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Vol. XLVI No.

Fourth Quarter 2010



Prof. Naila Iqbal

Summary of Articles
Relevance of Strategic Management in New Era: (with reference to) Strategic Control and Evaluation The Contemporary Approach to Pay Total Rewards - A Strategy to Attracting, Retaining and Motivating Talent Self-Organized Executive Control Functions

Shandana Shuaib

Michail Maniadakis, Panos Trahanias and Jun Tani Alok Chakrabarti & Pradip K. Bhaumik Zia Ullah

Internationalization of Technology Development in India Towards Organizational Effectiveness Through the Greater Use of Human Resource Practice in Public Healthcare Organizations Examples of How Leaders of Leaders Differ from Leaders of Followers

By Herb Rubenstein

Pakistan Institute of Management

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Pakistan Management Review

Vol. XLVI No. 4 Fourth Quarter 2010

Summary of Articles
Relevance of Strategic Management in New Era: (with reference to) Strategic Control and Evaluation The Contemporary Approach to Pay Total Rewards - A Strategy to Attracting, Retaining and Motivating Talent Self-Organized Executive Control Functions Internationalization of Technology Development in India Towards Organizational Effectiveness Through the Greater Use of Human Resource Practice in Public Healthcare Organizations Examples of How Leaders of Leaders Differ from Leaders of Followers Prof. Naila Iqbal

Shandana Shuaib

Michail Maniadakis, Panos Trahanias and Jun Tani Alok Chakrabarti & Pradip K. Bhaumik Zia Ullah

By Herb Rubenstein

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Notes for Contributors

1. Manuscripts of articles, notes, review-articles, comments, rejoinders, and book reviewsin English onlyshould be sent in to the Editor, The Pakistan Management Review, Clifton, Karachi-75600, Pakistan by e-mail So far as possible, all articles and research notes should be organised into the following sections: (i) Introduction, (ii) Basic Hypotheses, (iii) Methodological Issues involved, (iv) Basic Results, (v) Limitations of Analysis, (vi) Policy Implications, and (vii) Conclusions. Sub-sections should carry clear and distinct subheadings. The first page of the manuscript should contain: the title of the paper, the name(s) of author(s), and a footnote giving the current affiliation of the author(s) and any acknowledgements. Each article will be prefaced by a short abstract of about 250 words. The abstract should state the theme and structure of the article and the approach(es) taken. Tables for the main text and each of its appendices should be numbered serially and separately. The title of each table as well as the captions of its columns and rows should be clearly expressive of the contents. The source of the table should be given in a footnote immediately below the line at the bottom of the table; but, unlike other footnotes, which must be numbered consecutively, it should not be numbered. Footnotes should be numbered consecutively. Each appendix and each table should have a separate set of footnotes. All references used in the text should be listed in the alphabetical order of the authors surnames at the end of the text. References in the text should include the name(s) of author(s) with the year of publication in parentheses. In all cases, the submissions should conform to the style used in this issue. The author(s) of each article will receive two copies of the Pakistan Management Review in which their article is published.







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Pakistan Management Review

Editorial Advisory Board
Chairman PIM Board and Secretary, Ministry of Industries and Production Government of Pakistan Zarrar R. Zubair Director, PIM Mohammad Aslam Mustafa General Manager, PIM Muhammad Syed ul Haque General Manager, PIM Owais Malick Acting General Manager, PIM Muhammad Abid Hussain Dy. General Manager, PIM

The Pakistan Management Review is a quarterly journal of the Pakistan Institute of Management. It was established in 1960. The journal has made a valuable contribution to the development of professional management by making available to the practicing executives selected information and material on contemporary management practices. The Editor invites articles, discussions, research papers, communications and reviews of books and documents. Manuscripts should be sent by post, Fax or e-mail to: The Editor Pakistan Management Review, Management House, Shahrah-e-Iran, Clifton, Karachi-75600 (Pakistan). Telephones: 92-21- 99251719 PABX: 99251711-14 (four lines) Ext.304 Fax: 92-21-99251715-16 E-Mail: Web Site:

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Single copy Rs. 80 Subscription should be paid by crossed cheque or bank draft/pay order in the name of Pakistan Institute of Management, Karachi.
ISBN No.969-8027

Iqbal A. Qazi

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Summary of Articles

Relevance of Strategic Management in New Era: (with reference to) Strategic Control and Evaluation PROF. NAILA IQBAL The purpose of the paper is to explain the extent to which stress at work produces a degree of psychological impairment has become a central issue in the current debate on the quality of working life. Various analyses of alienation as a result of paced assembly lines and other forms of mass production have spawned a range of possible initiatives to mitigate that condition: job enrichment, autonomous work groups and versions of industrial democracy being some of the best known. The paper is to describe the increase in concern about stress and the methods used to combat it. Examines the perceived and actual causes, and argues that a new and different approach is needed. Describes a training programme which helps people to change their attitudes to stress and feel better about themselves. This paper also explains that the Stress is a key issue facing many organizations yet, despite the increasing awareness of how it impacts on business, many companies are unsure of the best way to fulfill their duty of care towards their employees. This article looks at how training can have a positive impact on tackling stress in the workplace helping employees become more resilient towards stress, and enabling them to tackle the root causes of any problems. It highlights the importance of providing additional training for managers who not only need to manage their own stress levels, but have responsibility for their direct reports.

The Contemporary Approach to Pay Total Rewards - A Strategy to Attracting, Retaining and Motivating Talent SHANDANA SHUAIB The paper focuses to finding out an appropriate model for Total Rewards which can be adopted and implemented by organizations to achieve the three things attract, retain and motivate employees in general and talented people in particular. A thorough literature review has been conducted which reveals that different experts in human resource management and specifically in compensation management have given their views and developed their models regarding compensation of talented people in the organization. After studying all these models and theories it can be concluded that there is no universal model that can satisfy the need of all organizations. Every organization has come up with their unique model for compensation which has been developed in the light of organizational values, vision, mission and strategies. The same has been supported by some compensation specialists also. In the end all the elements given by different experts
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have been integrated. Organizations will pick up elements of their choice and then develop a model in accordance to their organizational needs.

Self-Organized Executive Control Functions MICHAIL MANIADAKIS, PANOS TRAHANIAS AND JUN TANI Executive control incorporates cognitive functions involved in the control and management of other cognitive processes. Such high-level skills are hard to be explored with brain imaging studies because they require complex and persistent experimental procedures. Alternatively, computational modeling may provide a new way to indirectly explore executive control mechanisms. The current work adopts this latter approach to explore possible characteristics of executive control, focusing particularly on behavioral rule switching and confidence neurodynamics in artificial agents. To this end, our study explores a robotic version of the classical Wisconsin Card Sorting Test, incorporating also the option of betting. Our ability to perform multiple and statistically independent computational experiments together with the in-depth study of the mechanisms created in the artificial cognitive systems, provides suggestions for the executive control aspects of the human brain.

Internationalization of Technology Development in India ALOK CHAKRABARTI & PRADIP K. BHAUMIK The purpose of this paper is to study the internationalization of technology development in India. The internationalization of research and development (R&D) has not been a recent phenomenon. Large multinational companies increased their R&D investment in various host countries during the past years. While the US and the countries in Western Europe have been the traditional locus of R&D, China and India have emerged lately as the destinations for R&D. The changes in geopolitical systems of trade and intellectual property protection couples with the advances in information and communication technology have helped globalize the R&D activities. The results of this study indicated that there were three phases of technological development in India. Intensity of patenting, role of the different institutions in technology development, and the focus of technology characterize each phase. By examining the co-inventors, the authors see how the international cooperation among scientists has shaped. While government laboratories under the aegis of the council of scientific and industrial research had a high number of patents, their role has gone through significant shifts among the three phases. The authors also find that the multinational companies from the US have driven the recent growth in Indian patenting and are using more of all-Indian teams for patentable research. This indicates maturation the skills of technical personnel in India in terms of developing patentable technology.
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The study also points out the fact that despite the growth of the Indian corporations in the IT sector, they lack in building their own intellectual property. If India wants to maintain the momentum of growth in corporate R&D, it faces the challenge of upgrading its higher education in producing technical graduates at masters and doctoral levels. The study should be useful in identifying the sectors where India has developed strengths and the areas where it needs to improve. Also, by examining the ownership pattern of the intellectual property in these sectors, one can postulate the technological independence of Indian organizations.

Towards Organizational Effectiveness Through the Greater Use of Human Resource Practice in Public Healthcare Organizations ZIA ULLAH Healthcare being a basic public need, healthcare organizations are responsible to provide effective healthcare service to the public at affordable cost. The public sector hospital in developing countries and particularly in Pakistan are perceived no to provide the desired quality services. Prior surveys identified certain issues that impede healthcare organizations to provide quality services. Healthcare providers are handled on the traditional personnel management lines and this resource is, however, overlooked and underutilized. Based on the premise that greater use of human resource practices bears positive impact on organizational effectiveness, the paper in hand provides conceptual model that suggest possible solutions of the problems through better use of human resource practices. The paper also emphasizes extensive empirical look into healthcare workforce to find out the practice that ensure effective use of human resources. The paper concludes that timely availability of quality treatment through responsive employees using stat-of-the-art technology will cast positive impact on health outcomes

Examples of How Leaders of Leaders Differ from Leaders of Followers BY HERB RUBENSTEIN In this article the author gives examples of world class leaders of leaders. This article should stimulate your thinking in three ways. First, being a leader is a good thing. Being a leader of leaders is a much better thing. This article gives you a glimpse of a path you can blaze to becoming a leader of leaders in your own lifetime, starting now and never giving up.

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Relevance of Strategic Management in New Era: (with reference to) Strategic Control and Evaluation
PROF. NAILA IQBAL Faculty, Department of Management Maulana Azad National Institute of Technology, Bhopal

Introduction Implementation and control of organization are the two last phases in the strategic management process. Strategy formulation and strategy implementation - which is how strategy is put into action - are two side of the coin called strategic management. No matter how creative the formulated strategy, the organization will not benefit if it is incorrectly implemented. Moreover, organizations that formulate and implement strategies better than competitors can expect competitive advantages. The purpose of implementation is ensuring that the planned results of the strategic decisions are realized. Implementation involves several tasks - doing what must be done to make the strategy successful. Execution must be controlled and evaluated if the strategy is to be successfully implemented. Strategic control focuses on two questions: Is the strategy being implemented as planned? And is it producing the intended results? Therefore, strategic control: monitoring strategic progress, evaluating deviations and taking corrective action is also very important the key tasks in strategy implementation. The Evaluation and Control of Organizational Strategy presents an overview of the strategic control process. It deals with the decisions needed to evaluate and control the strategic plan and corporate performance of a company. Essentially, controlling involves the measurement and correction of activities of subordinates to make sure that objectives and plans to achieve them are being accomplished. Control Systems and Techniques discusses various control systems and techniques. It presents the elements of controlling, production and financial control, human resource control, and organizational change and development. This paper emphasizes the importance of developing an integrated control system which enables managers to monitor the performance of all resources devoted to the achievement of organizational performance.

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Strategic Evaluation and Control Strategic evaluation and control is related to that aspect of strategic management through which an organization ensures whether it is achieving its objectives Contemplated in the strategic action. If not, what corrective actions are required for strategic effectiveness? There are two aspects in this phase of strategic management evaluation which emphasizes measurement of results of a strategic action and control which emphasizes on taking necessary actions in the light of gap that exists between intended results and actual results in the strategic action. However, because of on-going nature of strategic evaluation and control process both these are intertwined. In practice, the term control is used in a broad sense which includes evaluative aspect too because unless the results of an action are known, control actions cannot be taken. Defination of Strategic Evaluation Evaluation of strategy is that phase of the strategic management process in which the top managers determine whether their strategic choice as implemented is meeting the objectives of the enterprise. Nature of Strategic Evaluation To test the effectiveness of strategy. To achieve a set of objectives. To implement the strategy.

Importance of Strategic Evaluation Ability to coordinate the tasks performed by managers. The need for feedback Appraisal and reward Check on the validity of strategic choice Congruence between decisions and intended strategy Successful culmination of the strategic management process Creating inputs for new strategic planning.

Barriers in Evaluation 1) 2) 3) 4) 5) Limits of controls Difficulties in measurement Resistance to evaluation Short terms Relying on efficiency versus effectiveness

Strategic Control Strategic control are the changing assumptions that determine a strategy, continually evaluate the strategy as it is being implemented, and take the necessary step to adjust the strategy to the new requirements. The four basic types of strategic controls are:
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1) 2) 3) 4)

Premise control Implementation control Strategic surveillance Special alert control

Brief explanation Premise Control Premise control is necessary to identify the key assumptions, and key track of any change in them so as to assess their impact on strategy and its implementation. Implementation Control Implementation control is aimed at evaluating whether the plans, programmes, and projects are actually guiding the organization towards its predetermined objectives or not. Strategic Surveillance Strategic surveillance is aimed at a more generalized and overarching control designed to monitor a broad range of events inside and outside the company that are likely to threaten the course of a firms strategy. Special Alert Control Special alert control can be exercised through the formulation of contingency strategies and assigning the responsibility of handling unforeseen events to crisis management teams. Operational Control Operational control is aimed at the allocation and use of organizational resources through an evaluation of the performance of organizational units to assess their contribution to the achievement of the objectives. Process of Evaluation The process of evaluation basically deals with four steps: 1) 2) 3) 4) Setting standards of performance Measurement of performance Analyzing variances Taking corrective action

Setting Standards of Performance Standard setting dealing with three questions that is: 1. What standards to set? 2. How to set these standards? 3. In what terms do we express these standards? Measurement of Performance The evaluation process operates at the performance level as action takes place. Standards of performance act as the benchmark against which the actual performance is to be
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compared. It is important to understand how the measurement of performance takes place. The other important aspects of measurement relate to: Difficulties in measurement Timing in measurement Periodicity in measurement

Analyzing Variances The measurement of actual performance and its comparison with standard performance leads to an analysis of variance. The following three situations arise: 1. 2. 3. The actual performance matches the budgeted performance. The actual performance deviates positively over the budgeted performance. The actual performance deviates negatively from the budgeted performance.

Taking Corrective Action It suggests three courses for corrective action: 1. 2. 3. Checking of performance Checking of standards Reformulating strategies, plans and objectives.

Difference between Strategic and Operational Control Attributes 1. Basic question Strategic control Are we moving in right direction? Proactive, continuous questioning of the basic direction of strategy Steering the future direction of the organization External environment Long-term Operational control How are we performing? Allocation and use of resources Organizational resources

2 Aim

Action control

3.Main concern 4. Focus 5. Time horizon

Internal organization Short-term

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Attributes 6. Exercise of control

Strategic control Exclusively by top management, may be through lower-level support Environmental scanning, information gathering, questioning and review

Operational control Mainly by executive or middle management or the direction of top management Budgets, schedules and MBO

7. Main techniques

Techniques of Strategic Evaluation and Control

Techniques of strategic evaluation and control in order to make a choice from among the many available alternatives and to use those. It is divided into two: 1. 2. Evaluation techniques for strategic control. Evaluation techniques for operational control.

