Demarcación Hidrográfica del Guadiana: Usos, demandas y presiones.

1. Usos del agua:

De acuerdo con la Instrucción de Planificación Hidrológica, se consideran usos del agua las distintas clases de utilización del recurso así como cualquier otra actividad que tenga repercusiones sobre el estado de las aguas.

Los principales usos consuntivos del agua en la Demarcación del Guadiana son el uso urbano, que supone unos 200 hm3 anuales (9% del total); la agricultura, con unos 1.973 hm3 al año (89%); y la industria no conectada a la red de abastecimiento urbano, con unos 44 hm3 anuales (2%). Este último uso comprende las actividades de la industria manufacturera, extractiva y energética (a excepción de la hidroeléctrica), la construcción y los servicios.

Entre los usos no consuntivos destaca la producción de energía eléctrica (1,2% del total nacional) existiendo 16 centrales hidroeléctricas asociadas a los grandes embalses de utilización mixta junto al regadío.

En cuanto a las fuentes del recurso, para todos los usos aproximadamente el 22% del agua es de origen subterráneo (80% en el Alto Guadiana) y el resto superficial.

 

2. Demanda hídrica:

De una forma genérica, la demanda de agua es el volumen de agua en cantidad y calidad que los usuarios están dispuestos a adquirir para satisfacer un determinado objetivo de producción o consumo. Desde el punto de vista de la planificación, es la necesidad de agua para las actividades tras ser sometida a las restricciones ambientales y administrativas existentes y sujeta a una gestión sostenible del recurso.

La metodología empleada para la caracterización de demandas en la Demarcación del Guadiana se caracteriza por basarse, en la medida de lo posible, en datos reales con lo que se obtiene una estimación más ajustada a la realidad. De este modo se definen las demandas, en el año base 2005, asociadas a los principales usos descritos en el punto anterior. Los datos no incluyen las demandas de Portugal ya que la coordinación con este país continua en proceso.

La demanda urbana bruta de los municipios de dentro y de fuera de la demarcación que son abastecidos por la misma es del orden de 199,65 hm3 anuales, estimándose un retorno al medio hídrico de unos 159,72 hm3.

Por otra parte, la demanda bruta media para uso agrícola asciende a unos 1.973,24 hm3 al año y la asociada a la industria no conectada a la red municipal a 18.54 hm3 anuales, siendo el volumen de agua vertida de nuevo a los cauces del orden de 13,16 hm3.

Por último, la demanda estimada para las centrales hidroeléctricas presentes en la cuenca del Guadiana es de unos 2.293 hm3 al año.

 

3. Presiones e impactos:

El estudio de las presiones existentes en las masas de agua tiene por objetivo identificar aquellas que puedan causar el incumplimiento de los Objetivos Medioambientales de la Directiva Marco. Este efecto negativo depende simultáneamente tanto de la presión en sí misma como de la susceptibilidad de la masa de agua afectada.

El mayor impacto en la Demarcación del Guadiana lo producen las infraestructuras transversales (presas, diques de regulación, azudes, puentes y demás obstáculos fijos) cuyo efecto radica en que interrumpen el curso normal del cauce produciendo un importante efecto barrera sobre los ecosistemas acuáticos.

Los efectos, también importantes en el ámbito, causados por las infraestructuras longitudinales (canalizaciones, defensas), son la introducción de cambios sustanciales en sus riberas y en la velocidad del agua, o eliminando la vegetación existente con la consecuente falta de refugios y hábitats para la fauna acuática y asociada.

La invasión del Dominio Público Hidráulico por actividades de agricultura es uno los más importantes factores de degradación de las riberas en extensión superficial. Análogamente, el Dominio Marítimo Terrestre se encuentra sometido a numerosas presiones debidas a los distintos usos del suelo tales como actividades extractivas, la existencia de escombreras y vertederos, cultivos de regadío y de secano, y el desarrollo urbanístico y de zonas portuarias.

Así, los principales impactos derivados de las presiones en aguas superficiales son:

Concentración de nutrientes: Algunos embalses se encuentran en riesgo de eutrofia por la aparición de elevadas concentraciones de amonio, amoníaco y fósforo debido a fuentes puntuales y difusas de contaminación.

