Impact of the Internet on Investment Privacy

Executive Summary

There is no form of information communication that can be completely guaranteed to be private, and the embarrassing wikileaks and the Hillary Clinton saga unearthed the vulnerability of private interactions over the internet. However, the big debate over privacy through the internet is concerned with the big data where large marketing companies can use private information of individuals in the internet for their own gains.

In this age of Facebook, Twitter, and other popular social sites, companies and the public have to extra aware than ever of the ethical snare that they get caught in by using the internet and its forms.

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In business, it is normally assumed that both product differentiation and value addition plays a significant function in competitive advantages of the product. The goal of any venture particular amongst companies that produce closely related products (substitutes), in theory, must align themselves with added value and product differentiation so as to achieve competitive advantages. Adding value to a product superficial meaning refers to the situation where a product(s) have advantages attached to them while product differentiation refers to the effort by a company to separate (sic) its products from those of close competitors.

Product differentiation is the situation whereby two or more products are considered by consumers as being close, but not perfect substitutes (George, Joll & Lynk, 2000: 215). This proposal shall seek to determine the dynamics of value added amongst oil marketers in the UK within the downstream market, and shall focus on a select number of marketers as well as their products. In recent years, competition has increasingly been stiff in the United Kingdom on oil marketers amid growing oil barrel prices as well as the unpredictable movements of the sterling pound. In this research proposal, the researcher attempts to study added value and product differentiation as they are key to not only customer service, but also in general business strategy.

However, the major aim of this research study will be to develop an understanding on the manner in which firms become competitive and sustainable from product differentiation and value addition. Further the objectives of the research shall be; to learn to significance of differentiation amongst oil marketers, to evaluate the impact of differentiation and value addition on consumers and to investigate consumer feelings on value addition and product differentiation.

Value Addition

Value addition and product differentiation is awash with varying number of literature items written and studied on them, particularly in business and in economics. It is always important to establish a meaning to a concept before researching or studying such concepts. Often this is not followed as most writers work on a topic and later fall folly of a weak comprehension of the concept they are writing about. Leslie et al (2000) evaluated the concept of value addition, and attributed varying definitions and means to the concept widely used in literature.

Added value is a concept with varying angles of analyses, as well as, multifaceted meanings and connotation, and Barnes & Blake (2009), as being practically to consumers while other writers think that it is closer to the business, while the third group places it in the middle between business and consumers. Added value is very interactive, and it entails a relationship that exists between a consumer and a product (Barnes & Blake, 2009).

Consumers have been observed to employ value addition both before and after consumption (Velamuri, 2012). A number of factors seemly play important roles during the different stages in the consumption process of a product, and in recent years brands, consumer values, customer satisfaction and service quality have incorporated into the package of value addition (Velamuri, 2012). Value addition involves the use of innovation to enhance customer experience, and the move by customer to exchange their money for the price of the product, could be simply understood as acknowledging the value of the product.

Product differentiation offers consumers a variety of products within a specific industry instead of a monotonous product that describes purely competitive markets. Firms practice differentiation to make their products better so that customers would rather buy their products than their rivals’. When differentiation is perceived as a method to enhance products rather than just making them look different, it emerges as the driver of economic development (Cohen, 2013:54).

In contrast to the traditional applications and perceptions where differentiation creates an expense on the economy in return for more product variety, differentiation reduces costs, inspires economic development, and creates better products in reality. In the neoclassical approach, differentiation improves consumer welfare by providing consumers with a greater field to choose from. According to Cohen (2013:54), that reward is countered by the increased average cost of production for firms that are monopolistically competitive (Cohen, 2013:54).

In the neoclassical system, the only advantage of differentiation is the increased variety of products offered. Studies have shown that most scholars have accepted the rewards brought by differentiation in terms of more variety, but they have not acknowledged the role that the differentiation process plays in driving economic growth. The neoclassical theory of the firm distinguishes monopolies from competitive companies (and takes into account many variants in between), but presumes that the industry structure is exogenous, even when it is showing the rewards to firms of having a greater market power.