Evaluation Techniques for Strategic Control

1) Strategic momentum control Responsibility control centers The underlying success factors The generic strategies 2) Strategic leap control Strategic issue management Strategic field analysis Systems modeling Scenarios

Evaluation Techniques for Operational Control 1) Internal Analysis

Value chain analysis Quantitative analysis Qualitative analysis 2) Comparative analysis Historical analysis Industry norms Benchmarking 3) Comprehensive analysis Balanced scorecard Key factor rating

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Strategic Evaluation and control deals with tools and techniques that have been used successfully in a wide range of business settings. Strategic Decision Making Aids, reviews several commonly accepted tools and concepts available for planning and decision making. Finance for Strategic Management, examines the various financial tools and gives managers into how identical figures can be presented and interpreted to offer widely divergent picture of the company. Business Forecasting contains explanation of a range of forecasting techniques sufficiently broad to deal with the most business forecasting problems.

Canales, James E.; Kibble, Barbara D.; Terk, Natasha. "One Step Beyond Strategic Planning." Foundation News & Commentary, Vol.41 Issue 5 Sep/Oct. 2000. Carrigan, Linda. "Braking for Growth." (2000) Organizational Development Collett, Stacey. "SWOT Analysis." Computerworld, Vol.33 Issue 29, Jul.19, 1999. Hay, Robert D. Strategic management in non-profit organizations, Westport: Greenwood Press, 1990. Stone, Melissa, Bigelow, Barbara, & Crittenden, William. "Research on Strategic Management in Non-Profit Organizations." Administration and Society, 1999. Polyack, Jolene. "Nonprofit Organizations Need Marketing Strategies To Meet Goals." Business Journal Serving Fresno & the Central San Joaquin Valley, Issue 322490, Aug.2, 1999.

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The Contemporary Approach to Pay Total Rewards - A Strategy to Attracting, Retaining and Motivating Talent
SHANDANA SHUAIB Institute of Management Sciences, Peshawar

Introduction The word reward is a part of our every day life. As we all know it refers to some sort of pay back for some thing done. In the organizational context in means the extrinsic and intrinsic pay back to the employees for their physical and mental efforts given to the organization in order to carry out the organizational its activities for completion of its goals and objectives and achievement of its mission. This paper aims at amplification of the concept -Total Rewards into much detail, in order to see what are its key components and why is it becoming more popular tool in todays organizations for motivating talent. In addition it will try to prove that how talent can be retained by the organizations in future. The same has been proved through the survey conducted by Watson Wyatt regarding Total Reward .During June and July 2004, in which more than 200 employers and nearly 3,000 employees were surveyed about the design and delivery of their organizations reward program. According to (Watson Wyatt, 2004) research tells us that 40 per cent of employees actively considering leaving their organisation in the coming 12 months. Obviously, all of these employees will actually leave, but it does reinforce the theme that continued focus on retaining key/top performing employees will be a priority organisations in the future13. are not the for

A holistic approach to rewards has been taken by Rumpel Steven, Medcof, John W, 2006 which goes beyond the strong focus on pay and benefits which has been the hallmark of traditional compensation practice. A total reward considers all the rewards available in the workplace, including opportunities for learning and development, and quality work environment. Because these rewards are a high priority for technical workers, as shown in the research reviewed in this article, total rewards offers an opportunity to tap the unrealized potential of the organization. Effectively managed rewards will ease the critical attraction, retention and motivation challenges faced by high-technology firms."1 In common parlance the word reward, compensation and pay are used interchangeably as they refer to one and the same thing which means remuneration by the employer to the employees for the work done for the organization. Again reward is something which is also used as a motivational tool besides other tools by the organization to motivate its employees for superior performances.

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The Two Approaches to Reward Reward has two approaches; the traditional approach and the contemporary approach. The traditional approach is suitable for static, bureaucratic and or mechanistic organizations. The traditional approach includes the very basic components such as cash (base pay) and benefits depending upon the employment contract. These may be may be given to the employee based on what he has achieved or it may be negotiated with the employee. The other approach is the one which is suitable for todays modern organizations such as the learning organizations, the boundryless organizations, the networking organizations in short the organic structures. The traditional pay system is becoming a thing of the past. Todays organizations as opposed to orthodox mechanistic are more flexible structures which continuously adjust itself to the dynamic environment-(the learning organizations). The employees working in learning organizations are different form the traditional employees employed in the mechanistic structures and are known as knowledge workers. Knowledge workers are considered indispensable and are the competitive edge of any modern organization. Knowledge workers are also referred to as talented workers. These talented employees require something more than the pay offered under the traditional approach. They require not just rewards BUT Total Rewards". Professional Association for Compensation, Benefits and Total Rewards has made a comparison between the traditional and contemporary rewards by stating that, companies built employment packages around compensation and benefits, creating a single, onesize-fits-all plan for everyone. Over the past decade, this concept has given way to a total rewards approach that makes room for other important aspects of the work experience. 10 Total reward is becoming a more preferred way to pay management that endeavors to arrest the complete potential and value of the employees by wholly mobilizing and tapping the employee worth thus using human resource more competitively. It has confirmed to be worth while. According to WorldatWork, Professional Association for Compensation, Benefits and Total Rewards, Total Rewards combines the separate activities of pay, benefits and career development etc into a single integrated system. Previously the administration of pay and benefits were carried out under different heads by the Human Resource department but now the contemporary pay has engulfed all these scattered components into the Total Rewards. The fast growing bio-tech company offered a sweet package: higher pay, a move up the corporate ladder, and great career building opportunities. But Bill MacGowan, senior vice president of human resources at Sun Microsystems, said it still wasnt enough to land one of his key employees.9 Another feature of the traditional pay is that the employees are paid in a similar manner which means that the pay system is homogenous. Although there are differentials on the basis of different levels and length of service but other wise for pay calculation the same formula is used. This system ignores the separate needs of the employees at different levels in the organization. A survey was conducted by Watson Wyatt, 2004. The results revealed that most organisations reward programmes are fragmented. Typically, they have evolved in a piecemeal fashion over a period of time with limited consideration being given as to how the various elements of the package fit together and reinforce each other. 6.
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The Total Rewords Association affirmed that in the earliest years that the fields of compensation and benefits were recognized as professions, practice was based largely on formulas that served the entire employee population in an organization. Salary structures were just that -- rigid and highly controlled -- and benefits programs were designed as a one-size-fits-all answer to a homogenous work force. In the 1970s and 1980s, organizations recognized that strategically designed compensation and benefits programs could give them the edge in a rapidly changing environment. 14 Paradigm Shift in Rewards Over the last decade there has been a growing debate around the importance of a strategic approach towards Human Resource Management towards business performance and success (e.g. Gratton and Truss,2003; Guest 1997,Schuler and Jackson,2005; Sparrow,1998) . These include Talent Management (e.g. Conference Board,2005; Higgs,2006(b));Employee Commitment (e.g. Allen and Meyer,1990);Employee Engagement (e.g. McBain,2006; Buckhingham and Coffman,1999); the impact of HR on the bottom line of a business (e.g. Guest,1997;Ulrich and Brockbank,2005;) and Employer Bran/ Employer of Choice (e.g. Higgs 2005;2006(b)).20 In the coming future organizations will be made up of three basic components such as financial, capital and intellectual. The third element which is the intellectual element is possessed by the employees in the form of knowledge. Such workers are known as knowledge workers. But the challenge will be how to attract, retain and motivate these people on which the organization success will be mainly dependent. Such talented people will require something more than the traditional approach to compensation management; they will look towards total rewards. Forces are infact redrawing the work model, Anne Ruddy, president of WorldatWork, a non-profit professional association that focuses on total rewards and the discipline associated with attracting, motivating and retaining a talented workforce. It recently adopted a new model that puts work life, performance, and recognition, and career development on the same plane as compensation and benefits, says Ruddy, noting that there is a new significant give-and-take between companies and their employees, allowing greater individualization of everything. The traditional model based on company loyalty, working your way up the ladder, and paying your dues is totally yesterday, says Bruce Tulgan, author of HOT management (HRD Press) and expert on generational issues in the workforce. People are constantly looking around too see what they will be offered today, tomorrow, and next week, says Tulgan. Now the employment package has become a moving target. He adds companies are fining they need to construct plans that are nimble enough to respond to continuing changes in the workplace. And employees are getting savvier everyday, says Andrew Richter, VP of compensation and benefits at NBC Universal, which means his biggest challenge is staying ahead of the curve. We have to accept the fact that what was an awfully good offering yesterday wont work next week, he says. We have to earn our employees loyalty everyday.26. The pressure on organizations to add value, achieve sustained competitive advantage, and respond and adapt quickly and flexibility to new challenges and opportunities are rentless. The responses to these pressures have taken many forms including new forms of organizations- lean, delayered, flexible, process-or project based, increasing reliance
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on technology, and emphasis on continuous improvement in terms of performance, quality, and customer service. The quality of human or intellectual capital possessed by organizations is seen generally as a key factor in differentiating them from rivals and achieving superior results. ------ As a result a significant changes in the ways in which pay systems are developed and managed are taking place.21 Total Rewards; is a pay system which has both the features of traditional payhomogeneity as well as contemporary pay-heterogeneity such as, within a homogenous pay system there is heterogeneity. Heterogeneity caters for the different needs of the employees at different levels and also individual requirements. The different components of the Total Rewards complement each other creating a synergy in the pay system. . Synergy means the interaction of two or more agents or forces so that their combined effect is greater than the sum of their individual effects This is one of the reason that Total Rewards is used as a tool by the management to attract, motivate and retain talent in organizations. This is what Dr. Paul R. Dorf has also talked about in his research paper Compensation in the Context of Total Rewards about this synergetic affect. "Each component of the Total Rewards Package must be viewed as not only based on its own virtues, but also in the context of a big picture, Paul R. Dorf, Managing Director of CRI. He furtehr says that ultimately, the "whole" should be bigger than the sum of its parts, and it is the totality of the Total Rewards Package that will make a difference and meet both the companys objectives, as well as, the employees needs. "5 The newest buzz phrase according to Paul R. Dorf, Managing Director of CRI in the compensation world is Total Rewards. It includes the traditional elements of pay in Total Rewards, but it also recognizes that people want to enjoy their work and, when they finish the days work, they want a life from which they get pleasure. As employers, there is only so much we can do about employees after- work experiences, but we can and should do a lot to enhance the day-to-day work experience. The efforts we make in this area will pay big dividends by enhancing an employee's desire to remain with the company and be motivated to perform at his/ her peak level."3 Both the systems have its pros and cons. Traditional rewards are easy to administer but at the cost of employee satisfaction whereas, the Total Rewards are complex in nature but the pros outweigh the cons. "In order to achieve these objectives, companies must design and implement the right plans as part of their Total Rewards Package (Paul R. Dorf, Managing Director of CRI.). For example, if an organization provides a costly but phenomenal benefit package, this will help to attract and retain staff. But to maximize its return, the company must communicate the value of this program to employees and their families."4 Total Rewards is becoming the accepted way of compensation in many reputable organizations such as: Symantec Corp, Microsoft, Johnson & Johnson, IBM, and AstraZeneca etc. The employees feel the Total Rewards as an employee friendly system, which acknowledges their needs not only in the short term but also in the longer term.

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Motivating Talent through Total Rewards Motivating knowledge workers as said by Peter Druker is one the greatest challenge of this century. Using the Total Rewards for such workers cannot cent percent guaranteeand of course can, but can to a greater extent overcome this challenge? The Motivation to contribute knowledge is an intangible key success factor for any knowledge management activity ( Daven port, De Long ans Beers, 1998). Yet for this to happen there needs to be a degree of trust between the individual and the organization as part of the psychological contract. 22 Peter Drucker has argued often that improving knowledge worker productivity is the most important task of the century. Yet we have few measures or management interventions to make such improvement possible. Most organizations simply hire smart people, and leave them alone. During this program, Tom Davenport will present six interventions for improving knowledge worker productivity, each with a set of approaches, examples, and cautions. The interventions combine roles for technology, organizational culture and behavior, and the physical work environment as tools for enhancing performance.23 The elements of reward which have the greatest influence on employee commitment levels are career development/promotion opportunities, increased flexibility and a payfor-performance culture. Watson Wyatt, 2004 .Employee commitment, in turn, positively influences certain people-based business performance indicators such as improved productivity and customer service. 7 These forces are in fact redrawing the work model, says Anne Ruddy, president of WorldatWork, a non-profit professional association that focuses on the total rewards and the discipline associated with attracting, motivating , and retaining talented workforce.It recently has adopted a new model that puts work-life, performance and recognition, career development on the same plane as compensation benefits. It has become a transactional relationship, says Ruddy, noting that there is now significant give-andtake between companies and their employee, allowing greater individualization of everything. The traditional model based on the companys loyalty, working your way up the ladder, and paying your dues is totally yesterday, says Bruce Tulgan, author of HOT Management ( HRD Press) and expert on generational issues in the workforce. people are constantly looking around to see what they will be offered today, tomorrow and next week, says Tulgan. Now the employment package has become a moving target, he adds, companies are finding that they need to construct plans that are nimble enough to respond to continuing changes in the workplace.12 Thus Total Rewards and employee motivation, especially motivation of knowledge workers are conjoined twins which seem difficult to separate even through the best surgical procedures. Scope of Total Rewards Experts on compensation/rewards have come up with their own models regarding Total Rewards. One such model has been given by Michael Armstrong and Duncan Brown, in their book New Dimensions in Pay Management which gives the reader a comprehensive insight of the concept of Total Rewards.

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The Secret to Motivating Talent-the Total Rewards

Michael Armstrong and Duncan Brown, New Dimensions in Pay Management,CIPD,2001 24 Total Rewards is not just a concept of a contemporary way of payment, it is infact a system integrating and coordinating the activities of HRM in an articulated and orchestrated way. In a global competition total competition might prove a cutting-edge for the companies by providing comprehensive pay systems to keep tem a step ahead of their competitors. No doubt corporate sector is all about competition and earning a name in the comity of companies. It might be the master key to unleash the much needed motivation of the employees. It is important for an employer to create a brand to differentiate itself from other employers. A Total Reward Package can be means of achieving this---- 16 Employees are getting smarter every day, says Andrew Richter, vice president of compensation and benefits at NBC Universal, which means his biggest challenge is simply staying ahead of the curve. We have to accept the fact that what was an awfully good offering yesterday wont work next week, he says we have to earn our employees loyalty every day.24. Looking at the above discussion and views of the experts the significance of Total Rewards might have some what become clear to the reader but what is the appropriate model for this approach still remains a question mark and it will remain a question mark as acknowledged by the FORTUNE magazine after getting the opinions of several HR and compensation experts on this topic. It states that there is no single model to be followed. Each company has to develop its own unique model keeping in view its culture, nature of business, employees needs, management polices regarding compensation and so many other related aspects.

