Volume 3, Issue 1, Year 2012

Page 1

Our Readers are invited to submit articles for the 2012 (8) Issues of the Scientific Review of the Romanian Distribution Committee – „Romanian Distribution Committee Magazine”. http://www.distribution-magazine.eu/submission

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Pledging for analyzing crises as a process of incubation that starts long before the triggering event, Christophe Roux-Dufort argued during a significant year (Is Crisis Management - Only - a Management of Exceptions? Journal of Contingencies and Crisis Management, Volume 15, Number 2, June 2007) that “if crisis management still limits itself to the analysis of exceptional situations, it might never go beyond the sphere of exception management and will for a long time remain an isolated discipline with little room for innovation and progress.” Trying to make enough room for innovation and progress, we asked ourselves what there is to do within the too long value crisis, knowing that there are values in direct conflict, and conflicts that are constantly managed in individuals.

What do we really want in our life? What do we really want to do with our lives? Because everything we do in our life represents a choice. Because knowing what we really want in our life helps us better organize our lives. Maybe what we really want is just a few feet away. We have to ask ourselves, because maybe the first step to considering the alternatives is to recognize our deeply seated systemic reasons, reducing together the discontinuity between our past and future. But are we really informed, smart, interested, engaged, and consulted?

As our decisions are based on value systems (we make choices based on what we think is best), Andrew Welch (http://thevaluecrisis.com/) argued that we need both a fundamental recognition of non-numeric values at the individual level (number-based value systems being limitless, linear, and consistent across time, space, and culture), and a return to having human values effectively represented at the group level (innate human value systems being bounded, relative, and inconsistent). It is said that education means first of all to give the educated a proper

sense of values, the quality of life in our modern society in full fight against the present value crisis being dependent on the rational acknowledgement of universal human values, in the interaction between the result of the education of creating and reception of values (culture, and its challenging adjusting with public and politics ), one side and the result of the practical organization of transforming the cultural values (civilization). Within this framework, Universities are also best placed to support character formation, and to develop these universal human values, while awakening the social consciousness beyond the confusion between the real values of life, and the material values elevated to the status of absolute values, reconciling individuality and solidarity, re-emerging community and re-imagining its future. But facing this significant challenge means making decisions based on informed judgments within this pressing priority, considering the systems’ and managements’ inability to deal with and the need for education to further improve our techniques and understanding of how to take much more active responsibility with respect to properly manage in addressing the complexity and in creating a communications climate that drives motivation through openness.

On March 20, in “Ion Heliade Radulescu”Auditorium of the Romanian Academy Library, the book “The Public Space. Management and communication” written by Professor Vasile Stanescu, Honorary Member of the Romanian Academy, was released. This new piece of work - completing a well-known work - appeared in February 2012 at “Universul Juridic” Publishing House, portrayed a triad: a documented and comprehensive continuing endeavor to revive the community spirit to transform public space into a fertile ground for responsible investment in a predictable future, reconfirming a state of perpetual vibration relative to the true purpose of public space, proposing to re-imagine the responsible teamwork crossing

the often invisible boundaries that define public space; a re-manifestation of the strong emotional attachment to our land and people, reconfirming the importance of the cultural compliance dimension of sharing by our people of the value systems and - within this context - the attitudes of consensus on common expectations and possible conflicts in the use and understanding of public space as normal and acceptable.

This new book of Professor Vasile Stanescu, Honorary Member of the Romanian Academy, was lunched within the context in which young people (and not only) remain the subject of a true “cerebral bombing” thanks to the creation of the illusion of ephemeral success that some Web pages would be public spaces, without understand the actually true exchange by giving up the attention and personal data privacy, the freedom of expression and even intellectual property rights. It has appeared reconfirming the idea that a truly public space should be an independent and cultural counterweight of the profitoriented private sector. We might dare to view this new piece of work as being an open and accessible public service contributing to overcoming a real difficulty today, namely that, as they say, in many cases, the “normal” has become “abnormal” and the “abnormal” has become “normal”, while “acceptable” has become “unacceptable” and “unacceptable” has become “acceptable”. We could also say that this new book of Professor Vasile Stãnescu, Honorary Member of the Romanian Academy, constitutes a vivid proof that the soul of a true community pillar is the expression of the power that comes from within, challenging beliefs (in the Professor’s characteristic note of warmth and wisdom) - and urging to education and culture, education meaning first of all respect of the past, of the present and of the future of the community assaulted by the uproar of the aggressive mediocrity’s nothing-

Léon F. WEGNEZ is a well known personality with a vision and commitment, knowing what to do with the time and having the power to give his life a meaning, with a real vocation for spreading knowledge about the distributive trade, pledging for the right decisions, the right choices and the progress of business life, through a better understanding of consumer value and consumer journey leading to successful marketing.

Léon F. WEGNEZ is: Secretary General, International Association of the Distributive Trade, AIDA Brussels; General Manager, Royal Belgian Committee for Distribution; Member of France’s Academy of Commercial Sciences; Administrator Secretary General of the Diplomatic Club of Belgium, and Co-Founder of the Diplomatique Gazette, Brussels; General Manager, International Association of Urbanism & Commerce; Administrator & Director, Association for Prevention & Safety. On the occasion of the First International Congress ,,Health-Nutrition-Wellbeing”, 15-17 October, 2011, Aro Palace Hotel, Braşov, Léon F. WEGNEZ sent a message to the Participants, that we present below.

Monsieur le Président, Permettez-moi de vous remercier, en ma qualité de Secrétaire Général de l’Association Internationale de la Distribution AIDA, pour l’invitation que vous m’avez adressée de participer à l’important Congrès International consacré à l’influence de l’alimentation sur la santé humaine, organisé du 15 au 17 octobre 2011, à Brasov, à l’initiative de l’Université de Médecine et de Pharmacie “Carol Davila” et de l’Université Américano-Roumaine de Bucarest, avec le patronage du Patriarcat de Roumanie, de l’Académie de Roumanie et de plusieurs Ministères importants de votre pays.

