Tata Ace- Case Study

MARKETING STRATEGIES ASSIGNMENT â€Å"TATA ACE† CASE STUDY 1) Why do we feel Tata Motors was targeting LCV (Light Commercial Vehicle) segment under commercial segment for TATA ACE? – – – Better highway systems like the Golden Quadrilateral meant that Commercial vehicles in 45+ Tonnes could carry bulk loads covering large distances in shorter time and at lower per tonne per km cost. Government also went about the task of improving road network between medium sized cities and also building all weather tertiary road network covering rural towns- only smaller and rugged vehicles could operate on these roads ( Pradhan Mantri Grameen Sadhak Yojana).Increased congestion & pollution in most of the cities forced the government to regulate the movement of Large/ Heavy trucks (larger than four tonnes) in the cities. Tata motors considered the above primary factors in determining the need for large commercial vehicles for the highways and smaller sub 4 Ton category co mmercial vehicle for operating on both Inter city/ Town and Intra city road network.Ruling out the possibility of developing large commercial vehicles due to the high cost of development and fearing loss of revenues from their niche standard size truck segment, Tata motors decided to develop TATA ACE targeting the Light Commercial Vehicle Segment. Also helping their decision process were some key policy initiatives: – Discouraging the use of Old. Polluting & uneconomical vehicles Scrapping of >15 years old vehicles Ban on overloading of vehicle. ) Highlight the Key outcome of Market Research which was conducted before launching TATA ACE and do we think there was a gap which can be addressed by a Product like TATA ACE? Market research involving interviewing of over 4000 truck and three wheeler operators across the length & breadth of the country highlighted the following needs, though there was a section which opined that even a three wheeler under TATA banner would be welcome d by the market: (i) Owning price of the vehicle should not exceed INR 200,000/(ii) Fuel Efficiency. Reduce â€Å"per ton per km† cost. iii) Maneuverability of three wheeler but with higher level of a. Safety b. Durability c. Ruggedness d. Reliability e. Higher payload f. Comfort of a four wheeled truck. (iv) And finally â€Å"Personal Motivation† to drive a four wheeler to enhance the status of operators in the society and thereby create transportation entrepreneurs . Tata Motors addressed all the key requirements of the market with TATA ACE, A four wheeler with economical pricing, Fuel Efficient engine, pay load of 1750 kgs and built in safety features including enhanced comfort. ) How was Segmentation & Targeting done for TATA ACE? As a Functional segmentation, Tata motors decided that the ACE would address the spectrum of LCV to transport 750 – 1500 kgs over 100-200 kms and position it between the Rickshaws/Cart and Pick up trucks; meeting the functional nee ds of different customers. They also further segmented this functional segmented customers into four groups viz. , – Performance sensitive (7%) o Interested in status, Brand image and speed o Willing to pay higher prices for features Current owners/ operators of larger SUVs or cars. – Balanced perspective (25%) o Return on Investment o Comfort and features o Owners – Entrepreneurs o Purchasing three wheeler, due to absence of an alternative. – Return on Investment sensitive (55%) o Per Ton per Km cost o No value for Non-monetary purchase considerations o Generally fleet owners/ operators- who hired drivers – Acquisition price constrained (13%) o Lacked credit o Could not afford for slightly expensive vehicles. o Prefer three wheelerFinally they identified a group that could not afford any motorized vehicle; using bullock & horse carts, cycle rickshaws, manual pull carts. However this group over time can move up and be a TATA ACE customer. Based on functional & customer segmentation and also considering potential growth of the market , TATA Motors estimated and targeted: – 45% of the ACE’s customers planning to purchase 3 Wheeler – 15% from potential pickup & LCV purchasers – and 40% from first time CV purchasers. 4) Explain the Marketing Mix 4P's [Product, Price, Place, Promotion] strategy adapted for TATA ACE?Product: TATA ACE was designed to address three major customer needs in terms of product ie. , – Overloading capability – 2 cylinder water cooled engine, based on the proven Indica diesel engine – Safety, Comfort and aesthetic considerations Price: Though the price apparently was higher at ` 225,000 as against ` 100,000-200,000, they addressed the Per ton per km cost. Tata Ace would cost Rs. 6. 70 for delivering one ton of goods over per km as against `7. 88, their nearest competitor could offer and segment average of ` 8. 