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Elements for Developing a Model for Total Rewards Thus it can be concluded that the scope of Total Rewards is very wide. It covers almost anything and every thing with which an employee might come in contact or might some be related to them either directly or indirectly. The elements which are included in the models given by experts include the following: Fixed Pay ( Base Pay) Variable pay Short term incentives and long term incentives Gain sharing Benefits Allowances Quality and quantity of work Work environment Work-life balance Non-financial rewards Leadership style Organizational values and culture Equity Training and Development (career/professional) Participation in decision making Holidays and Leave Challenging work Communication Employment security Opportunities for achievement Freedom and autonomy at work Management support and encouragement Performance management Even further elements can be added to the existing scope of total rewards. Conclusion: To conclude it can be said rightly that based on the scope of total rewards different organizations can come with their own model for rewarding their talented employeesknowledge workers, as no single model can be suitable for all organizations. The reason for suggesting different models for organizations is that no two organizations is exactly similar to another in philosophy, values, culture, environment, nature of business, motives etc. That is why organizations have to develop models which are exclusive to their needs and which can serve their goals and objectives in the best interest of that particular organization. But no matter what model is developed for a company cash
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reward no doubt will remains the core element and the remaining elements are dependent upon the employees motivational urge and organizational needs. In the opinion of the Worldwork Professional Association for Compensation, Benefits and Total Rewards one company cant simply adopt another firms program wholesale. Each need, to think through its own specific needs and find the unique answer that work for its particular workforce.For example Amgen Inc; biotech firm, added flexibility, portability, and increased paid time off to its benefit package.25. Total Rewards include other non-cash rewards that employees truly distinguish themselves in the labor market from the competition and earn employee commitment according to Anne C. Ruddy, CCP,CPCU,President, WorldatWork is a matter of focusing the employment compact on the rewards that matter to the workforce you are trying to create, not on the cash elements traditionally measured by companies. Organizations spend a lot of time measuring Total Remuneration. But what matters to employees is the total package-the Total Rewards. 27 Defining Total Rewards and a Reward Strategy begins with the broadest view and understanding of the concept of total rewards. The term includes all types of rewards- indirect as well as direct and intrinsic as well as extrinsic. From an employees perspective, it is every thing that an employee takes away from his or her relationship with an employer.Todd M Manas and Michael Dennis Graham says that people have different tastes; variety responds to those differences. The more broadly rewards are the more likely you are to touch upon what motivates the broad constituencies represented by your employees. But if rewards are not defined as broadly as possible, the range of alternative reward strategies and satisfied organizations will be very limited. Besides, our data suggest that a more limited view of rewards is also more costly view, as organizations may tend to respond to every situation with cash. 19.

* * Watson Wyatt ( 2004) Total Rewards Survey Rumpel, Steven,Medcof, John W (2006 ), TOTAL REWARDS: GOOD FIT FOR TECH WORKERS, Publication: Research Technology Management * ibid WorldatWork, Professional Association for Compensation, Benefits and TotalRewards. FORTUNE Watson Wyatt (2004 )Total Rewards Survey Professor Malcolm Higgs(2006 04), The Emerging Significance of Total Rewrd Management as a Strategy for Building Employee Engagement, , HRN, Henely Management College Greenlands,Henely-on-Thames, Oxford shire RG9 3AU, UK. The Total Rewords Association, Total Rewards Compensation Benefits Work life WorldatWork, Professional Association for Compensation, Benefits and Total Rewards. FORTUNE ibid Michael Armstrong and Duncan Brown, (2001) CIPD, New Dimension in Pay Management, by, Cromwell Press, Trowbridge, Wiltshire.

* * *

* * * *

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* *

Paul R. Dorf, Managing Director of CRI. (Compensation in the Context of Total Rewards, APD, Compensation Resources, Inc.,, Legal Experts Dictionary) John P Wilson, Allan Cattel,( page 123). Knowledge Management 23.LPCUBE Aware Personal Knowledge Management (PKM).h Linkage, Inc_ - Distance Learning - Tony Schwartz.htm Paul R. Dorf, Managing Director of CRI. (Compensation in the Context of Total Rewards, APD, Compensation Resources,, Legal Experts Dictionary) ibid Total Reward, www.Hay

* * *

* WorldatWork, Professional Association for Compensation, Benefits and Total Rewards. FORTUNE * Anne C. Ruddy, CCP,CPCU,President, WorldatWork Handbook of Compenstaion, Benefits and Total Rewards,. Published by John Wiley and Sars,Inc; Hoboken, New Jersey, * * Todd M Manas and Michael Dennis Graham) (Chap1, page 1) Creating a Total Rewards Strategy ,Defining Total Rewards and a Reward Strategy WorldatWork, Professional Association for Compensation, Benefits and Total Rewards. FORTUNE

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Self-Organized Executive Control Functions


I. Introduction Executive control functions refer to our ability to monitor and control our own thoughts and behaviors. This type of high level cognitive functions that involve working memory, planning and conflict monitoring are believed to be processed in prefrontal cortex. However, many aspects of this high level cognitive skill remain unknown. A common way to investigate executive control functions is by using the well known Wisconsin Card Sorting Test (WCST) [1], [2], [3]. According to the WSCT experimental scenario, subjects are invited to repeatedly discover, apply and re-discover a given card sorting rule that is unpredictably changed by the experimenter, based on reward and punishment feedback. The ordinary WCST can be further enriched with the option of betting on behavioral outcomes (i.e., success or failure of sorting) testing the capacity of subjects to implement confidence on the currently adopted sorting rule [4]. Therefore, the WCST-with-betting (WSCTB) is appropriate for investigating complex cognitive processes that include self-monitoring. The current work explores a robotic version of WCSTB investigating the development of high level cognition in artificial agents. Our task is based on the well known sample response paradigm. The experimental procedure investigates robot responses for a sequence of trials in order to explore robots ability to follow and switch along different sample response rules, as well as to develop confidence about the correctness of the currently adopted rule. More specifically, a Continuous Time Recurrent Neural Network (CTRNN) [5], [6] implements the artificial brain of a simulated mobile robot [7]. We use an evolutionary procedure to systematically explore CTRNN controllers with rule switching and betting capacity. The exploration of self organized executive control mechanisms in artificial agents, is expected to provide possible explanations for the cortical neuron dynamics supporting natural executive control functionality [8].
Michail Maniadakis is a researcher in the Computational Vision and Robotics Laboratory, Institute of Computer Science, Foundation for Research and Technology Hellas (FORTH), Crete, Greece. Additionally, he is a visiting researcher in the Laboratory for Behavior and Dynamic Cognition, RIKEN Brain Science Institute, Wako-shi, Saitama Japan. (email: Panos Trahanias is head of the Computational Vision and Robotics Laboratory, Institute of Computer Science, Foundation for Research and Technology Hellas (FORTH), Crete, Greece. (email: Jun Tani is head of the Laboratory for Behavior and Dynamic Cognition, RIKEN Brain Science Institute, Wako-shi, Saitama Japan. (email:

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In short, our experiments revealed more than one mechanisms capable of executive control. Furthermore, these mechanisms are highly correlated to the different interpretations one may give on the investigated task. Therefore, the findings of the present study suggest that when different subjects understand a given problem in different ways, then it is likely to develop different cognitive mechanisms to solve that problem. This type of personalized cognitive mechanisms are more likely for high-level cognitive functions that rely on knowledge abstraction and prior experiences rather than the lower level skills involved in processing the sensory-motor details of behavior. Our work clearly distinguishes from previous computational modeling studies addressing rule switching mechanisms, e.g. [9], [10], [11], [12], This is because earlier studies: (i) interpret computationally human hypothesis by hand coding the relevant mechanisms in the model (rather than letting these mechanisms self-organize) (ii) work in a pure theoretical level without being embodied in a robotic agent to interact with the environment. (iii) explore the simple version of the WCST task without considering the option of betting. The rest of the paper is structured as follows. In section II we describe the CTRNN models used in the current study. In section III we describe the investigated task providing the details of our experimental setup. Then we present the evolutionary procedure used to explore the space of CTRNN solutions. In section V we present the results obtained by the independent evolutionary procedures, and the common characteristics self-organized in all successful solutions. Finally, in section VI we discuss how our findings may apply to biological cognitive processes formulating suggestions about executive control mechanisms in the cortex.

II. CTRNN-Based Cognitive Model We use Continuous Time Recurrent Neural Network (CTRNN) models [6] to investigate how rule switching and confidence mechanisms self-organize in neural dynamics.

Fig. 1. Schematic representation of the bottleneck CTRNN used in the current study.
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In the current implementation, all neurons are governed by the standard leaky integrator equations described in previous studies [13], [7]. Interestingly this type of networks can adequately capture the continuous nature of biological cognition in the cortex. Therefore, in our experimental setup, the neuronal state is initialized only once in the beginning of the first trial, and then neuronal dynamics continue across trials and phases without resetting. In this manner, CTRNNs contextual memory is implicitly represented by internal neuron dynamics. We speculate that dynamical states will emerge for representing the rule stored in working memory, while confidence mechanisms will also interact with these representations to decide the amount of betting. Following our previous study [14] showing that bottleneck configurations [15] are more effective in rule switching tasks compared to fully connected CTRNNs, the current work focuses only on the bottleneck architecture. As shown in Fig 1, we use two bottleneck neurons to separate CTRNN in two levels. The bottleneck neurons loosely segregate information processing in two layers, maintaining minimum interactions between them. In order to investigate embodied rule switching, we employ a two wheeled simulated robotic agent equipped with 8 uniformly distributed distance, light and reward sensors. The experiments discussed here have been carried out using YAKS1 a simulated version of the real Khepera miniature mobile robot. The simulator has been slightly modified for the needs of the present study (e.g. by integrating a new sensor-type that supports feeling the special environmental signals simulating negative rewards). To comply with the basic anatomical characteristics of the brain, the lower layer of the CTRNN is linked to the sensors and motors accounting for environmental interaction (this is similar to primary sensory and motor cortices), while the higher layer of the network accepts reward information (that is similar to prefrontal cortex accepting reward from VTA), as it is shown in Fig 1.

Fig. 2. A graphical interpretation of the three sample-response rules used in our experiments. Each box explains one sample-response rule. In each box, the first line shows correct robot response when light appears to the left side of the robot, while the second line shows correct response when light appears to the right.

simulator has been developed in the University of Skovde, Sweden, and can be downloaded at

III. The Robotic WCSTB Experimental Setup

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The current study is an extension of our previous work [14] that also addresses rule switching dynamics in a mobilerobot. In the current work, we have incorporated in the experimental setup the option of betting similar to [ ], in order to explore the mechanisms involved in confidence development. A. Mobile Robot Rule Switching Task The task used in the current study is inspired by the rat version of WCST used to investigate the rule switching capacity of rodents based on the sample-response paradigm [16]. The overall task consists of a sequence of trials investigating the capacity of the agent to flexibly manipulate sample response rules. In the onset of each trial, the robotic agent is located at the bottom of a T-maze environment where it observes a light source turning on, either on its left or right side (see Fig 2). The robot should navigate in the T-maze, responding to the side of the light sample as it is indicated by three sample-response rules. The first is the same-side (SS) rule, implying that the robotic agent should turn left if the light source appeared at its left side, and it should turn right if the light source appeared at its right side. The second rule is the opposite-side (OS), implying that the robot should turn to the side opposite to the light (i.e. right if the light appears to the left side, and left if the light appears to the right). The third is the no-response (NR) rule asking the agent to stay close to the starting position regardless of what the sample signal was. At any given time, only one of the three available rules is correct. This is specified by the experimenter by properly positioning positive and negative reward signals. As a result, when the agent adopts the right rule giving a correct response in a given trial, it acquires a positive reward. However, in case that the response is not correct the agent receives a punishment. In order to evaluate the capacity of the agent to adopt and successfully follow a given rule, the overall task is split into several trials. The agent is required to find the correct rule (that is specified by the experimenter) and respond according to that rule, in order to be repeatedly rewarded in the sequence of trials. Turning now to rule switching, the experimenter at a random time (unknown to the robotic agent) changes the rule that is considered correct. This means that the experimenter re-positions positive and negative rewards according to the new sampleresponse rule. The task for the agent now is to discover this rule change, and switch its response strategy adopting the new rule. Moreover in the onset of each trial the agent bets for the success of its response in the given trial. Depending on the correctness of the response, the agent gains (or losses) the amount of reward (or punishment) received, multiplied by the amount of betting. Clearly the agent should reduce the betting amount during the rule switching period, and increase betting when the correct rule is successfully followed.

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B. Experimental Details The overall task is structured into P 2 f1:::10g phases, each one consisting of Tp trials. The number of trials Tp 2 f14; 16; 18; 20; 22; 24g is randomly specified, so that the agent can not predict the end of a phase. The experimenter randomly assigns different correct rules in each phase, which means that during a phase p, the agent must follow the assigned response rule for all Tp trials. Lets assume for example that it should follow the SS rule. In a sequence of trials we test the response of the robot after light sample appearance at its left or right side (their order is randomly chosen). When a trial starts, the robot is sensing the light and stays at the initial position for five simulation steps formulating its response decision and betting for the success of the underlying trial. Then the agent is allowed to move freely in the T-maze, responding to the aforementioned light sample. According to the SS rule, the response is correct when the robot navigates to the end of the corridor and then turns towards the side of the light sample. If the robot makes the correct choice, it drives close to the target location where positive reward exists. In case that the robot turning is not correct, it will drive to a punishment area receiving negative reward indicating that the currently adopted rule is not correct and it should be switched. Depending on the success of the trial the agent gains (or losses) the amount of reward (or punishment) multiplied by the amount of betting. During phase p, the robot is given 10 free of charge exploratory trials to discover what is the correct rule. In the remaining Tp trials the performance of the robotic agent is evaluated in terms of 10 following the desired response rule. If phase p is completed successfully, the robot moves to phase p+1, where the response rule is changed, let assume to OS. This means that the punishment and reward signals are moved and -for the sake of our example- they are now positioned according to the OS rule. However, the agent is not informed about the rule change and thus, in the first trials of the current phase it will continue responding according to the previous rule. In that case, the agent will drive to a punishment area indicating it is not following the correct rule. Ideally, the agent will realize that the rule has changed and being less confident about the forthcoming response, it will lower its bet in the next trial. In order to avoid punishments in the forthcoming trials, the robot must reconsider its rule choice, exploring alternative response rules, until switching to OS. After that, the agent should increase the amount of betting, in order to acquire more gains. In phase p + 1, the robot is given again 10 free exploratory trials to discover the new correct rule. In the remaining Tp+1 10 trials agents responses are evaluated according to the currently correct rule. If phase p+1 is completed successfully, the robot moves to phase p + 2, where the response rule is changed again say to NR, for our example and a similar let experimental procedure is repeated. Rules are changed in a random order, so that the agent cannot predict their sequence. Overall, the task evaluates agents switching behavior for a maximum of P phases.

we 2In the current study, the evolutionary procedure aims at exploring the domain of solutions of the
underlying problem, and does not represent an artificial counterpart of biological evolution