Il s’agit de la prévalence considérable de l’obésité qui est devenue un véritable problème mondial et qui est, naturellement, un facteur de risque considérable au niveau de plusieurs pathologies, en particulier les problèmes de tension sanguine, de cholestérol, de diabète, et d’une manière générale d’ordre cardiaque ou d’ordre respiratoire. Ce développement de l’obésité humaine résulte évidemment dans bien des cas d’une insuffisance d’activité physique, mais le comportement alimentaire et en particulier l’absorption excessive de lipides dans le cadre d’une alimentation insuffisamment diversifiée, y contribue grandement. Les médecins et les nutritionnistes ont un rôle important et déterminant à jouer dans ce domaine.

Des obligations se situant au niveau ministériel ne me permettent pas de me libérer pour vous rejoindre à Brasov. Je le regrette beaucoup et vous prie de m’en excuser. Je vous souhaite un excellent congrès, Monsieur le Président, dont le niveau particulièrement élevé sera assuré par les professeurs de renom qui figurent dans votre programme. Je vous remercie de bien vouloir saluer en mon nom les participants à votre Congrès International. Je leur souhaite des séances fructueuses L’influence de l’alimentation sur la santé humaine retient de plus en et je vous adresse mes chaleureuses amitiés. plus l’attention, tant des médecins et des scientifiques que des entreprises de production et de distribution et, naturellement, des Professeur Léon F. Wegnez consommateurs. Le bien-être des populations est plus que jamais au Directeur Général du Comité Royal Belge de la Distribution centre de tous les débats de société. L’initiative prise par vos Secrétaire Général de l’AIDA Universités s’inscrit donc parfaitement dans cette tendance fondamentale de mise en avant de la qualité des produits alimentaires et de l’adéquation qui existe entre elle et la bonne santé des hommes et des femmes d’aujourd’hui et de demain. Il s’agit bien, en effet, à la fois de prévenir autant que faire se peut l’apparition de certaines maladies trouvant leur source dans la malnutrition, mais aussi, au-delà de cette prévention, de générer des traitements médicaux permettant de guérir les malades atteints de dysfonctionnements dans ce domaine. En réalité, la qualité des produits alimentaires n’a jamais été aussi grande mais, de façon paradoxale, elle n’a aussi jamais été tant remise en question. C’est pourquoi, la recherche systématique d’une qualité optimale des aliments doit être considérée par tous comme une obligationfondamentale. Pour les entreprises, quelles qu’elles soient, il s’agit désormais non plus seulement d’un problème technique, mais bien d’une véritable question de politique, d’image, d’éthique, d’adéquation avec les exigences des consommateurs soucieux de leur santé. En particulier, une préoccupation très grande doit nous mobiliser tous.

Abstract The paper presents an analysis of the actual World major challenges, which could require priority technological solutions from the information and communications technologies (ICT) field, but not exclusively from this area. The main point of the paper is to emphasize the importance, for the actual information society (IS) and for the following Knowledge Based Society (KBS), of perceiving the gravity of these challenges, which appear as a companion of the general race for progress, as they put in danger the Earth civilization in a progressive way and as a consequence, of using the huge potential of ICT and complementary technologies to overcome as much as possible this trend and generate this way an other kind of race, for survival solutions.

Keywords Green technology, network centric, information/knowledge based society, information and communications technologies, biometric identity, social assistance.

JEL D8, L 86, M15

As concrete solutions, the paper identifies some of the main ICT areas which could contribute to solve critical problems as climate changes (CO2 generation), over-population and Earth resources (food, water, minerals etc.) fading, but including also internal progress risks (as nuclear incidents like Fukushima) or external credible menaces, as sun storms. A remarkable example is given by the biggest project, ever made, of using ICT in order to organize, from the identity point of view, a huge number of individuals, accounting about 1 billion at the end of 2011, in India. The paper concludes that the analyzed issues have a common point, in the World progressive dependence on electricity and soon of ICT products and services, which must lead to a mature control of this dependence.


A race for progress or survival? We already used to see the dramatic evolutions on our unique Earth: from breathtaking new technologies to hopes-taking conflicts or catastrophes. But more than this, we hardly observe the dramatic changes of life conditions, although very diverse on Earth. Neither we can perceive, at real scale, all the changing factors which in fact put a shadow on our daily spectacular progress. Of course, it is a matter of philosophy how we see the environmental processes and how we enjoy the positive side of progress. Still, a question remains: do we all habitants hear the ticks of Earth clock which seems to measure our race, but sometimes it seems to be a bomb clock? So, we may let, for further, the metaphoric approach and focus on a single, real, but not less complicated issue from above: the race. As a natural evolution, the mankind pace changed from the simple primitive life, to the dynamic, time-money measured today life, which is a continue race for progress and prosperity. One could say: this race is the essence of our life, the key to progress. We may agree and go even further: this way of thinking could be extended for companies, communities and states, but before doing that, we must see the whole process, i.e., all the implications of such multiplications. Jorge Luis Borges said: “mirrors and copulation are abominable since they both multiply the numbers of men”. Keeping the differences, we must observe that multiplying the individual prosperity actions at planetary scale will not necessarily produce only prosperity. As examples, the climate changes and Fukushima incident [7] are only 2 relevant (but sensible different) classes. Now we may conclude that the today world, featuring an explosive development of all activity fields, of all business and especially of information and communications technologies (ICT) and services, is a real race, with billions of participants, but we are not sure if, today and tomorrow, the goal must be the same general progress, or a very elaborated combination of stable progress and survival objectives for the Earth and the next generations. We also need, for each “competitor”, to carefully choose the right tracks of the race and perhaps the pace.


Choosing the right tracks of the race As we already mentioned, the race is a very complicated term, including, obviously, many processes. First of all we have to observe that the race will have more than a single meaning, referring to the usual one: the competition (for profit). Unfortunately, it is very probable that sooner or later, as depending on the field (goal), the race to become a “counter-time” one, a desperate struggle to save (at “last minute”) the Earth, or one of its unique and priceless values, as climate, water, food, air, minerals and more, including (why not) THE LIFE. Without dramatizing, this large imagine of the race is necessary in order to have the real dimension and importance of this approach, enabling this way the right evaluation and solving of the global challenges.

influence and action, at IS/KBS level, consisting of both hard (physical) and soft (information and knowledge) elements [4].

