, 2007). To monitor socio-economic impacts, a community-based tourism monitoring protocol has been established and implemented over the past 3 years. Project outputs include several community-based tourism related training manuals in the Lao and English languages, dozens of marketing and promotion publications, seminars, workshops and training course materials for tourism service providers and regulatory agencies, and some 40 small-scale infrastructure projects ranging from handicraft markets to information centers and village tourism lodges (Steven S, 2007).The project is producing direct financial benefits for over 600 families in 16 villages and indirect benefits for a much w ider population. To date, sales of community-based tours developed by the project and sold by local inbound tour operators have generated over US$175,000 in foreign exchange. Tour companies that partner with the project and tourist attractions where the project is active report that revenues of two million dollars have been generated over the past three years (Steven S, 2007).Also in Bhutan; The Nabji-Korphu Trail in Jigme Singye Wangchuck National Park in central Bhutan, the first pro-poor tourism pilot project of the national tourism strategy, was officially opened in November 2006 (Pelden D, 2007). The development of the trail, a 6-day, low altitude winter trek, enabled each village along the route to participate in revenue raising activities, such as provision of community camping sites, cultural programs, village guiding and provision of meals. Tour operators were compelled to use these local providers (Pelden D, 2007).One year on, socio-economic tourism impact analysis has sho wn that 84% of households received additional cash income from the 62 trekkers in the first season, contributing over US$38, 000 directly to the communities. Ninety eight percent of local respondents felt that tourism had brought tangible economic benefits and a range of other indirect benefits were also identified by respondents (Pelden D, 2007). The project involved the Department of Tourism (DOT), the Nature Conservation Division (NCD) and the Association of Bhutanese Tour Operators nd links with Bhutan’s national tourism strategy and 9th Five Year Plan. SNV delivered technical assistance in support to development and implementation of the project (Pelden D, 2007). 6. Traveling Potentials of Iran In 2006 the Iranian Cultural Heritage and Tourism Organization entered into a memorandum of understanding with the raveling’s Issues Organization to establish the traveling Cooperative Association, which was entrusted with the task of attracting foreign tourists to nomadic regions of the country. Persian society was formerly a traveling one. United Nations Report, 2007, p. 100). Thus, travelers are considered to be a cultural treasure which needs to be preserved. The Department of Tourism Development in traveling Regions was thus established to provide economic development for the nomads by carrying out technical and infrastructural studies. Along with the Department, the traveling Tourism Institute undertakes measures in marketing, advertising and attracting foreign tourists by organizing tours in traveling areas, providing posters, catalogues, pictures and other advertising instruments.In addition, a special centre will be established in Tehran to provide an outlet for the sale of traveling products (United Nations Report, 2007, p. 100). The authorities hope that devising appropriate tourism programs for traveling regions will lead to an increase in the incomes of the traveling tribes, which would, in turn, raise their standard of living without har ming their social systems and traditional lifestyles (United Nations Report, 2007, p. 100). 7. Poverty in Iran Before analyzing about poverty line in Iran, this research provides some useful information about labor force, unemployment rate and inflation rates.Then only can start analyzing the figures and how pro-poor tourism as a new type of tourism can helps to reduce economic problems. [pic] Figure 2. 1: Sources: CIA World Fact book – September 17, 2009 Figure 2. 2: Sources: CIA World Fact book -September 17, 2009 Figure 2. 3: Sources: CIA World Fact book -September 17, 2009 In this season of presidential elections in Iran, a scenario much in demand is that poverty has increased under Ahmadinejad government. There are newspaper reports of research that offer evidence for just such a scenario, that seem influential but have not gone through the usual academic scrutiny (Javad D, 2009).A few months ago Salehi D, commented  on another high profile poverty report that appeared last year in a journal  published by  the Central Bank of the Islamic Republic of Iran, using faulty methodology to show that poverty has increased. A study by researcher,  Professor Davoud S, of Sharif University of Technology in Iran states, the prominent Persian website  Ã¢â‚¬Å"Rastak†Ã‚  which is dedicated to â€Å"free market economics†, is  a mark above the rest in academic rigor and therefore worth a closer look (Javad D, 2009).He  estimates that more than  one-third  of urban Iranians were in poverty in 2007 and, more shockingly, that this rate has increased  during 2004-2007, the first three years of Ahmadinjad’s administration. Salehi D, shockingly not because Mr. Ahmadinejad had promised to eradicate poverty–that was hardly in the cards–but because in these four years Iran received about $200 billion from the rest of the world, some of them poor countries, from oil generated revenues. To learn that this inflow of money (nature’s gift) not only did not lift anyone out of poverty, it actually made the poor poorer is indeed shocking (Javad D, 2009).Professor Souri, who is a knowledgeable econometrician and knows his data well, but there are reasons why his study of poverty in Iran, like many others, should not be taken at face value. Let us look  a closer look at how he arrives at his conclusions (Javad D, 2009). According to Professor Souri, first conclusion that he drafted explains about high incidence of poverty is really not much of a finding because of his assumption defines, everyone under $10 per day ($4. 