A Caribbean Legacy Essay -- Caribbean History Culture Essays

A Caribbean Legacy The notions of slavery, colonialism, and race are indelible aspects of Caribbean history. In order to fathom the current political, social, economic, and cultural climate of the Caribbean one must engage in a critical study and understanding of the impact slavery has had in modern day Caribbean societies. The modes and intricacies of modern day Caribbean societies are intimately related to the plantation systems of the colonial period, which welcomed the arrival of the largest migration in history. Author Michelle Cliff, in her essay "If I Could Write This With Fire," attempts to make sense of the current deplorable social conditions of racial inequality in her native land of Jamaica. It is within this context of understanding the current social and racial strife in Jamaica that Michelle Cliff presents the intimate relationship between past and present. Michelle Cliff, in an ontological manner attempts to unmask the current phenomena of racial strife in Jamaica by considering and examining the disdainful legacies of slavery brought upon by ruthless European colonialism in the Americas. Cliff, like many of the historians, sociologists, and economists which we have encountered in our study of Caribbean history, is partaking in an unmasking process of the Jamaican society in her literature in order to reconcile a ravaged Jamaican and Caribbean identity. Ultimately, Michelle Cliff’s desire to make sense of the Caribbean’s intricate social and cultural mosaic prompted her to "look back," and, as she states in her essay: To try and locate the vanishing point: where the lines of perspective converge and disappear. Lines of color and class. Line of history and social context. Lines of denial and rejection. Wh... ...nges imposed by the plantation system created a hierarchy of color (similar to the one discussed by Michelle Cliff in Abeng, wherein the color of one's skin designated one's occupation and social position). Whiteness indicated economic and political superiority as well as leisure while blackness represented low social status and arduous labor. Consequently, it is quite evident that Knight offers significant evidence affirming the notion that slavery, or in this particular case, the social caste system imposed by the plantations has indeed had a grave influence in the evolution of Caribbean societies. -Footnotes- 1.) Excerpt taken from: Michelle Cliff’s essay, "If I Could Write This With Fire." 2.) ibid (1) 3.) Quote taken from page 124 of: Knight, Franklin. The Caribbean: The Genesis of a Fragmented Nationalism. Oxford University Press: New York, 1990.

Comparison of German and French Soldiers Experiences :: World War I History

Comparison of German and French Soldiers' Experiences The First World War was a horrible experience for all sides involved. No one was immune to the effects of this global conflict and each country was affected in various ways. However, one area of relative comparison can be noted in the experiences of the French and German soldiers. In gaining a better understanding of the French experience, Wilfred Owen's Dulce et Decorum Est was particularly useful. Regarding the German soldier's experience, various selections from Erice Maria Remarque's All Quiet on the Western Front proved to be a valuable source of insight. A analysis of the above mentioned sources, one can note various similarities between the German and French armies during World War I in the areas of trench warfare, ill-fated troops, and military technology. Trench warfare was totally unbiased. The trench did not discriminate between cultures. This "new warfare" was unlike anything the world had seen before, millions of people died during a war that was supposed to be over in time for the holidays. Each side entrenched themselves in makeshift bunkers that attempted to provide protection from the incoming shells and brave soldiers. After receiving an order to overtake the enemies bunker, soldiers trounced their way through the land between the opposing armies that was referred to as "no man's land." The direness of the war was exemplified in a quotation taken from Remarque's All Quiet on the Western Front, "Attacks alternate with counter-attacks and slowly the dead pile up in the field of craters between the trenches. We are able to bring in most of the wounded that do not lie too far off. But many have long to wait and we listen to them dying." (382) After years of this trench warfare, corpses of both German and French soldiers began to pile up and soldiers and civilians began to realize the futility of trench warfare. However, it was many years before any major thrusts were made along the Western front. As soldiers past away, recruits were ushered to the front to replenish the dead and crippled. These recruits were typically not well prepared for the rigors of war and were very often mowed down due to their stupidity. Both the French and Germans were guilty of sending ill-prepared youths to the front under the guise that "It is sweet and fitting to die for one's country." (380) Owen's Dulce et Decorum Est is a prime example of this "false optimism" created by the military machine in France to recruit eager new troops to die a hero's death on the front lines.

Conflicts in Elizabeth Stuart Phelps The Angel Over the Right Shoulder

Conflicts in Elizabeth Stuart Phelps' The Angel Over the Right Shoulder      Ã‚  Ã‚   "The Angel Over the Right Shoulder" is fascinating because of the conflict it uncovers between a woman's need to fulfill her domestic role and her need to develop as an individual. The story was published in 1852, when the American people were struggling with the role of women in society. The author, Elizabeth Stuart Phelps, introduces two opposing possibilities for this role. One is the woman whose entire being revolves around her domestic sphere and who has no individual identity. The other is an individual who, although fulfilling the role of mother and wife, takes time to cultivate and develop her own interests and person. This essay will focus on discussing the social and historical concepts intertwined with these two opposing viewpoints concerning the role of women in the middle 19th century rather then evaluating them in terms of the story. This will give the reader information necessary to better understand and analyze the events of the text.    The first possibility of woman's ideal social role, revolving entirely around her domestic responsibilities, has its origin in the past. Women of white middle class standing had historically taken on the responsibilities of clothing, feeding and caring for all members of the family, while the men had ensured that the raw materials for these duties existed. Stereotypically, the husband would work the farm cultivating the crops and caring for the animals, while the wife would turn these raw materials into the necessities of life, including food and clothing. When industry began to take over in the early 1800's the specific tasks of gender shifted, but the general spheres d... ...ideas about the new role of women in society while reading "The Angel Over The Right Shoulder", and to consider the ways in which Phelps encourages or discourages each one. I also encourage the reader to delve more deeply into the wealth of information surrounding this very important time period in the history of the United States, to understand where Phelps' ideas were generated and why she may have seemed to favor of one role of women over another.    Works Cited Graves, A.J., Mrs. Woman in America: Being an Examination into the Moral and Intellectual Condition of American Female Society. New York: Harper, 1847,c1841 Melder, Keith. Beginnings of Sisterhood: The American Woman's Rights Movement, 1800-1850. New York: Schocken Books, 1977. Phelps, Elizabeth Stuart. The Angel Over the Right Shoulder. Andover: Warren F. Draper, 1852.   