54. Place:Tata motors decided to roll out in phas e beginning with 5 states in Western and Southern parts of India; where the demand for three wheelers were high. They also benchmarked distribution network against two & three wheeler dealer network. Based on the data, they developed new dealership format called 1S (Sales), as against traditional 3S dealership network. Each existing Tata Motors 3S Dealer (Sales, Service & Spares) was required to set up 8 to 20 1S centers in their region and staff them with existing employees. Within 3 months 300 new distribution points were set up.Promotion: Tata motors used both Print and TV media to position and promote the product. – Chota Hathi – Symbol of Power, Reliability and â€Å"Mini† product A boy rushing to school, Wife seeing off for the day, Off to Work in Tata Ace and Going to School in Tata Ace. Also their positioning statements viz. , o India’s first Mini truck o Small is Big o Stability & Trust of big truck o Economic liberation o Feel good about jab o T ransportation at the last mile 5) What is the current trend of TATA ACE. Who are their competitors and suggest a future steps taken for TATA ACE?Present day competitors are : – Mahindra Gio – Mahindra Maxximo – Piagio Ape Mini Truck Force Trump Minidor. A few steps suggested for TATA ACE to continue to be the top seller are: – Continue to innovate and ring in changes to make the vehicle more fuel efficient. Increase engine torque to demonstrate performance in hilly regions Continue to control costs and offer competitive price to customers Increase Go Green initiative with increase in ENG and Electric drive variants Target export market aggressively; with both features and better pricing.

Edith Wharton - The House of M essays

Edith Wharton - The House of M essays Edith Wharton was born as Edith Newbold Jones in an aristocratic family in the city of New York. Wharton had no formal education but she was privileged enough to use her fathers library and was privately educated at home by governesses and tutors. She was expected to learn the social etiquette and conduct herself as a well-bred woman. She exhibited her creative talents from her childhood. Even before she could read she made up stories and later as an adolescent she wrote stories and novellas. At the age of twenty-three Wharton married Teddy Wharton. But their marriage was not a successful one for Teddy could not match Edith in her intellectual or artisitic interests. Apart from her career as a writer Wharton had a very important role to play as a social matron.During the first World War Wharton untiringly worked for the refugees in Paris.She also opened hostels and workhouses for women who had no support.However Wharton was dissatisfied as a wife and a society matron She lived in Pa ris till her death. She returned to United States only once and that was to accept the Pulitzer prize for her novel The Age of Innocence. Wharton authored about forty books and during her lifetime she enjoyed the company of writers like Hemmingway Theodre Roosevelt and Henry James. The writer Henry James immensely influenced Wharton . The House of Mirth was published in 1905 when Wharton was forty-three years old. Wharton primarily depicted the materialistic society in which she lived. She is best known for her portrayal of people and places in her works. In this novel she gives us a glimpse of the rich and materialistic New York upper class society, a subject she was well acquainted with. She wrote in A Backward Glance, There was before me in all its flatness and futility, asking to be dealt with as the theme most available to my hand, since I have steeped in it from infancy. The novel is unique because Wharton is not pretending to kn...

Babe Ruths 1927 Home Run Record

Babe Ruth's 1927 Home Run Record Babe Ruth was known as the Home Run King and the Sultan of Swat because of his powerful and effective swing. In 1927, Babe Ruth was playing for the New York Yankees. The Competition Throughout the 1927 season, teammates Babe Ruth and Lou Gehrig competed for who was going to end the season with the most home runs. The competition lasted until September when both men reached their 45th home run of the season. Then, unexpectedly, Gehrig slowed down and all that was left was for Babe Ruth to hit the incredibly high number of 60 home runs. It got down to the last three games of the season and Babe Ruth still needed three home runs. In the second to last game, on September 30, 1927, Babe Ruth hit his 60th home run. The crowd cheered wildly. Fans threw their hats in the air and confetti rained down on the field. Babe Ruth, a man known around the world as one of the greatest baseball players of all time, had done the impossible- hit 60 home runs in one season. Gehrig finished the season with 47. Babe Ruths single-season home run record would not be broken for 34 years. Previous Records The previous highest number of Home-Runs in a single season belonged to Babe Ruth at 59 home-runs hit during the 1921 season. Before that, Babe Ruth also held the record in 1920 with 54 HRs and in 1919 at 29 (when he played for the Boston Red Sox). The earliest single-season record was held by George Hall of the Philadelphia Athletics with 5 home runs in 1876. In 1879, Charley Jones batted 9; in 1883 Harry Stovey batted 14; in 1884 Ned Williamson batted 27 and held the record for 35 years until Babe Ruth burst onto the scene in 1919.   Current Record Although Babe Ruth remained the reigning Home Run King for 34 years, several notable athletes have since broken the record. The first of which happened during the 1961 season wherein New York Yankees star Roger Maris batted 61 home runs in the season. 37 years later, in 1998, Arizona Cardinals play Mark McGuire revitalized the competition with an impressive 70-home-run season. Despite impressive seasons from Sammy Sosa in 1998, 1999, and 2001 (66, 63, and 64 HRs respectively), he never held the title of Home Run King because of Mark McGuire slightly edging him out for the record. The reigning Home Run King in 2017 is Barry Bonds who hit 73 home runs during his 2001 season with the San Francisco Giants.