Concentración de materia orgánica, debida a la elevada densidad ganadera en determinadas comarcas agrarias de la demarcación.

Alteración hidrológica de cauces, zonas húmedas y complejos lagunares, provocada por extracciones significativas de agua.

Contaminación por sustancias prioritarias u otros contaminantes específicos, motivada por la actividad agrícola intensiva que genera una contaminación difusa que aporta este tipo de sustancias utilizadas en los tratamientos fitosanitarios realizados sobre los cultivos.

Hábitats alterados por presiones hidromorfológicas asociadas a los encauzamientos y a las grandes presas situadas sobre el cauce principal de la cuenca.

De igual modo, los principales impactos originados por las presiones en aguas subterráneas son:

Sobre-explotación de las masas de agua: Las declaraciones oficiales de acuíferos sobreexplotados realizadas en los años 1988 y 1998 sobre ciertos acuíferos de la demarcación siguen vigentes en la actualidad, con extracciones que superan los recursos anuales disponibles.

Intrusión salina: A pesar de que determinados pozos cercanos a la costa presentan problemas de salinización, las tendencias observadas de la profundidad de la interfaz agua dulce-agua salada son positivas indicando un retroceso hacia el mar de la intrusión marina.

Contaminación de masas de agua subterránea por fuentes de contaminación difusa: 14 de las 20 masas de agua subterránea definidas en esta demarcación presentan esta problemática de forma acentuada. Las zonas más afectadas son aquellas con áreas de regadío con aguas subterráneas en donde se han desarrollado cultivos con fuertes necesidades hídricas y de fertilización nitrogenada.

 

Fuente: Memoria del proyecto de Plan Hidrológico de la cuenca del Guadiana (parte española de la Demarcación Hidrográfica).


La tragedia de los comunes: El caso del espárrago peruano.

“¿Cómo escapamos del dilema en el que muchos individuos actuando racionalmente en su propio interés destruyen un recurso compartido limitado? Ahora estamos confrontando la tragedia del común global: Hay una Tierra, una atmósfera y una fuente de agua y seis mil millones de personas compartiéndolas. Mal. Los ricos están sobreconsumiendo y los pobres no pueden esperar a unírseles.”

Esta cita pertenece al artículo “La tragedia de los comunes” de Barry Schwartz, publicado en la revista Science en el año 1968. Con el paso de las décadas la solución al dilema que el autor describe sigue sin encontrarse o, al menos, sin aplicarse.

Como ejemplo de ello explicar el caso del cultivo a gran escala del espárrago en Perú. En menos de una década este país se ha convertido en el segundo mayor exportador del mundo de esta especie herbácea, sólo superado por China. Su cultivo, en campos ganados al desierto de Ica, al sur del país, está acabando con las pocas fuentes de agua subterránea que históricamente habían mantenido a la población.

La transformación del valle de Ica, localizado en una de las regiones más secas del planeta, comenzó en los años 90, cuando el Banco Mundial impulsó proyectos de agroexportación en países en desarrollo. Así, y a través de la Corporación de Finanzas Internacional, se ideó un programa de préstamos a la empresa privada que, en este caso, permitió convertir áreas de desierto en zonas de cultivo.

A partir del año 2000 este programa fue clave en el despegue económico de la nación andina, cuyo sector agrícola fue uno de los de mayor dinamismo. Los ingresos obtenidos por la exportación del espárrago van en aumento cada año y, según el diario peruano El Comercio, el país espera obtener 750 millones de dólares en el año 2015.

Pero los espárragos son vegetales que consumen una altísima cantidad del recurso hídrico. Sus cultivos necesitan irrigación constante y, según expertos en medio ambiente, es un producto que no favorece el desarrollo sostenible. En el caso de Ica, el agua procede del acuífero que se encuentra bajo la superficie de la región y que, según un estudio de la organización británica para el desarrollo Progressio (año 2010), desciende a un ritmo de unos ocho metros por año siendo una de la tasas de consumo y sobreexplotación acuíferas más rápidas del mundo.

Los intentos del gobierno peruano de frenar este consumo desmesurado del recurso de agua subterránea no han prosperado. La nueva Ley de Recursos Hídricos, aprobada en el año 2009, introduce conceptos de medición y control así como una cuota de extracción sobre el agua bombeada, pero su aplicación aún no se lleva a cabo.