In contrast to this theoretical approach, real-world companies can take measures to generate market power for themselves, so that the market’s makeup is not exogenous The best competitive strategies for companies involve seeking ways to differentiate their products and give themselves some element of market power, not reducing the cost of producing one product. Thus, this is the entrepreneurial aspect of a competitive company, which is vital for it to survive, is absent from the neoclassical framework. The profit-maximising strategy described for competitive companies by neoclassical theory does not do this in the real world competitive arena.

Looking for economic profits by increasing market power is the real profit-maximising strategy. This has been accepted and acknowledged in managerial economics literature since, but differentiation as a competitive approach has not shifted into the hub of neoclassical microeconomics. Managerial economics concentrates on profit-maximising strategies for companies instead of the effects on the economy as a whole. In microeconomic literature, pure competition, which is the market model that maximises social welfare, eliminates the possibility of differentiation by assumption.

Modern economics recognises the benefits of the variety that differentiation provides, but also states that markets with differentiated products do not generate at least average overall cost, and there is a trade-off of increased costs for greater variety. Companies need to recognise the benefits of increased variety that the process offers, and use such benefits to gain advantages over their rivals, and differentiation is a vital strategy for companies in competitive industries.

While the rewards are recognised, the critical role of differentiation in the facilitation of economic development has been ignored in most literature. Differentiation is a vital competitive strategy; one that firms employ to gain a competitive advantage over their rivals. The process makes markets more, not less, competitive.

In a market with homogenous goods or services, all firms have to do to stay competitive is minimise their costs. Firms will also lose a lot of revenue and profits until they learn to use differentiation effectively and challenge their rivals However, even if they do recover ground, they will once again only be making normal profits. This is not a long-term strategy for success; it only leads a business into a cul-de-sac from which it may never emerge.

According to Raddats and Burton (2009:34), such firms will either be making normal profits when they have matched their rivals or less than that if they are still trying to gain ground. As a result, they will always be lagging behind their rivals and may not be able to stay in the industry because they lose ground every day and making progress becomes an impossible dream. In the actual world of competition, a competitive company will always be seeking ways to make its outcomes more appealing than those of other companies (Raddats and Burton, 2009:36). Differentiation helps it do this and more; it can stay ahead of its rivals and record profits.


This report proposes the use of qualitative research methods for analysis, and qualitative Research study things naturally and it attempts to interpret the meanings of information in terms of the responses. It is intended to discover the deeper extent of the subject being searched as it focuses more on interpreting the subject matter and give priority to the existing information, and one important method used in Qualitative Research Is the in-depth interviews.

A qualitative research interview seeks to describe the meanings of the central theme of the life of the subjects as it primarily focuses on the meaning of what the interviewees answer. It seeks to cover a factual level as well as a meaningful level and it is particularly useful when the researcher seeks to find the experience of the participants. In depth interviews are followed up by certain levels of questionnaires asked to the participants for any kind of further investigation purposes.

Interviews are completed by the interviewer based on what the respondent says (Snieder, 2009). It is more time consuming in nature and often carries a personal touch as the interview needs to contact the interviewees directly in a more personal manner. This method can be done by using online surveys too that follows a questionnaire to answer. In this research, unstructured interviews of focused groups are conducted to collect the data from marketing executive of oil marketing firms within the country.

Further, this report proposes the use of secondary sources of data for qualitative analysis. The secondary data shall be analysed in respect of the topic on value addition and product differentiation amongst oil marketers in the United Kingdom.

Logistical Consideration

Logistical issues that may arise in the course of data collection shall be handed through a well developed logistics plan. These issues that comprise; confidentiality, privacy, voluntariness, reduction of errors, working with the instructor to review the work, assistance by enumerators and their qualifications if any, and virtually the methods of data collection. To achieve privacy, a letter of would be sent to the would-be participant outlining the research, and an official request to participate, hence allows respondents to consider the research before hand before the date with the researcher.

To ensure confidentiality of the research process from the respondents their names, addresses and other personal information shall not be included in either audio, text or video materials that will be used in data collection. Informed consent demands that when seeking data from the respondents it is imperative that the researcher discloses information to the potential respondents, ensuring that the pieces of information is understood, and they take part in the process voluntarily.

