Factors that influence the demand for mobile phones

Factors that influence the demand for mobile phones In the current competitive economy, any entities from non profit to multinational organizations that are considered as cash cow are in high demand for economic knowledge to survive. Economic system is the system by which the economy is organized. In this paper we are going to discuss about different types of economic systems, their variety, advantages and disadvantages. Function of price in market economy A market economy or free market economy is an economy in which the allocation for resources is determined only by their supply and the demand for them (J.Stanely Johnson, Introduction to economic analysis P1-1).In Market economy The price of goods plays a crucial role in determining an efficient distribution of resources .Price acts as a signal for shortages and surpluses which help firms respond to changing market conditions. In a market economy Price is determined by demand and supply, for example when there is a low price for a good it means the demand is low. However in market economy price for abundant goods never gets high to a critical point due to the fact of consumer sovereignty environment which consumers are the rulers for suppliers. Figure: 01(Demand chart). Describes the demand relationship with quantity and Price Source: http://bit.ly/1LhnYp As it is observed in figure 01; P1and Q1 interception determines a good with high demand and low quantity so the price is at the highest peak. In opposite side of the Demand law there is supply law. Figure: 02(supplys chart) describes the supply relation with price and quantity Source: http://bit.ly/1LhnYp As it is shown in supplys chart when the price is high for a product, supply will increase accordingly. And on the other hand equilibrium or balance will happen. As bellow Figure: 03(equilibrium chart) describes How supply, demand, price and quantity are stable Source: http://bit.ly/1LhnYp Figure 03, determines how supply is dictated by price. Role of other factors like excess demand and excess supply are not declinable in determining the price in a market economy but is out of this papers capacity. Market economy Vs command market Command economy is an economy system that all economic activity is regulated by the government, formerly in China and the Soviet Union are two appropriate examples for such economic system. There are two opposite approaches to an economys operation.   The command economy is Hierarchy from top to down, and centrally planned economy of socialism (Roberts, Paul Craig and Karen Lafollette, Melt down: Inside the soviet economy, Cato institute ,PP12-13)   The market economy is the divided economy of the market economy.   The most tangible difference between the two is the existence of private property in the market economy and the absence of private property in the command economy. The belief about command economy is that it is planned and organized while market economy is unplanned.  Contradiction to this view is the fact that market economy is very intelligently planned via consumer demand through the price system. Moreover, for five reasons the command economy is doomed. First, effort to plan an entire economy by a main decision making body is ineffective as the bulk of task is tremendous.  That is impossible that a board of few hundred planners could know the needs, conditions of resource availability, and localized knowledge spread throughout an economy. Second, the command economy motivation factor eventually is based on force and compulsion.  The main element in an economic system is in fact people; therefore controlling an economy is first and foremost control of people.  Unfortunately human motivation is reduced when force is used in any area which dooms that entity to end. Third, the command economy is based on collectivism which means collective control over production and distribution.   Individual encouraging is absent. For example, with ten employees in an economy each will receive one out of tenth of total output.   If one person neglects, his loss is only one of tenth of the production he would have produced.  So the loss for an entity with a population of millions is dramatic and sometimes irreversible .It turns out that everyone is trying to live at the expense of others and accordingly production efficiency and effectiveness both will reduce. Four, the incentive for production is to satisfy the political authorities who have control over the workers life.   In contrast to the market, where production is relied on consumers demand, consumer is not a vital factor to the command economy. And last but not least, economic risks are much likely to be higher in command market in compare with market economy, failures such as excess demand and excess supply are more likely to be less or at least are not as intense as command market as consumers demand plays a vital role in market economy and is more manageable. Command economy has advantages as well such as bellow Government removes all private contributors and tries to contribute products equally. In this way poverty level will be reduced and there is equal income. Social services are also emphasized in this type of economy. Command economy has capability of fast changes in major problems. For example if a company has to be shifted it will be fast as government has the