Así pues, muchas fuentes se están secando y comienza a haber problemas de desabastecimiento de la población local debido a la apropiación de este recurso por parte de la empresas agroexportadoras, factor que además limita el desarrollo de la pequeña agricultura, más respetuosa con el medio ambiente.

La expansión del cultivo del espárrago en Perú es uno de los paradigmáticos ejemplos de un desarrollo agrícola orientado a los mercados pero que no ha tenido en cuenta el desarrollo humano local. Este producto no forma parte de la dieta del país, pero se siembra en detrimento de otros cultivos de consumo habitual, aún cuando sus necesidades de agua superan las del recurso disponible cuando se pasa a su producción a gran escala.

Si bien la agroindustria del espárrago ha contribuido al desarrollo del país por los puestos de trabajo generados, hay también que destacar los beneficios que estas empresas, en su mayoría extrajeras, obtienen al favorecerse de costes tributarios y mano de obra barata. Se pasa así a un modelo de agricultura de contrata en la que la producción de los pequeños agricultores queda bajo el control de las grandes compañías. Y aunque todas necesitan disponer de agua, ninguna toma medidas para limitar su consumo y permitir la recarga del acuífero.

Si además pensamos en el coste, ya no económico, si no medioambiental, que el transporte refrigerado de los espárragos a países como España supone, el dilema planteado por Schwartz no puede ser más actual: Cada uno de nosotros, actuando racionalmente y en nuestro propio interés, contribuimos a destruir un recurso compartido limitado como es el agua. Porque es más barato comprar espárragos importados que aquellos locales sólo disponibles de temporada.

Para terminar el video que la oficina de Naciones Unidas para el Agua (UN-Water) difundió con motivo del día mundial del agua 2012 y que, bajo el leitmotiv “el mundo tiene sed porque tenemos hambre”, hace hincapié en la presión a la que están sometidos los recursos hídricos en un mundo en el que mil millones de personas viven en condiciones de hambre crónica.

 

 

Fuentes:

– Ministerio de Agricultura de Perú: http://www.minag.gob.pe

– Autoridad Nacional del Agua de Perú: http://www.ana.gob.pe

– Noticias BBC: http://www.bbc.co.uk

– Diario El Comercio: http://elcomercio.pe

– Informe “No te comas el mundo: La deuda de los alimentos en Euskal Herria. La producción y el consumo del espárrago como estudio de caso”: http://www.veterinariossinfronteras.org

 


Open Innovation: The Apple Case

First of all, what’s open innovation? Professor Chesbrough, executive director of the Center for Open Innovation, University of California, Berkeley, defines it as follows:

“Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively. [This paradigm] assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as they look to advance their technology.”

In other words, open innovation is about linking internal and external resources to jump into opportunities to bring to market better innovation.

Thinking about companies that might be using this approach to boost their innovation capabilities the first one that popped up into my mind was Apple. Not only because I’m a fan of this brand’s product but also because the company is an icon of innovation and always meets their clients needs developing technology in the smoothest and smartest possible way.

But, where is the open innovation in Apple? It’s well known that the company keeps a tight lid on its employees, suppliers and partners, so their products remained a secret till the launching date. However this style of close innovation results in technology that is highly conductive to open innovation and the Apple brand is almost a synonymous of freethinking creativity.

It is a unique case, as Apple is a unique company, that shows the exception to the rule, where there is no need to open up innovation processes in order to build great products. The key fact is that innovation is in Apple’s corporate DNA, something not easy to replicate for other companies.

From my point of view whether Apple’s innovation technique remains within the company and it’s not linked with external sources, the way they approach technology seems to suggest that open innovation lessons are well known by the company and I wouldn’t be surprised if the brand, at some point, opens up their processes, getting closer to the full meaning of the open innovation concept.

To end up with, what can’t be denied is that using open or close innovation paths the company created by the late Steve Jobs has succeeded in teaching the world the importance and the value of one key idea: To think different.