40 in rural areas) as poor. This is a superior standard to which no developing country has been held as far as I know.It  is 2/3 the poverty line in the United States and more than three times the threshold international agencies use to compare countries  (the so-called $2 per day) (Javad D, 2009). Another widely reported study uses a poverty line of nearly 8 million â€Å"rials † (Iraninan Currency) for a family of five, which translates into $16 per person per day, which is higher than the US poverty line! â€Å"The problem with these studies is not their very high poverty thresholds, it is that they fail to warn their readers about how their poverty lines compares with those used in other countries.Publishing poverty results that use poverty thresholds that are not comparable across countries can confuse international readers and convince unsuspecting journalists in the west, as well as some with an ax to grind, that Iran’s economy is a basket case (Javad D, 2009). A recent case  in point  of the latter group appears in the â€Å"Nowruz† newspaper (Iran’s daily newspaper), address by Israeli president Shimon Perez to Iranian people, in which he said:  Ã¢â‚¬Å"I see the suffering of the children [in Iran] and I ask myself, why? This is a country that is so rich† You can’t invest the money in enriched uranium w hile telling the kids to stay a little hungry and a little ignorant†. Where he sees the suffering of Iran’s children he does not explain; perhaps he is deducing it from studies that show poverty in Iran on a grand scale. The stronger point in Souri’s study is that poverty has increased during 2004-07. This finding should disappoint anyone who voted for Ahmadijead as a leader who would do something for the poor.It should anger people in oil importing nations who paid through the nose for Iran’s oil in recent years, that the country took $200 billion from other (sometimes poorer) countries only to impoverish its own poor. Is the economic system in Iran so broken that its richer citizens are not satisfied with the $200 billion they generate from oil revenues and have to rob their own poor? 8. Challenges and issues of Tourism in Iran Economically and politically, tourism is always likely to be a minor industry relative to the oil and other sectors with the res ult that politicians have little interest in it.This lack of interest is even greater in relation to niches such as indigenous tourism. A counter argument to this reality, which does not receive widespread attention in Iran, is the employment creation potential of tourism (Kevin O. G, Mc Lellan L. R & Tom B, 2007, pg 312). Oil and gas, notwithstanding their value to the country, generate relatively few benefits in employment terms. At the same time, the country’s major social and economic challenge is unemployment and under-employment among the youth.The under 25s constitute 75% of the total population and in some urban areas up to 50% of these young people do not have gainful employment. Tourism, despite its labor intense characteristics and geographical dispersion, is overlooked as a sector that can provide opportunity to this group. (Kevin O. G, Mc Lellan L. R & Tom B, 2007, p312). Tourism in Iran is characterized by huge opportunity in terms of natural and cultural assets . At the same time, such opportunity is countered by what can be described as political ambivalence at best and antipathy at worst. Encouraging tourism in Iran is a highly contested issue between two main section in the government, one that views tourism as means to achieve economic benefits and modernize, the other that sees tourism as leading to globalization and thus threatening Islamic values and norms† (Kevin O. G, Mc Lellan L. R & Tom B, 2007, pg313). The current political belief is highly apprehensive of foreign, non-faith influences and this situation acts contrary to interests seeking to develop tourism as a respectable and respected sector of the economy, particularly in rural and remote areas where indigenous tourism is likely to emerge.Rather than protect and support locally based tourism, the prevailing national ideology stifles local businesses from benefiting from cultural assets. The current environment is not, however, as overtly hostile to tourism as that whi ch existed in the immediate post-revolutionary era (Kevin O. G, Mc Lellan L. R & Tom B, 2007). During the period of the Khomeini led government, the state destroyed some historical monuments in the manner of the Taliban in Afghanistan but, more recently, a degree of restraint has prevailed.However, the image of Iran in the international tourist market is almost unique in terms of negative media attention over a sustained period. Only Libya and perhaps Cuba have suffered similar long periods of extremely negative western media coverage. As an outcome, the core perception of Iran in the eyes of the world and in particular, in the eyes of potential tourists from North America and Europe has been of a troubled, strife torn country that should be avoided (Kevin O. G, Mc Lellan L. R & Tom B, 2007).The Government in Iran does not help counter this image as tourism still tends to be subjugated to the ‘big project’ of promoting a religious – political agenda. For example, the August 2004 public execution of a 16-year old girl in the main street of a Caspian seaside resort, during the height of the tourist season received widespread national and international press coverage and blighted local tourism. Throughout the 1990s negative international media exposure was tempered by the hope that tourism development would be encouraged as part of an attempt to create an image of greater openness under President Khatami.But a constant barrage of damaging news items in the western media reinforced the old negative image (Kevin O. G, Mc Lellan L. R & Tom B, 2007). After encouraging foreign tourists to watch the solar eclipse in Iran in 1999, a relatively isolated incident led to the usual western headlines: ‘Tourists kidnapped in Iran’. ‘Three Spaniards and one Italian were abducted by an armed gang’ (BBC, 1999a) and ‘Official inquiry into Iran eclipse harassment’ as a result of foreign tourists visiting to view the eclips e, particularly women, being subjected to hostile slogans and harassment by Islamic hardliners (BBC, 1999b) (Kevin O.G, Mc Lellan L. R & Tom B, 2007). While this seemed to be the case in five of the countries (Iraq, North Korea, Cuba, Syria and Libya), in Iran the journalist was ‘detained and intimidated’ as the cameras, tapes and tourist visa were viewed as the instruments of spies. The lack of foreign investment in tourism can also be seen as a major mainstream tourism challenge, especially in the hotel sector, in that both product and service are woefully inadequate for the contemporary international leisure and business market (Kevin O. G, Mc Lellan L. R & Tom B, 2007, pg 314). Service standards in the major state hospitality businesses are among the poorest in the world, contrasting with the warmth and natural hospitality of service in small, private, indigenous businesses throughout the country† (Kevin O. G, Mc Lellan L. R & Tom B, 2007, p. 314). In marketin g perspective, international tourism to Iran is severely challenged by problems with respect to national image, relating to regional political concerns and also national social and cultural matters, notably the hijab requirement for women and the ban on alcohol.For example, there is evidence that some Chinese tour operators are unwilling to promote Iran because of the hijab requirement. Wider concerns about human rights issues are also a barrier to visitation and are further complicated by the challenges facing minority indigenous groups in Iran (Kevin O. G, Mc Lellan L. R & Tom B, 2007). 