Response to Free Play Essay Example | Topics and Well Written Essays - 500 words

Response to Free Play - Essay Example His book Free Play instills and resonate the passion of music in readers and is a best book on improvisation. Improvisation is a difficult topic and it is a most realistic book on improvisation I have seen yet. I am really impressed with Stephen Nachmanovitch’s book Free Play. It was a resonating and promising experience to study such a nice piece writing. It is a very unusual, thought-through, and through provoking book on mystic creativity, which is a difficult most topic. Improvisation in art and life is a very difficult topic. It is very difficult to perform extemporaneously for everyone even for actors. Doing improvisation in a strange place is a very difficult to deal with. Free Play book has far reaching affects. It runs deep into our activities of art, music and everyday life. This book integrates knowledge from variety of important works of art, literature, science, etc. â€Å"This book is important not only because it devolves into the creative process, but also because Nachmanovitch creates the opportunity for reader to get in touch with her/his own creative possibilities and abilities†. Harvard Educational Review My ideas about improvisation shifted due to this book. It resonates in me the element of the art of improvisation for art, music and everyday life. It tempts me to believe in myself and do everything as per my natural instinct. Writer‘s approach is equally useful for children, teacher and others peoples of all kinds. It is good to randomly do things but some part of me is reluctant to believe that we should improvise all the time. We can anticipate the future happenings and we can try to prepare for them in order to better coup with every situation. While, if we need to perform somewhere randomly, we should give our best shot by using the ideas presented by Stephen, Nachmanovitch in Free Play: Improvisation in Life and Art. In essence, I am really impressed with this piece

A comparison of effects of categorized and uncategorized words on Essay

A comparison of effects of categorized and uncategorized words on memory - Essay Example This model is best illustrated by a computer system where information is received and processed variably by the brain before it is stored into memory.Atkinson and Shiffrin's "multi-store model of memory" theory posits that there are three distinct memory stores - sensory, short term, and long term. The amount of attention paid and "rehearsal" of information affects likelihood of this information passing first into short term and then into long-term memory.Sensory memory has a very limited duration of about a second for visual store and two seconds for the acoustic store. Short term memory also has a limited storage capacity and a very short duration and can be lost through decay or displacement as new information is added to the store. Organizing information in short term memory through "chunking" enables it to pass into long term memory. These chunks can be acronyms, words, phrases, or anything else that links the information together into a meaningful structure. By chunking informa tion, a much greater quantity can be stored. Memory can decay over time, or there can be problems of retrieval, where the memory is there but cannot be recalled. Information in long term memory is more likely to be in the form of semantics, organized by general meaning rather than in greater detail. In a study by Tulving and Pearlstone (1966), participants' recall of word lists of 12, 24, and 48 words in categories of 1, 2, or 4 words was tested. The answer sheets were used with and without category headings to measure the effects of categorization on recall. Participants showed a significant increase in words recalled when the category headings were present on the answer sheet. This study shows that organizing information in memory increases the amount of recall. Objective of the Study Generally, the study's aim was to approximate studies [such as that of Tulving and Pearlstone (1966)] to determine whether word categorization could increase the number of words recalled from a prepared word list. In more specific point of view, the study is aimed at: 1. Identifying the factors that could help people recall more numbers of words 2. Assess which among the given factors (as stated in the first specific objective) is better be applied to specific age range of the people 3. Evaluate if there could be a difference to the number of words recall if the subjects are of different gender, social status and level of education earned. Hypotheses The null hypothesis supposes that any variation in the number of words recalled between the categorised and uncategorised word lists will be due to chance factors. The alternative hypothesis assumes that there will be a significant difference in the number of words recalled between the categorised and uncategorised word lists such that the number of words recalled from the former will be higher. Methodology Research Design The experimental method was used to try and establish a causal relationship.A repeated measures design was utilized to limit the number of participants required and to reduce participant variables. To minimize order effects, counterbalancing was used, with half the participants hearing the uncategorized list first and the remaining half hearing the categorized list followed by the uncategorized list. Participants The study was participated in by close

The movie battle in seattle compared to realbattleinseattle.org Essay