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IV. Evolutionary Procedure In order to explore the self-organization of executive control dynamics in CTRNNs, we use Genetic Algorithms 2. We are interested in the broader set of mechanisms with the capacity to develop rule switching and self-monitoring, and thus, we do not explicitly specify any internal mechanisms in the model. The network is allowed to self-organize in any appropriate way, developing partial functionalities to accomplish the robotic WCSTB task. Incremental Evolution. Due to the complexity of the investigated task, it is difficult for the evolutionary process to converge successfully when examining from the very beginning all the details of the problem. In order to support the success of the evolutionary procedure we follow an incremental approach similar to [7], investigating gradually more complex versions of the rule switching task. This is summarized in Table I. In the first generations, the evolutionary procedure aims at CTRNN controllers capable of adopting separately each one of the SS, OS and NR rules. In the forthcoming set of generations, we are interested in exploring all possible switching combinations and thus we explore 6 tasks in total (two tasks per rule). The accomplishment of all six tasks implies that the agent can successfully follow the three available rules, giving successful responses for a long sequence of trials. We note that the very same CTRNN model is evaluated six times (one for each task). At the beginning of each task, the states of all CTRNN neurons are set to zero (i.e. the robot is in a neutral state, without following any rule). The robot explores the environment in order to discover the rule that must be adopted for the successful completion of the single-phase task. In the next set of generations, the tasks are getting more complex, searching for controllers capable of switching between rules. Specifically, during generations 201-700,

TABLE I THE INCREMENTALLY MORE COMPLEX TASKS EXPLORED IN DIFFERENT PARTS OF THE EVOLUTIONARY PROCEDURE. explore tasks consisting of two phases, asking for controllers capable of making one ruleswitching step, and additionally bet successfully for the given responses (i.e. reduce betting during the transition period, but increase betting when the rules are successfully
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followed). Note in Table 3, that each task examines a different switching combination among rules. For all six tasks, properly positioned reward and punishment signals indicate the response strategy that the agent should adopt in each trial. The state of CTRNN neurons is reset to zero only once, at the beginning of each task. For all the subsequent steps neural states are kept continuous. This means that special memory pathways have to develop in order to support rule switching. Finally, during generations 701-1200, we explore the stability of rule switching mechanism. In particular, we investigate the performance of CTRNN controllers under multiple and unpredictable changes of the correct rule as well as the capacity of the agent to reduce betting during rule transition periods, but increase it when rules are correctly followed. All tasks consist of a ten-phase sequence. Rules are randomly assigned to the phases, while the number of trials in each phase is also specified in a random manner. The performance of the agent is evaluated on phase p only if it has adopted the correct rule in phase p-1. Similarly to previous generations, CTRNN is reset to zero at the beginning of each task, and then keeps continuous neural state when passing from one phase to the other. Fitness Measure. To evaluate the successful accomplishment of the task, we consider two main aspects of robot performance. The first aspect regards rule following and the second the success of betting strategy. In order to evaluate that rules are switched properly and the correct rule is followed at a given trial, target positions are appropriately exloited (see Fig 2). This approach is followed because it is necessary to have a continuous measure for the success of trials (either successful or not). Lets assume that D is the distance between the starting position of the robot and the target. Then, the minimum distance between the target and the robot route can be used for measuring the success of a given robot response. The target positions are specified according to (i) the current rule, and (ii) the side of the light sample, as it is described in Fig 2. Therefore, the changing of rules when we pass from one phase to the other will specify a varying set of target positions. Overall, the ability of the agent to switch (SW) between rules during the p phases of a task i, is measured by:

The evaluation starts from trial t = 11 because the first ten trials of each phase are exploratory and they are not considered in evaluation. Furthermore, we evaluate agents ability to bet correctly during a sequence of trials. Let us assume that in a given trial t, the agent bets the amount Bt 2 [0; 1], while after giving the underlying response the maximum punishment received was Pt 2 [0; 1], and the maximum reward received was Rt 2 [0; 1]. Then the correctness of agents betting choice (CB) in trial t is defined by:

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We assume that the agent is willing to bet if Bt is larger than 0.5, while it avoids betting if Bt is less than 0.5. The first line of eq (2), examines the case that the agent bets (i.e. Bt > 0:5). If the agent is rewarded (i.e. Rt is high) it gains a profit, while if the agent is punished (i.e. Pt is high) it has a loss. High values of Rt imply low values of Pt and vice versa. The weighting coefficient for punishment is set to the relatively large value of c = 6:0 making the agent to reduce betting during the rule transition period. Low values of the weighting coefficient (e.g. c = 1) make the agent develop an alwaysbet strategy. In the second part of eq (6) we examine the case of avoiding betting (i.e. Bt _ 0:5). When the response given by the agent is incorrect (Pt is high), the no-betting choice was right, and the agent makes profit. However, if the response given by the robot was correct (Rt is high), then avoid-betting choice was incorrect, and the agent has a loss of possible profit. Overall, for a task i described by a sequence of p phases, the capacity of the agent to bet efficiently (BET) is evaluated by the partial fitness measure:

The overall success of the agent on accomplishing the task i 2 f1; 2; : : : 6g, is obtained by the multiplication of SWi and BETi with a weighting coefficient d:

In the first stage of incremental evolution (i.e. generations 1-200) we use d=0, emphasizing the acquisition of rules. In the second stage of evolution (i.e. generations 201-700) d=0.5 making the agent to consider both rule switching and betting. In the last stage, (i.e. generations 701-1200) we use d=2.0, which makes evaluation focus on betting, considering

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Fig. 3. The behavior of the agent in a sequence of trials. The line on top of each trial demostrates the current amount of betting. Light is depicted with a double circle, goal position is depicted with an _, punishment area is depicted with a gray circle, while robot path is depicted with a black line starting from the bottom of the T-maze. In the present figure we follow a more compact representation of a sample-response trial than the one shown in Fig 2, in order to demonstrate an adequately large number of robot trials. also that the rule switching capacity of the agent must be preserved. All individuals encoding CTRNN controllers are tested on the incrementally more complex versions of Task1, Task2, Task3, Task4, Task5, and Task6 described above. The accomplishment of each task is evaluated separately according to eq (4). Then, the total fitness of the individual is estimated by:

The multiplication operator favors individuals that can accomplish (at least partly) all tasks, distinguishing them from those that fail in any one of them.

V. Results In order to explore possible neuronal mechanisms accounting for executive control functions related to rule switching and confidence development, we have conducted 14 statistically independent runs of the evolutionary procedure described above. Six of these procedures converged successfully, producing robot controllers that can effectively
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switch rules and bet correctly accomplishing the WCSTB task. An example sequence of robot trials together with the rule changes made by the experimenter is shown in Fig 3. In the first five trials the agent successfully follows the SS rule receiving rewards. The agent bets maximally with full confidence on its rule-choice. Then in the 6th trial, the experimenter changes the rule to NR. The robot that is not aware of this change responds according to the SS rule and is punished. Immediately after that, the amount of betting decreases, implying weakening of agents confidence about the currently correct rule. After two explorative trials, the agent finds that NR is now the correct rule, receiving positive reward (in trial 8). Subsequently, its confidence to the currently adopted rule is strengthened, and thus the amount of betting increases. The agent follows the NR rule for some more trials giving successful responses. Then in trial 15, the rule is unexpectedly changed again, and the agent gives a wrong response which makes the amount of betting to fall down. The agent identifies the correct rule receiving a positive reward at trial 18. Then its confidence increases, and in the next trial it bets high. In subsequent trials, the agent responds following the OS rule, receiving rewards. The experimenter changes the rule again in trial 27. It takes two more trials to the agent to identify that now SS is the correct rule. In the following trials, the agent increased adequately the amount of betting, responding successfully according to SS rule. Overall, the figure shows that the robot successfully adapts the response strategy to the rules specified by the experimenter, after a short transition period of erroneous responses. We have investigated the internal dynamics of the CTRNN solutions in order to obtain insight into the cognitive mechanisms self-organized in the successfully evolved models. We found that artificial evolution generated two broad categories of networks in which self-organized neural dynamics are qualitatively different (see below). For the sake of clarity of the current presentation, we will refer to these CTRNN categories as Type-A and Type-B3. A. Layered functionality Initially we studied the functional differences of CTRNN layers in order to determine their functionality in the global network. In particular, we performed Principal Component Analysis (PCA) to highlight the main characteristics of neural activity in each layer. The first principal component of high and low layer neural activation for the two types of solutions is shown in Fig 4 where different rules are depicted in different colors (i.e. red:SS, green:OS, blue:NR). We observe that the activity of the higher layer is much more stationary compared to low layer activation. This difference suggests the specialized functionality of each layer. In particular, the rather fast fluctuation of the low layer suggests it is dealing with the sensory-motor issues arising from real-time environment interaction, while the higher part of the CTRNN is probably involved in encoding the currently adopted rule as well as in estimating the confidence of the agent in order to decide betting.

note that our findings do not exclude the possibility that more solution types may exist for the underlying problem.

B. Rule Encoding One more observation form Fig 4 is that neural activity in the higher layer encodes rule NR by using nearly constant and distinct values, while the representation of rules SS and
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OS are less differentiated. To explore further this issue, we have taken the phase plots of the first two principal components of high layer activity, shown in Fig 5. We see three trajectories of quasi-attractors to appear, each one encoding one of the available rules.

Fig. 4. The unfolding of the first Principal Component of neural activity in the high and low layer of the CTRNN for 4 consequtive trials (i.e. 680 simulation steps). Different colours correspond to neural activity when the agent is successfully following different rules. In particular, the principal component of neural activity for rule SS is shown in red, for rule OS is shown in green, while for rule NR is shown in blue. Clearly, in the case of Type-A solution there is a partial overlap between the trajectories encoding SS and OS rules (i.e. trajectories shown in red and green) while NR is represented by a distinct attractor (i.e. blue trajectory). However, in the case of Type-B solution phase plot reveals attractors akin to three different fixed points with a clearly separate representation of each rule. We note that the afore mentioned distinction characterizes the obtained CTRNN solutions as Type-A (i.e. with SS, OS overlap) or Type-B (i.e without overlap). In the totally 6 successful evolutionary runs, solutions of Type-A appeared 4 times, while solutions of Type-B appeared 2 times. The overlap of SS and OS attractors in the case of Type-A solution (see Fig 5) suggests that these rules are organized as subclusters of a larger cluster separating them from NR. This organization is reasonable since SS and OS exhibit common characteristcs when they are both contrasted to NR. In particular, both SS and OS ask the agent to travel along the corridor and turn left or right, while NR asks the agent to ignore sample stimulus and stay close to the starting position (see Fig 2). As a result, the approach followed by the agent in the case of Type-A solution focusing on the differences of SS and OS to NR, is particularly appropriate for the investigated problem. On the contrary, the plot corresponding to Type-B solution (Fig 5), shows a clearly distinct representations for all three available rules. We would like to emphasize that this organization is also reasonable, since each of the three rules is actually standalone and may exists without the others. The completely separate representation of rules SS and OS highlights their independent nature, while at the same time they both remain separate from NR. In summary, the representations of rules self-organized in Type-A and Type-B solutions reflect the different interpretations one can give to the rule-switching problem
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investigated in the present work by either focusing on the relation of SS and OS compared to NR, or the unique identity of each rule.

C. Rule Switching Next we examine the rule transition mechanisms developed in each type of the obtained solutions. To this end, we consider neural activation in the early part of trials. This is a context-rich period, because at that time the agent decides its response according to the currently adopted rule and additionally decides the amount of betting for the underlying trial. We have estimated the average, over the first 15 simulation steps of a trial, for the first two principal components of neural activity in the higher layer of CTRNNs. A 2-D plot of the estimated averages for 68 trials is shown in Fig 6, both for Type-A and Type-B solutions. In this sequence the agent starts by following rule SS, then adopts NR and finally OS. In the trials that the agent successfully follows a given rule, the 2-D plot illustrates points in red, green and blue colors (depending on the rule). During the transition trials where the agent gives erroneous responses (trying to identify the correct rule), the points arising from the principal component averages are illustrated in black. Interestingly, we observe that different transition mechanisms are developed for the Type-A and Type-B solution. In the case of Type-A solution we see that a common rule transition area is formulated that corresponds to the unknown rule state. When the experimenter unpredictably changes the (currently correct) rule, the agent that is not aware of this change gives erroneous responses and thus it is punished. The punishment received

Fig. 5. Phase plot of higher level neural activity when the agent follows (a) the SS rule and (b) the OS rule. Neural activities stabilize to attractors having distinct shapes for each case.

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Fig. 6. The averages of the first two principal components in the begining of trials. The plots associated to type-A and type-B solutions correspond to a sequence of trials investigating rule transitions from SS to NR and then to OS.

causes an instability in the high layer of the CTRNN which makes neural activity move in the unknown rule area. From this state, the agent randomly selects a rule to be applied in the next trial (a rule might be selected more than one times even if it is not correct). If the rule choice proves to be successful, the agent adopts it for the forthcoming trials. However, if the selected rule is incorrect then the network remains in the unknown rule state, selecting a new rule in the next trial. As an example, Fig 6 shows SS!NR and NR!OS switchings. In addition, after testing every possible combinations of rule switching, we observed that all transitions always pass through the unknown rule area. In the case of Type B solution, a different transition mechanism is self-organized in CTRNN as it is shown in Fig 6. For the given example investigating SS!NR!OS, when the agent is successfully following rule SS and the experimenter is unpredictably changing the rule, the instability caused by punishment signals makes the adopted rule jump to OS. However, it happens that rule OS is not correct. Then in the next trial the robot is punished again, which makes CTRNN rule state jump to NR, that is the correct rule. A similar procedure is also observed when the experimenter changes the rule to OS. The punishments provided to the agent make the rule state jump first to SS and then to OS. Overall, we observe that in the case of Type B solutions there are direct transitions from one rule to the other, following a circular organization. We note that additinal expriments revealed that circular transitions apply for all possible rule switching combinations). D. Betting Mechanism Finally, we have investigated confidence mechanisms providing agent the capacity to bet successfully while switching among sample-response rules. Our findings suggest different betting strategies for the two types of solutions. In particular, for Type-A solution, when the agent is in a rule exploration mode (i.e. unknown rule state in Fig 6) its betting choice is always the same without any correlation to the rule currently tested. This is summarized in the second column of Table II showing betting amounts during
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rule testing. When the agent receives a reward approving a rule, then betting strategy differentiates depending on rule as it is illustrated in the third column of Table II. However, for the Type-B solution that is based on direct transitions among rules, the betting strategy shows different characteristics. In particular, when rules are assessed to determine their correctness the agent needs to minimize betting in order to avoid the loss of gains. For Type-B solution, during these testing trials, the agent differentiates betting depending on the rule assessed. This is summarized in the fourth column of Table II, listing the amounts of betting during rule testing. When the agent receives reward approving a rule, the betting strategy remains differentiated as it is illustrated in the fifth column of Table II.