Errors can occur during data collection when the instrument of choice ends up misrepresenting the information collected, and this shall be abridged through the use of backup instrument such as the tape recorder. To ensure that the research work is moving in the right direction, the researcher will regularly seek the auspices of the instructor for additional guidance. The researcher will coordinate with other people to assist in performing functions which include collection of primary data and transcription of information in the backup audio file to text.


At the end of the process, the research shall help in the understanding of the twin concepts of added value and product differentiation. A deeper knowledge of product differentiation within the oil marketing downstream industry shall be expected to be horned as well. An academic argument versus the empirical evidence on the real significance of both value added and product differentiation.

Today the world is more globally connected than any other period thanks to the internet. The benefits of reaching other people for different purposes cannot be ignored, and as the world gets more intricately connected through technology, so does effort by persons to reconnect. In essence, internet a pointer to communication is important for people from diverse backgrounds to participate in different discourses. Privacy is vital for numerous reasons. In some quarters, the consequences of not embracing privacy can be a big concern. People can be destroyed or spoiled when there are no restrictions on access and use of personal information (Whitehouse, 2010).

Other reasons are more essential, and touch on the core of an individual’s personhood. Respect for the individual as an end in itself and as an independent person demands respect for personal privacy. For one to lose control of own personal information to some degree implies a loss of dignity. Good information is vital for making good decisions, and more information is preferred to less.

However, at times the same information can be misused or used to attain malicious objectives. Information privacy is critical in safeguarding against abuses over the internet. Privacy is also need by internet users and it facilitates social interchange. Moreover, it is a prerequisite for the formation of relationships. The extent of intimacy in relationships is related to the level of revealed personal information.

The Ethical Divide

The divide between what is right and what is wrong can rarely be expressed in black and white, and when it comes to important ethical issues around internet privacy from government surveillance to social media privacy, different people have their own opinions, however much like other things, there are two sides to the story.

Perhaps the most obvious ethical issue that is related to internet privacy is the usage o spyware and other malicious applications to obtain private information. In most of the developed world, many cyber crimes are illegal, which shows a common perception that the activity is wrong. In Australia, there are numerous laws that have been enacted to control unfair practices over the internet.

However the threats to privacy over the internet do not originate from cyber criminals, individuals also unintentionally provide personal data on daily basis to online service providers. In such a case, personal data is not being stolen from the users, but numerous concerns have been raised on the manner in which the data is used. For companies in the mold of Google or Facebook, holding the personal data of billions of users has led to expectations from the users that the organisations should use such information in a fair way and protect their privacy.

Concerns have been raised on companies such as Google sharing or private information with third party websites and application that is often used for data mining. Moreover, confusing privacy settings that blocks many users from being able to take charge own privacy in an effective way.

 Big Data

According to (EPIC , 2016), Google has more than a mind boggling one million petabytes in size and process more than twenty four petabytes of personal data daily(Appendix). It has been argued privacy should not be held at the behest of the common good, especially with respect to big data (Payton & Claypoole, 2014). The analysis of large amounts o data enables researchers to establish effects of certain things that might have been ignored.

Modern life is virtually dependent on the internet and these points to the huge impacts it has on modern life. The internet can be relied on for different functional areas such as in business, design, medicine, military amongst other a multifunctional roles.

One of the greatest leaps in development of human beings has been as a result of the widespread usage of computers. In fact, the internet is the single greatest piece of technology in the 20th century and as such they have been associated with certain social impacts. Modern life has borne the brunt of the benefits and negative impacts the usage of the internet have impacted the world.

The vast amount of information in the internet has created a heated debate pitting on two sides: one side believes that privacy is cardinal principle that must be adhered to, while the other side believes that privacy is overrated social impacts have been magnanimous across a variety of aspects such as; health, communication, social interactions.

The internet, an application developed to enhance interconnectivity of computers has lead to widespread manifestations of the social impacts of the computers in modern life (Miller, 2013). Billions of people across the globe have access to the internet using it to accomplish different tasks. As a matter of fact, the internet has emerged as the melting point of different cultures in today’s world. Development of the computer and the internet has been the forerunner to the development of mobile computing, which has practically placed the world on its toes.