whole power. Practically bankruptcy does not exist under the command of government and if there is a loss in any enterprise it will be compensated by other resources that are under command of government. For example if any entity has loss and is in need of cash government is responsible for cash injection. In overall every economy system has its own advantage and disadvantages, the current economy paces are toward capitalism which might be the answer to all of prayers. Even though there is no pure market economy systems used in the world and are most considered as mixed economy but still changes are toward capitalism and countries with the background of command economy have taught us that consumer demand is most important factor in economy which its ignorance causes the failure of the whole system. Source: http://alturl.com/37gwd Factors that influence the demand for mobile phones Mobile phone markets are one of the most turbulent market environments today, due to increased competition and change. So it is important to look at consumers decision process and recognize the factors that determine the consumers choice between various brands of mobile phones. Factors that influence the demand for mobile phones are vary; we try to cover some of the most important. Technology: twenty century is the communication century, every day new phones by new features are produced, when there is a new technology or feature is added to mobile phones it will increase the demand, as an example for technology, when a technology like Bluetooth started to be added to new phones, demand for the phones with this technology increased, or for new feature like camera the demand increased. Nowadays mobile phone companies are using societal marketing concept as their marketing plans, which means they focus on consumer needs, while some companies like apple go even further than this concept and determine new needs for customers by invention and technology. They create something in a manner that goes higher than demand and become a need which is described as state of felt deprivation. While demand is described as human wants based on their purchasing power. Environment, as the world is leading to globalization, environment plays a critical role in determining the demand, as long as a person is in an environment that is affected by a product he/she will get affected by that product, for example resistance to change is much lesser in an environment that is commonly agree on the demand of a product. Usage of Price elasticity of demand and income elasticity of demand in phone companies Price elasticity of demand is measured by the responsiveness (or sensitivity) of consumers to a price change, according to Campbell McConnell and Stanley Brue (2004, p.356). The price elasticity of demand tool could be used to assess the several pricing plan to determine if the price should be reduced to attract more consumers, or to increase the price while making the product more attractive and more features to make it better bargain. This way also they can realize how elastic is their supplies. It also could dictate that different phones have different potential in elasticity, for example Nokia company Produces N series and E series, then company realizes the E series are highly elastic while N series are more likely to be inelastic in compare with the E series, so Company increase the production of N series while the price is stable, and lowers the production of E series in order to prevent the risk of excess supply. Income elasticity of demand isthe ratio of proportional increase in quantity demanded to proportional increase in income, with all prices held constant. A luxury is a good with an income elasticity of demand in excess of unity.  [1]   According to income elasticity of demand companies can estimate the future prices and production. As income elasticity is more likely to be effective in luxury goods companies can determine also the quality of the goods. As the world economy faced the recession and has just getting out of trough phase is recovering itself which means that in future we will face the peak or economy boom, it is when consumers purchasing power increases and are more likely to intend toward quality rather than quantity. That is when Income elasticity of demand tool could help the companies to determine whether they could increase the quality and/or price and/or quantity accordingly. For example Sony Ericson realizes that demand toward its expensive product is increasing opposed to its highly affordable cell phones. This determines that economy now has the potential for a higher demand especially on expensive products. Conclusion In overall doctrine of elasticity in economy helps supplier to understand, interact and connect to consumer. It helps you to have a communion with economic and its factors, also has an important role in planning and even marketing in an organization. A Company Like AirAsia that in the trough of recession Was The only airline that had a 271% ahead of pre tax level profit in the first quarter of 2004 (Fourth quarter repot 2005, Airasia  [2]  ), While all of the other companies only suffering from loss. Such companies like AirAsia have won their ticket by futuristic and planning using doctrine of elasticity analysis. It shows no company no matter how big needs to have planning and analyze in all its area and aspects.