TABLE II THE RANGE OF BETING AMOUNTS WHEN THE AGENT TESTS OR FOLLOWS EACH RULE, FOR THE TWO TYPES OF OBTAINED SOLUTIONS. Overal, our observations indicate that confidence interpretation in the CTRNN is directly correlated to the possible views that may be developed on a given problem, as well as the characteristics of the neural mechanisms supporting the solution of the problem. VI. Discussion In the current work we investigate executive control functions putting them in the context of artificial agents. Our study follows a minimum constraint approach that avoids assigning predefined roles at different parts of the artificial cognitive system. Examining the internal neurodynamics of CTRNNs we found two different types of solutions selforganized in the models. Interestingly, we observed that a loose segregation of system components by means of bottleneck architectures facilitates the emergence of different roles in each part of the system, and the self-organization of functional hierarchies. In the obtained results, higher layer is involved in the manipulation of sample-response rules, while the lower part takes care of environment interaction issues. The evolutionary self-organization of CTRNNs revealed two possible mechanisms accounting for high level executive control in WCSTB. The relevant mechanisms arise from two different interpretations one may give to the problem investigated in the current study (i.e. according to the similarity of SS and OS when compared to NR, or, according to the standalone nature of the three rules). Therefore, our findings suggest for biological cognitive systems that the way a task is understood by a human subject is likely to affect the development of the relevant
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dynamics in his brain. In other words, when two subjects understand a given problem in different ways, then they may use cortical resources in different ways when solving the problem. This is a novel way to approach high level executive control functions in the cortex that is rarely considered in neuroscientific studies. We note that we have also explored how the low layer of CTRNNs specialize for Type-A and Type-B solutions. However, we have been unable to identify clear specialized characteristics. Therefore, our experiments suggest that high level cognitive functions are more likely to differentiate among subjects than low level processes. Intuitively this view is supported by the fact that low level processes are less plastic because they are linked to the phylogeneticaly hard coded characteristics of the sensory-motor system, while high level cognition has enough freedom to flexibly self-organize in the cortex considering prior experiences and knowledge. Our suggestion is further supported by the argument that high level cortical areas far from the primary cortices show increased flexibility when adopting their functionality [17]. VII. Conclusions We have adopted an evolutionary robotics approach to explore posible characteristics of executive control functions. Our findings suggest that the mechanisms involved in excutive control may depend on the interpretations that humans may give to a particular problem. In the future we will investigate further the betting mechanisms self-organized in CTRNNs in order to obtain better insight on the possible slf-monitoring mechanisms of the human brain. References
[1] B. Milner, Effects of different brain lesion on card sorting. Archives of Neurology, vol. 9, pp. 90100, 1963. [2] K. Greve, T. Stickle, J. Love, K. Bianchini, and M. Stanford, Latent structure of the Wisconsin Card Sorting Test: a confirmatory factor analytic study, Archives of Clinical Neuropsychology, vol. 20, pp. 355364, 2005. [3] F. Mansouri, K. Matsumoto, and K. Tanaka, Prefrontal cell activities related to monkeyss success and failure in adapting to rule changes in a wisconsin card sorting test analog. The Journal of Neuroscience, vol. 26, pp. 27452756, 2006. [4] D. Koren, L. Seidman, and P. Harvey, Real-world cognitiveand metacognitivedysfunction in schizophrenia: a new approach for measuring (and remediating) more right stuff. Schizophrenia Bulletin, vol. 32, no. 2, pp. 310326, 2006. [5] K. Doya and S. Yoshizawa, Memorizing oscillatory patterns in the analog neuron network. in Proc. of 1989 Int. Joint Conf. on Neural Networks, (IJCNN-89), 1989, pp. 2732. [6] R. Beer, A dynamical systems perspective on agent-environment interaction. Artifficial Inteligence, vol. 72, pp. 173215, 1995. [7] M. Maniadakis and J. Tani, Acquiring rules for rules: Neurodynamical systems account for meta-cognition. Adaptive Behavior, vol. 17, pp. 5880, 2009. [8] E. Ruppin, Evolutionary autonomous agents: A neuroscience perspective, Nature Reviews Neuroscience, vol. 3, no. 2, pp. 132141, 2002.
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[9] S. Dehaene and J. Changeux, The wisconsin card sorting test: theoretical analysis and modeling in a neuronal network. Cerebral Cortex, vol. 1, no. 1, pp. 6279, 1991. [10] R. OReilly, Biologically based computational models of high-level cognition. Science, vol. 314, pp. 9194, 2006. [11] P. Dayan, Bilinearity, rules, and prefrontal cortex. Frontiers in Computational Neuroscience, vol. 1, pp. 114, 2007. [12] A. Stemme, G. Deco, and A. Busch, The neuronal dynamics underlying cognitive flexibility in set shifting tasks. Journal of Computational Neuroscience, vol. 23, pp. 313331, 2007. [13] B. M. Yamauchi and R. D. Beer, Spatial learning for navigation in dynamic environment, IEEE Trans. Syst. Man Cybern., vol. 26, no. 3, 1996. [14] M. Maniadakis and J. Tani, Dynamical systems account for meta-level cognition, in 10th Int. Conf. on the Simulation of Adaptive Behavior (SAB-08), 2008. [15] R. Paine and J. Tani, How hierarchical control self-organizes in artificial adaptive systems, Adaptive Behavior, vol. 13, no. 3, pp. 211225, 2005. [16] D. Joel, I. Weiner, and J. Feldon, Electrolytic lesions of the medial prefrontal cortex in rats disrupt performance on an analog of the Wisconsin Card Sorting Test, but do not disrupt latent inhibition: implications for animal models of schizophrenia, Behavioural Brain Research, vol. 85, pp. 187201, 1997. [17] J. Fuster, Cortex and mind: unifying cognition. New York: Oxford University Press, 2005.

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Internationalization of Technology Development in India

ALOK CHAKRABARTI Tampere University of Technology, Tampere, Finland, & PRADIP K. BHAUMIK International Management Institute, New Delhi, India


he geopolitical and economic systems have been transformed after 1990 globally. Changes in information and communication technology (ICT) have accelerated changes in the traditional business models of many industries. The codification of information makes it possible to open up the value chain of a business and to parse it to different partners (Mann, 2005). In a recent study, by McKinsey Global Institute (2005), it has been estimated that global outsourcing will increase significantly in different industries. The drivers for outsourcing are different by the industry sector characteristics and dynamics. Organizational, technical and operational factors such as needed for a global presence, suitability of process to support global outsourcing, and the scale of business process are also important determinants of outsourcing. Inhibitors for outsourcing are need for physical proximity, importance of local knowledge, and complex interaction in the business process. However, these factors have different levels of impact on the outsourcing decisions. Dossani and Kenney (2004) explored the potential of outsourcing of various types of business services to India. Their comprehensive analysis of the business conditions in India predicts a continuation of the growing trend of outsourcing of various services to India. As some of the vendors are moving up the value chain, one can expect a higher level of off shoring of higher skilled jobs. These of course, raised issues related to political economy of relocation of service jobs. Discussions about outsourcing both in academic and popular media are anchored either on the economics of outsourcing or on the political economy of the result of outsourcing from the perspective of the countries of the customers. Economists and management scholars have based their theories and normative statements primarily on the transaction cost economics. Most of the discussions in this area have been on how to get the advantage of the differences in the factor prices, primarily the wages, to attain operational efficiency of business services. In some instances, the management scholars are exploring the possibilities of some value added services from the vendors in the outsourcing context. The political debate in the context of outsourcing is primarily about the job loss and the changing nature of job composition in the USA. The trade policy of the USA has been
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singled out as the cause of the job loss through outsourcing. Even web sites have been developed by opponents of outsourcing to single out the companies involved in outsourcing and thus create political pressure against them. Outsourcing is a controversial topic that needs to be examined more carefully to understand its impact on both the customer and the vendor and their respective societal contexts. Bhagwati et al. (2004) have pointed out the problem of confusion due to inconsistent definition of outsourcing. They commented: When many politicians, journalists and even some economists start discussing outsourcing, they soon leap beyond purchases of offshore arms length services to include, without analytical clarity, phenomena such as purchase of manufactured components and even direct foreign investment by firms. Bhagwati et al. (2004) accepted the World Trade Organization (WTO) classification of outsourcing as follows: Mode 1 is the trade in services at arms length supply with the supplier and the buyer remaining in their respective locations. The Mode 2 services are provided by moving the recipient of services to the location of the service provider. In Mode 3, the service provider establishes a commercial presence in another country requiring a modest level of direct investment. In Mode 4, the service provider moves to the location of the service buyers. According to Bhagwati et al. (2004) most political controversies are related to the Mode 1 outsourcing ignoring the other types of outsourcing. The literature has not recognized the complexity of the process. This has led to the confusion and conflicting statements about the impact of outsourcing. The WTO definition is restricted to the location of the different parties and focuses too much on the offshore outsourcing. The benefits from outsourcing generally are cost savings. This is due to the differences in wage levels in different countries. As Dossani and Kenney (2004) pointed out, there is a significant cost advantage in locating the activities in a low-wage country like India. Agilent Technologies, a spin-off of Hewlett Packard lowered its processing cost of financial transaction to approximately one tenth of its original cost. There were other gains in productivity that became attractive to Agilent. The political debate against outsourcing is rooted in the fact that it is easy to ascertain the benefits accrued due to the operational efficiency achieved by a company. How much of that benefit can be externalized or appropriated by others is the key question. In other words, suppose company X achieves a cost saving of a million dollars by outsourcing some activities to another country and eliminates 100 jobs. The question is then how those people laid off are better off?
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Baily and Lawrence (2004) raised a caution in attributing cause of the job loss to outsourcing. They commented: First, some of the tasks that moved to India would have been performed by automated IT hardware and software in the US; hence jobs would have been lost in any case. Second, because services being provided from India are cheaper than equivalent services provided from within the United States, it is likely that greater quantities of these services are sold than if Indian off shoring were not available, and that these services are performed in a more labour-intensive fashion. One of the main arguments put forth by Baily and Lawrence (2004) is that it is the weakness of the US exports and not the strength of imports that was responsible for the job loss. Their argument is that macroeconomic policy determines the employment level while trade policy affects the composition of jobs. Our study examines how India has performed in the higher end of the value chain in outsourcing, namely technology generation. Globalization of R&D The internationalization of research and development (R&D) has not been a recent phenomenon. Large multinational companies increased their R&D investment in various host countries during the past years. Doz et al. (2006) have found that the multinational companies increased their R&D expenditure in various host countries from 45 per cent in 1975 to 66 per cent in 2006. The most significant factor in this trend is the emergence of China and India as major destinations of R&D since the mid-1990s. Multinational companies mostly setup their own R&D centres in China and India and occasionally utilize third parties. India adopted the policy of economic liberalization and opened up the economy for foreign direct investment. Coupled with the advent of the WTO trade was harmonized and new regimes of intellectual property were initiated. This has changed the patent system in India and the importance of patent was recognized to protect the competitive position. According to the survey done by a UK based firm, Ocomonitor, 25 per cent of all foreign direct investment in R&D projects are directed to India, China being the second with 12 per cent. In a detailed study of a large panel of manufacturing firms in India for the period of 1992-1999, Kumar and Aggarwal (2005) observed that the overall R&D intensity of enterprises in India declined over the post-liberalization era; the foreign subsidiaries increased their R&D effort, while local firms decreased theirs. Indian firms focused on absorption of knowledge embodied in imported capital goods. Their conclusion was that the firms had to seek international markets and required to develop in-house technological capability to support their global strategy. This pattern of behaviour is consistent with the model proposed by the United Nations Committee on Trade and Development (UNCTAD). UNCTAD identified four types of technical efforts that firms are engaged in based on the hierarchy of complexity: basic
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production, significant adaptation, technology improvement and monitoring, and frontier innovation. As the technical prowess of a country develops, it will engage in higher level of activity. Sturgeon (2003) subscribes to the hierarchy of technical activities in terms of complexity and consequent stickiness in specific locations. However, a locality can progress to more complex activities with development. Amsden and Tschang (2003) provide a broader categorization of R&D activities by combining the OECDs Frascati manual and the US Department of Defense terminology. They identify five activities based on the objectives and skills necessary to undertake the tasks as follows: pure science, basic research, applied research, exploratory development and advanced development. The effectiveness of the last two types of activities can be tested through market success while the first three can generate intellectual property in the form of patents and publications. To understand the innovation capability of these countries, we use the innovation capability index developed by the UNCTAD (2005). This index consists of two indices, technological activity index and human capital index. The technological activity index is measured by R&D personnel per million, US patents per million, and scientific publications per million. Human capital index consists of literacy rate, secondary school enrolment, and tertiary education enrolment as per cent of respective age group. India scores low in the innovation capability index and it has not changed from 1995 to 2001. Although India and China scored low on the innovation capability index, they have been able to attract great attention due to the sheer size of their technical and scientific personnel as well as the market potential. India provides an added benefit with its proficiency in the English language due to its colonial past. Both China and India have developed their universities to world standard. Huggins et al. (2007) estimated that 25.6 per cent of all foreign direct investment in R&D projects was directed to India in 2006. China was the second most popular destination for R&D projects. The major players in this are the US multinational companies (MNC), Intel, IBM, Motorola and Microsoft. Performance of R&D Organizations in India International R&D activities entail many risks. Based on the experience of Japanese pharmaceutical firms, Penner-Hahn and Shaver (2005) found that internationalization of R&D increased the patent rate. However, only firms that had developed internal cap capability in certain technical fields, benefited from their global effort. Their conclusion was that internationalization was no panacea for lack of internal capability. As we have observed the surge of outsourcing of various types of business processes including R&D and design activities to India, we examined the performance of these organizations by focusing on the US patents granted to inventors in India. Since many patents will have co-inventors from either India or abroad, we searched for the patents in which at least one inventor was from India. Patents have been used as a metric to measure the level of innovative output for comparing the competitiveness of nations (Atun et al., 2006). Bhattacharyya and Nath (2002) used US patents as index of performance in their comparison of China and India
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as they found this to be a consistent and valid measure. They also noted that firms often take US patents as the US represents the largest market. Global Trends in Patents Before focusing on India, we examined the general global trends in patents. In 2007, the US Patent and Trademark Office (2008) granted 182930 patents of which 51.21 per cent were of US origin. This has been consistent for a long time. During the period 1994 to 2007, there has been a 3.45 per cent cumulative annual growth rate in patents granted. However, foreign organizations exhibited 4.32 per cent growth rate per annum while the growth rate of US originated patents has been only 2.72 per cent per annum. The top ten foreign countries granted US patents are Japan, Germany, the UK, France, Taiwan, Canada, South Korea, Italy, Switzerland and Sweden. The shift in patents issued to countries in Asia is perceptible, but slow. Patents granted to India (578 in 2007) are negligible in the global perspective. South Korea has shown a remarkable high-growth rate of 15.2 per cent per annum. While the total number of patents to India is negligible, its growth rate is about 24 per cent per annum during 1994-1997. Our study is not focused on patents granted to India but on patents granted with Indian inventors. Corporations in the US and abroad were dominant in patenting technology. The negative growth rates of US Government and US Individual patents were noticed. US Corporation patents showed a positive growth rate of 3.70 per cent while foreign corporations registered a still higher growth rate of 4.93 per cent p.a. Foreign government patents showed a steep negative growth rate of29.34 per cent. The role of governments in patenting activity is disappearing globally while that of individuals is weakening. Corporations remain the driving force for R&D in the foreseeable future and India needs to actively encourage corporate R&D. The top corporations in patents are Samsung, IBM, Matsushita, Canon, Sony, Toshiba, Hitachi, General Electric, NEC and Mitsubishi. It is interesting to note that of the ten corporations, seven are Japanese and only two are Americans. Samsung has made a remarkable progress in this and in 2007 replaced IBM that has been the leader in US patents for many years till then.