Privacy and Security

Computers have assisted law enforcement officers in their daily operations. In the past, criminals were anonymous, but lately, search engines have made it easier for them to get hold of these anonymous criminals at the click of a button. However, for the law abiding members of the public, the security of their personal information has come out as a great concern and has caused anxiety and worry (Zaru, 2014).

Computers have made it practically difficult for individuals to control their personal information and as time goes by more powerful computers are being built; therefore, information dissemination and storage will be slicker and faster. This means that problems related to information storage and dissemination would increase many folds, including privacy related problems.

Privacy has emerged as some of the controversial issues concerning computer usage in modern times (Babcock & Freivogel, 2015). This is because computers are a medium of information dissemination, storage and such information can be retrieved. Personal and confidential matters that are very sensitive, for instance matters of national security are stored in computers.

Others include bank account numbers, personal identification numbers, credit card information, the amount one pays in taxes, medical history, and physical attributes among others. There is always a threat that organizations, institutions, individuals and state apparatus might have access to such information to the detriment of an individual, organization or even the government.

In recent history, the government of the United States has suffered considerable embarrassment as a result of some crucial confidential and sensitive information regarding its foreign escapades being released to the media. Huge strides are being developed in personal computing to address privacy issues; one of the major developments is the advances in biometrics- this ensures that biological features are used when accessing personal information (Ferrell & Fraedrich, 2015). Fingerprints and the iris will be used to access personal computers and thus address privacy issues.

Social interactions have perhaps provided a popular acclamation of the impact of computer to modern life

Social networking sites such as Facebook, twitter, YouTube and Google plus amongst others have more than billion users. The pace of communication and information flow is high and easy thus a person, who for instance, is in Japan, can easily befriend and interact with another in the United States. Social networking sites and blogging sites have introduced new dynamics to information dissemination (White, 2014).

As has been expressed here above, the internet has created wealth to very many people all over the world and the trend continues. Pornography is a hot cake in the internet; in fact, it is billion worth of industry, generating a lot wealth. However, the world is choking with it due to the immoral nature in which it will affect children and young adults. A national survey which was carried out ,2016 (n=1520) indicated that nearly eight out ten  Americans network users  (79%) use Facebook, followed by Instagram (32%), Pinterest (31%), LinkedIn (29%) and Twitter (24%).See figure 1 below.

Figure 1:Americans Social network users in the year,2016.

Typing any words related to copulation will give billions of search results which will redirect the user to locations where they can be retrieved. In the United States alone, 50 million people access pornographic web pages daily, and about 40 percent of them are teens,35 % are adults,while 15% are children,as shown in figure 2 below. Pornographic materials provide the wrong kind of teaching materials to children regarding issues related to intercourse. Children and adolescents are vulnerable to finding highly pornographic materials especially when they access the internet. These highly explicit adult materials can morally pollute the minds of children and adolescents, obscuring their attitude and perceptions towards copulation and nature in general. Pornographic addiction in children may affect their psychological development, which in turn will affect their perception on gender relations and sexual orientation (Mathiesen, 2013). Other information that might be accessible through the internet includes the potential availability of drugs.

Figure 2:Phornographic web access in USA

In the United States and United Kingdom, their governments have a right to make data requests from ISP and other social media organizations, although if the governments had their way, then big tech companies would agree to a revolving door guideline when it comes to access of the users’ data.

In the age of smart vehicle, smart phones, and other smart objects the internet cannot be restricted to the desktop only, as it follows people everywhere. When one is online, the potential to be tracked exists all the time. Often all the eyes rest on intelligence agencies, as they collect bulk data and they use the big in surveillance.

Similarly, companies collect information about consumers to sell advertisements in an effective manner. The most commonly visited websites use tracking cookies and sophisticated software through third parties to collect information about consumers and then sell it to advertisers, most often without the permission of consumers (Gillespie, 2015). New technologies and sensitive levels of sharing on different outlets have led to moral and practical dilemmas that consumers, the technology industry, retailers and regulators face.