Introduction to Psychological Counselling Essay

What is Required in Reflective Writing? Why Reflect? ‘It is not sufficient simply to have an experience in order to learn.Without reflecting upon this experience it may quickly be forgotten, or its learning potential lost. It is from the feelings and thoughts emerging from this reflection that generalisations or concepts can be generated. And it is generalisations that allow new situations to be tackled effectively.’ (Gibbs 1988) Reflective writing provides an opportunity for you to gain further insights from your work through deeper reflection on your experiences, and through further consideration of other  perspectives from people and theory. Through reflection we can we can deepen the learning from work. The Nature and Content of Reflection †¢ So what do we mean by reflection? One tentative definition of reflection is offered by Moon (1999): ‘†¦ a form of mental processing with a purpose and/or anticipated outcome that is applied to relatively complex or unstructured ideas for which there is not an obvious solution’. (Moon 1999:23) †¢ Moon continues by outlining some of the purposes for reflection: †¢Ã¢â‚¬ËœWe reflect in order to: – Consider the process of our own learning – a process of metacognition – Critically review something – our own behaviour, that of others or the product of behaviour (e.g. an essay, book, painting etc.) – Build theory from observations: we draw theory from generalisations – sometimes in practical situations, sometimes in thoughts or a mixture of the two – Engage in personal or self development – Make decisions or resolve uncertainty †¦ – Empower or emancipate ourselves as individuals (and then it is close to self-development) or to empower/emancipate ourselves within the context of our social groups.’ (Ibid pp23) †¢In this instance, whilst your reflective writing must relate to your experience, the exact focus and emphasis is for you to determine. Deepening Reflection – Three Models of reflection †¢ When assessing your reflective writing you will be expected more than a superficial review of your experience, they will be seeking evidence of deeper reflection. This means moving beyond the  descriptive, and subjecting your experience to greater scrutiny. In Learning by Doing, Gibbs (1988) outlines the stages for a ‘Structured Debriefing’, which are based on Kolb’s (1984) Experiential Learning Cycle and which encourage deeper reflection: Continued †¦.. Deepening Reflection – Three Models of reflection Description: What is the stimulant for reflection? ( incident, event, theoretical idea ) What are you going to reflect on? Feelings: What were your reactions and feelings? Evaluation: What was good and bad about the experience? Make value judgements. Analysis: What sense can you make of the situation? Bring in ideas from outside the experience to help you. What was really going on? Conclusions (general): What can be concluded, in a general sense, from these experiences and the analyses you have undertaken? Conclusions (specific): What can be concluded about your own specific, unique, personal situation or ways of working? Personal Action plans: What are you going to do differently in this type of situation next time? What steps are you going to take on the basis of what you have learnt? On being Reflective †¢ Starting point We need to acknowledge our role as theory builders Have a clear method for making sense of our experience Develop a range of theoretical perspectives Participate in learning opportunities to practice, theorise  and evaluate their work. The Method: Kolb’s (1984) Experimental Learning Cycle Experiencing feeling Observation & Reflection Watching & thinking Testing & Applying planning and doing Analysing & Conceptualising Theory building On being Reflective †¢ Reflection is the ability to think about the things we have experienced in a systematic way †¢ Evaluate those experiences and learn from them †¢ Reflective practice is where you as the youth, social or health work practitioner take a step back in order to review and analyse how well the work is progressing and how effective you are working. †¢ It has two components: 1. Reflection -in- action; you are reviewing as you are working with a group of young people. 2. Reflection-on-action; you review after the event. †¢ A commitment to ongoing reflection is necessary if you want to improve and learn as practitioners. Integrating Theory and Practice Key Stage Reflection involves asking a series of  questions about your work and the ways  in which you are approaching it. Key questions †¢ What were you aiming to achieve? †¢ What body of knowledge informed your  work? †¢ What skills did you use to work? †¢ For example group work skills, my role as  a Student, my learning style †¢ Interpersonal skills: listening and  responding. The use of open and close  questions. †¢ The skills of providing information †¢ The skills of making suggestions or command (prescriptive intervention) †¢ Challenge and confronting skills †¢ Being a catalyst †¢ Exploring feelings †¢ Providing support Models of reflection Hatton and Smith ( 1995) identified four levels in the development