 

Main references:

– “Open Innovation definition”, accessed from: http://www.openinnovation.net/about-2/open-innovation-definition/

– “Apple’s contribution to open innovation”, accessed from: http://www.crowdsourcing.org/document/apples-contributions-to-open-innovation-/7077

– “The Apple exception”, accessed from: http://www.100open.com/2011/10/the-apple-exception/

– “Innovation, lessons from Apple”, accessed from: http://www.economist.com/node/9302662?Story_ID=9302662



Entrepreneurial Initiative: Labeligent® – The smart label for fashion

By Natalia Díaz, Ricardo Garro, Cristina García-Ochoa, Hokuma Karimova.

Business idea

Labeligent is the technology that from now on will be included in every piece of clothing you buy from the greatest brands. It is defined as a cloud service in conjunction with a specially design intelligent label for garments (QR code) that lets people scan it and have a digital registry of their wardrobe in the web. Users will have access to interesting product information as well as free personalized promotions and discounts based on their loyalty to certain brands. The platform will also include an outfit of the day based on mood, weather and occasion; links to web pages, and it will work as a manager of returns and warranties requests.

Opportunity

Firstly, there is an unfilled information gap for companies in the process of knowing their clients. Secondly, customers would like to have an easy and practical recognition for their loyalty to brands. Secondly, products in the fashion industry still lack more digital and intelligent interaction. Considering that as of today no company provides the service Labeligent is offering, the opportunity to start the business couldn’t be better.

PESTEL analysis

Political: Spain is part of the EU, has enjoyed relative calm in the political arena. The latest economic crises and high unemployment and debt, however, have made it hard for new companies to take major risks.

Economic: As mentioned earlier, the economic crisis has been quite damaging for small companies. It has been less difficult for big corporations who have seen an increase in profits. The major reason for this is due to lack of competition in the fashion industry.

Social: Individuals are wanting to know more about their products, including the materials they’re made of, where they came from, who made them and what impact they had on the environment. All clients are becoming more aware, and providing answers to the above questions is vital for the success of the product.

Technological: Individuals are using the latest technology. They have smart phones, computers, blogs and utilize social media. Major companies are moving their work into the online world hoping to make their mark more visible in the Internet sphere. There is an increasing trend to digitalize all aspects of our lives and a very mature digital technology to base businesses online. Specific platforms such as social networks smart technologies and application stores can be utilized for the business.

Environmental: There are not many environmental concerns for the fashion industry. The only issues that might be visible are the use and production of clothing material. Ensuring that sustainable practices are used for garment creation is important to portray a responsible image and attract the more aware clientele.

Legal: Many big fashion industries are known for outsourcing their production to developing countries. Although big industries will not be faced with many problems within Spain and other European countries, the importance of maintaining good factory conditions, high wages and normal work hours is vital for minimizing any future legal lawsuits abroad. In addition, many corporations have been partnering with ILO and other organizations that ensure high work standards for their factory workers.

Internet-based businesses have to approach privacy and legal issues in a clear and effective way to gain people’s trust. There is an increasing concern about these legal terms.

SWOT synthesis

EXTERNAL FACTORS

Maximize Opportunities:

– Currently no company is offering the service Labeligent provides.

– The technology to develop the product services is already available and affordable.

– Clients are demanding a more personalized treatment and the recognition of their loyalty to brands.

– Headquarters of some of the biggest fashion companies are located in Spain. It will be easy to approach managers and to create a local network.

Threats:

– Big fashion companies as Inditex, H&M or Mango are not interested in the product or they develop their own technology to provide the service.

– Customers don’t scan the QR code of the labels, either because they don’t have a smart phone, don’t know about the technology or don’t want their purchases to be registered at the web platform.

INTERNAL FACTORS

Boost Strengths:

– The technology is which the service is based is easy to develop and maintain.

– The team developing the product knows the fashion industry key elements and the approach needed to sell the product.

– Marketing campaign is based in the concept that everyone can be fashionable by using the product.

– In 2010 Inditex began selling its products on-line, as many other companies.

Weaknesses:

– Being a small new company in the fashion industry that major corporations are not familiar with.

– Lack of resources to develop the technology or to adapt to the growing market.

– Personnel needed to be trained in order to make the product tangible and easy to sell.


