DEPARTMENT OF MECHANICAL ENGINEERING

INDUSTRIAL MANAGEMENT (GNS 413)

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SUBMITTED BY HND 1 MECHANICAL ENGINEERING STUDENTS (GROUP 3)

H/ME/11/407 H/ME/11/411 H/ME/11/415 H/ME/11/419 H/ME/11/423 H/ME/11/427 H/ME/11/431 H/ME/11/435 H/ME/11/439 H/ME/11/443 H/ME/11/447 H/ME/11/451

SUBMITTED TO ALHAJI ENGR. (PROF) S.A OLAGOKE (J.P)

THE FEDERAL POLYTECHNIC ILARO

MARCH 2012
QUESTION 1

SET GOAL TYPES OF VARIOUS BUSINESS ORGANIZATIONS

Business Objectives Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. This can motivate the employees. It also enables the business to measure the progress towards to its stated aims. The most effective business objectives meet the following criteria: S Specific objectives are aimed at what the business does, e.g. a hotel might have an objective of filling 60% of its beds a night during October, an objective specific to that business. M - Measurable the business can put a value to the objective, e.g. 10,000 in sales in the next half year of trading. A - Agreed by all those concerned in trying to achieve the objective. R - Realistic the objective should be challenging, but it should also be able to be achieved by the resources available. T- Time specific they have a time limit of when the objective should be achieved, e.g. by the end of the year. The main objectives that a business might have are: Survival a short term objective, probably for small business just starting out, or when a new firm enters the market or at a time of crisis. Profit maximisation try to make the most profit possible most like to be the aim of the owners and shareholders. Profit satisfying try to make enough profit to keep the owners comfortable probably the aim of smaller businesses whose owners do not want to work longer hours. Sales growth where the business tries to make as many sales as possible. This may be because the managers believe that the survival of the business depends on being large. Large businesses can also benefit from economies of scale. A business may find that some of their objectives conflict with one and other:

Growth versus profit: for example, achieving higher sales in the short term (e.g. by cutting prices) will reduce short-term profit. Short-term versus long-term: for example, a business may decide to accept lower cash flows in the short-term whilst it invests heavily in new products or plant and equipment.

Large investors in the Stock Exchange are often accused of looking too much at short-term objectives and company performance rather than investing in a business for the long-term.

Alternative Aims and Objectives Not all businesses seek profit or growth. Some organisations have alternative objectives. Examples of other objectives: Ethical and socially responsible objectives organisations like the Co-op or the Body Shop have objectives which are based on their beliefs on how one should treat the environment and people who are less fortunate. Public sector corporations are run to not only generate a profit but provide a service to the public. This service will need to meet the needs of the less well off in society or help improve the ability of the economy to function: e.g. cheap and accessible transport service. Public sector organisations that monitor or control private sector activities have objectives that are to ensure that the business they are monitoring comply with the laws laid down. Health care and education establishments their objectives are to provide a service most private schools for instance have charitable status. Their aim is the enhancement of their pupils through education. Charities and voluntary organisations their aims and objectives are led by the beliefs they stand for.

Changing Objectives A business may change its objectives over time due to the following reasons: A business may achieve an objective and will need to move onto another one (e.g. survival in the first year may lead to an objective of increasing profit in the second year). The competitive environment might change, with the launch of new products from competitors. Technology might change product designs, so sales and production targets might need to change.

Let us consider the set goals of the following organizations. 1. Government - To promote peace, instead of war.
- To make policies beneficial to all, instead of just a few already rich elite.

- To work towards protecting its citizens by promoting safer and healthier workplaces, a living wage, and accountability from CEOs who use their companies for greedy and nefarious purposes. - To be open to scrutiny and expect its actions to be monitored by its citizens. - To that assists the needy, without question, at home and abroad. - To ensure a cleaner environment, promote renewable and efficient energy sources, and punish companies that pollute the environment. - To uphold the rule of law, and strive to protect the Constitution and Bill of Rights. 2. Political Parties
The primary goals of major political parties are: - To nominate candidates for office -To raise money so candidates can get elected campaign on behalf of their candidate -To get people to vote for candidate -To create a unified policy and make policies through party in government 3. Lecturers and Professors

Incorporate the use of technology in classrooms to enhance understanding of students. Spend some time on alternate days in a week to improve vocabulary and general awareness of students. Motivate students to read books by conducting 'reading sessions' in classroom, at least once or twice a week. Build stronger professional relationships with other teaching staff. Plan teaching work based on every week basis. Continue learning by keeping oneself updated about latest developments in the interest area. Help first year teachers in work and solve students queries regarding suitable career path.