9. Strategies relate to pro-poor tourism development According to one report, regular monitoring and evaluation to assess the benefits was difficult at the field level due to lack of communication, limits on transportation and on-going armed conflict in some districts.Similarly, frequent transfer of the government officers from the program districts presented a challenge to monitoring implementatio n of pro-poor tourism policies and strategies of TRPAP. Monitoring activities from the rural community level to the central level in order to sustain the pilot rural tourism models required a different evaluation strategy. (Kayastha Y, 2006) An evaluation tool known as the â€Å"Development Wheel† was designed for communities to self-monitor their progress through discussions about changes in the community structure, development of enterprises and natural and cultural resources.The â€Å"Development Wheel† is one of several evaluation tools that are part of an evaluation methodology known as the Appreciative Participatory Planning and Action (APPA). The APPA methodology focuses on having local people identify plans and activities that are positive, successful and strong so they can serve as a means to empower communities. When people used the â€Å"Development Wheel†, it proved to be the most effective participatory way to evaluate progress of TRPAP at the progr am sites (Kayastha Y, 2006). On the other hand, WHL (World Hotel Links Corporation) make travelling easier for independent travelers.To find small local accommodation providers Independent travel is the fastest growing segment of the travel industry. A 2004 International Finance Corporation study on eco-lodges put the global independent traveler market at 50%. Many travelers use guidebooks and the Internet to select destinations and accommodation and rarely use tour packages. Thus they spend and leave more money locally. By serving smaller accommodation providers, WHL is making it easier for independent travelers to find interesting travel experiences, which in turn translates into more bookings for local SMEs (www. worldhotel-link. com).The researcher believes that such strategy analysis can be an important tool in furthering the research on pro poor tourism sustainability in Iran. 3. 1 Research Philosophy and General Method This chapter explains the methodology of the study which means the ways have been used for gathering the information and data and consequently how this study will analyze the data to find the best answer for the mentioned research questions. There is two methods of analyzing the data which are qualitative data analysis and quantitative data analysis . qualitative data typically involves words and quantitative data involves numbers.In this research, only Qualitative analysis is used by researcher to measure and analyze the data of the study. Specifically researcher attempt to use Discourse Analysis as types of qualitative analysis for this study, and that is why there will be definition of Qualitative Analysis and Discourse Analysis stated in this study. 3. 1. 1 Qualitative analysis Quantitative approaches are those where you make measurements using some relatively well-defined measurement tool. Assuming that the theory behind doing the measurement is valid, and then a well developed quantitative tool should give you information in which y ou can have confidence (www. sse. monash. edu. au). On the other hand, qualitative research methodologies are designed to provide the researcher with the perspective of target audience members through immersion in a culture or situation and direct interaction with the people under study. A qualitative â€Å"approach† is a general way of thinking about conducting qualitative research. It describes, either clearly or totally, the purpose of the qualitative research, the role of the researchers, the stages of research, and the method of data analysis (Trochim, 2006). „Qualitative methods allow us to stay close to the experimental world.They are designed to ensure a close fit between the data and what people actually say and do. By observing people in their everyday lives, listening them talk about what is on their minds, and looking at the documents they produce, the qualitative researcher obtains first-hand knowledge of social life unfiltered through concepts, operational definitions, and rating scales? (Taylor & Bogdan,1984). According Marketing dictionary, â€Å"qualitative research is a research that deals with the quality, type, or components of a group, substance, or mixture, whose methods are applied to advertising audience research in order o determine the quality of audience responses to advertising† (www. answers. com). Along with the above reference, according to the article published by DJS Research Ltd (2009), Qualitative research is used to help us understand how people feel and why they feel as they do. It is concerned with collecting information in detail and asking questions such as why do you say that? Depth interviews or group discussions are two common methods used for collecting qualitative information. http://www. marketresearchworld. net 3. 