The American Express Card

9-509-027 REV: APRIL 22, 2011 JOHN A. QUELCH JACQUIE LABATT The American Express Card Marketing is fully integrated into our overall strategy. Our largest investor, Warren Buffett, is very focused on brand health and customer metrics. — Kenneth I. Chenault In April 2008, Jud Linville, president and chief executive officer of U. S. Consumer Services at American Express Company, was preparing for a meeting with Ken Chenault, American Express’s chairman and chief executive officer since 2001, and Al Kelly, president of American Express Company.The purpose of the meeting was to discuss further growth prospects in the United States for the American Express consumer card business while maintaining the brand’s premium positioning. The performance of the American Express card, launched 50 years earlier in 1958, had been remarkable. By 2008, there were 52 million American Express cards in circulation in the U. S. , held by 41 million â€Å"cardmembers† (see Exhibit 1). American Express commanded nearly a 24% share of U. S. credit card payments. 1As Linville prepared for the meeting, he wondered whether he could continue to rely on the same business growth drivers that had served American Express well in the past. With the U. S. economy slipping into recession, the proliferation of cards in the market required American Express to deepen its consumer understanding to provide innovative, value-added products that would attract and retain cardmembers. Company Background The American Express Company was a leading global payments and travel company with revenue net of interest expense of $27. 7 billion in 2007, up 10% from 2006. American Express’s principal products and services included charge and credit card payment products and travel-related services offered to consumers and businesses around the world. American Express was the world’s largest issuer of charge and credit cards as measured by the annual value of purchases charged o n these cards. 3 Yet American Express maintained a â€Å"best-in-class† credit quality, reflecting in part the company’s traditional focus on the affluent segment, its expertise in evaluating the credit risk of individual consumers, and its ongoing commitment to investing in risk capabilities. In 2007, around 70% of American Express’s revenue net of interest expense and 85% of its pretax income from continuing operations5 was generated in the United States. The global diversity of the business included 86 million cards in force worldwide, more than 115 card-issuing or merchant-acquiring ________________________________________________________________________________________________________________ Professor John A. Quelch and Research Associate Jacquie Labatt prepared this case. HBS cases are developed solely as the basis for class discussion.Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective ma nagement. Copyright  © 2008, 2011 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800-5457685, write Harvard Business School Publishing, Boston, MA 02163, or go to www. hbsp. harvard. edu/educators. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School..This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card arrangements with banks and other institutions, and over 650 American Express network branded products. 6 Fortune magazine ranked American Express the â€Å"Most Admired† megabank/credit card company in its 2008 annual survey. 7 American Express’s roots date back to 1850, when Henry Wells, William Fargo, and John Butterfield founded an express deli very company.The very nature of handling and transporting customers’ assets depended on security and trust, core attributes that had remained at the heart of the company and brand. In the late 1800s, American Express introduced financial products such as money orders and Travelers Cheques. The company later expanded into the travel business to further support its Travelers Cheques customers who were increasingly going abroad. The First Card The first American Express card targeting the business traveler was launched in 1958. The decision to enter this new business â€Å"faced strong opposition within the company with senior leaders evenly divided on the issue. 8 The debate began when the Diners Club card was introduced in 1950. American Express recognized the card as a potential threat to the company as consumers began using this card as a substitute for Travelers Cheques. 9 Some argued that a charge card would cannibalize the Travelers Cheque business, while others believed competing cards would hurt those sales regardless. There was further concern that launching a card would upset the American Automobile Association (AAA), one of American Express’s largest distributors of Travelers Cheques. At the same time, AAA was known to be considering launching a card of its own.Finally, with the economy in recession, many executives argued that it was a risky time to be launching a charge card. Nevertheless, in December 1957, American Express president Ralph Reed decided to launch such a card without further delay, stating at the time: â€Å"All we have to sell is service. † When word of the card’s imminent launch leaked, the company was inundated with calls from potential applicants. Further, the American Hotel Association approached American Express regarding forming an alliance, which gave the company an immediate customer base of 150,000 cardmembers and 4,500 participating merchants. 0 By the official launch date of October 1, 1958, Am erican Express had already issued 250,000 cards at an annual fee of $6 each, $1 higher than the fee for a Diners Club card. The first American Express card11 was targeted at businessmen on expense accounts, offering them a convenient method of payment rather than a means of financing purchases. This American Express card was a charge card that required the user to pay off the balance monthly. It was not a credit card that offered the user the option of paying interest on the balance as if it were a cash loan.The Gold (1966), Corporate (1966), and Platinum (1984) cards followed despite concerns over cannibalizing the original American Express card. This hierarchy of cards with progressively higher annual fees and services offered business travelers the aspirational prospect of being invited to move up from Green to Gold to Platinum. (In 1999, American Express added an unadvertised, byinvitation-only product, the black Centurion card. Equipped with VIP benefits such as a personal conc ierge, the Centurion card was offered by invitation only to a small, elite group of Platinum card customers.Celebrities and the very rich clamored for the right to carry this new card. ) American Express launched its first credit card, Optima, in 1987. The Optima card was the first American Express card to allow customers to carry a balance and pay interest. It was marketed only as a â€Å"companion† card to existing American Express cardmembers. A downturn in the economy in 1991 resulted in unexpected losses as some Optima customers failed to make their payments.As a result, American Express deferred plans to expand its credit card business and tightened its existing 2 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card 509-027 credit modeling programs and controls. In addition, American Express â€Å"card suppression,à ¢â‚¬  whereby merchants tried to dissuade consumers from using their American Express card, began with the 1991 â€Å"Boston Fee Party. † Boston estaurateurs were upset with what they viewed as American Express’s excessive discount rate, the percentage fee American Express charged merchants on consumer purchases made with American Express cards. This practice of not honoring the American Express card gained momentum and discouraged some consumers from using their American Express cards. Scale was viewed as a key competitive success factor in the payments industry; American Express considered its 16%—and falling—market share of the U. S. payments market in the early 1990s too low.With too few cards in circulation and too few merchants accepting the American Express card, American Express management faced a â€Å"chicken and egg† dilemma in trying to determine which aspect of the problem to address first. Turnaround Harvey Golub’s appointment as chairman and chief executive officer in 1993 set the stage for restoring health to the American Express business and brand. Golub became the â€Å"vocal guardian† of the American Express brand as he outlined his vision for the company: â€Å"To become the world’s most respected service brand. 12 American Express’s purpose was to manage, market, and promote the core attributes of the American Express brand, â€Å"trust, security, integrity, quality and customer service,† through educating employees, incorporating these attributes into card products and services, and reflecting them in all marketing communications. Future chief executive officer Ken Chenault, who was then running the card business, laid down three guiding principles: to provide superior value to customers, to achieve best-in-class economics, and to direct all activities to support the American Express brand.In addition, Golub established long-term goals as the guiding metrics for the b usiness: earnings per share growth of 12%–15% per year, revenue growth of at least 8% per year, and return on equity of 18%–20% on average over time. With a business strategy built on the company’s brand, Golub refocused American Express on the card business. Starting in 1981, American Express had purchased brokerage and financial advisory firms in an effort to become a â€Å"financial supermarket. † This strategy proved to be a distraction.By 1993, Golub had divested American Express of most of its non-core businesses. Concurrently, the U. S. card business underwent a significant review under the leadership of Chenault. He identified three issues: Costs were too high compared to American Express’s most efficient competitors; the division was too slow to change and adapt, particularly in introducing new products; and the organization was not sufficiently flexible to meet the needs of specific, more targeted consumer segments. 13 By 1995, signs of a turnaround were evident in the American Express card business.New card products began to appear with increased frequency, including proprietary and co-branded cards. A co-branding strategy was initially opposed by branding purists who argued that the American Express brand was too precious to be shared with a partner. This had led American Express to turn down an opportunity to co-brand air-miles-earning AAdvantage credit cards with American Airlines in the mid-1980s. The company came to regret this decision as American Airlines and, later, United Airlines both launched co-branded cards with Visa and MasterCard.The launches of the co-branded Hilton Optima card (1995) and the Delta SkyMiles American Express card (1996) marked the company’s new willingness to partner with other strong brands. In future years, agreements were also struck with Costco, Starwood, and JetBlue. In 1996, Golub decided to open the American Express network and invited other banks and institutions to is sue cards on its network. Doing business with other card issuers that were often competitors was a significant shift for the company. But, by carefully choosing the right partners who 3This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card would tailor American Express products for their high-spending customers, the company could efficiently supplement its own efforts to grow the number of cards-in-force, cardmember spending, and merchant acceptance. The Global Network Services (GNS) division was formed in 1997 to build these relationships.By 2007, there were more than 750 different American Express cards (including cards co-branded with merchants and banks) available around the world. Exhibit 2 lists the principal American Express card offerings and features in the United States as of 2008. In evaluating prospective produc t offerings, Linville asked whether the company was, first, â€Å"removing friction† from the system— making everyday life easier in some way for consumers such as with a â€Å"contactless† card—and, second, â€Å"providing special recognition,† or badge value, to cardmembers.Linville sought to make the American Express brand available more broadly while ensuring that it retained its premium status. Organization As of 2007, the company was organized into two major customer groups: Global Consumer Services and Global Business-to-Business Services. The Global Consumer group contributed 67% of the company’s revenues net of interest expense and 52% of its income from continuing operations. 