Instil confidence in special children by giving them focused and goal - directed instruction. Read some popular books about teaching and try to bridge the parent - teacher - student communication gap. Manage time effectively to balance work and personal life. Plan ahead of the day regarding tasks and duties to be carried out that specific day. Organize desk and children files for recording information properly.
QUESTION 2

CONCEPT OF LIMITED LIABILITY

Limited liability is a concept whereby a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a company or partnership with limited liability. If a company with limited liability is sued, then the plaintiffs are suing the company, not its owners or investors. A shareholder in a limited company is not personally liable for any of the debts of the company, other than for the value of their investment in that company. This usually takes the form of that person's dividends in the company being zero, since the company has no profits to allocate. The same is true for the members of a limited liability partnership and the limited partners in a limited partnership. By contrast, sole proprietors and partners in general partnerships are each liable for all the debts of the business (unlimited liability). Although a shareholder's liability for the company's actions is limited, the shareholder may still be liable for its own acts. For example, the directors of small companies (who are frequently also shareholders) are often required to give personal guarantees of the company's debts to those lending to the company. They will then be liable for those debts in the event that the company cannot pay, although the other shareholders will not be so liable. This is known as cosigning. A business owner benefits personally and financially from the concept of limited liability. The concept of limited liability closely is associated with the establishment and operation of a business enterprise, according to "Business Organizations" by D. Gordon Smith and Cynthia A. Williams. Not all businesses provide their owners the benefits of limited liability. Therefore, when organizing a business and seeking to limit personal liability, a person must understand the concept of limited liability and the businesses that provide this type of protection. Function The function of the concept of limited liability is to provide the owners of businesses a way to protect their personal assets, according to "Limited Liability" by Michael S. Rozeff, writing at LewRockwell.com. For example, if a business is sued, the person seeking compensation cannot go after the personal property of the business' owners. Types The concept of limited liability gives rise to a variety of different types of business organizations, according to "Business Organizations." These include corporations and limited liability companies, all of which are created by the laws of each of the 50 states.

Significance The concept of limited liability plays a significant role in commerce. Absent the concept of limited liability, individuals would shy away from investing in businesses of any type. The vast majority of individuals would not want to put their personal property at risk by becoming involved in a business enterprise. Features The concept of limited liability restricts the amount of money a person risks to what she invests in a business enterprise, according to "Commentaries and Cases on the Law of Business Organization" by William T. Allen. Exception Protections normally associated with the concept of limited liability can be set aside in certain situations. For example, if a business owner co-mingles personal and business assets -- in a common bank account, for example -- an individual with a claim against the business likely can seek compensation from some, if not all, of the business owner's personal assets. Expert Assistance A business owner facing a situation in which another individual or business makes a claim against the business should seek legal assistance. A qualified attorney not only protects the interests of the business but works to ensure that the owner's personal assets do not end up in jeopardy. The American Bar Association maintains resources to assist in finding an experienced lawyer.

QUESTION 3

EFFECTS OF PRIVATE BUSINESS CONTROL

The theoretical literature often identifies private business control as the "psychic" value some shareholders attribute simply to being in control (e.g., Harris and Raviv, 1988; Aghion and Bolton, 1992). Although this is certainly a factor in some cases, it is hard to justify multimillion dollars premier with the pure pleasure of command. Another source of private business control is the perquisites enjoyed by top executives. The use of a company's money to pay for perquisites is the most visible but not the most important way in which corporate resources can be used to the sole (or main) advantage of the controlling party. If the law does not effectively prevent it, corporate resources can be appropriated by the large shareholder through outright theft. Fortunately such activities, while documented in a few cases, are generally rare. Nevertheless, there are several reasons why more moderate versions of these strategies might be more pervasive. Educated economists can legitimately disagree on what is the "fair" transfer price of a certain asset or product. As a result, small deviations from the "fair" transfer price might be difficult or impossible to prove in court. If these small deviations are applied to large volume trade, however, they can easily generate sizeable private benefits. Similarly, it is easy to disagree over who is the best provider of an asset or product when the relationship might involve considerations of quality and price. Or consider the value of the information a corporate executive acquires thanks to his or her role in the company. Some of this information pertains directly to the company's business while some reflects potential opportunities in other more or less related areas. It is fairly easy for a controlling shareholder to choose to exploit these opportunities through another company he or she owns or is associated with, with no advantage for the remaining shareholders. The net present value of these opportunities represents a private benefit of control. The common feature of all the above examples is that some value, whatever the source, is not shared among all the shareholders in proportion of the shares owned, but it is enjoyed exclusively by the party in control. Hence, the name private business control. Control does not only confer benefits: sometimes it involves costs as well. Maintaining a controlling block, for instance, forces the largest shareholder to be not well diversified. As a
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result, it might value the controlling block less. At the same time, a fledgling company might inflict a loss in reputation to the controlling party and, in some extreme cases, even some legal liabilities. For this reason we do not necessarily expect all our estimates to be always positive. In particular, we expect a higher frequency of negative value of control for financially distressed companies (see also Barclay and Holderness, 1989). Note that the existence of private business control is not necessarily inefficient. First of all, private benefits might be the most efficient way for the company to capture some of the value created. Imagine, for instance, that a corporate executive acquires valuable information about investment opportunities in other lines of businesses, which the company cannot or does not want to pursue. The executive could sell this information in the interest of shareholders. But the price she will be able to fetch is probably very low. Thus, it might be efficient that the executive exploits this opportunity on her own. Second, even if the extraction of private benefits generate some inefficiency, their existence might be socially beneficial, because their presence makes value-enhancing takeovers possible (Grossman and Hart (1980)). Given the difficulties in distinguishing whether private benefits are socially costly, consistently in this analysis we will shy away from any welfare consideration. Even the implications of the effects of private benefits on the development of security markets should be interpreted as a positive statement, not a normative one. In fact, in at least one of the models from where these implications are derived (Zingales, 1995b), the level of private benefits has no efficiency consequences, but only distributional ones.

REFERENCES
1. www.google.com 2. www.wikipedia.org 3. www.smallbusiness.chron.com 4. www.research.chicagobooth.edu