2 Discourse AnalysisThe focus of discourse analysis is any form of written or spoken language, such as a conversation or a newspaper article. The main topic of interest is the underly ing social structures, which may be assumed or played out within the conversation or text. It concerns the sorts of tools and strategies people use when engaged in communication, such as slowing one's speech for emphasis, use of metaphors, and choice of particular words to display affect, and so on. The investigator attempts to identify categories, themes, ideas, views, roles, and so on, within the text itself.The aim is to identify commonly shared discursive resources (shared patterns of talking). The investigator tries to answer questins such as how the discourse helps us understand the issue under study, how people construct their own version of an event, and how people use discourse to maintain or construct their own identity (Fulcher E, 2005). This research has been done to expose weaknesses and problems of Tourism development and planning specifically focus on pro-poor tourism and discuss about challenges and issues as well as opportunities for this industry.Moreover find out the reasons why tourism industry in Iran is not enough developed as compare to other developing countries with less attractions, facilities and potentials. The studies aim is to help to understanding the meaning and usage of pro-poor tourism and finding the challenges and analyze them and finding the reasons and issues which make this problems and by recommending and suggesting some action plans help to improve tourism policy and establishing new type of tourism industry which is not very new in the world and it is pro-poor tourism in Iran. . Process of Study Since this research is about pro-poor tourism in, Iran the study will focus more on Explanation of benefits of pro-poor tourism in Iran and the ways it will benefit the society and economy of the country. The research will be descriptive and then method of the study will be qualitative . after gathering the data will be analyzed on the content to find and recognize the issues and challenges of implementing the strategies and pl ans to find out the best effective strategies. Diagram 3. : Data Analysis process 3. 3. 1 Data collection (Notice and Bring Together) Study will began with collecting necessary information from reliable resources and identify the related data and bring those data together. Researchers collected some parts of the data which has from internet and from KDU College Library. Since this research have been doing in Malaysia, and there is no other possible ways for collecting the data from Iran, Internet played a very important role for finding the data very and necessary information.Beside internet and journals, interviews with professionals of the industry and also papers of pro-poor tourism researches which have been done by professors and lectures of KDU College and was presented in a pro-poor tourism conference in Malaysia (KDU College, 2009) will be used to help the study to analyze and strategies the plans which will be recommended by this study to improve tourism industry for the be tter future of the country. 3. 3. 2 AnalysisBase on the above studies research start to analyze the data and information which have been founded in the last stage to finding the correct answers for the research questions, and then planning for an action plan which will be use in next stage of study. The method of analyze which is using for analysis the data in this research, is qualitative method of analysis, and it is going to be evaluate by discourse analysis. 3. 3. 3 Action plan (Make Decision)In this part of study, according to the data we analyze and after finding challenges and issues in tourism industry, some recommendation and action plans will suggest to improve the tourism development and establishing pro-poor tourism in Iran. This study believes that the result of this research will be useful and helpful for building sustainable tourism policy in Iran for near future. 4. References Ashley. C and Haysom G, 2004, From Philanthropy to Different way of doing business: â€Å" Strategies and Challenges in Integrating Pro-Poor Approaches into Tourism Business†. Also available http://www. ropoortourism. org. uk/Publications%20by%20 partnership/propoor_business_ATLASpaper. pdf. Viewed 28/11/2009 Answer. com, Marketing Dictionary: Qualitative Research [Online] available http://www. answers. com/topic/qualitative-research-1. Viewed 14/12/2009 Caroline . A, 2006, For SNV East and Southern Africa, â€Å"How Can Governments Boost the Local Economic Impacts of Tourism†. Viewed 29/11/2009 Dilys. R, 2001, Pro-Poor Tourism: â€Å"Harnessing the World’s Largest Industry for the World’s Poor†, UK and Penny Urquhart Khanya, South Africa, International Institute for Environment and Development (IIED). Viewed 1/11/2009 DJS Research Ltd: â€Å"What is Qualitative Research† [Online] available http://www. marketresearchworld. net/index. php? Itemid=64&id=10&option=com_content. Viewed 14/12/2009 Dorji. P, 2007, Pro-Poor Community-based Nature Tourism in Bhutan [Online] available http://www. propoortourism. org. uk/pptpar2007. pdf Viewed 12/12/2009 Encyclopedia of the Nations 2009 (Iran) Country over view; â€Å"Location and size, Population, Infrastructure, power, and communications, Transportation, Power, Telecommunications, Industry† Also available: http://www. nationsencyclopedia. com/economies/Asia-and-the Pacific/Iran. tml. Viewed 3/12/2009 Fulcher. E, 2005, What is Discourse Analysis? [Online] available http://eamonfulcher. com/discourse_analysis. html. Viewed 14/12/2009 Gorman, O. K. D, McLellan, & L. R Baum, T. 2007, Tourism in Iran: â€Å"Central Control and Indignity†. In Tourism and Indigenous Peoples: â€Å"Issues and Implications†. Butterworth Heinemann, Oxford, p. 297-317 Viewed 8/11/2009 Iran Labor force (2009) [Online], available http://www. indexmundi. com/iran/labor_force. html Viewed 5/11/2009 Inflation rate in Iran (2009) [Online], available http://www. indexmundi. com/ira n/inflation_rate_(consumer_prices). tml Viewed 5/11/2009 Iran unemployment rate (2009) [Online], available http://www. indexmundi. com/iran/unemployment_rate. html Viewed 5/11/2009 Javad. D & Salehi. I, 2006. Revolution and redistribution in Iran: â€Å"Poverty and inequality, 25 years later, Department of Economics, Virginia Tech† Viewed 4/11/2009 Javad. D, 2009, â€Å"Tyranny of numbers Claims of rising poverty in  Iran† [Online] available http://djavad. wordpress. com/2009/03/30/playing-with-poverty-numbers Kevin O. G, McLellan L. R & Tom B, 2007, Tourism in Iran: â€Å"Central control and indignity† Viewed 3/12/2009Kayastha, Y, 2006 â€Å"Monitoring and Evaluation of a Pro-Poor Tourism Project in a Conflict Situation†, Conference Monitoring and Evaluation of Pro-Poor Tourism Policies for Sustainable Development, Saarbrucken, Germany, Also available: www. wuwien. ac. at/inst/iuw/fsnu/saarbruecken/papers/abstracts/Kayastha. pdf. Viewed 6/11/2009 Monas h University (2007): Qualitative and Quantitative Thinking [Online] available http://www. csse. monash. edu. au/~smarkham/resources/qual. htm Viewed 14/12/2009 Pro-poor tourism, UK, 2009 [Online] available www. propoortourism. org. uk Viewed 8/12/2009Pro-poor Brochure FINAL, 2006 [Online] available