14 Its range of products and services included charge and credit card products for consumers and small businesses worldwide, consumer travel services, and prepaid, stored value products such as Travelers Cheques and Gift Cards.Business-to-Business Services con tributed 29% and 38%, respectively, to the company’s revenue and income, and offered business travel, corporate cards, expense management products and services, network services, and merchant acquisition and processing for the company’s network partners and proprietary payments businesses. (See Exhibit 3 for a breakdown of company revenues by operating group and division, and see Exhibit 4 for income statement data on the company’s U. S. card business. ) U. S. Payments Industry Payment SystemsAmerican Express competed against all forms of payments for consumer purchases, a market that exceeded $7 trillion in the U. S. in 2008. 15 Payments could be divided into three broad categories: paper-based payments (checks, cash, money orders, official checks, Travelers Cheques); card-based payments (credit, debit, prepaid, electronic benefits transfer); and electronic-based payments (preauthorized and remote). Consumers were shifting from paper-based payments toward cards and electronic methods (see Table A).Converting even a small portion of the paper market to American Express payments represented a big opportunity. Many of these transactions were cash/check-based because either they were low-value transactions (at mom-and-pop stores) or high-value captive transactions where there was little incentive for the merchant (for example, a utility company or apartment landlord) to accept charge/credit cards and absorb the discount fees charged for the service. American Express estimated that around 25% of the cash/check segment represented high-value transactions such as car purchases, tuition fees, and rent/mortgage payments. This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card 509-027 Credit and Debit Credit cards held a leadership 26% share of the payments market and had grown 45% in dollar terms since the year 2001. Debit cards, which were issued by banks and allowed a purchase payment to be deducted immediately from the cardholder’s bank account, held a 14% share of the payments market and had grown 162% over this same period.Since American Express was not a bank, it did not offer debit cards. The average purchase per debit card in the U. S. was $39 compared to $87 per credit card purchase. 16 While debit card transactions were projected to exceed credit card transactions by 2011, the average purchase per credit card transaction was expected to remain higher. 17 Table A U. S. Consumer Purchases by Payment Type—2006 Method of Payment Paper Checks Cash Other $3,365 1807 1439 119 Cards Credit Cards Debit Cards Other Source: % Change Versus Previous Five Years Market Share -4 % -19 +23 -3 47% 25 20 2 3,048 1,871 ,010 167 +77 +45 +162 +209 43 26 14 3 751 443 307 +177 +136 +270 10 6 4 7,165 Electronic Preauthorized Remote Total Consumer Purchases (billions) +30 100 Adapted from The Nilson Report, Issue 890, October 2007. The average American adult carried 4. 4 payment cards in his/her wallet, be they debit, credit, and/or charge cards. 18 Competitors in the card payments business were either card networks that processed transactions (Visa, MasterCard), card issuers (primarily banks), or organizations that both issued cards and processed transactions (American Express, Discover Financial Services).Charge cards for specific retail chains were declining in importance. American Express aimed to increase its â€Å"share of wallet† by making American Express the payment card of choice for all transactions. This was especially important, as recent evidence showed the average number of cards per wallet falling rather than increasing; 20% of consumers shed payment products in 2007 versus 16% in 2004. 19 Further, only 31% of consumers were adding new payment products to their wallets, a drop from 56% three years earlier. 0 Many American consumer s â€Å"compartmentalized† their spending, using different cards for different types of payments. For example, some long-standing American Express members still used the American Express card just for travel and entertainment, and used a Visa or MasterCard credit card for other purchases. 5 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card Competitive Card NetworksPayment networks operated under two business models. â€Å"Open-loop† payment networks, as employed by Visa and MasterCard, were multiparty. Processing a payment typically involved connecting two financial institutions: one that issued the card (issuer) and one that serviced the merchant (acquirer). The open-loop network managed the information and transfer of value between the two banks. In a â€Å"closed-loop† network, as used by Americ an Express and Discover, the network â€Å"owned† the relationship with both the cardholder and the merchant.Leading payment networks are listed in Table B. Credit Card Networks—U. S. Market Share 2007 Table B Share of Credit Card Purchases Visa MasterCard American Express Discover Source: Share of Credit Card Transactions 42. 2% 28. 7 23. 8 5. 3 43. 8% 30. 5 18. 3 7. 4 Adapted from The Nilson Report, Issue 889, 2007. Visa, Inc. Visa operated the world’s largest retail electronics open-loop payment network. Visa provided financial institutions, their primary customers, with product platforms, including consumer credit, debit, prepaid, and commercial payments (see Table C).Visa operated a data-processing network that transferred transaction data and managed payment flow between issuers and acquirers. Visa generated revenue primarily from financial institutions based on fees calculated on the dollar volume of payment activity on Visa-branded cards (service fees) a nd from fees charged for providing transaction processing (data-processing fees). In 2007, Visa USA generated 82% of its gross operating revenue from service and processing fees combined. 21 U. S. Results for Visa, Inc. , Annual Product Performance (June 30, 2007) Table C Payment TypeConsumer Credit Consumer Debit Commercial and Other Total Payments Volume Cash Volumea Total Volume Total Transactions (in millions) Source: Payment Volume (billions) Share of Payment Volume by Payment Type $ 624 637 188 34% 35 10 1,449 79 382 1,831 21 100% 25,942 Adapted from Visa, Inc. , Form 10-K, December 2007. a Cash volume includes cash access transactions, balance transfers, and convenience check transactions associated with Visa. 6 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012.For the exclusive use of Y. SUN The American Express Card 509-027 Visa went public on March 18, 2008, raising $19 bill ion in the world’s second-largest initial public offering (IPO). 22 The IPO created a cultural and business challenge: Visa had to shift its focus from delivering benefits to its partner banks toward maximizing profits for long-term shareholder value. 23 As stated in Visa’s 10-K report, â€Å"Many of our employees have limited experience operating in a profit-maximizing business environment. †24 Further, the proceeds of the IPO bought out the interests of the partner banks.As a result, the banks were no longer Visa’s partners and co-owners but were now Visa’s customers. MasterCard MasterCard (MC), which successfully went public in 2006, was a global payment solutions company that was similar to Visa’s open-loop network. MC’s primary sources of revenue were transaction service fees, data-processing fees, and assessments on gross dollar use (purchases, cash disbursements, balance transfers) of MC-based cards. In 2007, transaction fees a nd assessments represented approximately 74% and 26%, respectively, of the company’s net revenues. 5 Discover Financial Services Discover Financial Services (DFS) was the consumer credit and financial services division of Morgan Stanley until it was spun off to shareholders as an independent closed-loop payments network company in July 2007. Founded in 1986, DFS was the only issuer whose wholly-owned network operations included both debit and credit card capability. 26 DFS also offered a range of banking products, such as personal and student loans, certificates of deposit, and money market accounts. DFS’s primary source of revenue in its U. S. ard business was interest income earned on revolving cardmember balances. Other sources of revenue included late-payment, over-the-limit, and merchant discount fees. Like American Express, the company offered a rewards program to cardholders; under the Discover program, card users earned a cash-back discount on the value of thei r transactions. Competitive Card Issuers Competitive card issuers (largely banks) issued credit and debit cards, predominantly under the Visa and MasterCard brands, and were responsible for the pricing, positioning, and marketing of their co-branded cards.The top three banks accounted for more than 60% of outstanding bank-issued credit card purchases, as indicated in Table D. Card issuers competed on the basis of card features and quality of service, including rewards, number of cards issued and quality of users’ credit and spending, number of establishments accepting the card, success of target marketing and promotional campaigns, and the ability of the issuer to manage credit and interest rate risks through economic cycles. The primary revenue source for bank issuers was interest income earned on outstanding credit card balances.They acquired new cardholders by cross-selling cards to the customers of their retail branch networks and, increasingly, targeted high-spending con sumers, offering premium cards with enhanced services such as larger lines of credit, cash rebates, lower interest rates, and co-brand benefits with airline frequent-flyer programs. 7 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card Table D U. S. Credit Card Volumes by Card Issuer in 2007 Volume of Purchases billions) American Expressa JP Morgan Chase Bank of America Citigroup Capital One Discovera U. S. Bank HSBC Wells Fargo GE Money Other Sources: $459 317 263 222 106 90 65 41 37 27 87 Adapted from The Nilson Report, Issue 896, February 2008, except for American Express (American Express Annual Report 2007). a Do not include third-party business. Emerging Payment Networks New entrants offering nontraditional, convenient, technology-based payment methods were growing in number and importance. It was estimated that cr edit and debit cards generated approximately $200 billion in purchase volume from online bill payments in 2006. 