Trends in Patent with Indian Inventors Until 1990, the number of patents originating from India has remained negligible for all practical purposes. The situation has changed since 1990 after the liberalization of the Indian economy and changes in the geopolitical environment at first slowly and then dramatically. We have carried out an exhaustive study of all the patents granted by USPTO from 1992 to 2007, where at least one of the inventors was a resident of India. In 1992, there were just 44 patents while by 2007 it went up to 779. These are the patents with at least one inventor from India. We find that this growth has taken place in three sequential phases: the first phase was from 1992 to 1997, the second phase from 1997 to 2002 and the third phase from 2003 to 2007. During the first phase the rate of growth in patents has been 12.2 per cent per annum, this increased to a staggering 36.1 per cent per annum in the second phase and
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rebounded to a decent 18.0 per cent per annum in the third phase. The slow rate of growth in the first phase is perhaps due to the bootstrapping effect and is the result of enhanced awareness and acceptance of a culture of patenting ones intellectual property. The second stage shows a very high rate of growth, probably the inventors pursued patents for technologies on the shelf. The third stage shows a growth rate that is pretty high and we expect it to be stabilized at this rate in the near future.

Nature and Ownership Pattern of Patents with Indian Inventors Our analysis was focused on the following issues: residence status of the inventors; patterns of patents by industry sectors; and ownership patterns of the patents. Figure 1 shows our conceptual map for analysis. Our presentation is built around this conceptual map of the process of patenting. The output of the process is the award of patents to different assignee countries. The research inputs are provided by individual researchers residing in different countries. These researchers are organized into different researching entities like companies, institutes, etc. The researchers work in different sectors where the inputs are converted into patent outputs these are analogous to processes. We study the whole process on a time line captured by year or by phase.

Most patents are issued either to India alone or to some foreign country(ies). Very few are jointly assigned to India and another country. This suggests very little collaborative work between research entities. However, there could still be collaboration among researchers Indian and non-Indian, say from the same MNC, i.e. with a single assignee. This aspect will be studied later. Figure 2 shows that patents granted to foreign countries are growing at a faster rate than those granted to India. As a result, 2005 onwards more patents are granted to other countries than to India. In the third phase, the growth of patents with India as an assignee country has fallen and that has made the difference between the two sharper just three years after the crossover.
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This aspect is further elaborated in Figure 3, which shows that Indian patents increased 4.40 times from between Phases I and II while Foreign patents increased 3.10 times between Phases II and III. The same is reflected in the composition of patents Indian patents constituted 41 per cent of all patents in Phase I; this increased to 55 per cent during Phase II, but fell to 44 per cent in Phase III as Foreign patents grew 3.10 times during Phase III. Sectoral Distribution of Patents We classified all patents granted into 16 sectors. However, only six sectors had active patenting viz. biotechnology (59 in 2007), electronics and telecom (149), industrial chemicals (52), information technology (252), instrumentation (51) and pharmaceuticals (103). We further reduced sectors to four broad categories: ICT, food and chemicals, biotechnology and pharmaceuticals and others. Figure 4 shows the distribution of patents in four broad categories of sectors in three different phases. In Phase II, the first two sector clusters viz. biotech and pharma and food and chemicals grew faster than the other sector clusters, while in Phase III, only ICT grew faster than the remaining three sector clusters. The result is that in Phase III 42 per cent of all patents were ICT patents.

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On further analysis a pattern can be identified from Phase II onward. Indian patents were mostly in the first two sector clusters viz. biotech and pharma and food and chemicals
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while foreign patents were largely in ICT. Although a few ICT patents were granted to India in Phase III, the earlier trend continued in Phase III as well. Ownership Pattern of Patents with Indian Inventors We identified the following classes of ownership: individual inventor, Indian companies, foreign companies and public research institutes. Individual inventors accounted for negligible number of patents. Corporate organizations and public research institutions, notably the Council of Scientific and Industrial Research are the major players in this. There is a distinct difference in technological focus between Indian organizations, and foreign corporations. The research institutions have focused on two sectors: (1). Biotechnology and pharmaceuticals; and (2). Food and chemicals. Indian companies do not show any proclivity to any particular sector. Foreign companies have focused on the ICT sector and they dominate it. The major players are well-known companies such as IBM, General Electric, Texas Instrument, Hewlett Packard and Microsoft. In Phase I total patenting activity was low, largely carried out by foreign companies. The largest number of patents in a particular year was 43 in the whole of Phase I and was in the pharmaceutical sector. In phase II, public research institutes in India received many patents particularly in biotechnology (71), industrial chemicals (131) and a fewer 58 in pharmaceuticals. It is interesting to note that Indian pharmaceutical companies accelerated their patent rate and received 89 patents in Phase II (vs only ten in phase I). Foreign companies were active in electronics and telecom (132 patents) and information technology (54 patents). The same trend continued in third phase foreign companies intensified their patenting effort in ICT. As in pharmaceutical sector earlier, Indian companies followed foreign companies and made a modest beginning in ICT patents. Indian companies are slowly getting active in other sectors as well like in biotechnology, industrial chemicals and petrochemicals while they successfully overcame the dominance of foreign companies in pharmaceuticals. The growth rate of patents from Indian institutes seems to have slowed in the third phase vis-a` -vis the second phase.

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Inventor Background The background of the inventors can be categorized as follows: Indian inventors working alone. Indian inventors working with other Indian inventors. Indian inventors working in collaboration with foreign inventors. Our data show that there are only two dominant categories of researchers: (1). Indian residents working alone or only with other fellow Indian residents. (2). Indian residents working with US residents (with or without residents of any other country). In other words, most researcher collaboration is with US resident researchers many of these may still be of Indian origin and ethnicity but US residents. In 1992, in less than 50 per cent of the patents granted, Indian researchers were working alone or with fellow Indian residents; in majority of the patents the Indian researchers were working in collaboration with non-Indian residents as shown in Figure 5. In the second phase (or late first phase) onwards, Indians working alone gathered momentum. We know this was due to the thrust provided by the CSIR institutes. Even in the third phase when corporate patenting has grown faster than institute patenting, this trend continues. This is because even foreign companies are using only Indian research teams more frequently. When Indian residents collaborated with others, most (95-96 per cent) of the patents were granted to foreign countries. On the other hand, when Indians work alone, bulk (66-82 per cent) of the patents are granted to India alone. In phase III, this ratio has come down to 66 per cent suggesting that even in many MNC projects, more and more all-Indian teams are being used. Collaboration of Indian and non-Indian researchers is used only by foreign companies, while Indian companies as well as Indian institutes do not use much collaboration. Foreign companies have also increased the use of all-Indian teams in the third phase. This suggests the maturing of Indian researchers particularly in the ICT sector cluster. Figure 6 shows patterns of collaboration with technical personnel in foreign countries. Percentage of ICT patents is growing in both collaborated and non-collaborated projects. In collaborated projects, this trend is consistent across all three phases. In noncollaborated projects, ICT patents started growing only in third phase. This may largely be due to MNCs using more of all-Indian teams for their ICT projects. Percentage of ICT patents is growing in both collaborated and non-collaborated projects. In collaborated projects, this trend is consistent across all three phases. In noncollaborated projects, ICT patents started growing only in third phase. This may largely be due to MNCs using more of all-Indian teams for their ICT projects.
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Conclusions In both Indian companies and Indian institutes, Indian researchers were working alone in Phases I and II. In Phase III, we note the initiation of collaborative R&D with foreign nationals by Indian organizations.

About 2.4 per cent of the Indian company patents involved collaborative work during Phase III. Foreign institutes and universities receiving patents using Indian researchers have been very few, just about 15 in each of the three phases and that is a small number to draw any meaningful conclusions. However, the most striking change is noticed in the case of foreign companies. For these patents owned by foreign companies, only 17.1 per cent of the patents in Phase I involved only Indian team members. This increased to 25.7
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per cent in Phase II and peaked to 41.4 per cent in Phase III. This happened just as the total number of patents obtained by foreign companies increased from 146 in Phase I through 382 in Phase II to 1,488 in Phase III. This shows two trends one is the clear increase in patents obtained by foreign companies using Indian researchers. We have noticed this change earlier as well. The second trend is the greater reliance on all-Indian research teams. This suggests the maturing of Indian research teams. They have learnt in the earlier phases and are in a position to take more and more of the responsibilities themselves without depending on non-Indians. Both are advantageous trends for the host country India. Its researchers are getting more competitive as judged by the MNCs. Simultaneously, its companies are learning to take advantage of non-Indians perhaps in niche research areas. References
Amsden, A.H. and Tschang, F.T. (2003), A new approach to assessing the technological complexity of different categories of R&D (with examples from Singapore), Research Policy, Vol. 32, pp. 553-72. Atun, R., Harvey, I. and Wild, J. (2006), Innovation, patents and economic growth, Discussion paper 5, Imperial College, London. Baily, M.N. and Lawrence, R.Z. (2004), What happened to the great US job machine: the role of trade and electronics off shoring, Brookings Papers on Economic Activity, Vol. 35, pp. 211-43. Bhagwati, J., Panagraiya, A. and Srinivasan, T.N. (2004), The muddling over outsourcing, Journal of Economic Perspectives, Vol. 4 No. 4, pp. 93-114. Bhattacharyya, S. and Nath, P. (2002), Using patent statistics as a measure of technological assertiveness: a China-India comparison, Current Science, Vol. 83 No. 1, pp. 23-9. Dossani, R. and Kenney, M. (2004), Lift and shift: moving back office to India, Information Technologies and Development, Vol. 1 No. 2, pp. 21-37. Doz, Y., Wilson, K., Veldhoen, S., Goldbrunner, T. and Altman, G. (2006), Innovation: Is Global the Way Forward?, INSEAD, Paris. Huggins, R., Demirbag, M. and Ratcheva, V.I. (2007), Global knowledge and R&D foreign direct investment flows: recent patterns in Asia Pacific, Europe and North America, International Review of Applied Economics, Vol. 21 No. 3, pp. 437-51. Kumar, N. and Aggarwal, A. (2005), Liberalization, outward orientation and in-house R&D activity of multinational and local firms: a quantitative exploration for Indian manufacturing, Research Policy, Vol. 34, pp. 441-60. McKinsey Global Institute (2005), The Emerging Global Labour Market: The Demand for Offshore Talents in Services, McKinsey Global Institute, Washington, DC, June.

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Mann, C. (2005), This is Bangalore Calling: Hang up or Speed Dial? What Technologyenabled International Trade in Services Means for the US Economy and Workforce, Federal Reserve Bank of Cleveland, Cleveland, OH. Penner-Hahn, J. and Shaver, J.M. (2005), Does international research and development increase patent output? An analysis of Japanese pharmaceutical firms, Strategic Management Journal, Vol. 26, pp. 121-40. Sturgeon, T.J. (2003), What really goes on in Silicon Valley? Spatial clustering and dispersal in modular production networks, Journal of Economic Geography, Vol. 3, pp. 199-225. UNCTAD (2005), World Development Report: Transnational Corporations and the Internationalization of R&D, United Nations Conference on Trade and Development, New York, NY. US Patent and Trademark Office (2008), PTMT Special Report: All Patents, All Types, Electronic Information Products Division, USPTO, Alexandria, VA.

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Towards Organizational Effectiveness Through the Greater Use of Human Resource Practice in Public Healthcare Organizations
ZIA ULLAH Institute of Administrative Sciences University of the Punjab Lahore

Introduction The desire of human resource (HR) practitioners to demonstrate the value of what they do for the rest of the organization has a long history (Wright, Gardner, Moynihan, Allen, 2005). Drucker (1954) referred to personnel manager as constantly worrying about their inability to prove that they are making a contribution to the enterprise. This has been echoed more recently by Stewart, (1996) who described HR leaders as being unable to describe their contribution to value added except in trendy, unquantifiable and wannabe terms. In response to these longstanding and repeated criticism that HR does not add value to organization, the past ten years has seen a burgeoning of research attempting to demonstrate that progressive HR practices result in higher organizational performance (Wright, at el. 2005). Huselids (1995) groundbreaking study demonstrated that a set of HR practices he referred to as High Performance Work System (HPWS) were related to turnover, accounting profits, and firm market value. Today most hospitals have human resource management policies which look very similar to those in modern industries (Lentz, 1957). Hospital is a service oriented and labor intensive organization. The effectiveness of a hospital is mostly dependent on the effectiveness of its workforce. Therefore, among the most frustrating and fascinating problems of hospital administration is that of integrating human resource management policies and practices into its top management decision-making process. Significance of the Study Healthcare is a general public basic need and as such community expects the healthcare organizations to provide healthcare services effectively and at affordable cost. The hospital may be seen as a special kind of public utility designed to serve the total community (Lentz, 1957). Like many industries and businesses today, healthcare organizations are under mounting pressure to embrace new approaches to improve quality. For many healthcare organizations over the past decade, it has become clear that the sustainability of these organizations, whilst making them both modern and dependable relies upon a new drive for quality (Zairi & Jarrar, 2001). Healthcare organizations have to adopt a series of strategies to increase effectiveness and efficiency in health service provision. These include reengineering organizational layout; investment in human capital; decentralizing decision-making; restructuring hospital services with an increased role for substitution between different levels of care; strengthening primary healthcare services; increasing patient choice and participation in health services; and improving outcomes through technology assessment and quality development initiatives (EHR, 2002).
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The hospital continues to be one of the most complex organizations in existence (Dawra, 2002). It does not lend itself to be defined precisely and objectively. Its different organs are autonomous in one sense and controlled in the other, independent and at the same time seriously dependent and complement one another. Patient is the major stakeholder of a hospital and all the activities in hospital take place for the sake of welfare of patients. All the employees of a healthcare center including physicians are expected to subordinate their personal interest to the welfare of patients. Patients trust doctors, nurses, and other employees with their lives and well being. Keeping in view the total dependence of the patient on hospital employees especially on physicians, hospital administration should ensure the greater use of human resource practices. The public health sector in Pakistan is still weak and is suffering from considerable deficiencies such as insufficient fund to meet the recurring expenditures and mismanagement. The main causes of avoidable deaths in the country are malaria, tuberculoses, childhood infection diseases, micro-nutrient deficiencies, unhygienic living conditions and poor nutritional practices. Such bad health condition is reflected in the very high rate of child mortality (110.3 per thousand), infant mortality rate (83.3 per 1000), and low life expectancy (63.0) (ESP 2003-04). However, in Pakistan, healthcare is being provided to the public through a vast infrastructure of health facilities consisting of hospitals, dispensaries, basic health units and maternity child health centers with considerable number of doctors, dentists, nurses, lady health visitors and mid-wives. At present there are about 97945 hospital beds in the country which give a population bed ratio of 1490 persons per bed. The number of registered doctors is 96248 while the number of available dentists is 4622 and that of nurses is 40114, and 5845 qualified health visitors. There is one doctor for 1516 persons, one dentist for 31579 persons and one nurse for 3639 persons. There is about 907 hospitals and 4625 dispensaries in the country. The number of Basic Health Units (BHUs) is 5230 while the number of Rural Health Centers (RHCs) is 541. Since the majority of doctors and hospitals are located in cities and towns, the rural population has much lower standard of health facilities (ESP, 2003-04). However, the paper in hand will focus on underlining the operational problems faced by a patient, when he/she enters into a healthcare center with a view to get treatment. Based on the premise that High Performance Work Practices (HR practices) increase organizational effectiveness, the paper suggests to seek remedies for such problems in these practices. A preliminary survey of different publicly owned hospitals highlighted the following problems common in the most hospitals in Pakistan:


Patients who need surgery most often have to wait for a long time, mostly months, for their turn to come. Thus unavailability of timely treatment causes death of patients suffering from curable diseases. Test results are less reliable and valid. A large number of patients as well as physicians prefer to get the required tests done privately for relatively accurate and better diagnosis. The results of laboratory tests take considerable time and a patient has to wait for months to have radiographic image like CT Scan, Angiography etc. Delay in communication of diagnostic results produces difficulties for patients. Medicines provided in public hospitals are purchased at the lowest price as per government rule without considering their efficacy. This affects organizational



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performance badly by either not working against the diseases or slowing down the rate of recovery.