Of course, this approach, even focusing on ICT and conceded technologies, is not supposed to optimize all the World activities, but it could offer a way of thinking and acting, with powerful instruments and methods, which has the potential and the information impact to crucially influence the World, as we all share the preoccupation about the future evolutions and the present decisions for all economical, financial and social layers, which globally affect the Earth. Defining the tracks (directions and fields) and then choosing the right ones is obviously an optimization process in general and the ICT fields are enough extended in the actual information society (IS), with a crucial influence on the future knowledge based society (KBS) [6]. These premises of ICT are the basic mechanisms to make operational any improvement to the complex process of optimization regarding a continuous refining of the directions and pace of development, the stategical applications and the IS/KBS impact evaluation. On the other hand we have to face the realistic approach, observing that the actual World is more and more difficult to rule (optimize), although globalization, international organizations and institutes for standardization (IEEE, ETSI, ITU) have a crucial role in harmonizing a mess of crossing interests. So, let’s search the right tracks, at least among the existing ones, with the hope that, step by step, they could have a higher influence (and pace), promoting their new extensions and slowing their negative effects.

It is no doubt that the main potential and secret of the impressive development of these countries is close linked with their huge population, but one could ask: Why now, since they have the biggest populations for decades?

It is important to notice that the criteria we suppose when choosing “right” options must be first linked with the most stringent challenges for the Earth and mankind: climate changes (CO2 emissions), ecological development (power and material saving), food, water and air preservation, social security and… PEACE. The main track of ICT evolution will remain for a long time its “network centric” (NC)

Again we must emphasize the less observed elements of NC, which could have a crucial role in the future, as innovation and knowledge remain the main factors of mankind stable progress in the future KBS. This new paradigm is true as NC is the main vector of knowledge in our present and future World, where innovation will be enabled by all ICT/NC elements, which will stimulate and acquire all creative potential from the large “network” of people on Earth. Perhaps the best evidence of this trend is the rise and rise of the new powers of the World: China, India and other.

Of course the answer is not very simple, but we may consider at least some relevant reasons, as the cumulating effects of wise decisions on exploiting the new opportunities of globalization, ITC and…NC! Notice that, among other, NC results are impressive, when the “network” has billions of individuals, so it is no wonder that we see, in most scientific ICT journals and conference proceedings, more and more names from China and India. Completing the above answer, we also must point now that the “learned lessons” approach became more actual that ever been. It is obvious that China and India had to “learn” a lot from the main powers (USA, Europe, Japan), from technology to social management, but they also added their specific values, where individual loyalty is prominent (in general in Asia). An important issue, in the paper context, is to observe now that our World already has to learn from this Asian miracle, especially in the crisis period but not only. A good and refreshing example, on the above line, comes now from India and reveals a “right” track of ICT and beyond. In India is going to be finalized the biggest project, ever made, of using ICT in order to organize, from the identity point of view, a huge number of individuals, accounting about 1 billion at the end of 2011. Notice that in India, 2% of GDP is dedicated to the social programs, but 59% of the spending fails to reach the target (the poor) [1].

A good and refreshing example, on the above line, comes now from India and reveals a “right” track of ICT and beyond. In India is going to be finalized the biggest project, ever made, of using ICT in order to organize, from the identity point of view, a huge number of individuals, accounting about 1 billion at the end of 2011. Notice that in India, 2% of GDP is dedicated to the social programs, but 59% of the spending fails to reach the target (the poor) [1]. Once again we stress that this project (Aadhaar = Foundation) is more than relevant, it is a model for the today world, for many right tracks it covers. First of all Aadhaar is the best trial for ICT potential to implement the advanced technologies of biometric identity (security) in a very complex and adverse environment, considering the average level of education, the precarious conditions of living, transport infrastructure and administration, at the huge demographic and geographic scale of India. In spite of all these, the commitment of the organization which implemented the project (UIDAI – Unique Identification Authority of India), with the financial support of authorities, succeeded to obtain impressive concrete results, but perhaps the decisive support came from the population (“the network”), which understood the main power (goal) of the project. As we have mentioned, the general purpose of Aadhaar is “to organize” this population, not for a political, scientific or technical goal, but for the most stringent scope: their social assistance (food, health care, education and generally social support). Of course, the

project achievement will also provide many other advantages and instruments for the state administration, from taxes to social security. From a technical point of view, the project raised a diversity of challenges, taking into account the social and demographic problems (people with no identity, or multiple identities linked with family, no house etc.). The most impressive technical problems were generated by the natural diversity and dynamic of individuals, which led to the necessity to have a dual technology biometric solution (fingerprints of all 10 fingers and iris scanning), finalized by a 12 digit ID number, which could be confirmed on line by a special terminal of test (scanning). Even so, the potential of ICT was really tested, by millions of problems like finger mutilation (by hard working!) and multiple registrations (on vast territory, before the project final), so the data bases, the deduplication and other ICT resources proved now their NC power! Not the last, we must remark the determination of all leaders and organizations to continue, when the project was blocked for many times. All these represent perhaps the best lesson to be learned in all states on the entire Earth, because this is the kind of challenges they have to face today and tomorrow. Although the differences could come in goals, individuals and resources, one thing will remain common: the necessity to use NC/ICT power to find the right tracks and solve such stringent tasks, being sure every time that the “right track” is a reason “good” enough to be fully supported by all the participants, with all their potential, through NC/ICT, just like India did.

An other face of the learned lesson of India is that, in the same time, in India the explosion of development and modernization, where ICT is prominent, arisen among the large poor areas, the lack of infrastructure and other realities of emergent countries. So, in hard times, we all have to learn how the progress is still possible and especially how the miracle of switching from very low to high can be made. My opinion is that we will need unfortunately more and more such miracles and they could be done only refining our strategies, our way to treat the people and use the money in order to create more innovation and right knowledge, along with ICT/NC potential.

It is fair to observe that ICT already follows some of these ideas, but the challenges are still bigger, new ones appear and ICT is not the only involved in the decision processes, as the economical and financial power is so specially melted with politics [2]. Other right tracks of ICT could be observed in action and shortly listed as:

A continuous design effort to reduce the power consumption (and then CO2 generation) is the way the “green technology” could strongly contribute to World CO2 reduction, by the NC gears. This way the processors and generally the ICT components, which are present in all industries and everywhere, from smart phones, cars to toys, will have a major impact on CO2 reduction. The computers speed and especially the supercomputers speed is driving, again through NC, many important scientific research, industry and medicine fields. Perhaps the most expectations are regarding the progress in simulating climate changes, brain activity, Earth reserves exploration and nuclear processes. The computers speed and especially the supercomputers speed is driving, again through NC, many important scientific research, industry and medicine fields. Perhaps the most expectations are regarding the progress in simulating climate changes, brain activity, Earth reserves exploration and nuclear processes.