7 New payment methods included online â€Å"aggregator† networks, such as PayPal and Google Checkout, and telecom providers that leveraged new technologies and customers’ existing charge and credit card relationships to create mobile payment solutions where the plastic card would not need to be presented to the merchant. PayPal used encryption software to allow consumers to make financial transfers between computers. 28 Similarly, Google Checkout, which accepted and processed existing payment methods such as American Express, Visa, and MasterCard, aimed to offer buyers a fast, safe, and convenient purchase experience.American Express Card Business Model The American Express â€Å"spend-centric† business model (see Exhibit 4) depended on increased cardmember spending. American Express’s primary source of income was â€Å"discount revenue,† revenue earned from fees charged to merchants for processing purchases made using an American Express card. The fee charged represented a percentage of the dollar value of these transactions. In 2007, discount revenue and card fees accounted for more than 70% of U. S. Card Services’ revenue net of interest expense (see Exhibit 5).The average American Express cardmember charged more each year than the average Visa or MasterCard credit card user. In 2007, the annual average purchase volume per American Express card of $8,360 in the U. S. was substantially higher than that for Visa ($2,470/card) or MasterCard ($1,960/card). 29 By accepting American Express cards, merchants benefited from attracting as patrons the higher-spending American Express consumer. As a result, American Express could justify a premium discount rate from merchants over its competitors.American Express invested this price premium in information systems that studied the purchase habits and inclinations of c ardmembers. These insights led to the development of targeted 8 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card 509-027 promotions, connecting merchants with interested American Express cardmembers who were in turn motivated to spend even more on their American Express cards.In this way, the spend-centric model became a virtuous cycle, benefiting cardmember, merchant, and company alike. From the outset, American Express targeted the affluent, high-spending consumer. â€Å"High-wallet† consumers were defined by American Express in 2007 as those who spent more than $30,000 annually using cards. Affluent consumers represented roughly 10% of card users but accounted for half of U. S. charge/credit card consumer spending. 30 American Express’s target consumer typically liked to travel, liked to be different, and lik ed special access to exclusive experiences.For many years the American Express consumer skewed slightly toward affluent, older men, a reflection of the company’s early targeting of the male business traveler. The company had successfully increased American Express brand penetration of affluent younger and female consumers. Unlike its transaction-oriented competitors, Visa and MasterCard, the American Express card always emphasized an aspirational lifestyle. An early example was the 1985 launch of Departures magazine for Platinum cardmembers who were active, affluent consumers.The Departures editor defined luxury not as status and privilege but in terms of quality and authenticity. Membership in a Lifestyle From the outset, American Express executives emphasized that the company sold not just a card but a relationship. The relationship involved a â€Å"membership† in which the company committed to providing the member with the following: Access (premium and exclusive ac cess and enhanced experiences for cardmembers), Advocacy (in merchant disputes, for example), Accountability (privacy of information, fairness in billing), and Affiliation (a sense of belonging to a community).Every American Express charge card included the â€Å"Member Since† designation on the front followed by the year the consumer became an American Express cardmember. To underscore the membership status of American Express consumers, the company in 1991 launched the Membership Miles program to motivate customer sign-ups, customer retention, and more frequent card usage. At launch, the Membership Miles program gave cardmembers one point for every dollar charged on the card and the ability to redeem points with seven airlines. The program was renamed Membership Rewards (MR) in 1995.Spending on American Express cards linked to MR averaged four times higher than that on cards without rewards activity. 31 Seventy percent of cardmembers used the MR program. Cardmembers enrolle d in the program were found to be lower credit risks as well as more profitable. 32 The company’s â€Å"data-mining† capabilities helped shape the MR program into an industry-leading loyalty program. For these reasons, American Express’s marketing spending on MR had grown at a compound annual growth rate of 24% since 2001, compared to an average 12% increase in marketing and promotion spending. 33 The MR program in the U.S. had more than 160 redemption partners34 and featured 29 airlines among its 250 merchandise brands. Analytics not only helped to determine whom to reach and with what offer, but also how rewards influenced loyalty. In 2005, the MR analytics team analyzed which members were more likely to redeem, in which categories, how many points they would redeem, and at what cost to the company. This research enabled American Express to craft a more appealing mix of reward offers, to predict more accurately the volume of demand for particular offers, and t o negotiate better deals with suppliers.Innovations such as â€Å"First Collection,† a luxury tier exclusively for U. S. Platinum and Centurion cardmembers that included redemption partners such as Tiffany and Lamborghini, and â€Å"Bonus Points Mall,† an online gateway to more than 100 retailers, were 9 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card examples of how American Express increasingly tried to match the nature and the level of rewards to what its members sought and expected.Data-Based Marketing As a card issuer and network provider, American Express had direct relationships with both its cardmembers and its merchants. â€Å"Data-based marketing† became a competitive advantage at American Express. Analyses of cardmember purchases enabled American Express to develop offers that boosted spending with particular groups of merchants. Open-loop competitors Visa and MasterCard could not match American Express’s data-driven capabilities because they controlled access to either the cardholder or the merchant data, not both.The purpose of data-based marketing was to develop insights and offers that would match members’ interests, drive charge volume, and increase loyalty to American Express. 35 The company did not use individual consumer data for marketing purposes but rather clustered cardholders into segments based on personal, financial, and lifestyle characteristics evident in the patterns of their transactions. Cardmember clusters might have greater than average spending in, for example, entertainment, dining, home, fashion, electronics, or automobiles.Cardmembers whose spending showed them to be more â€Å"passionate† about their homes might then receive offers from local homeimprovement retailers. The company also researched correlations across spending categories to identify potential partnerships. For example, research indicated that affluent consumers who owned at least one luxury automobile brand had a strong affinity not only to other luxury brands but also to consumer electronics brands, an above-average tendency to engage in skiing and antiquing, and a strong likelihood of owning a second, more practical vehicle.Data mining also enabled American Express executives to predict how spending behavior evolved through various â€Å"life stages† and increasing levels of affluence. For example, the company’s predictive model indicated that non-affluent cardmembers who made a single luxury purchase, such as a first-class airline ticket, were three times as likely to become affluent. Card upgrade offers distributed following a cardmember’s first luxury charge purchase resulted in response rates over 50% above normal. 36 Emerging ChallengesBy 2005, competitors had begun to imitate American Express’ s lifestyle platform with premium product offerings (e. g. , Visa Signature, MasterCard World Elite), exclusive experiential rewards (e. g. , MasterCard’s Unique Experiences program), and lifestyle advertising. Visa’s â€Å"Life Takes Visa† advertising campaign emphasized the â€Å"brand’s promise to deliver innovative products and services that empower cardholders to experience life and business their way and on their terms. †37 The quality of a card’s rewards program was increasingly important to higher-spending consumers.No longer did they evaluate rewards programs just on ease of earning and redeeming points. The variety and frequency of unique rewards (such as backstage access at a concert) were more and more critical. American Express had an edge over Visa and MasterCard owing to its cumulative expertise in arranging special events, but bidding wars for such opportunities were increasingly common. While continuing to emphasize relation ship and lifestyle over transaction, American Express had to broaden its merchant network to maintain its share of consumer spending.In 1990, 64% of 10 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card 509-027 American Express U. S. billings came from the travel and entertainment (T&E) sectors and 36% came from retail and other sectors. 38 This reflected the company’s belief that spending could be segmented into â€Å"business† and â€Å"personal. † American Express’s focus on T&E concerned Chenault and Kelly.They believed that, in the interests of scale, American Express had to expand its presence in the â€Å"everyday† retail market. This change in strategy was opposed initially, partly because it would necessitate launching more new products and, in the eyes of some traditionalists, weaken the brand. However, by 2007 the sources of cardmember spending had more than reversed, with everyday retail spending representing more than 69% of U. S. American Express card billings. 39 Marketing Communications Advertising CampaignsAmerican Express had a long history of successful, distinctive advertising that consistently stressed prestige, inviting consumers to join an exclusive club of cardmembers. One of the first TV campaigns, â€Å"For People Who Travel† (1969–1974), demonstrated how the American Express card is â€Å"All You Need† for your travel and entertainment needs. This was replaced by the â€Å"Do You Know Me? † campaign, which that ran for more than a decade, produced 125 commercials, and marked the beginning of the company’s strategy of using famous American Express â€Å"members† to sell cards to consumers. Do You Know Me? † used a variety of celebrities to highlight the special treatment and recognition cardmembers enjoy, the premise being that people with famous names don’t always have equally famous faces; anyone who carried an American Express card would be immediately identified as someone of note. In 1987, American Express premiered the â€Å"Membership Has Its Privileges† campaign, which highlighted the company’s superior service and showed how the card â€Å"not only facilitated the variety and enjoyment of a cardmember’s lifestyle, but that membership is also invaluable when emergencies arise. 