The Millennium Development Goals: Sub-Saharan Africa situation in 2011

In 2000, 189 nations made a promise to free people from extreme poverty and multiple deprivations. This pledge became the eight Millennium Development Goals to be achieved by 2015.

Based on a review of 50 country studies, the assessment “What Will It Take to Achieve the Millennium Development Goals? – An International Assessment” released by UNDP in June 2010, finds that the resources and know-how necessary to achieve the MDGs exist. Acceleration of progress over the next five years will need to focus on continuing proven strategies, policies and interventions and making a radical break with those that do not work.

http://www.beta.undp.org/content/undp/en/home/librarypage/mdg/international-assessment—english-full-version.html

In this post I’m focusing in the sub-Saharan region to analyze the impact the strategies developed to achieve the MDGs have had and the gap that still has to be bridged to reach the mentioned goals by 2015. The analysis is made from the perspective of the three main Human Development Indicators: Education, Health and Income and therefore limited to goals 1, 2, 4, 5 and 6.

But, first of all, let’s have a global graphic view of the current situation in the sub-Saharan region. The following chart presents an assessment of progress based on selected indicators. Trends and levels are assessed on the basis of information available as of June 2011. The latest available data for most indicators are from 2009 to 2011; for a few indicators, the data date back to 2005 or 2007.

Equivalent information regarding other regions of the world can be found at: http://www.un.org/millenniumgoals/pdf/(2011E)_MDReport2011_ProgressChart.pdf

Regarding Income Index and Goal 1, poverty in sub-Saharan Africa is falling. Based on recent economic growth performance and forecasted trends, the extreme poverty rate in the region is expected to fall below 36 per cent. However, the level is still very high withmore than half of the population below the poverty line.

Moving a little bit backwards I’d like to underline that it is most worrying that in sub-Saharan Africa and South Asia the number of poor people increased from 877 million to over one billion people in 2002, mainly driven by high fertility and population growth rates. The trend is encouraging as the number of poor people fell to 984 million by 2005.

Another important facts related to this goal are the increase in the vulnerable employment rate that was found in the region as well as the difficulties to meet the hunger-reduction target. Based on current trends sub-Saharan Africa will be unable to meet it by 2015. A revealing fact is that 44 percent of children under five suffered from stunted growth in 2006, a telling indicator of chronic under-nutrition.

Regarding Education Index and Goal 2, sub-Saharan Africa has the best record for improvement in achieving universal primary education, with an 18-percentage-point gain between 1999 and 2009. The abolition of school fees, supported by reforms in education systems and investments in school infrastructure and human capital, leads to high enrollment rates in primary schools. However, the majority of out-of-school children in sub-Saharan Africa are largely excluded from education, and most will never enter a classroom.

It’s also a relevant fact the quality of the education given. One measure of it is a student-teacher ratio of no more than 40 to 1, as recommended by the Education for All Fast Track Initiative (EFA-FTI). However, pupil-teacher ratios in primary schools across sub-Saharan Africa and in four sample countries have increased between the pre-MDG and post-MDG periods.

Regarding Health Index and Goals 4, 5 and 6, sub-Saharan Africa still has the highest levels of under-five mortality, where one in eight children die before the age of five (129 deaths per 1,000 live births), nearly twice the average in developing regions overall and around 18 times the average in developed regions. With rapid progress in other regions, the disparities between them and sub-Saharan Africa have widened. In sub-Saharan Africa, diarrhoea, malaria and pneumonia are responsible for more than half the deaths of children under five.

Maternal deaths are concentrated in sub-Saharan Africa and Southern Asia, which together accounted for 87 per cent of such deaths globally in 2008. The ratio has fallen by only 26 per cent in sub-Saharan Africa, though evidence suggests that progress has picked up speed since 2000.

The vast majority of maternal deaths are avoidable. The largest proportion of such deaths are caused by obstetric haemorrhage, mostly during or just after delivery, followed by eclampsia, sepsis, complications of unsafe abortion and indirect causes, such as malaria and HIV. According to recent findings, without HIV, maternal mortality would have been 18 percent below its 2008 level.

Studies have also shown that the likelihood of maternal death increases among women who have many children, are poorly educated, are either very young or very old, and who are subjected to gender discrimination.