After wikileaks sparked international firestorm with respect to intelligence agencies bulk gathering of personal information, the security and privacy debate raged and made it clear that the public have different priorities. The government often insists that due weight must be given to both security and privacy, especially the wider public. The public cannot even obtain the most basic information about what is going on with intelligence agency’s surveillance policies and whether or their privacies is being sullied.

Consumer Choice

Privacy proponents argue that the proliferation in the use of the internet requires a relook of the privacy laws; moreover, the mass consumer surveillance should be regulated (Coll, Olivier, & Balleys, 2011). Advertising companies are willing pay money for information about their consumers, information that they use in producing advertisements that target people who have expressed interests in their products.

Tracking cookies and spyware collect data about the search history, people’s ages, location, interests, friends, items that people like, although they did not purchase and the period that the people spent on a websites. In general, when companies disclose what they are doing and do not cause consumers any financial damage, then the laws on privacy should be rendered useless.

Today, companies some that are legitimate, while others shady can collect data especially on individuals’ locations from a smart phone and then sell it to an advertising companies or well just anybody (Hannigan, 2014).

It is absurd that certain companies have developed applications and software used in stalking other people. People should be specifically concerned about the GPS locators in vehicles and smart phones. Recently vehicle makers have been asked to illuminate their data collection practices, and especially who they share the data with.

The suitability and appropriateness of the potential investment offers

Financial performance and position when considering the investments offers to be used by the company. When evaluating financial performance, the areas that should be looked into are the growth in the turnover, the growth in operating profits, growths in EBITDA, the movements in profit margins, ROCE, and ROE. A key point to remember is that the ratios often provide some of the most accurate financial analysis of a company.

The critical consideration when assessing the financial aspect of the company is the determination of the financial risks of the company. Therefore, the key ratios should be used in evaluating the financial gearing that indicates the financial risks using the information from the financial state and interest cover that indicates the financial risks when using information from the company’s income statement.

Northstar offer shall provide £1 million and they holding out for an extra ten percent stake given that currently they have a 25 percent stake in the company. Their valuation of the company based on the projected EBIDTDA is £10 million. The offer of £2 million from Iomart is also on the table, and it was provided for a fifteen percent stake in Affinity. Besides, their valuations placed the company at approximately £13 million in capital.

The third offer from ANE is similar to that of Iomart, and while the company can provide one member to the board of the company, ANE is proposing three people to the board. In the current compositions, the fifteen percent stakes for both ANE and Iomart would reduce the interests of Wren and Martin to 55.25 percent and those of Wren’s uncle and Northstar would be reduced to 8.5 percent and 21.25 respectively.

Figure 3: ANE and Iomart interests reduction

The suitability and appropriateness of these offers should be considered within the financial and nonfinancial parameters based on their own merits or demerits. On the face of these compositions alone, it would see that ANE and Iomart offers leaves Wren and Martin better off compared to the offer from Northstar. A rational economic agent is assumed to prefer more to less, and hence a straight forward preference for a 55.25 percent stake on a £2 million compared to a flat 55 percent stake on £1 million that Northstar offers (Appendix 2). Moreover, Northstar plans to offer their capital over a three year period. Assuming that the other two shall provide their resources on a lump sum nature, then the former should be ignored and the other should be considered.

The suitability of an investment is at the core of the investment process, and the concept is an essential one from a legal angle and in terms of positioning an investor’s resources to work in a prudent and sensible manner (Billy, Egbe, KNOX, FORD, & KARSH, 2016). The nature of suitability can be persuaded by personal discretionary factors. This idea implies that an investment is adequate in terms of the willingness and ability of the investors to assume certain risks. It is critical that the two criteria be met, and if an investment is to be as suitable, then it is not sufficient to declare the investment as risk friendly.

Suitability of investments is continuously in flux, and what is suitable for one might be unsuitable for another. For Wren and Martin, understanding play a vital role in suitability, but such should not be confused with the two understanding the risks that are linked with futures that certain investment becomes suitable. Nevertheless, Wren and Martin should develop an understanding of the comparative risks of the three investments.