40 To complement this television campaign, the â€Å"Portraits† print campaign was launched. Portraits underscored the message that â€Å"superior customer service, security, and convenience† were important American Express qualities that cardmembers relied on. Shot by celebrity photographer Annie Leibovitz, â€Å"Portraits† focused on a unique group of high-profile cardmembers. The company’s first global advertising campaign, â€Å"Do Mo re,† was launched in 1996 and emphasized brand attributes such as trust, customer focus, travel relevance, and financial insight.A variety of â€Å"product† commercials highlighted individual card benefits such as no preset spending, purchase protection, and global assist, while talent-driven â€Å"stories,† such as Tiger Woods’s â€Å"Manhattan† commercial in which he plays the world’s toughest â€Å"island† course—Manhattan—were intended to drive emotional relevance. In an effort to encourage everyday usage of the card, the â€Å"Do More† campaign introduced a series of ads showing comedian Jerry Seinfeld using the American Express Card in supermarkets and drugstores. In 2004, a new global campaign with the tagline â€Å"My Life. My Card. featured snapshots of the lives of celebrities, including Robert DeNiro, Tiger Woods, and Ellen DeGeneres. The campaign portrayed American Express cardmembers as exceptional pe ople no matter where they lived or what they did. The campaign was also the first to support both American Express’s proprietary and network businesses. John Hayes, American Express’s chief marketing officer, believed that the company’s history of tastefully portraying the rich and famous had provided it with an edge in attracting A-list talent. DeGeneres purportedly pointed to Seinfeld’s ads before signing on to do her own. 1 11 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card American Express launched its most recent campaign, â€Å"Are You A Cardmember? ,† in 2007. Hayes explained: â€Å"The new campaign continues the tradition of defining the value of belonging to the American Express community by showcasing some of our most exceptional cardmembers and the ways in which membersh ip works for them.But our latest campaign not only reaffirms for existing members why they belong, it also calls on nonmembers to consider becoming a cardmember. †42 See Exhibit 6 for a summary of American Express’s U. S. card advertising campaigns. Expenditures The company’s mix of marketing spending had changed to reflect the growing importance of targeted communication over mass mailings and the emergence of the digital world. Over time, spending on direct mail, while still large, had decreased along with spending on television advertising.Event/experiential marketing and Internet spending had both grown. American Express used direct marketing both to acquire new customers and to motivate existing members to upgrade. Traditionally, American Express sought new customer applications from outbound telemarketing, â€Å"Take Ones† (applications placed in restaurants and other retail establishments), and direct-mail efforts. By 2008, only 40% of successful ne w applicants still came from direct-mail solicitations and response rates had slipped well below 1%.By contrast, a significant portion of applications came from new channels such as the Internet, co-branded partner channels, and consumer-initiated phone calls to American Express customer service. The American Express website had become one of the company’s largest sources of new member applications. It allowed the company to leverage its datamining expertise to provide real-time consumer rewards and offers. The Web simplified the card selection/application process by guiding the applicant through card choices.Based on the applicant’s stated card feature priorities (fees, rewards, payment terms), the American Express website provided card product comparisons and recommended the most appropriate card options from American Express’s portfolio. The growing importance of the digital world was reflected in the company’s shift in media spending, as shown in Tabl e E. American Express Company—U. S. Card Media Spending Table E Share of Media Spend 2003 Media Type Online Share of Media Spend 2007 7% Television 19% 48 57 14 10 Print 23 13 Radio 2 Non Traditional Source: Mediaa Company records. a Non Traditional Media includes billboards, transit, cinema, and other out-of-home media Investing in the website reduced American Express’s costs and built brand presence and prestige. By 2008, 38% of American Express applications, payments, and reward redemptions had migrated to the Web at cost rates 53%, 84%, and 86% lower, respectively, than offline. 43 The Internet allowed the company to attract new customers faster (one application every eight seconds) and more 12This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card 509-027 economically. The website, serving as a virtual service cen ter around the clock, increased the frequency with which the company was in contact with its customers, making it a powerful marketing channel. Claiming the americanexpress. com site â€Å"gets more traffic than the Wall Street Journal online,† the company noted that its members used the Web primarily for checking statements and cashing in rewards.With more than 50% of American Express payments left to migrate online, upside opportunity existed for further cost savings and deeper relationships with customers. Bank and Merchant Partners As of 2008, American Express obtained customers in two ways: through direct company solicitations and communications that resulted in consumers being issued proprietary American Express cards; and through third-party financial institutions that solicited their customers to sign up for American Express cards through them, a business managed by the company’s Global Network Services (GNS) division.Bank Partners American Express’s GNS business was set up in 1997 to build partnerships with banks and other institutions to issue American Express–branded products. GNS products were designed to help issuers develop products for their highest-spending, most affluent customers and to support the value of American Express card acceptance with merchants. GNS enabled American Express to broaden its cardmember base internationally at relatively low cost. By 2008, GNS had over 120 partners in more than 125 markets and accounted for nearly 25% of American Express’s overall cardsin-force.American Express particularly wanted to help each bank design card products for their highspending, affluent private banking clientele, and to benefit from new distribution channels that included each bank’s website, direct-mail capabilities, and retail branch network. For their part, the banks were interested in partnering with American Express because of its superior marketing expertise as a card issuer and the higher-s pending profile of American Express cardmembers. Merchants stood to benefit from more American Express cards in circulation.For American Express, expanding the GNS business required little capital; the banks owned the receivables and therefore absorbed the consumer credit risk. While consumers could choose between American Express proprietary cards and those issued under GNS partnerships, cannibalization of direct sales appeared to be minimal. While GNS began building a healthy international business, it was effectively barred from doing business in the U. S. by Visa and MasterCard’s policies preventing their U. S. member banks from issuing other card brands. In 1998, the U.S. Department of Justice filed suit against Visa, MasterCard, and eight of their member banks, charging anticompetitive practices. The suit charged that Visa and MasterCard prohibited their U. S. partner banks from issuing American Express–branded cards on the American Express network. Discover card s were affected similarly. The legal battle was resolved in 2004 when the U. S. Supreme Court let stand a court ruling that Visa and MasterCard had violated antitrust laws. Visa settled for $2. 25 billion. MasterCard later settled for $1. 5 billion.American Express soon signed Network Card License Arrangements (NCLs) to issue American Express–branded cards with seven leading U. S. banks. MBNA was the first, followed by Citibank, Barclaycard U. S. , USAA, GE Money, HSBC, and Bank of America. Though the banks were licensed to issue American Express–branded cards, American Express owned the relationships with merchants. 13 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y.SUN 509-027 The American Express Card This meant that GNS earned discount revenue from both the bank issuer and the merchant acquirer, a sum that represented roughly one-third o f total GNS revenues. This design feature underscored the importance of the continued focus on the high-spend segment. American Express developed strong account-management teams to manage the relationships with these major banks. Two major banks that had not yet signed on to issue American Express cards were JP Morgan Chase and Capital One. Merchant Partners In addition to U. S. anks, American Express depended on relationships with merchant partners, seeking always to expand its merchant coverage. These relationships were managed by the Merchant Services Group. Despite American Express’s premium discount rate, American Express believed that merchant coverage was not a function of price alone; if it were, Kmart and Walmart, for example, would not have chosen to accept American Express. Further, the Discover card discount rate was less than American Express’s yet Discover had a much lower merchant penetration. (See Table F for fees paid in 2005 by U. S. erchants to accep t card payments. ) American Express account managers and third-party sales organizations aimed to convince merchants of two benefits to offset American Express’s higher discount rate: that American Express cardmembers would spend more with them than with competitive cardholders and that American Express data mining could target promotional offers that would drive business their way. To persuade reluctant merchants to sign up, the Merchant Services Group might target members who were likely shoppers at a new merchant with double points promotions for an inaugural period.Since 2000, American Express increased merchant acceptance of its cards in many categories, especially quick-serve restaurants, mass transit, and health care. American Express card acceptance also increased in industries where cash, checks, or bank transfers were the predominant forms of payment, including apartment rentals, private jet travel, and destination clubs. By 2008, the American Express card was accep ted at millions of merchants in the U. S.. Management estimated that U. S. ocations where the American Express card was accepted covered more than 90% of American Express cardmembers’ general-purpose charge and credit card spending. 44 Table F Fees Paid by U. S. Merchants to Accept Card Payments—2005 Payment Card Brand Visa/MasterCard Credit Cards Visa/MasterCard Debit Cards American Express Discover Source: Fees Paid (billions) Weighted Averagea $25. 13 9. 76 8. 51 1. 46 2. 19% 1. 75 2. 41 1. 