Regarding HIV, Sub-Saharan Africa remains the most heavily affected region, accounting for 69 per cent of new HIV infections, 68 per cent of all people living with HIV and 72 per cent of AIDS deaths. Two thirds of new infections and a similar rate of those currently infected live in this region of the world.

Recent data from population-based surveys in selected sub-Saharan African countries show that the proportion of young people who know that using condoms can reduce the chances of getting HIV ranges from about 50 per cent to almost 90 per cent in some countries. However, in almost all countries surveyed, young women are less likely to have such knowledge.

Regarding Malaria, the past 10 years have seen a remarkable surge in the production, purchase and distribution of insecticide-treated mosquito nets globally, particularly in Africa where about 1 million people die each year from malaria, with 88 percent of the deaths occurring in sub-Saharan Africa.

Data from household surveys indicate a marked increase in both net ownership and use among children. Most African countries with data for 2009-2010 show increased mosquito net coverage and reduced disparities among various population groups—largely due to nationwide campaigns for the distribution of free nets that emphasize poor, rural areas.

From this analysis it can be concluded that, although the 8 MDGs have galvanized unprecedented efforts to meet the needs of the world’s poorest, there is still a lot to be done in order to achieve success by 2015. In the case of sub-Saharan Africa progress should be accelerated over the next years, as the region hasn’t shown enough improvement in most of the goals and targets, moving even backwards in the field of maternal health.

To end up, I want to share a video of a real story that shows how change is possible and how education is making a difference with women in sub-Saharan Africa:

 

Sources: UN Reports – The Millennium Development Goals Report 2011, What Will It Take to Achieve the Millennium Development Goals? – An International Assessment, Unlocking progress: MDG acceleration on the road to 2015, and UNDP Human Development Reports web page, accessed from: http://hdr.undp.org/en/reports/


The Sidney Opera House construction: A case of project management failure

The Sydney Opera House is one of the best-known iconic buildings, recognized around the world as a global symbol of Australia. The Danish architect Jørn Utzon won the architecture competition set out by the New South Wales government for the new building in 1957, and the construction started in 1959. The project was originally scheduled for four years, with a budget of AUS $7 million. It ended up taking 14 years to be completed and cost AUS $102 million.

The Sydney Opera House could probably be seen as one of the most disastrous construction projects in history not only from the financial point of view but also for the whole management plan. Lets analyze the main reasons that led to it.

First of all, at the beginning of any project goals and objectives have to be clearly defined by the client to provide a guideline for what the project must complete. There are three main factors: time, cost, and quality. In the case of the Sydney Opera House the last one was the most important, as it was an almost unrestricted goal of the project and the reason why it was launched. No indications regarding time or cost limits were either provided for the competition. Thus, the architects were allowed total freedom in their designs.

After Utzon was selected, he presented his “Red Book” in March 1958, which consisted of the Sydney National Opera House report. It comprised some indications such as plans, sections, reports by consultants, etc. The funds came almost entirely from a dedicated lottery, so the project was not a financial burden for the government. Regarding time planning the goal was to complete the construction at the end of 1962 and have the grand opening at the start of 1963. The project should have lasted four years.

The main stakeholder was the architect, but Utzon was much more concerned with the design aspect rather than time and costs objectives, which proved problematic. During the project, Utzon collaborated with Ove Arup, who was in charge of the structure and the engineering. With some other subcontractors, the team was in charge of mechanics, electrics, heating and ventilating, lighting and acoustics. There was no real project manager, but rather collaboration between Utzon and Arup.

The other main stakeholder was the client, the state of New South Wales. This encompassed the Australian government, which launched the competition for the project, and especially the Labor Premier, Joe Cahill. A part-time executive committee was created to provide project supervision but the members had no real technical skills. The government eventually became an obstacle to the project team by inhibiting changes during the progress of the operations and thus contributed to cost overrun and delays. Finally, the public was an indirect stakeholder because they were concerned with the projects success.

There appeared to be problems from the start of the project that was divided into three stages: Stage 1 was the podium, stage 2 was the outer shells, and stage 3 was the interiors and windows. Apparently Utzon protested that he had not completed the designs for the structure, but the government insisted the construction had to get underway. In addition, the client changed the requirements of the design after the construction was started, moving from two theatres to four, so plans and designs had to be modified during construction.