The movie battle in seattle compared to realbattleinseattle.org - Essay Example For example, the movie illustrates the world trade organization WTO protest as acts of hooliganism where protesters looted and burned shops. This was not the actual case. Were it not for the brutal force that met the protest by the Seattle police initially, the organizers of the protest after the world trade organization (WTO) conference had planned for a peaceful demonstration insisting that no violence was to be used, (Reitan 89). The Hollywood version of the protest after the world trade organization (WTO) conference is very biased. The Film describes the film illustrates the Events that took place in the city of Seattle in 20th February 1999. It blames the protesters for the outcome of the violence whereas the source of the violence during the protest was police brutality. The film also depicts that the cause of the protest was political while the actual truth is that the protest was protesting against corporate globalization, (WTO people’s history). Corporate Globalizatio n When bureaucratic corporations dominate the economy in hierarchically, it is considered corporate globalization. This is where big corporations and business establishments take control of decisions that affect the economy as a group. They do this to ensure that business keeps flowing on their side hence making very huge profits. The protest that happened in Seattle on November 30th 1999 aimed at fighting this control that big corporations and business institutions have on matters that affect the economy (Chapman 33). There have been other protests such as the protest after the world trade organization (WTO) conference that protests this control of the economy by bureaucratic corporations. Such protests include, Greek protests of May 2010, Global May Day protests in 2006, June 26, 2003 Thessalonika Clashes in Greece, during EU Summit, in 2001 in Quebec City in Canada, during FTAA, in Los Angeles, USA August 11, 2000 Clashes, at the Democratic National Convention and worldwide Carni val against Capitalism in 1999 (Chapman 45). All theses protests were held to demonstrate against the evil of corporate globalization, which is also referred to as corporate capitalism, (Chapman 45). One of the agendas of these protests it spread awareness on the effects that corporate globalization have on the world. These protests have helped a lot because after each protest people know what is happening in the economy of the world because they are received with a lot of press and publicity. These protests have been effective since policies that affect the world’s economy are being determined differently. This means that governments do their own research in order to assist them in making good economic decisions rather than relying on what huge corporations and business organizations advice on. Another effect that these protests have had is that decisions about the economy are not left to countries that dominate the world economy such as the United States of America (USA). N owadays, almost all countries are consulted when it comes to make such decisions. In my opinion, decisions about the world economies should not be left to big corporations and business institutions. However, countries that experience the best economies in the world should be given a lot of attention when it comes to theses decisions. This is because theses countries have advanced their economies to high levels hence, countries with weak economies can learn a lot from them. However, these countries

Examining the usefulness of Financial Statement Analysis

Examining the usefulness of Financial Statement Analysis Financial statement analysis involves the assessment of a businesss past, present and future condition. The objective is to identify the weaknesses as well as the strengths of a business. If weaknesses are found, the business can take appropriate steps to correct or overcome them. On the other hand, the business can use its strengths to its advantage. In this way, the business will be able to improve its overall financial situation in the future. As the business owners they are intently interested in how well their business is doing. The most likely way to determine the status of a business is by analyzing the financial data and that means crunching the numbers. The basics of financial analysis usually mean calculating different financial ratios and then coming to conclusions about the how the company is financially performing. Financial ratios here refer to principal tools for financial analysis as they can be used to answer numerous questions regarding the businesss financial well being. Financial ratios are used by three main groups. First is Managers, who employ ratios to help analyze, control, and thus improve their firms operations. Second is a credit analyst, such as bank loan officers or bond rating analysts, who analyze ratios to help ascertain a companys ability to pay its debts. Third is stock analyst, who is interested in a companys efficiency, risk, and growth prospects. Also, the ratios provide useful information to users of financial statements for example investors and analysts to assess and evaluate the operations undertaken as well as being used to analyze its performance and position over time (Al-Ajmi J., 2008). As stated by Al-Ajmi J. (2008), the most important of the users groups to know about financial ratio analysis are investors and creditors because these users interested to read the contents of financial statements and calculate a variety of financial indicators