The appropriate level of capital needed for the company is difficult to determine that level purely through figures and numbers. In such an aspect the regulatory minimum capital ratios are the benchmarks that are concerned with as subsets of risks faced by companies in the tech environment (Navis & Glynn, 2011).

Therefore, Affinity should maintain capital that is appropriately above the regulatory minimum capital ratios, in particular as it seeks to expand to overseas market, especially when the current operations are faced by tough economic times, but the natural risks in their business and its balance sheet can increase (Vanacker, Manigart, Meuleman, & Sels, 2011). Similarly, emphasised in this paper, the company at the well-capitalised under certain rules should not instantly assume that it has enough capital to meet all of the risk.

The capital levels at competitors with the same risk profile can often play a significant role in the investment evaluation process through the provisions of benchmarks used comparisons. Given that peer contrasts are vital, their assessment can be limited. The effectual advance to capital assessment and evaluations accounts for the factors that are unique to the company (Hayward, Forster, Sarasvathy, & Fredrickson, 2010).

Determining the appropriateness and suitability of the investment offers is a dynamic process, and it had to be effect, forward-looking and incorporate changes Affinity’s strategic emphasis, risk tolerance states, business tactics, the operating environments and the other aspects that are material to the investment adequacy. Apart from the criteria used above in zeroing on AEN and Iomart at the behest of Northstar’s offer, it would be important to consider both the short and long term investment needs and is integrated with the company’s entire plan and strategy cycles, normally with a prediction prospect of approximately three financial periods.

Companies need to put into consideration in events that happen external to the ordinary capital planning cycle into the investment planning processes; for instance, a economically crippling action could have a huge effect on the company’s investment needs. The capital planning process should be customised to the entire risk, difficulties, corporate structure of Affinity. The company’s range of business activities, overall risks and the operating environment have a considerable impact on the level of detail needed in the company’s investment planning. The first part of the investment planning is the identification and evaluation of all material risks, and these can be quantified with reasonable confidence and should estimated in determining how the risks influence the company’s entire investment adequacy (Atherton, 2012).

The qualitative factors mentioned above that are integrated with the management’s experience and judgment in evaluating all the risk factors. Qualitative assessments are particularly key to an understanding and evaluation of the risks that cannot be conceived quantitatively. Some of the risk that are affecting the company include the following; credit, operational, exchange rates, price and compliance risks. The other risks that the company faces in its overseas markets include reputation risks, strategic risks, and can be material for the company.

It is important for the company to avoid allowing the present financial performance in masking or compensating the weaknesses that may exist in risk management practices and procedures (Park & Steensma, 2012). Often, there is a lag between the developments of risk when they can materialize in the company’s financial performances.

Once the company has faced difficulties in the mould of a falling foreign currency, increased sales offer, strained pricings, increased competition, and other financial performance measures that underlie the root causes are already properly established and difficult in reversing. Moreover, once weaknesses show up, it may be challenging or even costly raising more investments. The investments alone do not reduce the excess risk taking or unsafe, unsound practices that move from sound governance, internal controls and risks management principles. Trade rates are costs cited with offer ask spreads.

Foreign Exchange Risks

Although Wren and Martin face different types of exchange rate risks when they export directly to buyers in Brazil or when they sell to their intermediary, Blue Mountain. The foreign exchange risk for Affinity is the possibility in depreciations in foreign currencies. The company faces ore risks when they export directly compared to when they use an intermediary, and in which case when the firm reports the foreign currency and converts to sterling pounds, it may reflect a smaller amount of sterling pounds for the same amounts of the Brazilian Real (Mancini, Ranaldo, & Wrampelmeyer, 2013).

Suppose that the company exports directly its products to Brazil, and its accounts receivable are denominated in Brazilian Real, totalling to BRL 100000. As a British firm, Affinity does not rely on Brazilian Real in when reporting their operations. Hence as soon as they receive payments for their sales in Brazilian Real, they plan to convert them into dollars.

Currently, the GBP-BRL rate is 0.25, and they observe the GBP appreciating daily until it attains an exchange rate of 0.20 a week from today, when they convert the BRL into GBP. Note that the exchange rate used is the GBP-BRL rate. A fall in the rate from 0.25 GBP to 0.20 GBP for every BRL indicates that appreciation of the Sterling Pounds because fewer sterling pounds are needed in order to buy one Brazilian real.