http://www. ifc. org/ifcext/mekongpsdf. nsf/AttachmentsByTitle/Propoor_Tourism/$FILE/Propoor_Tourism. pdf Viewed 9/11/2009 Pro-poor tourism; Annual register 2007, [Online] available http://www. propoortourism. org. uk/pptpar2007. pdf Viewed 9/11/2009 Steven S, 2007, The Mekong Tourism Development Project in the Lao PDR [Online] available www. ecotourismlaos. com and http://www. propoortourism. org. uk/pptpar2007. pdf Viewed 10/12/2009 Taylor, S & Bogdan, R 1984, â€Å"Introduction to Qualitative Research Method†s, JohnWiley & sons, New York Viewed 30 April 2009 United Nations Report, 2007, New York, â€Å"Study on the Role of Tourism in Socio-Economic Development† Viewed 3/1 2/2009 United Nations ESCAP, â€Å"The Contribution of Tourism to Poverty Alleviation†, Tourism Review number 25 (New York: United Nations, 2005), p. 68-70. Viewed 5/11/2009 World hotel-link, 2009 [Online] available http://www. ifc. org/ifcext/mekongpsdf. nsf/AttachmentsByTitle/Propoor_Tourism/$FILE/Propoor_Tourism. pdf Viewed 12/12/2009 ———————– Chapter One: Introduction Chapter Two: Literature Review Chapter three: Methodology

Amul: Deary Cooperative in India Essay

Abstract In this paper we describe a case study of a dairy cooperative, AMUL, in western India that has developed a successful model for doing business in large emerging economy. It has been primarily responsible, through its innovative practices, for India to become world’s largest producer of milk. A subset of strategies followed by AMUL would still be very useful. Thus, firms that are contemplating addressing large undeveloped markets or have an intention of taking advantage of extensive but marginal supplier base would still benefit. Introduction The Kaira District Cooperative Milk Producers’ Union Limited was established on December 14, 1946 as a response to exploitation of marginal milk producers in the city of Anand (in Kaira district of the western state of Gujarat in India) by traders or agents of existing dairies. Producers had to travel long distances to deliver milk to the only dairy, the Polson Dairy in Anand – often milk went sour, especially in the summer season, as producers had to physically carry milk in individual containers. These agents decided the prices and the off-take from the farmers by the season. Milk is a commodity that has to be collected twice a day from each cow/buffalo. In winter, the producer was either left with surplus unsold milk or had to sell it at very low prices. Moreover, the government at that time had given monopoly rights to Polson Dairy (around that time Polson was the most well known butter brand in the country) to collect milk from Anand and supply to Bombay city in tu rn (about 400 kilometers away). India ranked nowhere amongst milk producing countries in the world in 1946. The producers of Kaira district took advice of the nationalist leaders, Sardar Vallabhbhai Patel (who later became the first Home Minister of free India) and Morarji Desai (who later become the Prime Minister of India). They advised the farmers to form a cooperative and supply directly to the Bombay Milk Scheme instead of selling it to Polson (who did the same but gave low prices to the producers). Thus the Kaira District Cooperative was established to collect and process milk in the district of Kaira. Milk collection was also decentralized, as most producers were marginal farmers who would deliver 1-2 litres of milk per day. Village level cooperatives were established to organize the marginal milk producers in each of these villages. The first modern dairy of the Kaira Union was established at Anand (which popularly came to be known as AMUL dairy after its brand name). The new plant had the capacity to pasteurise 300,000 pounds of milk per day, manufacture 10,000 pounds of butter pe r day, 12,500 pounds of milk powder per day and 1,200 pounds of casein per day. Indigenous R&D and technology development at the Cooperative had led to the successful production of skimmed milk powder from buffalo milk – the first time on a commercial scale anywhere in the world. The foundations of a modern dairy industry in India had just been laid as India had one of the largest buffalo populations in the world. We move to year 2000. The dairy industry in India and particularly in the State of Gujarat looks very different. India has emerged as the largest milk producing country in the world. Gujarat emerges as the most successful State in terms of milk and milk product production through its cooperative dairy movement. The Kaira District Cooperative Milk Producers’ Union Limited, Anand becomes the focal point of dairy development in the entire region and AMUL emerges as one of the most recognized brands in India, ahead of many international brands. Starting with a single shared plant at Anand and two village cooperative societies for milk procurement, the dairy cooperative movement in the State of Gujarat had evolved into a network of 2.12 million milk producers (called farmers) who are organized in 10,411 milk collection independent cooperatives (called Village Societies). These Village Societies (VS) supply milk to thirteen independent dairy cooperatives (called Unions). AMUL is one such Union. Gujarat Cooperative Milk Marketing Federation or GCMMF is the marketing entity for products of all Unions in the State of Gujarat. GCMMF has 42 regional distribution centers in India, serves over 500,000 retail outlets and exports to more than 15 countries. All these organizations are independent legal entities yet loosely tied together with a common destiny. In a recent survey GCMMF was ranked amongst the top ten FMCG firms in the country while AMUL was rated the second most recognized brand in India amongst all Indian and MNC offerin gs. 2nd Phase: In 1966, Amul hired Sylvester daCunha, then managing director of the advertising agency AS to design a new ad campaign for Amul Butter. daCunha designed an add campaign as series of hoardings with topical ads, relating to day-to-day issues.