before they want to make any final decisions on credit and investing decisions. To them, they believe that through analyzing financial statement will provide valuable financial indicators and have predictive power. Financial analysis can be done through assessing the financial statement of company. Financial statement in this case focuses on balance sheet, income statement, cash flow statement and statement of changes in equity. Financial ratios are generally classified into four main groups liquidity ratios, activity ratios, gearing ratios, and profitability ratios. The liquidity ratios can be used to measure whether the firm can repay its financial obligations on time or not. The two commonly used liquidity ratios are the current ratio and the quick ratio. Next is activity ratios can be used to measure how effectively the firm uses its resources (assets) to generate sales or revenue. This ratio is so called efficiency, turnover or even business asset management ratios. Commonly used to measure activity ratios are inventory turnover ratio, average collection period, accounts receivable turnover ratio, non-current assets turnover ratio and total assets turnover ratio. Third is gearing ratios also called debt management ratios and leverage ratios. This ratio indicate how the firm is utilizing outside funds to finance its assets and whether the firm can pay the interest on the use of these non-owner supplied f unds as well as repay the principal or the original amount of the loan. Commonly used to measure gearing ratios are debt ratio, time interest earned ratio and debt to equity ratio. Lastly are profitability ratios which can measure the end results of the firms ability to produce profits from its resources as well as to measure the companys use of its assets and control of its expenses to generate an acceptable rate of return. The most commonly used ratio is gross profit margin and net profit margin. Knowing the financial ratios of our business is important because by knowing what these ratios mean and being aware of trends can aid the entrepreneur in better managing a business in future. In general this paper is reviewing the literature review on the effect of analysis of financial ratios on business financial performance or financial situation in three different types of industries. Focus on the analysis of financial ratio in service industry, financial industry and higher institutional education. There are different views and different effects when financial ratio analysis going to used to analyze company performance from different types of industry. LITERATURE REVIEW 2.1 USEFULNESS OF FINANCIAL RATIOS Financial ratios are said as the most widely used indicators of company. It play a role to value firms, to distinguish creditworthy companies compare to others, to identify acquisition targets and to indicate the process of organizational in completing or the time needed to complete a task (Al-Ajmi J., 2008). The financial analysis model known as a quite helpful tool for executives to measure or predict enterprise bankruptcy or enterprise failure provides concerned decision-makers (authorities) with the possibility or hoping to avoid failures. Also it becomes an early warning system to the corporate management. (Karacaer and KapusuzoÄÅ ¸lu, 2008). As stated by Karacaer and KapusuzoÄÅ ¸lu, (2008), the most highest ratios contribution in the analysis regarding the variables whose effect the financial condition of the sample enterprise are ROE, debt ratio, net working capital, acid test ratio, net profit ratio, cash ratio, and current ratio respectively. Among of them, the liquidity ratios are the main element in these ratios. It is observed that all the variables have differing but significant effects on the corporate financial situation. Financial ratios can be used as financial indicators which allow for comparisons between companies, between industries, between different time periods for one company, between a single company and its industry average. Apart from that, financial ratios generally hold no meaning unless they are benchmarked against something else, like past performance or another company and industries. The reason behind that is the ratios of firms in different industries, which face different risks, capital requirements, and competition are usually hard to compare if we have no other things to compare (Wikipedia). As mentioned by Salmi, Timo Roy Dahlstedt Martti Luoma Arto Laakkonen (1988), financial ratios are commonly used for comparison of financial position intra-industry. Also, in financial statement analysis a firms performance and financial status are frequently evaluated in relation to other firms in the same branch of industry or in relation to industry averages. 