76 Adapted from The Nilson Report, Number 862, August 2006. a Fees vary according to merchant category, volume, and type of card. ConclusionBy the spring of 2008, American Express was strategically focused on the payments and travel businesses, having sold off the last of its banking interests. Michael O’Neill, senior vice president of corporate affairs and communications, explained this transformation: â€Å"We narrowed the business and broadened the brand. † Warre n Buffett, who was the company’s largest shareholder, described 14 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card 509-027American Express’s â€Å"powerful world-wide brand† as â€Å"an enduring moat that protects excellent returns on invested capital†45 and Chenault as one of the â€Å"giant-company managers whom I greatly admire. †46 In March 2008, Barron’s named Chenault as one of â€Å"The World’s Best CEOs† for having â€Å"positioned American Express well to withstand turbulence. He hasn’t compromised credit standards to gain new cardholders, nor has he cut back on marketing spending to prop up earnings. His loss rates on cards remain among the industry’s best. †47 In the second half of 2007, a U. S. housing downturn and credit crunch slowed U . S. economic growth.American Express issued a profit warning in early 2008. Chenault explained that the slowdown in cardmember spending that had come on suddenly in December 2007 was broad-based and was expected to continue into 2008. â€Å"Now we’ve been through slowing economies before, but none of us can recall such a dramatic drop over such a short time frame, except for the event-driven decline of 9/11. †48 Past-due loans and write-offs also rose, especially in parts of the U. S. that had experienced a housing price bubble. However, superior risk management and credit controls at American Express meant that it was less affected than competitors. 9 It was in this context that Jud Linville prepared for his meeting with Ken Chenault and Al Kelly. How could the American Express consumer card business continue its growth while maintaining the company’s premium positioning? Were there opportunities for his organization to serve U. S. consumers and merchants in n ew ways while continuing to turn in the profits that shareholders had come to expect? 15 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express CardExhibit 1 American Express Card Business Statistics: 2006–2007 Years Ended December 31 (billions, except percentages and where indicated) 2007 2006 Card billed businessa United States Outside the United States $459. 3 188. 0 $406. 8 154. 7 $647. 3 $561. 5 52. 3 34. 1 48. 1 29. 9 86. 4 78. 0 40. 9 29. 2 37. 1 25. 4 70. 1 62. 5 Total b Total cards-in-force (millions) United States Outside the United States Total Basic cards-in-force (millions) b United States Outside the United States Total Average discount ratec Average basic cardmember spending (dollars)d Average fee per card (dollars) d Source: 2. 56% $12,106 32 2. 57% $11,201 $32 Company documents. a Card billed business inc ludes activities (including cash advances) related to proprietary cards, cards issued under network partnership agreements, and certain insurance fees charged on proprietary cards. Card billed business is reflected in the United States or outside the United States based on where the cardmember is domiciled. b The number of cards that are issued and outstanding. Proprietary basic consumer cards-in-force includes basic cards issued to the primary account owner (â€Å"cardmember†) and does not include additional supplemental cards issued on that account.Proprietary basic small business and corporate cards-in-force include basic and supplemental cards issued to employee cardmembers. Non-proprietary basic cards-inforce includes all cards that are issued and outstanding under network partnership agreements. c Designed to approximate merchant pricing, the percentage of billed business (both proprietary and Global Network Services) retained by the Company from merchants it acquires, prior to payments to third parties unrelated to merchant acceptance. d Average basic cardmember spending and average fee per card are computed from proprietary card ctivities only. 16 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card Exhibit 2 509-027 Selected American Express U. S. Charge and Credit Card Products: 2008 CARD TYPE SELECTED FEATURES AND BENEFITS CHARGE CARDS Green (1958) Gold(1966) —Preferred Rewards Gold (2002) —Rewards Plus Gold (1994) Platinum (1984) Centurion (1999) One from American Express (2005) 1% of purchases deposited to high yield savings account CREDIT CARDSBlue (1999) —Blue (1999) —Blue Cash (2003) —Blue Sky (2005) —Blue for Students (2001) Optima (1987) —Optima Platinum (1997) City Rewards —In New York City (2004) —In Los Angeles (2005) —In Chicago (2005) Clear (2005) No annual fee, flexibility to pay over time, free additional cards No annual fee, earn up to 5% cash back, unlimited cash rewards No annual fee, earn points redeemable on airline, hotel or cruise services. No annual fee, flexibility to pay over time, Membership Rewards No annual fee, transfer balances for free, Membership Rewards No annual fee, earn Inside points to at, drink and play in New York No annual fee, earn Inside points to eat, drink and play in L. A. No annual fee, earn Inside points to eat, drink and play in Chicago. No fees of any kind, automatic rewards, flexibility to pay over time PARTNER CARDS Airlines —Gold Delta Sky Miles (1996) —Platinum Delta Sky Miles (2002) —JetBlue Card (2005) Hotels —Starwood Preferred (2001) —Hilton HHonors (1995) Costco—True Earnings Card (2004) Lifestyle Cards —The Knot (2005) —The Nest (2005) Earn Sky Miles on every dollar spent, earn double m iles on some purchases Earn Sky Miles, earn 1 companion ticket each yearEarn points towards JetBlue flights Earn points towards free hotel stays, upgrades, even flights Earn HHonors points on every purchase Earn cash back on purchases Membership Rewards, no annual fee, get special offers from The Knot Membership Rewards, no annual fee, get special offers from The Nest FOR CORPORATE CLIENTS American Express Corporate Cards (1966) Business ExtrAA Corporate Card (2003) Comprehensive reporting to track spending and increase compliance Savings through airfare rebates, free travel awards FOR SMALL BUSINESS Business Gold Rewards (2005) Business Platinum Card (1995) Plum (2006)Starwood Preferred Guest Business Credit Card (2001) Business Cash Rebate Credit Card (2003) Source: Membership Rewards, no limit, year-end summary Membership Rewards, access to special events Membership Rewards, access to special events, 5 free additional cards Airport Club access, 24 hour concierge service, by Invit ation Only events Save 3-25% on business expenses at selected partners (e. g. : FedEx, Delta) Access to airport lounges, professional office space, personal concierge Trade terms, pay within 10 days, get 2% off or defer payment Free awards nights at Starwood Hotels, awards flights on over 30 airlines Earn 2. % on all purchases and up to 5% for certain business purchases. Company documents. 17 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card Exhibit 3 Source: American Express Company Overview: 2007 Company records. 18 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card Exhibit 4 509-027American Express: Spend-Centric Model The American Express spend-centric busines s model focused primarily on generating revenues by driving spending on its cards, and secondarily finance charges and fees, allowing the company to grow market share in the payments industry. Source: Company documents. 19 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card Exhibit 5 American Express U. S. Card Services—Selected Income Statement Data Year Ended December 31 (millions)Revenues Discount revenue, net card fees and othera Cardmember lending revenueb Securitization income Excess spread, net Servicing fees Gains on sales from securitizations Securitization income, net:c 2007 2006 $10,435 4,762 $9,421 3,434 1,025 425 57 1,055 407 27 $ 1,507 $ 1,489 Total revenues Interest expense Cardmember lending Charge card and other $16,704 $14,344 1,518 964 957 767 Revenue, Net of Interest Expense $14,222 $12,620 Exp enses Marketing, promotion, rewards and cardmember services Human resources and other operating expenses Total Provisions for lossesd Pretax segment income Income provision 5,140 3,354 $ 8,494 $ 2,998 $ 2,730 $ 907 $ 4,445 3,227 $ 7,672 $ 1,625 3,323 $ 1,171 Segment Income $ 1,823 $ 2,152 Source: American Express Company Annual Report 2007, p. 53. a Discount Revenue represents revenue earned from fees charged to merchants with whom the company has entered into a card acceptance agreement for processing cardmember transactions. b Cardmember Lending Revenue represents the outstanding amount due from cardmembers for charges made on their American Express credit cards, any interest charges and card-related fees and balances with extended payment terms on certain charge products. Securitization Income, Net includes non-credit provision components of the net gains from securitization activities; excess spread related to securitized cardmember loans; and servicing income net of related dis counts or fees. d Provisions for Losses include credit-related expenses. 20 This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN The American Express Card Exhibit 6 509-027 Major American Express Advertising Campaigns in the United States 1958–early 1960s Good As Gold.The World Around! Establish prestige image for AmEx card and provide application instructions. 1969–1974 For People Who Travel Show how the American Express card is â€Å"all you need† for your travel and entertainment needs. 1975–1987 Do You Know Me? Show celebrities receiving the special treatment and recognition cardmembers enjoy around the world. Tagline, which continued through 1995, is â€Å"Don’t Leave Home Without It. † 1987–1992 Membership Has Its Privileges Introduce notion of â€Å"membership† and showcase the benefits of res pect, recognition, unsurpassed service as well as Global Assist, Buyers Assurance. 996–2000 Do More/Seinfeld Highlight individual card product benefits such as no pre-set spending, purchase protection, global assist. Talent-driven â€Å"stories† drive emotional relevance and recognition benefit. Use Jerry Seinfeld in a larger than life manner to increase awareness and use of the American Express card at everyday spend locations. Sub-campaign uses everyday moments to highlight individual product benefits such as retail protection and roadside assistance. Make Life Rewarding 2002 Relaunch American Express brand post 9/11 using charge card as the face of propriety.Sub-campaign introduced â€Å"revitalized† charge card with membership reward programs built in. 2004–2007 My Life. My Card. Demonstrate the company’s belief that American Express cardmembers are exceptional people no matter where they live or what they do. Featured extraordinary individuals including Robert DeNiro, Tiger Woods, Ellen DeGeneres, and Laird Hamilton, revealing snapshots of their lives. Acclaimed director Martin Scorsese and celebrated photographer Annie Leibovitz were commissioned to lend their vision to elements of the campaign creative.While the creative direction varied from ad to ad, the campaign theme was consistent: achievers of all types choose American Express. 2007–2008 Are You A Cardmember? Entice prospective cardmembers to apply and join the American Express community and reinforce the membership benefits to current cardmembers via showcasing the advantages American Express offers versus competition. Celebrities such as Beyonce Knowles, Ellen DeGeneres, Tina Fey, and Diane Von Furstenberg are featured within a lifestyle and access theme. Source: Company documents. 21This document is authorized for use only by YUJIE SUN in Intensive in American Business taught by Robert Calamai from September 2012 to December 2012. For the exclusive use of Y. SUN 509-027 The American Express Card Endnotes 1 Adapted from The Nilson Report, Issue 902, 2008. 2 American Express Annual Report, 2007, inside front cover. 3American Express Fixed Income Presentation, March 12, 2008, http://media. corporate-ir. net/media_files/ irol/64/64467/DebtInvestorPres. pdf, accessed June 12, 2008. 4 American Express Financial Community Meeting 2/16/2008 K.Chenault speech, texthttp://media. corporateir. net/media_files/irol/64/64467/KCSTalkingPoints020608. pdf, accessed June 12, 2008. 5 American Express Annual Report, p. 110. 6 American Express Fixed Income Presentation, March 12, 2008, ir. net/media_files/irol/64/64467/DebtInvestorPres. pdf, accessed June 12, 2008. 7 American Express Fixed Income Presentation, March 12, 2008, ir. net/media_files/irol/64/64467/DebtInvestorPres. pdf, accessed June 12, 2008. http://media. corporatehttp://media. corporate- 8 Americ