The ICT global performances push all world applications and they are depending on Moore’s Law race, which is approaching now the physical limits of semiconductors. So Intel and other big companies have in 2012 some major tests for their revolutionary solutions: a. EUV (extreme ultraviolet) lithography; b. 3D-chips (TSVs – through silicon vias). It is enough relevant to mention that the implementation of TSVs will provide incredible increase of performance for DRAM memories as: +800% in bandwidth, -50% in power consumption and -35% in size [3]. Smart grids represent a complex system of optimization of the national power grids, which provide remarkable savings of electricity. Their latest performance could be the equivalent of a “virtual power plant”. LEDs lamp will replace, at world scale meaning huge savings, both incandescence lamps and fluorescent (mercury) tubs, as their performance (versus the first) provides 1/6 of power consumption and 25 times longer life, with technological controls for the light “colour” (warmer or cooler) [8]. But the price has a long way to decrease! Plug-in cars, which, in perspective, could be an other planetary scale generator of savings, have important benefits from ICT (even not exclusively) and electric industry, in order to overcome


Conclusions could be replaced by continuing to deeply think

The real challenge and right tracks for ICT will come from a general risk, which puts Earth community on the most stringent race (for solving, or at least to be best prepared for it), we may call the Achilles’ Heal type of risk: our total dependence on electricity (see sun storms, nuclear incidents etc). A very sad (but “lesson to be learned”) example is that Fukushima incident will lead to a critical situation in Japan, where, from the tens/hundreds of nuclear reactors, from different reasons, all could be stopped (for shorter or longer terms) in the summer of 2012 [7]. Without dramatizing, going even further from electricity, it is realistic to observe and learn from the fact that, we will soon be almost total dependent on ICT products and services! The solution is far to be simple, but we must think to a mature control of this dependence. So, we have, every day, to look for the right tracks we have mentioned before, while the whole Earth is in a hurry and everybody is in “his race”, because we can not afford to forget that the Earth race is sure two-fold: to progress and to survival. REFERENCES [1] Joshua J. Romero, India’s big bet on identity, IEEE Spectrum, March 2012. [2] Stephen Harper, The European Union Takes the Next Step in Realizing the Energy Efficiency Potential of ICT, February 26, 2010, http://www.smart2020.org [3] Rachel Courtland, ICs grow up, IEEE Spectrum, January 2012. [4] Victor GREU, The network centric and cloud - a new paradigm for the optimization of the technical and human information systems, Romanian Distribution Committee Magazine Volume 4, Issue 4, 2011. [5]John Kappenman, A perfect storm of planetary Proportions, IEEE Spectrum, February 2012. [6] Abdulaziz S. Almazyad and Farooqui N.K., Towards Knowledge Based Society, Proceedings of the World Congress on Engineering and Computer Science 2009 Vol II, WCECS 2009, October 20-22, 2009, San Francisco, USA. [7] Ritchie S. King, The post Fukushima world, IEEE Spectrum, November 2011. [8] Richard Stevenson, LEDs for less, IEEE Spectrum, January 2012.

Abstract Being kept permanently connected to the reality of our life, we have the duty to demonstrate our firm commitment to sharing the respect for those who prove passion in serving and promoting a real culture of excellence, for those who demonstrate strong beliefs in the imperative of being involved responsibly with the community and school, having a real sense of caring. A Professor’s students are intensely feeling the need of being supported by people who bring the core values of community networking, by displaying the architecture of honest and pertinent conversation. The same way, the town’s residents are intensely feeling the need of being given a heard voice in all the decisions that impact their families and town community.

Keywords Community engagement, professional teamwork, knowledge for understanding


Honest and pertinent communication with the community he cares about Born, raised and married in Buftea Town (the town’s historical, social and economical link with Prince Barbu Ştirbei being well known) and having a beautiful family (two children, and his wife Silvia Marinescu being the Principal of “Barbu Stirbei” College in Buftea Town), Professor Radu Titus MARINESCU breathes through every pore of the community and school. The beginning of our transition to the free market economy brought him in the position of Vice Mayor, and now, after 22 years, we find him in the same public position, dedicated to working in cooperation with others to better serve the hometown Buftea as Vice Mayor, considering an honor and a privilege to serve the town community with honest and pertinent communication. He is promoting responsible development consistent with the values of his hometown Buftea, pledging constantly for both, experiencing the transformation of the hope for a better life of the people and their children’s future in reality, and a fiscally responsible approach to budgeting issues, being convinced of the importance of thinking together in what concerns how to identify ways to reduce taxes and spending while facing crises pressures. v He has significant contributions to well known scientific debates reflected by the mass media (“Economistul”, No. 10, 28 of March 2011, pp. 10-11), such as “National Project for the Economic and Social Modernization of Romania” (the scientific debate was based on a diagnosis made by the distinguished Professors Constantin Anghelache, Ion Gh. Roşca, Constantin Mitruț and Vergil Voineagu; this diagnosis being appreciated by the distinguished Professor Gheorghe Zaman - http://www.crd-aida.ro/our-team/gheorghe-zaman/ - and the other distinguished participants). Together with his distinguished Colleague Professor Constantin ANGHELACHE, who is The President of the Senate of the ARTIFEX University, Professor Radu Titus MARINESCU (Vice Dean of the Finance and Accounting School) form a true example of professional teamwork. Together with their colleagues, they are constantly developing an active interdisciplinary community, making pedagogy more student-centered, and trying to make a difference establishing relationships built around teaching, by adequately talking to the students while developing the school expertise when it comes to student knowledge about practice, knowing that their students must be able to succeed in an ever changing labor market by engaging in the specific activities and becoming accountable. In this respect, they are assuming the recommended responsibility of instructing and evaluating their students in a fair and effective manner.

Professor Radu Titus MARINESCU is involved in scientific research projects and has received different scientific prizes, such as a prize from the Romanian Academy (Virgil Madgearu, 2003), and from the General Association of Economists from Romania (A.G.E.R., 2009, for outstanding contributions to public finance performances analysis). In the last few years, he published the following books: Public Finance. Analytics Models and Case Studies (Editura Economica Publishing House, Bucharest, 2009), Elements of Banking and Financial Marketing (ARTIFEX Publishing House, Bucharest, 2010), and Analytics Models in the Field of Public Finance (ARTIFEX Publishing House, Bucharest, 2010).