2.2 STEPS TO EFFECTIVELY FINANCIAL RATIOS As stated by Darrel Hulsey, the basics of financial analysis usually mean calculating different financial ratios and then coming to conclusions and clarification regarding on how the company is financially performing in business activities. There are certain things that must be considered before too many conclusions are drawn. Firstly, understand what comprise different financial ratios before start analyzing companys data. Must take into consideration all financial ratios numbers derived from financial statement comprise of balance sheet and income statement. Balance sheets represent a reflection for a particular point in time. Income statements present a cumulative time summary of performance. For example, year-end financial statements should include a balance sheet that presents how various company accounts look on that particular day at the end of the year, whereas the income statement shows how companys performance over the period Second is evaluating external influencing factors. As with all companies, the financial statements can be influenced by various factors like management or owner decisions and discretionary spending, seasonal effects, legal structure choice, type of industry, customer mix, or a number of other issues. These factors can influence the financial statements and will, in turn, influence the financial ratios analysis. Third is look at internal trends. Always keep in mind is that one ratio alone tells one very little. A clear picture starts developing when one looks at ratios over different time increments. By comparing financial results against prior performance one gets a better idea of what is occurring within the company. Trends will start to develop and can give insight into areas that may need corrective attention or to areas that may need to be reinforced. Internal trend analysis is most likely most beneficial because one is comparing similar business situations over various periods of time. Fourth is compare results to the industry. Comparing your business performance to other similar businesses is a common way to judge how well the business is doing. Even though this is very common, there are limitations to doing so. First realize these comparative ratios represent an average. Averages are simply that and most likely your business will vary somewhat. Next be sure you are comparing your business to other businesses similar in asset size and sales volume. In some cases there may be no suitable comparisons. Try to insure you are comparing apples to apples. There are several sources to get comparative financial data including private companies such as Risk Management Association (RMA) and trade associations that collect data from their members. Knowing what is the average for your industry is important. The averages can serve as a general benchmark for your business. Additionally, these averages are often times used to compare your business performance when you are seeking capital from outside sources such as a bank. Being different may not be a deal killer, but not being able to explain why you are different may indeed be a deal killer. 2.3 THE EFFECT OF ANALYSIS OF FINANCIAL RATIOS ON BUSINESS FINANCIAL SITUATION IN DIFFERENT INDUSTRIES 2.3.1 SERVICE INDUSTRY In measuring the performance of service firms, the most strongest and consistent ratios used are activity and profitability ratios. Obviously, the profitability ratios indicate that small service firms have higher returns to sales than large firms. Specifically, service firms have less liquidity, greater activity, and higher profitability. Interestingly, the small and medium size service firms had higher total debt levels. The short-term debt findings show that service firms used significantly smaller amounts of short term funding. Means that service industry more prefer to finance the business activity through long term debt. On top of that in service industry, the most suitable of ratio to measure business profitability is by calculating return on equity. Apart from that, activity ratio was measured by a primary ratio and a secondary ratio. It refers to sales to assets and sales to inventory respectively (Michael D., John X. and Steven J.). The results found by Michael D., John X. and Steven J. associated with the activity ratios for service firms show a positive and significant relationship an concluded that size of firm very unrelated to productivity of public firms in service sector The growth in air transportation industry gives a picture that performance evaluation is important for executives body to identify and recognize the operating problems arise in market competition. According to Feng C.M. and Wang R.T. (2000), referring to previous study it more concerning airline performance evaluation which only focus merely on operational performance. However, evaluation on financial performance is seems to be ignored. As far as we are concern, to measure the survival prospect of an airline market can be look through the financial performance of the company itself. The absence of financial ratios may lead to biased assessment. There are three main types of performance indicators used in airline industry. The first one is production efficiency, marketing efficiency and execution efficiency which relate to department of production, marketing and management (Feng C.M. and Wang R.T., 2000). As stated by Feng C.M. and Wang R.T. (2000), in making analysis of financial statement of airline industry, assets and capital of the owners equity are classified as the input of financial factors. Moreover debts and expense are classified as the output of the financial factors and for revenue or otherwise losses categorized as the outcome of financial factors. Due to that, the input financial factors characterized by sunk cost which included flight equipment and interest expense, while its output by intangible products. Otherwise its consumption characterized as not-stored services. 