The exchange can be inverted easily and see that the Brazilian Real depreciates. The BRL-GBP exchange rate increases from 4 BRL to 5 BRL for every dollar. It is obvious that one might need more BRL to buy one GBP, which implies the depreciation of the Brazilian Real. If the exchange rate of 0.25 GBP would have remained the same, then the fir could have received £ 25000. However, because the Brazilian Real depreciated against the GBP, the fir only receives £20000.

Wren and Martin face numerous risks masks in different colours on their expansion paths to overseas markets. There great success with the rollout program in schools in the UK cannot necessarily be popular or work in their target markets in the overseas. Hence, the might runs the risks of rolling out a project that might perform dismally in the overseas markets (Hodrick, 2014). There are also financial risks that can from non-payments, and unfavourable exchange rate movements. Dealing with success is a non-financial and non-cultural risk factor, but generally tied to individual factors.

Intellectual property can give Wren and Martin the leverage they need in staying ahead of their future rivals, through a unique design, innovation and amongst others. If Wren and Martin can protect the intellectual property with respect to their product, then it can serve as a powerful barrier to their rivals. The overseas market might expose the duo to risks of crime and fraud; however, being aware of the risks often becomes he first steps in minimising the impacts of them on their business (Frenkel & Harry, 2013). A vital step involves creation and following a risk management program that helps in reducing their exposure to the risks.

They run the risks of theft, which include intellectual property theft and amongst others (Ning, 2010). The notion that the current prices in the market for the company’s products shall be equivalent to their expected future prices that is anchored on a specific forward rate, and much like every other thing, it is relies on the bank rate forecast, for instance an outlook, which can change as the economic conditions transform.

Statistically, a bias can be conceived as the difference between the real outcome and the predictions, and therefore as an unbiased predictor is one that closely predicts the future behaviour of one currency against the behaviour of the foreign currency. In such a case, the forward rate is conceived as the unbiased predictor of change in the exchange rate as its movement is aligned with the movement of the change in the exchange rate. The real value is exchanged between the GBP and BRL when either is bought and sold. The real prices often incorporate several times, and individuals looking to profit from the changes in the two currencies that are expected incomes.

Wren and Martin Options

Wren and Martin can benefit by delegating their authorities to other managers, and this is based on the agency theory. Agency theory explains the relationship between two parties, where one sets the terms of work, while the other performs the work.

Wren and Martin shall act as the principal in the arrangement and their agent shall be a CEO and a management team. In companies, the shareholders (Wren and Martin and the others) are the principal who shall then delegate the management of the company to the management led by the CEO. The agency theory is anchored on the assumption that their own interests fuel the principal and the agent.

The basic agency theory was developed in the field of economics in the mid 20th century and it determined the maximum level of the risks that is shared among various parties (Ballwieser, et al., 2012). Nevertheless, the growing field of agency model was expanded to the managerial field to determine the association connecting different parties with dissimilar objectives in the firm and the accomplishment of the objective alignment.

The extensive presence of agency theory in management accounting realms is important in the determination of the maximum-incentive contracting among various people and the setting of an appropriate accounting control system to examine the behavior and activities of employees (Cuevas?Rodríguez, Luis, & Robert, 2012).

The function of the agency theory has been the discussed and explored at length in this paper. In its archaic form, the theory related to one party known as the agent, and which is engaged to another party known as the principal, and the former acts on behalf of the latter based on an agreed fee and schedule.

There are three major agency issues, and which include risk aversion, dividend retention and horizon disparities. Risk aversion is indeed a problem that is caused by the relationships between returns and risks. In general, a higher risk is associated with high potential return, a perspective, that might be favored by the owners, but unaccepted by the managers, as they skepticism is often derived from their perception of the business to be a source of income.

When managers take less risky projects, in turn they translate to low profits or returns that are not what the owners’ desire. Nevertheless, such a problem can be reduced through the provision of bonus incentives associated to accounting earnings so that the agent would be involved in taking high risks to achieve the bonuses.