A proactive Member of the Board of the Romanian Distribution Committee As a member of the Board of the Romanian Distribution Committee, Professor Radu Titus MARINESCU has permanently confirmed his willingness to take matters into his hands, assuming an active role in the Romanian Distribution Committee struggling to deal with the barriers raised in front of the necessity of returning to knowledge for understanding, of capitalizing on the tradition for wisdom of humankind, by joining our responsible team he decided to prove that human interaction is the one that makes a better sharing, by opening our hearts and restoring the preeminence of character over spectacle, transforming ourselves and others by widening the constructive debate, and step by step building in terms of knowledge, experiences and interests of the citizens, communities and civil society. He was directly involved both, in our effort of promoting sustainable development by organizing on May 16, 2000, together with the “International Foundation Health – Environment – Sustainable development ” and in partnership with “ION RATIU” Romanian Parliamentarian’s Club , the Symposium ”The Economy of Ideas and Sustainable development” (first reported by the Magazine “Tribuna Economica”, no. 18/3 May 2000) that took place at the Parliament House, and in the achievement of the interdisciplinary research (representing a turning point in developing a national strategy) “Sustainable development: principles and action” (Millenium Publishing House, May 2000), which formed the basis of the debates on that occasion. As it is known, the study was centered on the need for enterprise reconstruction on the basis of negotiated competency, in the context of spiritualization of economies. It was also discussed, in the context, the opportunity to exploit the model of Product Development Research/CDP in meeting sustainable development, CDP representing product trajectory as a specific methodological instrument (in Anexe 1 being presented the Research-Developemnt Programe - with 4 subprogrames - “Sustainable Development”). Professor Radu Titus MARINESCU was also involved in many other activities, such as: the first “International Congress of AIDA Brussels” in Romania (in May 1998, Athenee Palace Hilton); the International Symposium “The distribution of fresh products” (March 13, 2001, at the Parliament Palace); the Symposium “Institutional-spiritual reconstruction of enterprises, requirement for sustainable development in the knowledge society”, a nationwide premiere organized in 2006 by the Romanian Distribution Committee, in collaboration with Bucharest Academy of Economic Studies and UGIR 1903; The First International Congress ,,Health-Nutrition-Wellbeing” (Aro Palace Hotel, Brasov, 15-17 October, 2011). And all these within the framework of our actions enrolled in a common endeavor for the normalization of the competitive environment, to prevent inefficiency and to increase the overall level of performance, for partnerships and loyal competition in the distribution process, to increase welfare by offering the possibility of options. It is worth remembering, in this context, the aspects mentioned in the 1997 Report (page 561), 1998 Report (pag. 66-67), 1999 Report (pag. 53) and 2001 Report( pag. 64 ), of the Competition Council, concerning the collaboration with the Romanian Distribution Committee. As we all know: competition is the key leader of performance and innovation which feeds economic growth, thanks to fair and open competition the best product winning and the market forces prevailing; the signals regarding the changing of the nature of competition intensify, that increasingly takes place inside corporate-controlled networks, emphasizing the necessity to apply in the global industrial network of some fresh engineering principles carefully building political calibrated institutions and following the approach through the whole system of human businesses, both private and public; it is necessary that the approach based on the market helps in implementing the ambitions of the social reform; the situation is even more pressing in a global context in which it is considered that calculated dishonesty and the application of the double standard, characteristic to the agreement between the political power and the financial power, raise strong barriers to the responsible intelligent decisions.

As we have remembered on the occasion The First International Congress ,,Health-Nutrition-Wellbeing”, the speech and action on this real serious identified challenge must and can be changed. The health of the people and of the economy lies in the center of sustainable development and adapting the business accordingly. That is why we will continue to demonstrate our consequently commitment of sharing the respect for those who prove passion in serving and promoting a real culture of excellence, for those who demonstrate strongly beliefs in the imperative of being involved responsibly with community and school, having a real sense of caring, for all those trying to build consensus in order to organize the necessary community effort aimed at serving the community quality of life.

Bernd Hallier, Silvia Marinescu (Principal of “Barbu Stirbei” College in Buftea Town), and Radu Titus Marinescu (Vice Mayor of Buftea Town)

John L. Stanton, Carol Stanton and Radu Titus Marinescu

John L. Stanton and Radu Titus Marinescu

Theodor Valentin Purcarea, Bernd Hallier and Radu Titus Marinescu ă

Abstract Since the early 1990s there has been a substantial restructuring of retailing in Europe. The implications extended beyond Europe but they have had primary impact within European markets. The restructuring involves not only changes in horizontal competitive relationships amongst retailers but also involves new forms of relationship with suppliers and an extension of the activities of West European retailers into Central and Eastern Europe. The restructuring has occurred alongside substantive changes in strategies, relationships and operations. These changes have encouraged the emergence of an alternative perspective of the role of retailing that places this sector as the initiator of added value activities in the economy rather than in its traditionally more passive role of building on the value being added in manufacturing. The new role places retailing in a global framework of international store operations, international sourcing of products, international flows of management and managerial know-how, and international retailer brands.

Introduction Restructuring into a global context is the most recent stage of a half a century of change in European retailing that can be seen as comprising three major phases. The first phase occurred during the years after 1945 when the priority for the retail sector was the reconstruction of both the organisational and physical structures of retailing. There was a strong American influence in managerial developments, for example in the introduction of self-service into the food sector. A number of American firms, for example JC Penney, entered Europe.. The development of the ‘Common Market’ in Western Europe and the subsequent development into a more integrated European Union marks a second phase. The retail markets across Europe started to consolidate and substantial growth of a different type occurred. Marketing became accepted as a key activity for retailers with different types of retailing being designed to satisfy different consumer needs. As market segmentation developed, retailers explored new formats. Consumers, during this second phase, wanted different products and better quality products rather than simply more products. The third phase is characterized by a restructuring of retailing with new roles and functions becoming evident. The convergence of information and communication technologies, the use of new materials, and other applications of technology, such as RFID, across the value chain are enabling retailing to take on more forceful roles within the economy. Economies of scale of organisations associated with global sourcing and international operation of stores are allowing retailers to become some of the largest firms within Europe. In establishing the new distinctive role for retailing, the leading firms have developed a distinctive European model of retailing and distribution. This European model, now emerging, is different from that of the USA. It is a model that is internationalist, not domestic; compare for example the international scope of METRO Group and Tesco with Kroger and Target being limited to USA. The opening of Central Europe to investment from West European retailers was a stimulus to the internationalist view. The European model also is structured around an integrated demand chain, not a supply chain. And, it has market innovation, not copying, at its core.