[14]The campaign was widely popular and earned a Guiness world record for the longest running ad campaign in the world. Since the 1980s, cartoon artist Bharat Dabholkarhas been involved with sketching the Amul ads, who rejected the trend of using celebrities in advertisement campaigns. Despite encountering political pressure on several occasions, daCunha’s agency has made it a policy of not backing down. Some of the more controversial Amul ads include one commenting on Naxalite uprising in West Bengal, on the Indian Airlines employees strike, and the one depicting the Amul butter girl wearing a Gandhi cap. Amul hired DraftFCB+Ulka for the brands of Amul milk, chocolates, paneer, ghee, ice-cream. The establishment of Amul is also known as White Revolution. The White Revolution of India inspired the notable Indian film-makerShyam Benegal to base his film Manthan (1976) on it. The White Revolution ushered an era of plenty from a measly amount of milk production and distribution. Aside from the great measurable success that this project was, it also demonstrated the power of â€Å"collective might†. A small set of poor farmers of Kheda district in Gujarat had the vision and foresight to act in a way that was good for the society and not for the self alone. There have been several factors driving the restructuring of the dairy business (which has chiefly been organized around cooperative principles). These include efficiencies in managing fewer large plants versus a number of under-utilized small plants, need for more milk supply (and declining membership), need to offer wide variety, improvements in trucking & milk handling thereby facilitating long hauls, opening of new international markets (also markets for new products), seeking marketing clout and need to bring investment from outside the cooperatives. AMUL in India has learnt from many experiences and has been influenced by practices in dairies around the world especially in its formative years. It has, however, formed it own organizational structure (i.e., AMUL is a cooperative of village cooperatives) to bring about a change in the lives of marginal farmers of India. The AMUL experience has attracted considerable interest from the development community – predominantly an thropologists, development & agriculture economists, and political scientists. Key areas of their enquiry have been the role of AMUL in reducing social and economic inequality in the region of the cooperative, the sociology of cooperation, interface of the dairy cooperative and the rural power structure, relation of the State and the Cooperative and the role of government in its growth (interestingly, AMUL has successfully managed to exercise its independence from the government unlike other cooperatives in India), elements & replicability of the cooperative movement at Anand, cost effectiveness of subsidies to AMUL (in its initial years) etc. A few studies have evaluated the operational effectiveness of the operations at AMUL. Studies have reported usage of mobile veterinary dispensaries, wireless sets to link mobile units to service centers as early 1951, developing a programme of cross breeding of cows in early 1970s etc. that have led to a phenomenal rise in productivity of milk (Patel, 1988). AMUL’s Journey towards Excellence AMUL’s journey towards excellence is marked by some critical understanding of the business environment in large emerging economies like India where markets have to be developed by combining efficiency related initiatives with increasing the base of marginal suppliers and consumers. The essence of AMUL’s efforts were as follows: †¢ It combined market and social development in an emerging economy. It recognized the inter-linkages between various environments that governed the lives of marginal milk farmers and the unmet needs of consumers. It also changed the supply chain paradigm in order to reduce the cost to the consumer while increasing the return to the supplier. †¢ It realized that in order to achieve their objectives, it had to benefit a large number of people – both suppliers and consumers. While large scale had the danger of failure due to poor control and required more resources, it also had the advantage of creating a momentum that would be necessary to bring more people into the fold and thereby help more suppliers and consumers. †¢ It also realized that its goal could only be achieved in the long run and this required developing values in people and processes that were robust, replicable and transparent. †¢ It also realized that the cooperative would not be independent and viable in the face of competition if it were not financially sound. Leadership While Kaira Union (or AMUL) had the support of national leaders who were at the forefront of the Indian independence movement, its local leaders were trained in Gandhian simplicity and had their feet rooted firmly amongst people whom they had mobilized – the poor farmers of Anand. The foremost amongst them was Tribhuvandas Patel who had led the movement for the formation of cooperatives of small and marginal farmers in order to compete against investor owned enterprises on one hand, and keep bureaucracy away on the other hand. Tribhuvandas was the first Chairman of the cooperative. His skills lay in organizing the village producers, in making them believe in the power of cooperation and their rights towards improvement of human condition. He is remembered as fair and honest person whose highest sense of accountability to the members of the union laid the foundation of trust between network members. Another important aspect of his remarkable management style was his gentleness and ability to repose trust in people – he gave complete autonomy to managers of the union and earned complete commitment from them. Verghese Kurien was one such manager who would, first, shape the destiny of the Union and then the milk movement throughout the country. Several young people left better paying jobs to help create a dream of making India the milk capital of the world. Kurien had learnt the persuasive charm of Tribhuvandas through plain speaking and had soon created a cadre of highly capable managers to whom he had delegated both management as well as commitment. These leaders were created at the village, district and state levels in different organizations of the network. Tribhuvandas knew that his fledgling cooperative needed a technocrat manager who shared his concern for the farmers and also had the tenacity to organize marginal producers. Convincing farmers to join the cooperative required commitment bordering on stubbornness, a can do attitude and a desire to change lives of poor people. Verghese Kurien had those skills and had linkages to the government. He was charismatic in his communication and committed in his effort. Over a period of time, he developed a very close link with the poor farmers who, as he always says, â€Å"w ere his employers† at the cooperative. He would travel through the villages along with Tribhuvandas and work out the details of how the milk collection cooperative would work, how trucks would pickup milk from village societies, how the cattle would have to be taken care of and how all of this