The next problem is one of dividend retention that is the capability of the managers to pay out little of the business earnings in dividends and retain more so that they could invest in the growth of the business that in turn lead to more returns. Such a perception runs contrary to the interests of the shareholders because as rational human beings, they prefer more to less. The horizon disparity is associated to long-term bonus incentive.

A significant role and responsibility of managers is the exertion of control over business’ functions and assets. The archetypal definitions of management control is the mechanisms through which agents guarantee that the capital are acquired and employed appropriately in the attainment of the firm’s goals.

However, in the present age, the domain of control extends to touch on other strategic positions of the firm and contemplates the behavioral issues, which provide motivations to the employees. Fundamentally, the appropriate managerial accounting framework must fix the control and planning system in a way that communicates ideas that relates to accountability and feedback system to guarantee that the firm conforms to the internal and external managerial and behavioral transformations such the behaviors of the staff and the measurements of the company’s dispersal from the real results.

Strategic planning cycle refers the establishment of the long run and short-run strategic objectives, measurements and goals that and other budgets and standards. The feedback is the main emphasis of the control framework as it gets ideas from the strategic planning mechanism and in particular, from the budgets and standards the elements that make it feasible for actual results to be compared with benchmarks and budgets and in the determination of parallel dispersals. The last stage of the control cycle proceeds to assimilation of important ideas for future plans and it is also taken back to feedback part. Therefore, in the implementation of a successful control system, several issues become glaring.


Advocates in the investment options and internet privacy can end hurting consumers, and that regulations by the government are bad for business. The half hearted approaches to privacy that the regulators have engaged in has assisted innovators to develop good products for the mass online market. Having a smartphone comes at a price and not just the actual cost, but one that comes with the possibility of risking one’s privacy.

The price of owing a smartphone is one that consumers must be prepared to pay. People must come to terms with the reality that phones are just like radios as their broadcasts are susceptible to interceptions and this implies that unauthorized people can collect conversations when they have the appropriate software and hardware.

When an individual consents to websites privacy policies through enabling of GPS settings, or the individual checks into a location or accepts cookies, and then the individual is technically sharing information. Information is power, and whether is the a state regulator or companies, then all the powerful information about people, without getting anything back, may lead to an even more repressive society.

Reference List

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Barnes, C. & Blake, H. 2009. Creating and delivering your value proposition managing customer experience for profit, London, Kogan Page.

Cohen, A. 2013. Finance and economics discussion series: competition, product differentiation and… S.l, Bibliogov.

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Ferrell, O. C., & Fraedrich, J. (2015). Business ethics: Ethical decision making & cases. Nelson Education.

Gillespie, I. (2015, August 12). The internet and the death of privacy. The Sydney Morning Herald.

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Hannigan, R. (2014). The Web is a terrorist’s command-and-control network of choice. Financial Times , p. 3.

Leslie De chernatony, Fiona Harris, & Francesca Dall&Rsquo;Olmo Riley. 2000. Added value:

its nature, roles and sustainability. European Journal of Marketing. 39-56.

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Payton, T., & Claypoole, T. (2014). Privacy in the age of Big data: Recognizing threats, defending your rights, and protecting your family . Rowman & Littlefield.

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Snieder, R.Larner, K. 2009. The art of being a scientist. Cambridge, Cambridge University Press.

Velamuri, V. 2012. Hybrid value creation, Wiesbaden, Springer Gabler.

White, M. (2014, JANUARY 18). Online privacy: ‘Big data’ is watching, and building your digital profile’. The Sydney Morning Herald .

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Zaru, D. (2014, March 29). Dilemmas of the Internet age: privacy vs. security. CNN.

Indicative Bibliography

Collins, J.C. , J.I. 1996.  Built to Last, Century, London.

This book explores the value of value addition in brands that last long at the top of the food chain.

Greenaway, D., Hine, R., ; Milner, C. 1995. Vertical and Horizontal Intra-industry Trade: A Cross Industry Analysis for the United Kingdom. The Economic Journal : the Quarterly Journal of the Royal Economic Society. 105, 1505.

This journal explored both horizontal and vertical differentiation of products across industries in the united kingdom.

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