Iago -Betrayal and Loyalty

The Theme of Betrayal and Loyalty Through the Eyes of Desdemona, Othello, and Iago The play The Tragedy of Othello the Moor of Venice, written by William Shakespeare in the 1600’s, has many underlying and reoccurring themes. The major themes are betrayal and loyalty. During the entire play, every character is either betrayed or proved loyal. The Tragedy of Othello the Moor of Venice can be seen through the characters of Iago, Othello, and Desdemona. Othello and Desdemona have both been betrayed in their attempt to be loyal to another character.Throughout the play, Iago manipulates the other characters into betraying one another so that he can get his ultimate betrayal on Othello. Shakespeare uses Iago as the main portrayer of betrayal throughout the entire play. He betrays all the other characters, but his main focus is on Othello. Despite that, he ends up betraying all the people closest to him. Iago’s betrayal starts off from the first scene page of the play right unt il the end. The audience learns Iago’s motive through his monologue: â€Å"Thus do I ever make my fool my pursel hate the moor, and it is thought abroad that ‘twixt my sheets’ has done my office.I know not if’t be true, but I, for mere suspicion in that kind will do as if for surety. † Iago suspects that Othello has had an affair with his wife. However, Shakespeare makes Iago’s motif very unclear; therefore, it can be argued that this is Iago’s excuse and in actual fact he has no reason other than he simply hates Othello. Iago wants to destroy Othello because Othello promoted Casio as chief lieutenant instead of him, which is another reason why Iago wants to destroy him. Iago is one of Shakespeare’s most complex villains. Initially, we see Iago’s character as pure evil, yet later we see him as a completely amoral person.Iago does not push aside his conscience to commit his evil plans, he simply lacks a conscience to begin with. Through Iago, Shakespeare shows us a character that acts against his reputation and betrays all this friends and loved ones. Through some careful thought out words and actions, Iago is able to manipulate others to do things in a way that benefits him and moves him closer to his ultimate goal. He is the main driving force of the play, pushing Othello and everyone towards their tragic end. Iago is smart. He is an expert judge of people as well as their character and uses this to his advantage.Iago is also quick on his feet, making him able to improvise when something unexpected occurs. Being as smart as he is, Iago is quick to recognize the advantages of trust and uses it as a tool to forward his main purpose. Throughout the story he is commonly known as the â€Å"honest Iago†. He even says himself, â€Å" I am an honest man†. Trust is a very powerful emotion that is easily betrayed. Iago is a master of betrayal. He slowly poisons people’s thoughts, creatin g ideas in their heads without risking himself. Iago is capable of anything, not even the brave soldier Othello is safe from this villain.Othello holds Iago to be his closest friend and advisor. He believes Iago to be a person, â€Å"of exceeding honest, who knows all qualities with learned spirit of human dealings†. Yes, he does know about human dealings, but he is not the honest man he appears to be. He uses Othello’s trust in him to eventually turn Othello into a man no better than himself. Othello is introduced to us in the first scene of the play in a negative light, when Iago and Rodrigo refer to him using derogatory terms such as, â€Å"The Moor†, â€Å"the thick lips†, â€Å"an old black ram† and â€Å"a Barbary horse†.Othello may be an outcast in Venice due to the color of his skin; however, he is a highly respected soldier. He is extremely skilled in his field and a loyal man; therefore, valuable to the state. Due to this, we soon learn of Othello as the noble man he is. Othello, however, has the â€Å"tragic flaw†. It is the internal imperfection in a hero that brings him down. His downfall becomes his own doing; he is no longer the victim of fate. The prejudice of those around him destroyed him, and they believed that, â€Å"A black man is an unattractive creature, not quite human, and unworthy of love†.Thinking this made him unable to believe that Desdemona could truly love him. This is why he believes Iago so easily when he convinces him Desdemona has had an affair. Othello betrays his wife by believing Iago’s word over hers, this then leads him to his ultimate betrayal when he kills her at the end of the play. At this point he also shows his loyalty to her by killing himself, stating that he can’t live without her. The man we see at the end of the play is not the loyal man we meet in the beginning.Othello has let the â€Å"green eyes monster of jealousy† turn him from a loyal soldier to a betrayer just like Iago. Desdemona is a lady of spirit and intelligence; she is the most direct, honest and loyal character of the play. She only betrays people to those to who she is loyal. Desdemona is a lady of few words, yet she makes sure every word counts to get her point across. In Desdemona’s eyes, Othello is the hero of many exciting and dangerous adventures; he is the orphan who needs love. These are the reasons Desdemona had fallen in love with Othello, despite all the nasty remarks from fellow Venetian citizens.Her marriage has brought her position and happiness, so much that she finds it unbearable to think that her husband has turned against her. This numbness lasts until she sees that he actually intends to kill her. She then puts up a defense, insisting on her loyalty and innocence. In despair of losing his love, she still defends him from consequences of his actions, but he is past seeing the truth: that she has committed herself to his lo ve, and without it she cannot live. Othello ends up killing his wife, in spite of her loyalty toward him till the very end.By the end of the play, all characters have lost their loyalty to each other from what Iago as done to make them feel betrayed. Desdemona is left lifeless in her room, Iago kills his wife Emilia, as she reveals that Desdemona has been falsely accused of adultery, and Othello kills himself rather than living with what he has done. Iago is the only survivor by the end of the play, which further justifies his intelligence. All the characters have reached their downfall and Iago is finally pleased. He has completed the ultimate betrayal.

How will future changes affect Human Resource Management Essay

Introduction Human Resource Management (HRM) has become more important to society in the past twenty years, going through many changes already. But how will it adapt in the future. What are the predictions for the future and how will HRM cope? The forthcoming document analyses the history of HRM, predicts what will happen in the future of employment and the changes that HRM will have to consider to be able to keep functioning. The History of HRM According to Winning (Online), Personnel Management has been around since the early 1920’s but mainly just to support employees and also keep them away from being part of unions as it wasn’t in the company’s interest to encourage unions then. It was the 1960’s where Personnel Management started to get recognised slightly more, at this time it was still being called Personnel Management. This changed in mid 1980’s when Personnel Management started to be seen as something that is actually important to a company. The image of Personnel Management got given a face-lift and was now referred to as Human Resource Management or HRM. The reasons for this being that the powers of the trade unions were decaying slowly. Staff functions also began to change with more technology being introduced, which introduced the start of HRM (Mullins, 1999) Personnel Management was recognised on a low level before the introduction of HRM, but still had a part to play in the negotiations of machinery in the 1960’s and 1970’s. The introduction of HRM brought around many questions about the similarities and differences between HRM and personnel management. The main differences are stated that Personnel Management is an employee centred activity including more opinions than facts, and that HRM is a resource centred activity with more planning, monitoring and control. Functions of HRM The HRM department varies from organisation to organisation. But there are some specific tasks that need to be completed by every organisation. Some organisations are just too small to have a separate HRM department, but they still need to complete these specific tasks by whichever means. All organisations have to recruit employees by going through the recruitment and selection process. Larger organisations will have specific guidelines by which they follow to complete this process; some smaller companies may not have these guidelines, but they still have to abide by the law. Any staff that are employed need to be trained in their job with compliance to any laws relating to the role. Larger companies will offer a development plan to run along side the training, but even smaller companies need to train staff. The HRM function in the company adheres to any legislation set by the Government. All organisations must have a motivation and reward scheme or the employee turnover will be high as everyone has needs, whether it is basic or social needs. Employee records need to be maintained in accordance with the data protection act. If things are not kept legal in the organisation then it will be in trouble. The HRM department/function sees that everything operates correctly. Specific HRM departments looks after the employees and their welfare in the organisation, taking care of wages and dealing with personal issues that may arise with particular employees. Although many line managers will carry out such functions in smaller organisations. Predictions for the future and how it will affect HRM HRM has come along way over the years. Since the 1980s there has been a significant but gradual change from Personnel management to HRM, being recognised as something that is becoming more important to organisations. With many people not joining unions and expecting more care from companies, it is something that had to happen to keep good relations. The key issues to discuss are the acceleration of technology and homeworkers having an affect on HRM in the future. Such issues such as outsourcing, planning and future attitudes also need to be considered. The future is always hard to predict but an issue that is becoming obvious is that technology will play a huge part of what is to come. The Internet and computer technology is moving very fast, one business year is seven Internet years according to Dr Patrick Dixon (online). With growth like this, the Internet will be a backbone for society before long. In 2000 62% of all businesses functioned with Internet access as table 1.1 shows in Appendix 1. This demonstrates how important the Internet has become to businesses and the way they operate. 