of teacher reflection from teaching practice. In your reflective writing your tutor  will be looking for evidence of reflecting at the higher levels. Descriptive writing: This is a description of events or literature reports. There is no discussion beyond description. The writing is considered not to show evidence of reflection Descriptive reflective: There is basically description of events, but shows some evidence of deeper consideration in relatively descriptive language. There is no real evidence of the notion of alternative viewpoints in use. Dialogic reflection: This writing suggests there is a ‘stepping back’ from the events and actions which leads to different level of discourse. There is a sense of ‘mulling about’, discourse with self and an exploration of the role of self in events and actions. There is consideration of the qualities of judgements and possible alternatives for explaining and hypothesising. The reflection is analytical or integrative, linking factors and perspectives. Critical reflection: This form of reflection, in addition, shows evidence that the learner is aware that actions and events may be ‘located within and explicable by multiple perspectives, but are located in and influenced by multiple and socio– political contexts’ Bloom (1964) identified different levels of thinking processes, which he presented in a hierarchy; these can also be used as a framework for more thorough reflection. They move from knowing, evidenced through recalling information, through to evaluating, evidenced through making systematic judgements of value. In your reflective writing your tutor will be looking for evidence of these higher level processes. Process Increasing Process Knowledge Recognition and recall of information – describing  events Comprehension Interprets, translates or summarises given information demonstrating understanding of events. Application Uses information in a situation different from original learning context – Analysis Separates wholes into parts until relationships are clear – breaks down experiences Synthesis Combines elements to form new entity from the original  one – draws on experience and other evidence to  suggest new insights Evaluation Involves acts of decision making, or judging based on  criteria or rationale – makes judgements about Difficulty Possible sources of evidence for reflective Other things I know Personal aspirations Experiential learning theory Me as a learner SELF Organisational review COURSE WORK Work-based issues Work-based learning PERSONAL REFLECTION YOUR LEARNING PLACE Application of other  modules / learning  to these ideas Application to other modules / learning Guidelines for completing the Reflective Journal/ Dairy Studies have shown that rreflection upon one’s learning is key to a full learning experience. For this reason, you will be required to keep reflective journals as part of your professional development. There are two different Reflective Journal templates. Learning Reflection – to be completed after attendance of each one day of workshop Technology Reflection – to be competed after using the technology in your work practises. Participants are required to integrate at least two new skills into their work practises after each one day of workshop attendance. How long will it take? – As a rough guide, each journal entry should take approximately 20-30 minutes. Feel free to add comments but the minimum requirements are included in the template. What should I write? – What you learn today †¦. Confidentiality – All information completed in journals is confidential. Learning Journal †¢ Reflect for a few minutes on today lesson and write your sample reflection on Reflective Journal Template. †¢ Don’t forget writing your learning journal each week after lesson. Next – Week 7 Session Introduction to Counselling Skills References †¢ Gibbs, G. Rust, C. Jenkins, A. Jaques, D. 1994, Developing Students’ Transferable Skills. Oxford Centre for Staff Development. †¢ Kolb, D. 1984, Experiential Learning: Experience as the Source of Learning and Development, Prentice Hall, New Jersey †¢ Moon, J, 1999, Learning Journals: A Handbook for Academics, Students and Professional Development. Kogan Page †¢ Wright, Jeannie and Bolton, Gillie (2012) Reflective Writing in Counselling and Psychotherapy (London: SAGE)

Kate Chopin’s Story Of An Hour And The Storm Essay

Author Kate Chopin has expressed feminine freedom in two of her short stories: â€Å"The Storm† and â€Å"Story of an Hour†. She was the breakthrough author for female independence and human sexuality. Through these two short stories, Chopin describes the lives of two women who discover their freedom in times where society does not accept women as equal to men. â€Å"The Storm† relates love and marriage as a prevention for free full blown passion. â€Å"Story of an Hour† relates love and marriage to unhappiness and repression. â€Å"The Storm† holds a very symbolic meaning for passion. It affirms feminine sexuality through Calixta and Alcee’s relationship. Despite Calixta’s marriage to Bobinot, she proceeds with her unacceptable behavior in society with Alcee and commits adultery. Her newfound passion determines the importance of passion in 1890s where many women felt they were bound. Many parts in the story foreshadow Calixta and Alcee’s sexual encounter. The storm itself was describing their progressing passion with the encounter of a lightening bolt and thunder: â€Å"Calixta put her hands to her eyes, and with a cry, staggered backward. Alcee’s arm encircled her, and for an instance he drew her close and spasmodically to him.