Regarding the project’s budget the initial estimation was drawn on incomplete design drawings and site surveys which later lead to disagreements. The contractors for the first stage successfully claimed additional costs of AUS $1,2 million in 1962 due to design changes. When it was completed in 1963, it had cost an estimated AUS $5.2 million and it was already 47 weeks over schedule for the whole project.

Stage two became the most controversial stage of the entire construction. As costs were rising a new government stepped in and monitored all payments being requested by the Opera House. By the end of stage one, Utzon submitted an updated estimate of the projects total cost as AUS$12.5 million. As more payments were being delivered and no visible progress was seen, the government began withholding payments to Utzon. Stage two slowed down and in 1966 Utzon felt he was forced to resign from the project as his creative freedom was restricted, and therefore could not bring his perfect idea to fruition.

The project was then taken over by three Australian engineers, and stage two was completed in 1967 with a total cost of AUS$13.2 million. When Utzon walked out of the project, he did not leave any designs or sketches to work with as he was convinced that he would be called back to the project once the new team failed. This was not so, and due to the lack of designs to work with, new ones had to be created based on the current structure of the Opera House and many unforeseen complications were found. Evidently this caused a huge increase in the estimate of the total cost of the project, which came to AUS$85 million.

This came as a shock and nearly an insult to Utzon who had been fending off the Government from rising costs for years. The news that they had agreed to that budget, which was more than four times Utzon’s original estimate, was evidence that he had been unjustly treated.

Queen Elizabeth II inaugurated the Sydney Opera House in 1973, after 17 years of redesigns, underestimates and cost overruns. By 1975, the building had paid for itself, thanks mainly to the lottery system that was created to help its funding. Utzon was never to return to Australia, never to see the final result of his work that was recognized as an incredible feat of architecture. In 2003 the architect was honored with the Pritzker Prize for architecture, the most renowned architectural prize in the world.


Introducing myself in a 3 minutes video-blog

I hope you like it!

Imagen de previsualización de YouTube

MARS Ice Creams: Distribution strategy problems

Mars, a company that started in the confectionary business at the beginning of the 20th century, launched its first ice cream bar in 1989, when they already had an outstanding position in the European market.

The strategy the company followed to promote this new range of products was not only backed up for their know-how of the confectionary sector but for three key factors: High-quality ingredients, advertising and price. Nevertheless these strengths were not enough to guarantee the success of the launching as their strategy might not had studied deep enough one of its weakest points: Distribution.

The new chocolate ice cream bars needed frozen transportation and storage. While this supposed no difficulty dealing with some of their trade sectors, it meant high costs when it came to distribution to retail outlets due to small orders sizes and low unit cost, among others.

Rival companies such as Unilever and Nestlé had solved the storage issue offering free frozen cabinets to retailers for the exclusive use of its products. Mars strategy to face the threat of being superseded by them included freezers sales and distribution agreements with companies that were in lower positions.

The other weak point of Mars new products launching is related both to the specific kind of ice cream items they were selling and the buyer’s power. Retailers were looking for a whole range of ice cream products that could meet their clients needs and Mars couldn’t offer. As a consequence, the branded frozen cabinets were filled with products from other suppliers, losing Mars its prominent presence at the retailer’s shop.

The strategy problems Mars has had regarding its ice cream products are directly related to the logistics of distribution and storage. I believe the company could start making significant profits from these operations as far as they could invest in new factories located in strategic European towns, as nowadays the whole production comes from a single factory in France. Decentralizing the storage of frozen items so as to reduce distribution distances and costs could be another, less expensive, option.

Mars has the potential to become a leading brand in the ice cream sector due to the consolidated position the company owns in the confectionary market as well as the long-term business relationships it has with both buyers and suppliers. Designing the right strategy and taking into account the wide range of substitute products Mars already has and the relation with rivals companies, I believe the brand could success in the commercialization of ice cream products.

 


Management skills: Focusing on people

Management skills has not only been a great subject to start the EOI Master I’m enrolled in, but one that leaves a mark, influencing in the way of performing everyday tasks both at professional and personal levels.

If I had to summarise all that I’ve learned in these short but intense classes I would have not doubt to state that the key point is not to forget that we are always dealing with people, human beings with needs, aspirations and dreams.