Keywords Restructuring, Managerial Processes, Organizational Structures, Value Chains, Market Concentration, Competitive Power

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Changes in managerial processes in the retail sector Managerial processes in the retail sector are changing within the overall restructuring. Four changes are particularly apparent. 1) The Large Firms Are Growing Faster than the Sector as a Whole. Despite low growth in the European economies in recent years large firms have been able to increase their output through entering new markets, diversifying their retail offer, acquisition and, importantly, like-for-like sales growth. In most cases for European firms the growth is above the general level of growth in the sector. Leading companies in other more specialist sectors show even strong growth. 2) A More Strategic Approach to Managerial Decision Making. Across the sector in the large and medium sized firms a strategic approach to management has been adopted more consistently. Strategies vary considerably but there is a wider presence of a general business strategy that is then made operational through functional strategies for marketing, merchandising, buying, branding, logistics, employees, finance, etc. Private and publicly quoted firms exhibit this trend. Whilst short-term opportunistic development and reactive competitive moves remain, these occur within a broader, formalised, strategic framework involving a mission, market positioning and formalised approach to channel relationships. 3) Increased Complexity of Organisational Structures. With the new role of retailing and the increased size of firm, organisational structures have become more complex. The expansion of international operations, for example, has required retailers to develop a structure of country ‘vice–presidents’ and in several cases an international Board of Directors. At store level the international moves have required different organisational structures in different countries in order to respond to the different consumer cultures. It is not only international operations that require a more complex organisational structure to the firm. International sourcing centres have to be accommodated in organisations. The outsourcing of many previously in-sourced functions also changes organisations. The diversification of retailers into financial and leisure services provides further organisational complexities. 4) Moves Towards Retailer Co-ordinated Value Chains. In recent years the nature of the value chain within the successful retailers has changed substantially. Retailers have become increasingly involved in co-ordinating the relationships between retailers and suppliers. Thus value is created at a variety of places in the value chain, not simply at the point of final sale to the customer. In taking costs out of the channel of distribution there is a redistribution of the locus of value generation. An example of this is in the terms of trade that exist between retailers and suppliers such that a retailer’s inventory is financed by suppliers. By providing a longer number of credit days than the inventory turn of the retailer, the retailer operates with negative working capital. These four changes illustrate the nature of the changes taking place in European retailing during this third and current phase of major restructuring. They are clearly inter-related with the focus on strategy underpinning the rapid growth of the large firms and the change in financial relationships with suppliers. The four changes are illustrative of the totality of change and other changes could be highlighted. Nonetheless the conclusion that can be drawn is that the current phase of re-structuring is resulting in an increase in the complexity of the sector, a quickening in the rate of development and a more global perspective being adopted by management.

The Implications of the Changes There are many implications of the changes in the role and structure of the retail sector across Europe. A major implication is an increased level of governmental intervention in retailing. Four particular aspects of change give rise to governmental intervention at various levels across Europe:

The Increase in Market Concentration. With the continuing

growth of already large firms and their acquisition activity, the competition agencies in individual European countries and in the European Commission have become more active in reviewing levels of market concentration.

The Decrease in the Number of Small and Micro Firms.

An aspect of long term structural change has been the decline of small firms in retailing across Europe. This loss of small firms has become more acute in recent years such that governments have been exploring ways to provide support to smaller firms through different types of policy initiative. These include limiting the local competition from large firms by restricting the establishment of new shops, providing direct financial help to the small firms to encourage investment and training, reducing the tax burdens on small firms, encouraging co-operative behavior amongst small firms, and providing special protection to particular sub-sectors, for example pharmacists and small firms in rural areas and in the lowest income parts of cities. Governmental intervention in the market in these cases is aimed at protecting smaller firms from the full rigour of the market.

The Change in the Balance of Competitive Power Between Retailers and Their Suppliers. An implication of

the changes in retailing is the growth of channel power of retailers at the expense of their suppliers. Governments have sought to intervene in the market to regulate the behaviour of the participants in the channel. This has involved policies on the nature of the contracts between retailers and suppliers, the number of credit days allowed, the types of discount that can be used, the ability of retailers to re-sell products at below cost, etc.

The Increased International Activity of Retailers. In some

European countries, notably those in central Europe that attracted large amounts of foreign direct investment into retailing after 1989, the governments have been adopting policies to limit foreign ownership of retailing. The rationale for such policies is to protect local retailers and suppliers from the business practices used by the foreign, often large, firms. Those foreign retailers that have a presence in the market, having entered early, are in effect protected from peer-group competition and so may benefit from the policies aimed at limiting them. The extent of and types of intervention of governments in the retail markets is generally increasing in Europe. The rationale for intervention is generally to ameliorate, in some way, the consequences of the structural changes in the sector. In many cases the policies are instituted without a clear understanding by government of the nature of the causes of the structural changes that generate the ‘undesirable’ change but there is growing awareness of the complexity of the distributive trade in respect of the vertical relationships involved. The reasons for the structural adjustments in this current phase of major change in European retailing can be presented as a process linking changes in the environment to responses by retail managers. Retailing, as an activity linking consumers to goods and services, operates in local markets. As such many of the managerial decisions are a response to both the local culture of the consumers and the local culture of consumption. Within Europe these local cultures are subject to considerable social, economic, political and technological changes. This dynamic cultural environment requires responses from retailers that seek success through the close matching of their operations to consumer requirements. These responses underpin the strategies of retailers. The strategies are executed through the formats and formulae that the retailer creates. In creating these formats and formulae the retailer enters into relationships with other groups, for example suppliers, finance groups, consumers, etc. In the current context of activity in Europe all four of these attributes of the retail sector – cultures, strategies, formats & formulae, and relationships – are undergoing substantial change as they inter-act. It is the changes in these attributes that provide the reasons why retailing is changing in the ways that it is.