would help the poor milk farmer come out of poverty and the clutches of the middleman. Operational details were meticulously planned and executed. And then, he along with two of his close associates would work on the design of the dairy plant including conducting experiments to create powder out of buffalo milk – a task that was ridiculed by all who heard of it including the international aid agencies in the dairy industry. Tribhuvandas and Kurien were able to convince the government also of the value of his efforts and secured funding for several projects of the cooperative. Kurien’s biggest strength lay in his ability to convince people that the cause of rural farmers was important thus establishing an important shar ed value. Subsequently, he could convince the government to replicate the AMUL model in almost all states of the country. Strategy AMUL’s business strategy is driven by its twin objectives of (i) long-term, sustainable growth to its member farmers, and (ii) value proposition to a large customer base by providing milk and other dairy products a low price. Its strategy, which evolved over time, comprises of elements described below. Simultaneous Development of Suppliers and Customers: From the very early stages of the formation of AMUL, the cooperative realized that sustained growth for the long-term was contingent on matching supply and demand. Further, given the primitive state of the market and the suppliers of milk, their development in a synchronous manner was critical for the continued growth of the industry. The organization also recognized that in view of the poor infrastructure in India, such development could not be left to market forces and proactive interventions were required. Accordingly, AMUL and GCMMF adopted a number of strategies to assure such growth. For example, at the time AMUL was formed, the vast majority of consumers had limited purchasing power and was value conscious with very low levels of consumption of milk and other dairy products. Thus, AMUL adopted a low price strategy to make their products affordable and guarantee value to the consumer. The success of this strategy is well recognized and remains the main plank of AMUL’s strategy even today. To summarize, the dual strategy of simultaneous development of the market and member farmers has resulted in parallel growth of demand and supply at a steady pace and in turn assured the growth of the industry over an extended period of time. Cost Leadership: AMUL’s objective of providing a value proposition to a large customer base led naturally to a choice of cost leadership position. Given the low purchasing power of the Indian consumer and the marginal discretionary spending power, the only viable option for AMUL was to price its products as low as possible. This in turn led to a focus on costs and had significant implications for managing its operations and supply chain practices (described later). Focus on Core Activities: In view of its small beginnings and limited resources, it became clear fairly early that AMUL would not be in a position to be an integrated player from milk production to delivery to the consumer. Accordingly, it chose a strategy to focus on core dairy activities and rely on third parties for other complementary needs. This philosophy is reflected in almost all phases of AMUL network spanning R&D, production, collection, processing, marketing, distribution, retailing etc. For example, AMUL focused on processing of liquid milk and conversion to variety of dairy products and associated research and development. On the other hand, logistics of milk collection and distribution of products to customers was managed through third parties. However, it played a proactive role in making support services available to its members wherever it found that markets for such services were not developed. For example, in the initial stages, its small and marginal member farmers did not have access to finance, veterinary service, knowledge of basic animal husbandry etc. Thus to assure continued growth in milk production and supply, AMUL actively sought and worked with partners to provide these required services. Managing Third Party Service Providers: Well before the ideas of core competence and the role of third parties in managing the supply chain were recognized and became fashionable, these concepts were practiced by GCMMF and AMUL. From the beginning, it was recognized that the core activity for the Unions lay in processing of milk and production of dairy products. Accordingly, the Unions focused efforts on these activities and related technology development. Marketing efforts (including brand development) were assumed by GCMMF. All other activities were entrusted to third party service providers. These include logistics of milk collection, distribution of dairy products, sale of products through dealers and retail stores, some veterinary services etc. It is worth noting that a number of these third parties are not in the organized sector, and many are not professionally managed. Hence, while third parties perform the activities, the Unions and GCMMF have developed a number of mechanisms to retain control and assure quality and timely deliveries (see the sub-section on Coordination for Competitiveness later in the paper for more details). This is particularly critical for a perishable product such as liquid milk. Financial Strategy: AMUL’s finance strategy is driven primarily by its desire to be self-reliant and thus depend on internally generated resources for funding its growth and development. This choice was motivated by the relatively underdeveloped financial markets with limited access to funds, and the reluctance to depend on Government support and thus be obliged to cede control to bureaucracy. AMUL’s financial strategy may thus be characterized by two elements: (a) retention of surplus to fund growth and development, and (b) limited/ no credit, i.e., all transactions are essentially cash only. For example, payment for milk procured by village societies is in cash and within 12 hours of procurement (most, however, pay at the same time as the receipt of milk). Similarly, no dispatches of finished products are made without advance payment from distributors etc. This was particularly important, given the limited liquidity position of farmer/suppliers and the absence of banking facilities in rural India. This strategy strongly helped AMUL implement its own vision of growth and development. It is important to mention that many of the above approaches were at variance with industry practices of both domestic