The number of beds in public hospitals is less as compared to the average number of inpatients. Beds are informally distributed among physicians and surgeons. Patients are admitted to wards at their will and medical officers even registrars of wards have no authority to admit a patient needed to be observed continuously. Admission to wards is relatively easy when a patient has already visited a physician privately. Patients from out-patient department (OPD), needed to be admitted, find less often the opportunity to be admitted. Provision of medicines from OPD dispensary is well red tapped. A large number of patients purchase medicines from outside market to avoid this cumbersome facility. Physicians mostly focus only on clinical aspect of treatment and ignore psychological side of it. A large number of physicians prescribe medicines of low efficacy or high priced to please sale representatives of pharmaceutical companies when substitute medicines of high efficacy and low price are available. ordinates. This high empowerment coupled with job security make them more private practice oriented where the accessibility for the public at large is hard because of economic reasons.


7. 8. 9.

10. Physicians are relatively independent and less accountable before their super-

11. Tight control and centralization of power by regulating their private practices led
them to quit from their services. Thus public hospitals started to loose senior and experienced physicians.

12. Senior physicians perceive the entry of young competent doctors a threat. So, they
try their best to create all possible hurdles in their way to entry to avoid competition.

13. Physicians resist change and prefer status quo. As a result hospitals remain deprived
of technological developments and innovations that facilitate and authenticate diagnosis and treatments.


The position of Medical Superintendent and other top level management positions are political ones. Such positions are filled vis--vis affiliation rather than competence. given due importance neither by physicians and hospital administration nor by patients and their caretakers. This results lack of work motivation and high turn over rate among nurses and paramedics.

15. The work of nurses and paramedical staff is always underestimated. They are not

16. The service provided in OPD is less satisfactory as compared to wards and
emergency units. The activities in OPD are not properly systematized to facilitate patients.

17. Hospitals are not kept clean. Odd smell is generally experienced and grimes are
seen everywhere.
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The present study aims at developing a conceptual framework that exhibits possible solution of these problems or at least a few of them in High Performance Work System (HPWS). Related Literature The impact of human resource management (HRM) policies and practices on firms performance is an important topic in the fields of human resource management, industrial relations, and industrial and organizational psychology (Boundreau, 1991; Jones & Wright, 1992; Kleiner, 1990; Huselid, 1995). An increasing body of work contains the argument that the use of High Performance Work Practices, including comprehensive employee recruitment and selection procedures, incentive compensation and performance management systems, and extensive employee involvement and training , can improve the knowledge, skills and abilities of a firms current and potential employees, increase their motivation, reduce shirking, and enhance retention of quality employees while encouraging nonperformers to leave the firm (Jones & Wright, 1992; U.S. Department of Labor, 1993). A firms current and potential human resource are important considerations in the development and execution of its strategic business plan and human resource management practices can help create a source of sustained competitive advantage, especially when they are aligned with a firms competitive strategy (Cappelli & Singh, 1992; Huselid, 1995). Since then a number of studies have shown similar positive relationships between HR practices and various measures of firm performance. For instance MacDuffie (1995) found that bundles of HR practices were related to productivity and quality in his sample of world wide auto assembly plants. Delery and Doty (1996) found significant relationships between HR practices and accounting profits among a sample of banks. Youndt, Snell, Dean, and Lepak (1996) found that among their sample of manufacturing firms, certain combinations of HR practices were related to operational performance indicators. Delaney (in press) found the widespread use of progressive human resource management practices to have a strong and negative effect on organizational turnover in the manufacturing sector. Ichniowski, Shaw, and Prennushi (1993) using longitudinal data found the impact of cooperative and innovative HRM practices to have positive and significant effect on organizational productivity. Similarly, Arthur (1994) found that those with commitment, human resource systems, emphasizing the development of employee commitment, had lower turnover and scrap rate and higher productivity than firms with control system emphasizing efficiency and the reduction of labor cost. The evidence presented by Boyne, Jenkins, & Poole (1999) suggests that, in the area of HRM at least, organizational policies and practices in the public and private sectors remain different in many important respects. In particular the traditional style of paternal, standardized and collectivized HRM is more prevalent in public than private organizations. Farnham and Horton (1996) identify a number of primary characteristics of conventional HRM practices in the public sector. First, a paternalistic style of management which purported to protect and promote the well-being of the workforce. Secondly, standardized employment practices were adopted in each part of the public sector (for example, civil services, local government, health service). This implied that workers performing the same task had the same terms and conditions, both within organizations and across organizations providing the same services regardless of their geographical location. Such standardization provided full-time employment, job security
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and life-time employment for large numbers of worker. Organizations may be driven to emulate their private competitors. Similarly, public organizations with a large number of new staff may follow private practices more closely (Boyne, Jenkins, & Poole, 1999). The Theoretical and Research Framework Most interpretations of the term Human Resource Management may be traced to the definition of the Harvard School in which HRM is seen to involve all management decisions that affect the relationship between the organization and employeesits human resources (Beer et al. 1985). Delaney, Lewin, and Ichniowski (1989), demonstrated that ten practices in the areas of personnel selection, performance appraisal, incentive compensation, job design, grievances procedures, information sharing, attitude assessment, and labor-management participation represented sophistication in human resource management. Huselid (1995) added three practices widely found to affect a firms performance: the intensity of its recruiting efforts (selecting ratio), the average number of hours of training per employee per year, and its promotion criteria (seniority vs. merit). Effectiveness has been defined in various ways by different scholars. Cameron (1983) argues that there cannot be one universal model of organizational effectiveness. However, there are many ways of measuring organization effectiveness (Au, C. 1996). In non-profit human service organizations, which have ambiguous and amorphous goals, and offer intangible services, it is even more difficult than with for-profit entities to measure organizational effectiveness (Hasenfeld, 1992). Nonetheless, the literature presents various approaches for measuring the effectiveness. According to Collins (1999), effectiveness, relative to the criterion of goal accomplishment, is gauged by how well the organization meets or exceeds its goals. Another criterion of gauging organizational effectiveness is resource acquisition where an organization is deemed effective in this regard if it acquires necessary factors of production such as materials, human capital, managerial and technical expertise (Kreitner & Kinicki, 2001). Some refer to another effectiveness criterion as the healthy system approach. An organization is said to be a healthy system if information flows smoothly and if employee loyalty, commitment, job satisfaction and trust prevails (Ibid. p 633). Another and most frequently used criterion is strategic constituency perspective or stakeholder approach. This denotes any group of individuals who have some stake in the organizationfor example, resource provider, and user of the organizations product or service (Buxton, 1999). As proposed by this paper the variable of primary interest is organizational effectiveness, in which the variance will be attempted to be explained by a number of human resource functions practiced in an organization. The study will suggest to establish a causal as well as correlational relationship between HR practices and organizational effectiveness. In this study HR practices include employee training, HR planning, selection, employee empowerment, employee motivation, grievance registering, supervision and professional ethics. In this paper organizational effectiveness is defined as the absence or reduction in the problems mentioned earlier resulting in elimination or reduction ailments, rehabilitation and patient and attendant satisfaction. The HR practices may lead to five intervening dimensions that further lead to organizational effectiveness. These dimensions are:
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Availability of Treatment, Timely Treatment, Quality of Treatment, Responsiveness of Employees including physicians, and Use of Technology. Quality treatment which is available on timely basis through responsive employees using state of the art technology will ensure eliminating or reducing patients sufferings, rehabilitation of abnormal persons while keeping patient satisfaction considerably high. Availability of Treatment refers, firstly, to the availability of physicians. Physicians are relatively independent and because of it they become more private practice oriented and do not give ample time to their public practice. On the other hand tight control resulted in high turn over of senior physicians and surgeons. Ensuring moderate empowerment neither giving freehand nor tight controlwill remedy the problem. Secondly, beds are informally distributed among physicians and surgeons of high rank and lower level caregivers have no authority to admit patients needing admission. Maintaining balance of power will also help check the personalization of wards and beds. Thirdly, patients have objections for not being provided with admission in the hospital at first contact unless they visit the concerned physician privately. Ensuring the practice of medical code of ethics will negatively effect this behavior. Fourthly, the provision of medicines particularly from OPD dispensary is not simple. Patients undergo a bureaucratic procedure to obtain medicines. The empowerment of physicians by giving them the authority to recommend deserving patients for such facility, and provision of medicine solely on this recommendation will reduce the problem. Thus the following proposition can be framed: Proposition 1. There will be a positive association between greater use of Human Resource Practices and the availability of treatment. Timely Treatment refers, firstly, to the provision of treatment at the first contact. Patients needing surgery are to wait for a longer time for their turns to come. It is noticed that considerable number of sanctioned posts of physicians and surgeons were laying vacant in most of the hospitals. The practice of HR planning and selection ensuring identification of crucial posts laying vacant and their timely fulfillment will minimize this problem to a great extent. Employee motivation by positive reinforcementrewarding them for better performanceand negative reinforcementremoving difficulties as a reward for better performance will also lead surgeons to operate more and more patients. Secondly, patients have to wait for test results for a longer period. Imparting proper training to laboratory technicians and use of state-of-the-art equipments in labs will bring efficiency in laboratory performance. Thirdly, late admission and provision of medicines also aggravate treatment. Ensuring availability of treatment will reduce this problem. Keeping in view these logics the following proposition can be developed: Proposition 2. There will be a positive association between greater use of Human Resource Practices and the availability of timely treatment. Quality of Treatment refers to the validation of treatment. Firstly, test results are less valid. Imparting proper training to laboratory technicians and use of state-of-the-art equipments in labs will improve the validity of test results. Secondly, medicines are purchased at lower rates without considering their efficacy. Empowering physicians with the authority to reject medicines of low efficacy will enhance treatment quality. Participation and interference of physicians and surgeons of all specialties in the process
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of medicine procurement will minimize the chance of occurring this problem. Thirdly, physicians mostly focus only on clinical aspect of treatment and ignore psychological side of it. Through proper training the importance of the aspects of the treatment other than clinical can be well highlighted. This will lead physicians to give proper weight to the psychological side of treatment. Fourthly, senior physicians perceive the entry of young and competent doctors a threat and create all possible hurdles in their way of entry. Aggressive selection methods including increasing validity of test by strictly following meritocracy and externalization of selection process will help solve this problem. This will also help filling the position of medical superintendent with a suitable candidate. Fifth, physicians resist change. As a result hospitals remain deprived of novel things that can facilitate and authenticate diagnosis and treatments. A proper training can increase their adaptability capacity by making them familiar with the new things causing change. Sixth, the pathetic condition of cleanliness contributes to the development of unhygienic environment inside the hospital. Close supervision coupled with intermittent rewards or punishments will correct this problem. Thus the following proposition is developed: Proposition 3. There will be a positive association between greater use of Human Resource Practices and the quality of treatment. Responsiveness refers to how promptly physicians and nurses react to patients needs. Firstly, physicians are more private practice oriented and pay less attention to patients in hospital. Ensuring the practice of code of medical ethics and proper grievance filing system for patients will reduce the problem. Secondly, nurses and other lower staffs are underestimated and harassed in different ways. This lack of recognition of their contribution to the healthcare delivery system reduces their level of responsiveness. Proper grievance registering system and timely settlement of such cases will enhance the level of their responsiveness. Thus the proposition will be: Proposition 4. There will be a positive association between greater use of Human Resource Practices and the employee responsiveness. Use of Technology refers to the use of modern equipments available in market or used by other hospitals particularly private ones. Test results are late and less authentic. Introduction of modern technology will bring efficiency and accuracy in laboratory performance. Use of modern equipments in operation theaters will assist surgeons to increase the number of operations along with high accuracy. Computerization of records will provide timely information thus facilitating decision making processes. Computerization of patient registration in OPD will save the time of both patients and employees. Installation of such equipments is not enough. Equipments provided to different hospitals were found idle due to unavailability of skilled operators. Therefore, relevant trainings of employees will ensure proper use of technology. So it is assumed that: Proposition 5. There will be a positive association between greater use of Human Resource Practices and the greater use of technology. As the five areas which could be strengthened by greater and effective use of HR practices will cast a direct and positive impact on health outcomes. Patients come to hospitals with different levels of anxiety and expect healthcare organization to address
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their needs on prompt basis in humanely ways. Addressing patients needs and obtaining their satisfaction are the ultimate justifications for the existence of healthcare organizations. The five areas (availability of treatment, timely treatment, quality of treatment, responsiveness of employees and use of technology) will have a positive impact on health outcomes. So a proposition can be developed as: Proposition 6. Timely availability of quality treatment through responsive employees using state-of-the-art technology will cast positive impact on health outcomes Number of beds available in the hospital, existence of relevant treatment facility e.g. labs, OTs, laboratory and surgical equipments, length of stay of patients, number of patients needing admission, and pay level of nurses and other lower level staffs, who mostly quit the organization, may also influence the effective of hospitals. Therefore, such variables should be included as control variables. Schematic View

Since all health care is ultimately delivered by people effective human resources management will play a vital role in the success of healthcare organizations (Kabene et al. 2006). HRM practices must be developed in order to find the appropriate ability to use technology. A practitioner without adequate tools is as inefficient as having the tools without the practitioner (Kabene et al. 2006). Workforce training is one of the important issues. It is essential that human resources personnel consider the composition of the health workforce in terms of both skill categories and training levels (WHO, 2000). New options for ht education and in-service training of health care workers are required to ensure that the workforce is aware of and prepared to meet a particular countrys present and future needs. A well trained and competent human resource is crucial to any successful health care system. Studies showed how human resource initiatives aimed at improving human resource capabilities had a significant and positive effect on the efficiency and effectiveness of the hospitals studied (Kabene et al. 2006). Ultimately healthcare services are delivered by people, so health care management can really be considered people management. This is where human resource professionals must make a positive contribution. Examining case studies makes it evident that human resource management can and does play an essential role in the healthcare delivery system. The practices policies and philosophies of human resources professionals are imperative in developing and improving healthcare. The implication is that further research and studies must be conducted in order to determine additional resource practice that can be beneficial to all hospitals and patients (Kabene et al. 2006). The literature also stresses that allowing some autonomy in personnel matters is an essential facilitative condition for
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developing the organizational performance in healthcare system (Fritzen 2007). A review of high-performing public organizations in developing counties found that they enjoyed autonomy to identify positions, advertise for candidates, establish routines for hiring people to fill positions, promote people on the basis of organizationally defined standards and priorities, and punish those who did not meet these standards (Grindle 1997). Conclusion Since human resource management as a distinct department is yet awaited to be recognized as a crucial resource for organizational success in developing countries particularly in Pakistan, the focus on organizational development and effectiveness through people is insignificant. Human resource management does not exist in its true sense that is why human resource is the underutilized resource inside public sector healthcare organizations. Validity and reliability of selection tests are not usually ensured, trainings are not financed, bureaucratic procedures do keep authority centralized, grievance filing systems are literally absent and reinforcement on ethical issues is less often. Human resource activities are carried out without proper HR planning. Workforce is handled on the traditional personnel management lines. Since all health care is ultimately delivered by and to people, a strong understanding of the human resource management issues is required to ensure the success of any healthcare program. More extensive research must be conducted to bring about new human resource policies and practices that will benefit patients around the world.