† The increasing power of the storm represents the increasing passion between the two lovers. This short story puts aside the constraints of society and marriage, and opens a door for feminine sexuality. The same sense of freedom that Chopin expressed in â€Å"The Storm† applies to â€Å"Story of an Hour†. Main character Louise Mallard is an elderly woman who has lost her husband. She is in a state of thought when she realizes her newfound freedom. She discovers that her marriage was a bondage and hopes for a long life to enjoy this new freedom. Her marriage seemed to have cast shadows on her happiness. In this time of thought, she focuses on her own feelings and indifference to her husband Brently Mallard. Even more so Louise is affected with her heart condition. Her heart condition foreshadowed Louise’s demise. It’s purpose was to describe her as weak of heart and weak of character. She could not accept her misery and lacked honor even so to be aware of her own unhappiness. This  again expressed the oppression of women in the 1890s mentally and physically. The two stories share a sense of contradiction. Calixta is left happy and renewed after her experience. She welcomes her husband Bobinot and her son Bibi happily when they arrive home after the storm. This is where Chopin describes the first step into freedom of marriage and sexuality. â€Å"Story of an Hour† on the other hand expresses demise of a woman who was on the verge of freedom. Louise is happy too when she realizes that her marriage was preventing her from happiness. She chanted the word free to her self in realization. She is so overwhelmed with her freedom that she dies when her surviving husband appears to her. She dies of knowing that she does not have her freedom after all. Chopin expressed love as a way of freedom and oppression in her short stories. She described Calixta’s adultery a passion while Louis’s marriage an oppression. Either way, it lead to some sort of resolution into freedom. The discovery of passion in â€Å"The Storm† was so great that Alcee himself did not want to commit to his wife. In â€Å"Story of an Hour† Louise Mallard considered her marriage and love unreal and unworthy of her. She does not want to be under the will of another person Women of Chopin’s time felt these fictionous stories, but were undermined of society. Love, passion, and marriage work together in â€Å"The Storm† and â€Å"Story of an Hour† to bring an idea to the reader of how relationships were in the 1890s. Love and marriage fall to passion in Chopin’s stories.

How Long Can Northern Telecom Limited Survive Finance Essay - Free Essay Example

Sample details Pages: 6 Words: 1892 Downloads: 9 Date added: 2017/06/26 Category Finance Essay Type Cause and effect essay Did you like this example? Nortel Networks is a telecommunication equipment manufacturer. Its corporate life in 1895, Nortel produce the traditional phone in Canada, as few years after Alexander Graham Bell invented the telephone. Originally part of the Bell Telephone, it morphed into Northern Telecom and finally Nortel. Figure 1: The telephone that born in Canada, 1894 Don’t waste time! Our writers will create an original "How Long Can Northern Telecom Limited Survive Finance Essay" essay for you Create order Major changes began at Nortel in 1997 as John Roth was elected to be the new CEO. He figured out that the market of telecommunication is shifting from voice to the internet. One of their great inventions is the frame-relay network equipment that has been used all over the world. In Malaysia, Telekom Malaysia has using the equipment for more than 10 years. It also was being used by the multinational companies, banks and insurance firm. But what happen now, most of the equipments are already at the end of life, and many firm have been migrated to other networking technologies. Nortel equipments are not compatible with the new technologies. Because of that, many carriers are using the other equipment produced by the competitors and Nortels sales are decreasing. Unlike other companies, notably airlines, that have used bankruptcy protection to renew their businesses, Nortel, which began this decade as one of the worlds largest makers of telecommunications equipment, is probably headed for liquidation, several analysts said. I dont think its going to exist, said Mark Sue, an analyst with RBC Capital Markets, a unit of theÂÂ  Royal Bank of Canada. Incident that happens to Nortel would be one of the biggest failures in the telecommunication industry. Nortel had produced much of the fibre optic equipment that now carries most of the Internets data during 1990s. Nortels misery went beyond finances. In the market for interworking devices,ÂÂ  JuniperÂÂ  