Culture. The changes in consumer culture in Europe af-

ter 1989 have been considerable. The emergence of market economies in central Europe meant widespread privatisation of retailing. Perhaps of greater importance in terms of consumer culture, however, has been the increased demand for products and services from consumers in the former communist countries. Steady increases in consumer wealth after the initial periods of high inflation have meant that from the mid-1990s consumers have expected a more extensive range of price-quality combinations in the retailing. In clothing for example distinct markets in street fashion, work clothes, high fashion, discount apparel, etc emerged quickly to parallel the market structures that have been developed, more gradually, in West Europe. Across much of Western Europe consumer cultures show apparent contradictory trends of standardisation and fragmentation. The fragmentation of demand is evident in many ways with ever smaller segments of consumers having specific patterns of demand. Consumers have translated their values into demands for goods and services such that there are differing values, for example the ecologically responsive groups, vegetarian groups, designer brand groups, sport obsessed groups, etc. These are in addition to the longer established groups associated with age, educational level, income, etc. This fragmentation has been encouraged by specialist media. The fragmentation has been extended even further with consumer demands varying on a temporal dimension – by time of day or day of the week. The consumer can no longer be considered as one person but has to be viewed as many different ‘people’. In apparent contradiction to this fragmentation is a Europeanisation of some aspects of consumer demand. With the wider and faster availability of information through satellite communication, the rapid diffusion of fashion, in clothes and music particularly, has generated European-wide patterns of demand. The movement of people through Europe particularly for leisure and tourism similarly has generated a diffusion of cultures, often in food items, with consumers in Northern Europe becoming familiar with foods from the South and vice–versa. The availability of international manufacturer brands, in electrical items, food, grocery, toys, etc. stimulates this move to ‘sameness’ or ‘Europeanisation’. The euro-integration of consumer infrastructures is often facilitated by common technologies in the home or mobile ‘close to body’ technologies (mobile phones, pocket computers, hand-held games machines, etc.). The driving force for much of this integration is a combination of the aspirations European politicians and multi-national manufacturers. Many European politicians have a vision of the future as a single and more standardised European market. Multinational manufacturers wish to exploit economies of scale by producing goods for a large market, but often consumers have a more local perspective. The approach adopted to address the strategic dilemma resulting from the changes in culture is to move away from the traditional approach to strategy that contrasted either low cost or high service. Retailers have approached strategy by having a wider perspective that considers co-operation and competition both in a vertical dimension through the distribution channel and horizontally with other retailers. There is a presumption of vertical co-ordination to increase horizontal competitive ability but this basic model is subject to detailed interpretations by firms. A greater emphasis is placed on innovation and the generation of knowledge as key inputs into the development of strategy such that firms reject the idea of a ‘generic’ strategy and seek ones that are appropriate to their own knowledge base and are flexible enough to accommodate the localizationstandardisation dilemma. There are several results of this new approach.


Four results serve to illustrate the point: • Branding has become controlled by the retailer. The stores have become brands, for example IKEA, Zara, Dia, Pimkie, Aldi and B&Q. Alongside the branding of the store the retailers have also taken control of the branding of merchandise. Individual firms have adopted different strategies to the branding of merchandise. Some use the name of the firm, some have developed different brands for different merchandise categories and others have developed different brands for different market positions. Although the implementation varies from firm to firm the rationale for the strategy is similar. By controlling the brand offering inside the store it is possible to co-ordinate the merchandise brand with the store brand to make the total marketing effort more effective. • A wider perspective on productivity. A more integrated view of the productivity of assets emerged in the new strategic approaches. The traditional view was of productivity being related to employees and floorspace with sales per employee and sales per square metre being the key metrics. In the new strategic approaches not only are these traditional measures disaggregated, for example profit of checkout employee per hour, shelf-space sales per cubic metre, but new assets are considered. The ‘productivity’ of customers, of suppliers, of in-store services for example in-store bakeries, and coffee shops, of promotions, and of brands, are now considered and attempts made to develop a more integrated view of productivity of the firm. • Identification of the profit sources in the value chain. With a more strategic approach to considerations of productivity so there has been greater awareness of the nature of the value chain in retailing. This has resulted in shifts in the balance between out-sourced and in-sourced functions. Retailers have evaluated the functions they undertake and established which generate value added to the retailer in respect of specific knowledge owned by the retailer. These they have retained as in-sourced. Thus for example, merchandising has been concentrated inside retailers. Where value added is less in relation to the retailer’s knowledge then the functions have been outsourced with contracts made with specialist groups. • Consideration of new markets. The ability to respond to the new cultures of consumption has encouraged European retailers to move into new markets.

Conclusion It has been argued in this article that the retail sector in Europe has been undergoing, since the mid 1990s, a period of intense restructuring. The reasons for this restructuring lie in the changes in the culture of consumption in Europe, in the resulting strategies of the retail firms, in the formats and formulae that have been developed and in the relationships that the retailers have generated with various other agents in the distribution channel. Retailers have been attempting to compete by changing their operations. Innovation has been critical to retailer success in this regard. Retailers have moved from traditional forms of innovation to undertake ‘experience’ innovation. The key importance of experience innovation is in acting as a catalyst for growth in mature economies with little increase in consumer spending. The innovation enables the growth in productivity that retailers then use as the basis for obtaining more control over activity in the channel and also undertaking marketing initiatives to provide better experiences for customers. Both routes facilitate increases in sales at a rate greater than growth in the overall economy.

REFERENCES [1] KRAFFT, M. /MANTRALA M.K. (2010) – “Retailing in the 21st Century: Current and Future Trends”, Springer-Verlag Berlin Heidelberg. [2] BURT, S. (2000) - “The strategic role of retail brands in British grocery retailing”, European Journal of Marketing, Vol. 34. [3] DAWSON, J. (2001) – “Strategy and Opportunism in European Retail Internationalization”. British Journal of Management, vol. 12. [4] LEVY, M./ Weitz, B. (2007) – “Retailing Management” (McGraw-Hill). [5] MCGOLDRICK, P. (2002) – “Retail Marketing” (McGraw-Hill). [6] ZENTES,J./MORSCHETT, D./SCHRAMM-KLEIN, H. (2007) - “Strategic Retail Management”, GWV-Vieweg. [7] ZILIANI, C./ BELLINI, S. (2004) - “Retail Micro Marketing Strategies and Competition”, in: The International Review of Retail, Distribution and Consumer Research,Vol.14, No. 1. [8] ZILIANI, C. (1999) - “Retail Micromarketing: Strategic advance or gimmick?”, in “Proceedings of the 10th International Conference on Research in the Distributive Trades”, Institute for Retail Studies, University of Stirling.