50% of businesses in the UK have their own web site now as well, so only 12% of the businesses with Internet access don’t choose to have a web site. Having a web site catches another corner of the market and makes a company grow considerably, this would allow employees to work from home and brings lower costs for the businesses. E-Commerce is beginning to take off as table 1.3 shows in Appendix 1, 16% of businesses trade in this way over the Internet. E-Commerce is quite a new concept and the fact that 16% of businesses trade this way already is shocking. Since 1999, table 1.4 on Appendix 1 shows that the supply of ICT products has escalated by 150%. This is a very clear indication that technology is growing at a very high speed. Therefore the future of HRM will have to work around this and face the facts that with the lower costs for businesses and job losses HRM will have to seriously change the way operations are conducted. The question is where do they start making changes. Perhaps an Internet based solution could be planed and trailed, but part of HRM is face-to-face communication with employees, which is also something else that will need to be considered when bringing in any changes. Home and work integration is already starting with 0.7% of the population in 1996 working from home (Appendix 2a), this figure is practically unchanged from 1996 with the 2000 figure being the same. But in 2001 there are some significant findings, the figure not being vastly different from the above but, as the Office of National Statistics states (Appendix 2b), â€Å"Homeworking is most common among women, but among men it is the associate professional and technical occupations where homeworking is most common.† Office of National Statistics (Online) This means if technology keeps progressing like it is today, more and more people will work from home. As most men that are homeworking have professional and technical occupations, the growth of technology keeps the doors firmly opened for men to easily work from home (Appendix 2b). The impact on HRM is huge, it will have to keep up with this and find a way to be able to carry on functioning. But with homeworkers, if they are located all around the country, communication is hard. HRM may have to become like door-to-door salesman, having HRM representatives knocking on employees door for a review. Some organisations are already predicting this in the future and have taken certain measures to try and either delay or combat the problem. For example Google, ironically an Internet based company, keep their workers on-site and have brought in excellent benefits for employees, a few examples being a free gourmet lunch five days a week and a doctor, dentist and massage therapists on-site (Google job opportunities, 2004) In the past employers have been thinking of schemes to try and boost the company and its profits, but before long schemes will have to be brought in to retain and motivate employees. Employees are the way of the future whether they work from home or stay on-site. On-site workers will need an incentive to stay on-site and home workers will need support with the issues that arise from homeworking such as motivation, friendship and fulfilment. Has Google set the trend for the future? There are other issues that have to be considered such as outsourcing, planning, and future attitudes. Outsourcing, according to Deloitte Research (Appendix 3), by 2008 will have two million financial service jobs moved to India, as it is cheaper for companies to locate there. If other companies follow the trend that financial services has started, lower paid jobs may become reduced to a minimum in the UK leaving unemployment at an all time high. HRM will be cut in this case and only used in the higher paid jobs. Another alternative for HRM is being told by employers to still look after branches in India. How will this be achieved? Perhaps Video Conferencing or relocation for many workers is an option. If more people are having to think about highly paid jobs in the future, things such as friends and family may have to become very planned out for people. The society we live in may become false with everyone focused on getting a job leaving things in our lives, such as finding friends, being all about getting into a certain job. HRM employees will have to be very careful; they may find they are finding many new friends that are very interested in where they work. HRM will have to become a very tight profession to go into, everything being planned to the fine detail, even perhaps who your friends can or cannot be. Future Attitudes will pave out a lot of what the future will be like. Some jobs may become redundant if no one in the future wants to do it. What will happen when young workers cannot get onto the house ladder? Many people now work to support their family and cannot afford to leave a job, will workers of the future feel the same, if they have no house and no young family, what will attitudes be like? How will the HRM department stop young workers from leaving and moving from job to job? How will HRM try and get employees to have company loyalty. These are issues to be addressed for the future if social attitudes hit an all time low. The effect of these changes on traditional HRM functions If people will be working from home the whole recruitment and selection process will have to change. Perhaps a home visit interview will have to be deliberated by companies to find the correct candidates. How will training be issued and measured? Possibly by post, email or web site even. Will HRM representative have to go to employee’s houses to deliver a training package? HRM will have to investigate what would be the most effective measure. How can HRM deliver motivation to a self-motivated homeworker? There is no way possible that HRM can motivate homeworkers when they work at home on their own all day. A homeworker just have to motivate themselves, but HRM can think of social activities designed to get homeworkers out of the house and perhaps targets that they get rewards for. Personal issues and employee welfare will be the hardest thing to monitor. If the HRM department are not getting to know employees through the work place, they do not know what this person is like which makes it harder to get to know them let alone assess their needs. Conclusion HRM will face many problems of how they are going to plan and organise people in the company, facing difficulties of how and where people are working and monitoring this. As HRM is also responsible for employee well-being, but without being in a specific work place more issues of motivation, friendship, respect and fulfilment will have to be addressed and dealt with in a specific manner. If the predictions come true HRM will be under a lot of stress to completely change over the next few years. The operations they undertake from day to day will have to be managed in such a way it incorporates every eventuality.

Malunggay as an effective cooking oil Essay

Commercial cooking oil is an enormous need of people nowadays. These days, cooking oil is becoming expensive. Commoners, or people with insufficient finance, can no longer afford this necessity. Instead, they opt for oil with lesser quality simply because it’s cheaper. It’s very ghastly to do this because for one; your health could be affected, two; you could harbour diseases, and three; on the worst case scenario, it could lead to your death. To think that they would go to extreme lengths, such as that, just to provide oil. Going back to the topic prior to this, we think that although it may be costly, most cooking oils are of unsatisfactory standards especially in our nutrition. With that said, we all share the idea of wanting to solve this problem. We conducted a research about the effectivity of Moringa Olefeira, also known as â€Å"Malunggay†, when used as an ingredient for cooking oil. We chose Moringa Olefeira for a reason; gram for gram, â€Å"Malunggay† leaves contain: seven times the vitamin C in oranges, four times the Calcium in milk, four times the vitamin A in carrots, two times and the protein in milk and three times the Potassium in bananas. Using this so called â€Å"Wonder Vegetable† (according to the elderly), we could create a product that can be healthy and useful, and at the same time be sold in a reasonable price. Our main goal is aimed at the welfare of everyone. We hope that this experiment can be of great help to anyone who uses it. We gathered the data of this study from various references. We owe a massive and part of this study to literature and the internet; without them we wouldn’t have anything, even a problem, to begin with. 3 Statement of the Problem. Main Problem Can malunggay (Moringa Oleifera) leave extract be a potential material for formulating cheaper yet healthier commercial cooking oil? Specific Questions 1. At which concentration of malunggay (Moringa Oleifera) leaves extract will it be able to cook food? a. 10 mg/ml b. 20 mg/ml c. 25 mg/ml 2. How effective will it be on cooking safe and edible food? It can be inferred in terms of: a. Period or time of cooking b. Taste of the food cooked c. Nutrition facts or nutrients contained by the food 4. Significance of the Study People living in the community. The study will help the people in the community to manufacture useful cooking oil that can be alternatively used to cook food – which is a basic commodity. Malunggay is very common to the community so people can easily grow them and prepare it for extraction. In addition, unlike the commercial cooking oil we use, it is healthy and contains the nutrients of malunggay. The researchers. The researchers will benefit from the study because in would fulfil our curiosity. It will also encourage us to find other alternatives from malunggay -which is very abundant in our country- that can help us in our everyday lives. Environment. The environment profit from the study in the fact that cooking oil that is already used by people will just be thrown away in the streams and it will cause water pollution. Not like with the cooking oil made from malunggay, its chemical components can be easily dissolved in water. Manufacturers of commercial cooking oil. This study would help big companies as it lessen the production cost of cooking oil because it only uses malunggay. 5 Scopes and Limitations of the Study The study aims to produce budget-friendly and nutritious oil that can be used by people to cook their own food. In able to do this study, researchers must first collect Malunggay (Moringa Oleifera) around the community and prepare it for extraction in the laboratory or do it at home. After the extraction process, series of test must be done to prove and justify the effectivity of the product. It must cook food using stoves at normal cooking temperature that are normally used by households and the food must contain healthy nutrients that must be good to our body. This experiment also has its fair share of restrictions. And one of those restraints is when the researcher doesn’t have sufficient materials to create the said product, especially if they don’t have the main ingredient or, in this case, the malunggay. The person would have to plant or buy these materials, thus spending much time and cash. Speaking about money, another problem may occur if the researcher has a weak budget. An extra problem is if the researcher does not have enough knowledge to create and research about the problem. Another limitation of the study is when the researcher doesn’t have a place to create the product or when his surrounding isn’t fit for the making of the substance. The researcher must remember to take into account even the smallest detail of this project. The researcher must have great dedication in doing this study. He should love what he is doing and he need to make it as one of he’s passion. 6.