and others proved to be more innovative and can perform better. Nortel have to file for court protection just a day before the due to make the debt payment for about US$107 millions. By doing so, it give the company more chance to look for the restructuring options or sell off their assets. Nortel said in a release that it had been in the process of a turnaround since late 2005, but the global financial crisis and recession have compounded Nortels financial challenges and directly impacted its ability to complete the transformation. Nortel must be put on a sound financial footing once and for all, the president and chief executive, Mike S. Zafirovski, said in a statement. These actions are imperative so that Nortel can build on its core strengths and become the highly focused and financially sound leader in the communications industry. Tragedies that happen to Nortel make their customers queries about the continuity of support from the company. Nortels competitors try to exploit that uneasiness by offering Nortel customers attractive deals to the alternative equipments. It is also unclear if Nortel will be able to sell any of its operating units to raise cash for a corporate revival. Nortels US$4.5 billion in debt is largely from the result of an acquisition spree by the company during the 1990s. The government of Canada offered Nortel some support. Export Development Canada, a government-owned bank and insurer, has agreed to provide the company with up to US$30 million in loans for the next 30 days. Currently, Nortel is obtaining further extension of stay under the Companies Creditors Arrangement Act. The stay of proceeding was granted by the Canadian Court for further extend to October 29, 2010. The reason of doing that is to provide stability to the company to continue with their divestiture and other restructuring efforts. . INTERNET BUBBLE The internet bubble or sometimes called IT bubble was aÂÂ  provisional bubbleÂÂ  happening between 1995 and 2000, with a climax on March 10, 2000 (refer to Figure 1). During that time, stock marketsÂÂ  in industrialized nations saw their equity value rise rapidly from growth in the more recentÂÂ  Internet sectorÂÂ  and related IT fields. Figure 1: The technology-heavy NASDAQ Composite index peaked at 5,048 in March 2000, reflecting the internet bubble In order to be aggressive in market, Nortel made big investment in high-speed fibre optic system in 1993 and leading the industry. In the late 1990s, Nortel grew for about 100% per annum. The company wanted to dictate the rising market for networking. This had to be done by trying to renovate the old technology to a modern Internet Protocol technology based firm, but those skills were beyond the Nortels expertise. Nortel pay an enormous price for acquiring Bay Networks in 1998 to obtain these skills. It also bought Alteon Websystems for US$7 billion, even though the firm had revenue for only US$200 million; the price must be regarded as expensive. As the internet uprising created substantial growth in fibre optic equipment, Nortel grew rapidly and so did its stock. At its height, Nortel accounted for more than a third of the total valuation of all the companies listed on Toronto Stock Exchange. It has expanded rapidly and entered the new markets. Thought the company paid a huge price for these acquisitions, it failed miserably in integrating them and transforming its business into IP routing. As a large and old firm, Nortel never really embraced the IP shift in the marketplace and then the market bubble burst in 2000 and 2001. The recession was particularly hard on companies like Nortel, which had paid excessive prices for firms which were never really absorbed. Nortel had paid US$2.1 billion for Clarify Inc. in 1999, but this firm was sold in 2001 for only US$200 million. In the bubble years, Nortel had about 95,000 employees, but 60,000 of them being fired due to its financial crisis. Figure 2: Nortel performance LIQUIDATION Nortel was the first giant in the technology industry that facing bankruptcy issue during this global downturn. On January 14, 2009, Nortel filed for protection from creditors, in the United States underÂÂ  Chapter 11 of the United States Bankruptcy Code, in Canada under theÂÂ  Companies Creditors Arrangement Act, and in the United Kingdom under theÂÂ  Insolvency Act 1986. Nortel had an interest payment of $107 million due the next day, approximately 4.6% of its cash reserves of approximately $2.3 billion. The share price for Nortel fell more than 79% on theÂÂ  Toronto Stock Exchange after the announcement. A government agency in Canada, EDC had agreed to provide up to C$30 million in short-term financing through an existing bonding facility, however the Canadian government resisted characterizing its position on Nortel as a bailout. Nortel initially hoped to re-emerge from bankruptcy, so that it paid out retention bonuses to almost 1,000 of their top executives, totalling up to US$45 million, drawing criticism as the company withheld severance payments to employees laid-off prior to the creditor protection filing. TheÂÂ  worsening recession and drop in stock marketsÂÂ  deterring potential companies from bidding for Nortels assets, and many of Nortels major customers reconsidering their relationships with the restructuring company. In June, 2009 Nortel announced that it no longer planned to emerge from bankruptcy protection, and would seek buyers for all of its business units. After announcing it planned to sell off all of its assets, Nortel shares were delisted from theÂÂ  Toronto Stock ExchangeÂÂ  on June 26, 2009 at a price of US$0.185 per share, down from its high in 2000 when it comprised a third of the SP/TSX composite index.