and MNC competitors of AMUL. Organization AMUL is organized as a cooperative of cooperatives (i.e., each village society, a cooperative in itself, is a member of the AMUL cooperative) thereby deriving the advantage of scale and uniformity in decision making. The founders of Kaira Union realized that to fulfill their objectives, a large number of marginal farmers had to benefit from the cooperative – a network of stakeholders had to be built. And once built, it had to grow so as to draw more rural poor to undertake dairy farming as a means of livelihood. The network had to have several layers – the organizational network where the voice of the owners governed all decisions, a physical network of support services and product delivery process and a network of small farmers that could deliver the benefit of a large corporation in the market place. More importantly, a process had to be put in place to build these networks. Building an organizational network that would represent the farmers and the customers was the most complicated task. A loose confederation was developed with GCMMF representing the voice of the customers, the Unions representing the milk processors and the village societies representing the farmers. Competition in the markets ensured that the entire network was responding to the requirements of the customers at prices that were very competitive. The task of ensuring that returns to the farmers was commensurate with the objectives with which the cooperatives were setup was achieved through representation of farmers at different levels of decision making throughout the network – the board of directors of societies, Unions and the Federation comprised farmers themselves. In order to ensure that most returns from sales went to the producers, the intermediaries had to operate very effectively and on razor thin margins. This turned out to be a blessing in disguise – the operations remained very â€Å"lean† and started to provide cost based advantage to the entire network. AMUL establ ished a group to standardize the process of organizing farmers into village societies. In addition to establishing the criteria for selecting members, the group had to train the VS to run the cooperative democratically, profitably and with concern for its members. This included establishing procedures for milk collection, testing, payment for milk purchased from member farmers and its subsequent sale to the union, accounting, ensuring timely collection and dispatch of milk on milk routes established by the union, etc. The Village Societies Division at AMUL acts as the internal representative of village societies in their dealings with the Union. Cooperative development programmes at the village level for educating & training its members have become an important part of the strategy to build this extensive network. Milk procurement activity at AMUL comprises development and servicing of village societies, increasing milk collection, procurement of milk from societies & its transport to the chilling locations, and resolving problems of farmers and village societies. Thei r stated objective is to ensure that producers get maximum benefits. The Village Societies Division coordinates these activities. Milk collection takes place over a large number of pre-defined routes according to a precise timetable. The field staff of this division also help village societies interface with the Union on various issues ranging from improvement of collection, resolving disputes, repair of equipments to obtaining financing for purchase of equipment etc. In addition, they are also responsible for the formation of new societies, which is an important activity at AMUL. In essence, the organization structure of AMUL allows effective utilization of resources without losing the democratic aspiration of individual members. It is obvious that such a system needs charismatic leadership to achieve consensus across issues – a process that has long-term benefits for any organization. Marketing GCMMF is the marketing arm of the network and manages the physical delivery and distribution of milk and dairy products from all the Unions to customers. GCMMF is also responsible for all decisions related to market development and customer management. These activities, which range from long-term planning to medium-term and short-term operational decisions are described below. As mentioned earlier, introduction of new products and choice of product mix and markets should be consistent with the growth strategy, and synchronous with growth in milk supply. GCMMF’s demand growth strategy may be characterized by two key elements: (i) developing markets for its high value products by graduating customer segments from low value products, and (ii) maintaining a healthy level of customer base for its base products (low value segment). This strategy often requires GCMMF to allocate sufficient quantity of milk supply to low value products, thereby sacrificing additional profits that coul d be generated by converting the same to high value products. Interestingly, advertisement & promotion (a la FMCG) was not considered to be enough of value addition and hence the budget was kept relatively small. Instead, GCMMF preferred a lower price with emphasis on efficiency in advertising. In this context, GCMMF provides umbrella branding to all the products of the network. For example, liquid milk as well as various milk products produced by different Unions are sold under the same brand name of AMUL. Interestingly, the advertising has centred on building a common identity (e.g., a happy & healthy â€Å"cartoon† AMUL girl) and evoking national emotion (e.g., the key advertising slogan says â€Å"AMUL – The Taste of India†). GCMMF also plays a key role in working with the Unions to coordinate the supply of milk and dairy products. In essence, it procures from multiple production plants (the thirteen Unions), which in turn procure from the Village Societies registered with each Union. GCMMF distributes its products through third party distribution depots that are managed by distributors who are exclusive to GCMMF. These distributors are also responsible for servicing retail outlets all over the country. GCMMF sales staff manages this process. Retailing of GCMMF’s products takes place through the FMCG retail network in India most of whom are small retailers. Liquid milk is distributed by vendors who deliver milk at homes. Since 1999, GCMMF has started web based ordering facilities for its customers. A well-defined supply chain has been developed to service customers who order in this manner.