2.3.2 FINANCIAL INSTITUTIONS Evaluating the performance and financial condition of the financial service organizations is very critical. The intermediation role of financial institutions in market trading is such that performance in this sector indirectly gives impacts on other sectors of the economy. When performance is good it will contribute a positive effect on the economy but when the financial sector is distressed and got some problems then they will contribute a negative effect on other sectors of the economy (Ibiwoye A., 2010). In the perspective of banks to achieve their aims for institution development was by growing the components of their assets as an alternative of moving to increase the profitability. All of these require the determination and management of several factors, which play an important role in the profitability of banks in the new environment (Halkos and Salamouris 2004). In U.S Banks, to increase investors hope and confidence, they adopt Dominion Bond Rating Service (DBRS) which provides bank ratings as a forward-looking measure of a banks ability to meet its financial obligations. The DBRS ratio analysis focuses on four interrelated aspects of a banks financial health. First is Earnings Power, it refers to the ability to generate consistent profits and grow capital internally. Second is Asset Quality, it refers to the potential for losses that could impair earnings and capital. Third is liquidity where it focuses on cash resources available to meet short-term obligations. And the last one is Capital Adequacy; it refers to the ultimate creditor protection against future losses (Reid, Lister, Schwartz, and Muranyi, 2005) According to Al-Ajmi J., (2008), the financial indicators that analysts use as basis for decisions are not necessarily all equally useful to them in making any decision. There are no significant differences between credit analysts and financial analysts with respect to 40 of the indicators identified in the study. From the perspectives of 244 credit analysts and financial analysts in Bahrain, they are measured by the ranking of 71 financial indicators and 5 components of corporate governance. Based on the result it shows that credit analysts consider the quick ratio as the most useful ratio, followed by the non-recurrent ratio. For the financial analysts they consider price-earnings as the most useful ratio, followed by the market-to-book ratio. It is also worth mentioning that the efficiency difference between large and small banks reaches its maximum value in 1999. While doing financial analysis it has a positive relationship between size and performance. Besides, through mergers and acquisitions it leads to a continuous increase of average efficiency of the larger banks while efficiency of the small banks is impaired. It is proved that the higher the size of total assets leads to the higher of the efficiency is. It is evidenced from the significant increase in the sum of the total assets employed in the market as well as the increase in the average level of Banks Assets (Halkos and Salamouris, 2004). 2.4.3 HIGHER EDUCATION INSTITUTIONS As study did by Buddy N.J. (1999), it identified a set of financial ratios that summarize the financial situation of a higher education institution in which the ratios helped to analyze the financial solvency and viability of the six higher education institutions in Oklahoma. The study focused on the ability of the institutions to meet current and future financial requirements of the institutions. Therefore financial ratio analysis is the most suitable and known as an effective communication to the mind of users regarding financial situations of universities and colleges to internal and external entities. On top of that, ratios known as excellent tools for facilitating the communication, analysis, and understanding of large masses of complicated, detailed information of the institutions. As what have been found in study conducted by Chabotar, (1989); Cirtin Lightfoot, (1996), they concluded that financial ratio analysis could also serve as a tool to evaluate the efficiency, effectiveness and accountability of higher institution education as what been done by ratio analysis in analyzing business financial condition. In this case Buddy N.J. (1999) said that financial ratio analysis allows for the evaluation of past performance and for future planning of institutions. By identifying a manageable number of quality ratios, the presentation of financial data may be more efficient and tell a better story and give a better picture of the true financial condition of the institution of higher education. The reduction of a large mass of numbers into a few manageable, easily interpreted ratios will allow both internal and external entities to make better-informed decisions regarding financial position and condition of higher learning institutions. In the opinion of Buddy N.J. (1999), understanding the financial condition of higher education institutions become an important part in view of decision making to respond to any pressures arise. As supported by Chabotar, (1989) where work on financial ratio analysis for higher education institutions has aimed at clarifying and explain the perceptions and making judgments of financial distress more credible. Financial ratios can also have the reverse use, to identify what is unique about a higher education institution. The most frequently cited motivation for financial ratio analysis is the ability to control for the effects of size difference over time and across institutions As mentioned by Buddy N.J. (1999), financial ratio analysis can help both the institutional user and those agencies to make funding decisions. This is due to where the financial ratio analysis could be used to obtain the physical evidence of any deviations of the norms and could also allow management by exception. Also financial ratios recognized as an indicator to whether conditions are getting worse or getting better which may allow management by