The article analyses the MIC.Ro business from various perspectives, in order to gain some understanding of what the future looks like for the business. One very important aspect to be mentioned in this analysis is the competition coming from foreign traders, or European giants such as Delhaize, Carrefour, or Metro. Other aspects of analysis refer to the location of the MIC.Ro stores, the way the MIC Ro network was built, the design of the stores as well as the price policy.

Retail, stores, price policy

Introduction If you remember, in an article several month ago, my comment on MIC. Ro was both optimistic and pessimistic .Unfortunately I have to admit today that what I presume regarding the MIC. Ro future is near to prove right .The competition of foreign traders almost killed what had to be a promising adventure. MIC.Ro was welcome by many observers as a hope for local capital to produce economic effects within the Romanian home trade which day by day seems to fade away. And this is the aftermath of something that can be called (just be in the trend !!), “occupy Romania “, i.e. occupy Romanian local market , a long term policy of the Europe giants like Delhaize, Carrefour, Metro a.s.o. To me it is hard to understand why those giants still come to us while nowadays living standard is lower than 6-7 years back .In my residential district somewhere near the former “23 August”big metal plant, on an area of less than 20 streets (to my count about 5-6 sq Km) , in 1995 there were about 6-7 big food stores and some milk and bread outlets. Now we have Auchan and Cora hypermarkets, 2 Mega Image stores, a Billa, a Carrefour, a Lidl, and 3 MIC Ro. Besides, there are 2 or 3 food market stores and an open market mainly for country side producers. All old shops disappeared and the Romanian shop keepers closed their business for ever. So, “our friends “ cleaned the place and got rid of local competitors. I expect they will realize that such a crowded market with modest earning people cannot produce efficiency. But this is another story.


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What is the future of MIC.RO? What interested me is the fate of this MIC. Ro which according to some newspapers, started closing many stores mainly in other towns like Oradea and the whole organization have a huge debts to the suppliers. So they have to think of reevaluating their business plan and policy so they eventually survive but I have little hope in this respect. And I tell you why: I used to visit MIC Ro shops daily , every time at different hours so I can see who are the customers. I never saw more than 2 or 3 people at a time and mainly at noon no one stepped in for hours. In my view, something has not been carefully took into consideration. One cannot open an outlet just in between the “Giant” stores.That was a mistake because no one in Romania today can compete and fight against Cora, Carrefour , Mega Image an so on. First reason is the price and MIC Ro is unable to resist and second, the variety of goods is not to be compared and there is no special item to capture people to buy. During winter time the price problem in competition to the open peasants market, in what fruit and vegetables are concerned, is easier because as soon as weather become harsh vegetable price rise while for hyper or super markets as well as for a network like MIC.roprices could remain almost stable because there are different sources of goods. In Romania, today, almost 70 % of food products are imported from a variety of world areas and this is an advantage. Let us take an example of recent winter days. A kilo of imported carrots varies from 1.5 to 2.5 lei in big stores and abt.4-6 lei Romanian carrots in peasants outlets. Same happens to potatoes, onion and so on . MICRo prices are in between for some goods and at the highest level for many others. I read a funny story in a newspaper recently that reflects the MICRo prices : MICRo attendants use to buy their daily cigarettes and refreshments in nearby shops instead to their own just to save some money!!! Another story, yet unconfirmed ,is that MIC Ro network was mainly built on money provided by the goods suppliers which means that MICRo sold their goods and instead of paying the invoices have used money to invest in the network. In other words MICRo investment was based on other’s money not on the owner’s. If so, that explains why relationship with good suppliers deteriorated . There are also some technical items to discuss –stores area is ,in some cases, to big and lighting as well as some shop equipment are too expensive compared to sales volume. I dare to say that the MICRo very poor advertising may also be taken into consideration. All in all, the price policy will finally be decisive in this war .. I may say that foreign big traders present here have already learned that more than half of Romanian consumers reason to buy is the price and not only the goods quality . But they have enough funds to sustain such price policies to beat any competition. And the victim are such shops like MICRo’s. In mean time, MIC Ro. will be obliged to review the number of stores and do something to reduce the risk of bankruptcy. My final question of the previous article on the same matter, “Competition, what is this?” remained unanswered and nobody can do something in this respect.


The Second Conference of the International Network of Business and Management Journals (INBAM): “Brokering Knowledge” took place in Valencia, Spain, between March,20 and March,22, 2012. A high-level conference that enjoyed the participation of 13 editors of the most prestigious International Journals (Small Business Economics, International Small Business Journal, International Business Review, Human Resource Management, Management Decision, Journal of Organizational Change Management, Canadian Journal of Administrative Sciences, Cornell Hospitality Quarterly, International Journal of Manpower, Service Industries Journal, International Journal of Project Management, European Journal of International Management, Service Business. An International Journal). But first...you might ask yourselves what is INBAM? Well... INBAM is a network created in 2009 by the Editors of eight prestigious international Journals, that became an Association in September 2011. At the moment, the Association comprises editors and journals from Emerald, Springer, Taylor and Francis, Wiley, Blackwell, Elsevier, Inderscience, Sage. I therefore had the opportunity to take part in a highly valuable event that offered me a whole different perspective on the directions for improvement that I should be pursuing, both in terms of research methodology employed and acquiring specific article writing skills. I had the priviledge to attend very interesting presentations, high-quality content in what concerns the topicality as well as the complexity of the researches conducted. The journal editor corresponding to each area opened each session with a presentation on the main trends in the future in his/her

journal. What I particularly enjoyed and found highly relevant and important, was the emphasis on the article review process, including suggestions on how to improve the articles submitted in order to increase the chance of having your work accepted for publication. In 2013, the Journal of INBAM will be launched. JINBAM will be a new academic journal published by Springer and will include papers presented at the INBAM events and Conferences for the first four/five years of its existence. The Third Conference of the International Network of Business and Management Journals (INBAM) will take place in Portugal, between 9 – 11 May, 2013. Eighteen editors of leading journals will participate in this 3rd Conference. So...see you in Portugal!