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Arthur, J. B. (1994). Effects of human resource system on manufacturing performance and turn over. Academy of Management Journal, 37, 670-687. World Health Report (2000).Health Systems: Improving Performance. Available from Retrieved on December 5, 2009 Fritzen, S. A. (2007). Strategic management of the health workforce in developing countries: what have we learned? Human Resource for Health. 5. 1-9 Au, C., (1996). Rethinking organizational effectiveness: Theoretical and methodological issues in the study of organization effectiveness for social welfare organizations, Administration in Social Work, 20: 1-21 Boyne, G., Jenkins, G., and Poole, M. (1999). Human resource management in the public and private sectors: An empirical comparison. Public Administration. Vol. 77 No. 2, 407-420. Grindle, M. (1997). Divergent cultures? When public organizations perform well in developing countries . World Development. 25 (4) Cameron, K. (1983). Organizational Effectiveness: A Comparison of Multiple Models. Whetten, K. (eds) New York: Academic Press, p. 262 Dawra, S. (2002). Hospital Administration and Management, Mohit Publications, New Dehli Vol. 1, 2 & 3 Delaney, J. T., Lewin, D., & Ichniowski, C. (1989). Human resource policies and practices in American firms. Washington, DC: U.S. Government Printing Office. Delery JE., & Doty DH. (1996). Modes of theorizing in strategic human resource management: Test of universalistic, contingency and configurational performance predictions. Academy of Management Journal 39, 802-845. Economic Survey of Pakistan, (2003-04). An, retrieved on April 7, 2007. Online Publication by

Hasenfeld, Y. (1992). Human Services as Complex Organizations. Newbury Park, CA: Sage. Huselid, A. M. (1995). The impact of human resource management practices on turnover, productivity, and corporate financial performance. Academy of Management Journal. Vol. 38, No. 3 pp 635-672 Ichniowski, C., Shaw, K., & Prennushi, G. (1993). The effects of human resource management practices on productivity. Working paper, Columbia University. Jones, G. R., & Wright, P. M. (1992). An economic approach to conceptualizing the utility of human resource management practices. In K. Rowland & G Ferris (Eds.), Research in personnel and human resource management, vol. 10; 271-299. Greenwich CT: JAI Press. Kleiner, M. M. (1990). The role of industrial relations in firm performance. In J. A. Fossum & J. Mattson (Eds.), Employee and labor relation. 4.23-4.43. Washington DC. BNA Press. Lentz, M. E. (1957). Hospital administration One of species, Administrative Sciences Quarterly, Vol. 1, No. 4, pp. 444-463 Kabene, S. M., Orchard, C., Howard, J. M., Soriano, M. A., and Leduc, R. (2006). The importance of human resources management in health care: a global context. Human Resource for Health. Available from Retrieved on December 25, 2009
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McDuffie, J. P. (1995). Human resource bundles and manufacturing performance: Organizational logic and flexible production system in the world auto industry. Industrial & Labor Relation Review, 48, 197-221 Wright, P. M., Gardner, M. T., Moynihan, M. L., & Allen, R. M. (2005). The relationship between HR practices and firm performance: Examining causal order. Personnel Psychology. Vol. 58, 409-446 Youndt, M.A., Snell, S.A., Dean, J. W., & Lepak, D. P. (1996). Human resource management, manufacturing strategy, and firm performance. Academy of Management Journal. 39, 836866. Zairi, M., & Jarrar, F. Y. (2001). Measuring organizational effectiveness in the NHS: Management style and structure best practices. Total Quality Management, Vol. 12 No. 7&8, p. 882-889. Beer, M., Spector, B., Lawrence, P. R., Mills, D. Q., and Walton, R. E. (1985). Human resource management: a general managers perspective. New York, The Free Press. Boudreau, J. W. (1991). Utility analysis in human resource management decisions. In M. D Dunnette & L. M. Hough (Eds.), Handbook of industrial and organization psychology (2nd ed.) Vol. 2 621-745. Palo Alto, CA Consulting Psychologists Press. Buxton, W. (1999). Growth from top to bottom. Management Review. July- August p 11 Cappelli, P., & Singh, H. (1992). Integrating strategic human resource and strategic management. In D. Lewin, O. S. Mitchell, & P Sherer (Eds.), Research frontiers in industrial relations and human resources; 165-192. Madison , WI: Industrial Relation Research Association. Collins, J. (1999). Turning goals into results: The power of catalytic mechanisms. Harvard Business Review. 71-82. Delaney, J. T. In Press. Unions, Human resource innovations, and organizational outcomes. Advances in industrial and labor relations. Drucker, P. (1954). The practice of management. New York: Harper & Row. Farnham, D., and Horton, S. (1996). People management and employee relations. In K. Farnham and S. Horton (eds.), Managing people in the public services. London: Macmillan. Kreitner, R., & Kinicki, A. (2001). Organizational Behavior. Irwin McGraw-Hill. Report, European Health. (2002). Health System Policies and Reforms. Part Three pp. 114121 Stewart, T. (1996). Taking on the last bureaucracy. Fortune, 133 (1) 105-108 U.S. Department of Labor. (1993). High performance work practices and firm performance. Washington DC: UA Government Printing Office.

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Examples of How Leaders of Leaders Differ from Leaders of Followers

BY HERB RUBENSTEIN CEO of Growth Strategies. Inc


n a related article I make the distinction between what a "leader" typically does in organizations and what a "leader of leaders" does. Today, many leaders in America are primarily problem solvers. "Leaders of leaders" have a different role. They develop a platform upon which the organization and the organization's "leaders" set the tone, ethic and direction of an organization as well as figure out the best answers to systemic challenges and entire classes of problems an organization can face. This article includes examples of what a typical leader would do in a situation and compares that to what a leader of leaders would do in the same situation. Example 1 A group of people travel long distances to resettle in an area where they were ousted many years before. As we learn from sociology, while people are displaced and while they travel back to their "homeland," there is usually little infighting. However, once they get back to their homeland there is significant internal strife. Leader: What a leader does in this situation is meet with the people, generate their trust, declare that he or she will help the people live in peace and adjudicates their disputes one at a time thus promoting a better life for the people. Leader of Leaders: What a leader of leaders does is analyze the nature of the disputes, writes a code of laws to cover as many situations as imaginable, recruits well respected, honest and intelligent people in the community to become judges and establishes a system to adjudicate all of the disputes. Source: Exodus 18:13 through 18:27. Example 2 A group of people are hired to "write up" a conference. Three people are assigned to the job, with two to cover the room and one person to interview each speaker. Everyone expects that all people at the conference will be in one room for the two days. There are 60 people attending. In the first session, a person suggests that the groups break up into three rooms for most of the two days and that the number of speakers be tripled. This is done.

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There are no more than three people to cover this conference and write it up. They cover the three rooms and the conference ends on Sunday and their report is due on Friday. At a meeting on Monday with the three people and their boss, the three people tell the boss about how big a challenge it will be to get anything written by Friday summarizing the conference and ask for advice on how to integrate what was said in each of the three rooms. Leader: What a leader does in this situation is listen to all of the challenges that the group faces to help them figure out what they can do and how the leader may be supportive. A leader may also begin to ask, "So when do you think you could get the report written and do you need more people to help you. Leader of Leaders: A leader of leaders will say, we have a budget that only calls for three people and we have a deadline on Friday. The leader of leaders will say that he picked the three people on the team because he thought they could rise to whatever challenge the conference raised and that they knew of the budget and deadline when they took the assignment. The leader of leader will then ask the three, "Can you make the deadline with an excellent product." Source: W. Victor Rouse, American Institutes for Research Example 3 There is significant evidence that early pregnancies, substantial illegal consumption of alcohol and drugs among junior high and high school students is associated with negative life outcomes including poverty, incarceration and longer than average spells of unemployment. Leader: What a leader does in this situation is join an organization or school as a teacher, coach or administrator and participates daily with young people to teach them positive work, social and cultural habits and to help give meaning to their lives. Leader of Leaders: What a leader of leaders does is create an entirely new platform for education, a new curriculum, a new message, a new organization and enrolls thousands of people to help fund, support and run their organizations which teach character, education and gives young people right after college the opportunity to teach for two years in public schools in impoverished areas. Sources: Elayne Bennett, Founder and CEO, Best Friends Foundation. Wendy Kopp, Founder, Teach for America. Example 4 Research shows that young people with poor communication skills, low self-esteem, poor team building and few significant mentors or role models in their lives often do not do as well as people who are better or more fortunate in these areas. Leader: A leader volunteers in the community, in the schools, mentors and provides one on one guidance to those in need to assist them along their way.
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Leader of Leaders: A leader of leaders writes books that change the rules of games like tennis and soccer to make them less competitive, more team oriented, where all players can win, and injects communication exercises into fun filled sessions designed to alleviate the deficiencies and lack of opportunity to gain these skills which these young people face. Then he creates an international organization, with a world class board and begins to offer these programs through Boys and Girls clubs, military bases, schools and other outlets. Source: Andrew Oser, Founder and CEO, Joy of Sports Foundation. Example 5 In the early 1800's people interested in creating a better understanding of how societies worked knew their ability to gather sufficient information (data) was very limited. And the mathematical tools were getting stronger so that when data were generated correlations and associations could be identified. Leader: A leader faced with this situation would improve the theories of social science since they were generally not trained or had the resources to gather accurate data for proper analysis. The leader would expect that by creating a better theory it would guide future social science leaders. Leader of Leaders: A leader of leaders took one of the most private areas of life, suicide, where there were accurate data, analyzed the data from the point of view as to figure out what in society at large caused suicide rates to rise and fall and proved a strong mathematical connection between social events at large and what most people thought at the time was a purely private event. Source: Emile Durkheim, father of modern sociology. Example 6 In the late 1970's air transportation was expensive, had very uneven service between differing cities and was completely regulated. Leader: A leader would become a CEO of an airline and find new ways to economize, to expand market share and to provide better service. Leader of Leaders: A leader of leaders decided to push for the deregulation of the airlines, allow and promote large scale innovation, price management by the airlines and would direct the government on a successful course of action to greatly expand air travel in the United States. Source: Alfred Kahn, father of airline deregulation. Example 7 For most of the nation's history, the United States did not have a national newspaper.
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Leader: A leader would work within the larger dailies, like the NY Times, Wall Street Journal and other similar newspapers or buy up as many local newspapers as he or she could, profiting within and improving on the current system of how newspapers were made and sold. Leader of Leaders: In 1982, USA Today became the first national newspaper. Losing millions in its first few years, the leadership of this paper listened to its customers and cities, created new features and now is both profitable and gives the United States a national newspaper. Source: Allan H. Neuharth, Chairman, Gannett, Inc. Example 8 Government programs are often criticized for not being customer responsive and not being efficient. Leader: A leader would get into a management position in the government, set standards for efficiency, accountability and improve the operations of the agency where he or she works. Leader of Leaders: A leader of leaders would study all areas where government was improving, catalogue them, find their common nucleus and develop a strong set of publications that showed the government how to improve itself. Today, there are over 48 books with the term "Reinventing Government" after the first such book in the early 1990's that have contributed significantly to the improvement of government services, especially at the local and state levels. Sources: Gaebler and Osborne, co-authors, Reinventing Government and many related titles. Example 9 Under generally accepted accounting principles "people" (workers, advisors, board members, etc.) are not listed on all financial records as "costs" or "assets" in any way even though it is the people of an organization that are the ultimate source of its success. Leader: A leader would work in an organization that has thousands of workers (or possibly a union) and strive to get the management of the company to treat the workers well and invest in their education, training and work conditions to improve the potential for success for the organization. Leader of Leaders: A leader of leaders would measure the actual statistical relationship between a company investment in the education and training of its workers and the company's future stock price, even though Wall Street does not even take into account how much a company is spending on educating and training its workers as a factor in evaluating a company's future expected stock price. This research and the proof of a causal relationship between investing in workers and future financial performance of a company will lead the accounting profession, kicking and screaming, to begin to list
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people (human capital) as an asset rather than as a liability and change the entire way companies invest in their workers. Source: Dr. Laurie J. Bassi, Ph.D., Founder, Human Capital Capability, Inc. and Knowledge Asset Management, Inc. Example 10 In the 1960's African American citizens in Louisiana had to drink out of separate water fountains, use separate bathrooms (and many times they were not even allowed to use bathrooms in stores since they were for whites only). There were separate schools and no admittance to whites only pools even when they were located right next to predominately African American neighborhoods. Leader: A leader, if he or she were white, would see that a fundamental injustice was being perpetuated. This leader may set a personal example by drinking out of the water fountain labeled "colored", would argue for changes in the United States so that all Americans were treated equally and given equal access to "public" facilities like schools, restaurants, pools and buses. A leader would work for African Americans running for office and live life in an "integrated" manner. Leader of Leaders: A leader of leaders would draw the nation and the world's attention to the violence, atrocities, debasement and subjugation of African Americans throughout the United States throughout its history through the 1960's. He or she would create a message, a platform, communicate a vision of equality as being good for all Americans and he or she would build the organizations supporting this idea to force the government to change the laws, to prosecute the guilty and to make one standard, a nationwide standard, requiring every state to fulfill the mandate of the United States Constitution. Source: Dr. Martin Luther King, Jr. Conclusion These are examples of world class leaders of leaders. Among our midst there are thousands of people who have created platforms, garnered and managed resources to achieve a breakthrough in improving this world. This article should stimulate your thinking in three ways. First, being a leader is a good thing. Being a leader of leaders is a much better thing. This article gives you a glimpse of a path you can blaze to becoming a leader of leaders in your own lifetime, starting now and never giving up.

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