exception and alerts the institution to the possibility of future financial distress. Besides, financial ratio analyses have a role to identify how and in what ways the condition is changing (Collier Patrick, 1978). Lupton, Augenblick, and Heyison (1976) in their study identified the indicators which include institutional control, enrollment trends, trends in education and general expenditures, current fund revenues to expenditures, academic expenditures to education and general expenditures, freshman full-time equivalents (FTEs) to total undergraduate FTEs, and tuition and fees to student aid revenues. All these indicators determined by using a panel of experts, as well as discriminate analysis, to determine 16 discriminating indicators of financial condition. Whereas, Collier and Patrick (1978) conducted theory-based research and developed a set of dimensions that describe financial condition which comprise of financial independence, revenue drawing power, financial risk, revenue stability, and reserve strength. Same as what being done by Lupton etc., Collier and Patrick also used experts and discriminate analysis to determine the indicators that differentiate between strong and weak private institutions and between strong and weak public institutions. As agreed by Buddy N.J. (1999) the purpose of institutional comparisons is to highlight differences and to raise important questions about past and future policies for internal and external entities. The reason is many higher education institutions differ from comparative peers for good and valid reasons. The argument might be that, when an understanding is reached for why an institution scores differently from its comparative peers, a conclusion can be drawn as to what is unique about that institution as compared to others institutions. Referring to study of Buddy N.J. (1999), he found that many of the measures financial ratios used by higher education institutions are based on what sources financial revenues are earned and for what services expenses are incurred. Based on the result it allows both internal and external entities to monitor institutional effectiveness and efficiency. There are 15 key financial relationships being used by Donald E. Miller (1972) to set forth for business and industry a cause-and-effect ratio analysis based. The reason is higher education institutions will find themselves in a particular financial position because of some cause or causes. The 15 ratios have been applied and tested as a unified system in thousands of business situations demonstrated that, when used together; provide a fundamental financial understanding to the users. The interrelationships that exist among financial resources require a better examination of the institutions total fund structure. A better understanding o f the trends in and the condition of the financial resources is important to the early detection of any institutional distress. Changes in resources are symptoms of those internal and external factors might cause financial pressure or development. A higher education institution with sufficient financial resources can withstand adverse trends and has the flexibility to institute changes at opportune moments to reverse the trends. Resources merely provide the opportunity to be flexible through economic changes and experiment where possible without jeopardizing and impair the institutions future prospect. 3.0 CONCLUSION It is important to analyze trends in ratios as well as their absolute levels. Trend analysis can provide clues as to whether the firms financial situation is likely to improve or to deteriorate. Financial statement analysis involves a study of the relationships between income statement and balance sheet accounts, how these relationships change over time (trend analysis), and how a particular firm compares with other firms in its industry as we called as benchmarking. In addition, financial statements are used to help predict the firms future earnings and divi ­dends. From an investors standpoint, predicting the future is what financial state ­ment analysis is all about. From managements standpoint, financial statement analysis is useful both to help anticipate future conditions and, more important, as a starting point for planning actions that will influence the future course of events The importance of financial statement analysis should not be underestimated. The understandable format of financial ratios allows virtually any stakeholder and users of financial statement to acquire a basic comprehension of the most critical financial policies of institutions and their financial condition. Chabotar, K. J. (1989). Financial ratio analysis comes to nonprofits. Journal of Higher Education, 60(2), 188-208. (ERIC Document Reproduction Service No. EJ 389 089) Cirtin, A., Lightfoot, C. (1996). Financial statement analysis for private colleges and universities. The National Public Accountant, 41(8), 29-34. Collier, D. J., Patrick, C. (1978). A multi-variate approach to the analysis of institutional financial condition. Boulder, CO: National Center for Higher Education Management Systems. Chabotar, K. J. (1989). Financial ratio analysis comes to nonprofits. Journal of Higher Education, 60(2), 188-208. (ERIC Document Reproduction Service No. EJ 389 089) Lupton, A. H., Augenblick, J., Heyison, J. (1976). A special report: The financial state of higher education. Change, 8(8), 20-35. Miller, D. E. (1972). The meaningful interpretation of financial statements: The cause-and-effect ratio approach. New York, NY: American Management Association, Inc.