ÂÂ   Nortel handed out US$14.2 million in cash compensation to seven executives in 2009. Nortel also paid out US$1.4 million to 10 former and current directors, and paid US$140 million to lawyers, pension, human resources and financial experts helping to oversee the companys bankruptcy proceedings. In February 2010, Ernst Young, the court-appointed monitor of Nortels Canadian bankruptcy proceedings, reported that the assets of Nortels Health and Welfare Trust had a shortfall of US$37 million in its net assets as of December 31, 2008. The trust supports pensioners medical, dental and life insurance benefits, as well as income support for some groups such as long-term disability recipients. CRITISM CONTROVERSY In 2003 Nortel have paid US$10 million in so-called return to profitability bonuses, largely to the selected group of their top management. The return to profitability was a fabrication that achieved by the release of US$490 million in reserves to boost earnings. There was criticism to Nortel since the company suspended the unemployment payment to employees laid-off prior to the creditor protection filing. When Nortel entered protection from creditors proceedings in 2009, it paid out the retention bonuses to almost 1,000 top executives, totalling up to US$45 million. The company also make additional thousands of lay-off without severance, and the pension fund remained underfunded, but it can pay US$14.2 million in cash to seven executives. Nortel also paid $1.4 million to ten former and current directors, and paid $140 million to lawyers, pension, human resources and financial experts helping to oversee the companys bankruptcy proceedings. Figure 3: Nortel pensioner line up for an information session Nortel proposed to spend US$92.3 million on retention bonuses for 1,475 employees in its Nortel Business Services and Corporate groups, in the United States court filing on February 11, 2010. Christopher Ricaurte, the president of Nortel Business Services, will receive US$2.5 million in incentives according to the plan. In all, Canadian employees are eligible for US$27 million, United States employees getting US$55 million, and about US$10 million will go to others. This proposed plan came the same week Nortel negotiated a US$57 million deal to wind up health care and other benefits for former Canadian employees. Claiming that the retention bonuses proposal is extraordinary, acting US trustee, Roberta DeAngelis, objected to the payment of US$555.6 million to 866 employees. However, court appointed representatives for Nortel former employees, who are creditors in the Ontario bankruptcy court, haveÂÂ  signed an agreementÂÂ  to not oppose any employee incentive program. The U.S. Securities and Exchange Commission (SEC) and the Ontario Securities Commission (OSC) have announced the legal proceedings against Frunk Dunn, the former CEO of Nortel and three other former senior executives in March 2007. The SEC accused the four of civil fraud relating to Nortels accounting and its restatements. While, the OSC alleged that Dunn and two others broke securities laws by making material misstatements. CONCLUSION As we entered the new millennium, corporate distress and bankruptcy were no longer a niche area of corporate evolution. Indeed the bankruptcy rate of U.S. corporations reached record proportions in 2001/2002, with as many as 77 large corporation filing for protection under Chapter 11 of the bankruptcy code with liabilities more than US$1 billion. Telecommunication firms lead the way, followed by the airlines, steel companies and so on. Bad financial management is one of the Nortels problem, but the root cause to the bankruptcy is Nortel not succeed to evolve with their customers changing needs. Nortel was actually very good at develop and anticipating industry change from 1970s to 1990s, but it failed to address the single dominant change after that. The commoditization of technology brought on by the Internet Protocol technology and the appearance of Chinese competitor like Huawei worsen the problem. Telecommunication operators are looking for the cheaper equipment, so that they can compete with others. There are many telecommunication suppliers nowadays and each company has the business strategy to survive in the industry. All of them have the distinctive business strategy to ensure their continued existence. But, Nortel is at the other side as it cannot cope with what the market need. Current demands for the telecommunication equipment are the one that hi-tech and reliable. However, the price usually becomes the first priority in the selection.