Having this principle clear it’s just a matter of preparation and constant work to achieve success in almost every field. How can you give a good and effective presentation? Focusing in the audience, understanding they needs and wishes, making clear the benefits they can get for being there listening to you. Of course there are other elements that help presenting, as using the appropriate language and having the support of well design visual aids. But still the key is focusing on the people.

Same regards when it comes to negotiations: our best chances of getting a good deal lays on a cooperative approach to the discussed matter. It’s not always possible to have a positive interaction with the other part, but trying to find common ground and mutual benefits is definitively the best option.

However, the field when it becomes vital to have clear the focus-on-people principle is leadership. A good leader knows how to positive influence on its team, motivating and encouraging but also delegating and supervising. As leaders we should have our own values clear and listen to the others ones, making them compatible and an asset to the group. I know now the importance of being a good leader, as an opposite to be just a manager focused on the task, not on the people.

I would also like to underline the impact that time management theories have had on me. Maybe because it was a while since I wasn’t this busy I couldn’t deal with all my tasks as a student and as a person in a positive healthy way. From rushing every day, sleeping too little and losing toomuch time in not important things I’ve started focusing in what is really important, avoiding turning tasks into urgent matters for not having them done at the right moment and organising my time better.

Here it goes Covey’s Time Management Matrix; I hope it’d be as useful to you as it’s being to me.

Lastly, I just want to emphasize the importance this subject and its key principles have and how useful it would be to know them when rejoining my professional career. I would also like to thanks our teacher Chris Metcalfe for making the subject so interesting and the classes so active and participative. I truly believe I speak on behalf of the whole class when stating that we’d love to have at least a few more of his classes.


Hypermarkets in Spain: Mercadona case

Due to the economic situation Spain is going through, hypermarkets have been obliged to reduce prices in order to get more customers or, at least, not to lose a significant amount of them. Contrary to expectations, main companies in this sector have seen their benefits grow an average of 40% annually. Let’s have a closer look to the hypermarket chain that seems to be in fashion lately: Mercadona.

Recently I’ve seen how this company is opening new supermarkets all over Madrid and family and friends are happier than ever shopping there due to its good quality products at reasonable prices. On the other hand they have mastered the promotion of its own-brand products, especially Hacendado, Bosque Verde, Deliplus and Compy.

While 10 years ago this kind of products were considered only cheaper imitations of the real-branded ones, nowadays they have its own identity based on a good quality-price relation and are not longer considered for the low-income classes.

Regarding Mercadona’s financial report for 2010 we can see how the net income of the company grew 47% from the previous year. Both operating income and income before taxes figures increased more than 50%. Sales and turnovers grew as well, but in a more discreet percentage.

However, having a more detailed look at the income statement figures it’s possible to calculate the net profit percentage, which is around 2.6% of the company’s revenues. This minimum margin of profit is common in a sector that relies in selling more units at lower price rather than the other way round.

It’s also frequent in the hypermarket sector in Spain to have short account collection periods, 2 days as an average for Mercadona, and long account payable periods, 61 days in this case. This scheme of collecting money very soon and paying very late allows the company to finance itself with the money they own to its suppliers.

Other shocking figures that can be calculated from the financial report data are:

The current ratio, which shows the capacity of a company to face short-term debts, which stands at 0,97 for Mercadona, almost reaching 1, the minimum that is, in general, expected from a company.

The working capital that, in this case and due to the financing system exposed above, is negative, -67.008 thousand of Euros. This figure doesn’t mean that the company is not doing well; it’s just a reflection of the way they trade with their suppliers.

To end up with, the return equity that relates net profit and equities stands at 0.18 for 2010 and the financial leverage that measures the risk of investment stands under 1. These figures mean that investment in the company is not highly profitable but safe.

For further economic analysis the 2010 annual report is available at Mercadona’s web page: http://www.mercadona.es/corp/ing-html/noticias.html

Mercadona, because of its marketing policy and financial scheme is a good example of the hypermarkets situation in Spain. The fact that the company stands for local commitment, transparency and friendly environmental behaviours, plus the quality and prices of its products, has contributed to the success of this hypermarket brand.



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