SigmaWay Blog

There is a lack of awareness about the insurance sector but it has a lot of attractive and interesting propositions to offer. Amendments have been made to the Insurance Act, 1938.  Foreign investment ceiling in insurance companies has been increased which will boost job opportunities and growth potential. But, talent retention is a challenge in this sector. Economic and regulatory changes have affected this sector. This led to companies adopting short term policies over long term ones. It is also predicted that salary structures would increase slowly with average increment levels at 8% for the current year. Read more at: http://info.shine.com/article/talent-retention-is-a-big-challenge-for-insurance-firms/8814.html

There is a positive correlation among investment in employees and output generated. This phenomenon has been defined as the Return on Employee Investment and it has been a challenge for organizations. It has been found that employee investment leads to business growth, revenue generation and has significant effect on long term growth. There is no hard and fast rule to measure the return on investment but it does bring back positive changes within an organization. This investment can be treated by the employees as a motivation factor, a "benefit on efforts". This can help to retain talents in an organization. Experts believe that though it is possible to find a measure for ROI, HR is not always the right choice to quantify it. To know more, please follow: http://info.shine.com/article/spending-on-employees-can-maximise-your-roi/8849.html

Mainstream retail companies are taking a heavy beating from their online counterparts. These companies are facing stiff competition due to discounts and lots of advertising from the e-commerce industry. Company reports indicate that the decline in sales for the brick and mortar firms are a steady affair, and sales do not increase even during the festive seasons. Revenue growth of these companies has slowed down impacting the distributors. Distributors are stocking less and there has been a significant decrease in inventory holding. With the number of offline firms growing day by day, these firms are looking for a change in their marketing strategies to counter online competition. To know more, please follow the link: http://info.shine.com/article/the-churn-in-the-retail-sector/8822.html

80% (including tangible assets) of a business total corporate value on the S&P500 index, now only count for 20%. Now, intangible assets such as data, talent and intellectual property has become the hallmark. In this competitive world, the CFO needs to allocate their entire budget in digital technologies. CFOs need to become leaders and guide business during digital transformation. According to Gartner, "intangible assets are the core competency value of any business." And they need to rebalance their investment portfolio. According to Shailender Kumar (MD of Oracle India), data and access to the data are the most valuable intangible assets for businesses today and cloud helps organizations to get the most from the data. Organizations need to rethink on their ROI measurement procedure. They need to develop new metrics, risk and performance measures in order to measure ROI. To know more about the CFO role in cloud and digital technologies, please follow this link: http://www.financialexpress.com/article/industry/companies/data-talent-and-ip-are-key-to-a-companys-market-worth/78557/

Small Medium Businesses (SME) contribute to around half of the GDP and two-third of all private sector jobs in UK, thus playing a massive role in innovation. Nearly 9% of the UK adults are now in early-stage entrepreneurship.  Tech firms & digital enterprises has sprung up all over the country. Banks are helping smaller companies with correct tools and best practice in their earlier stage so that these companies can achieve their full potential. Read more about this interesting article by Richard Phelps, Head of Corporate and Employer's Solution at: https://barclayswealthblog.com/index.php/fostering-fast-growth-start-ups/ 

According to the bi-annual Entrepreneurs Index, entrepreneurship is booming in UK. The future growth of these relatively new businesses will enhance UK's Small Medium Enterprises (SME) landscape further. These businesses contribute to around half of the GDP and two-third of all private sector jobs in UK. Since entrepreneurs are fast becoming the center of the modern day business world, wealth managers must found the best way to meet their demand. To know more, please read the article by Richard Phelps, Head of Corporate and Employer Solution of Barclays at:  https://barclayswealthblog.com/index.php/the-age-of-the-entrepreneur/

There is a lack of awareness about the insurance sector but it has a lot of attractive and interesting propositions to offer. Amendments have been made to the Insurance Act, 1938.  Foreign investment ceiling in insurance companies has been increased which will boost job opportunities and growth potential. But, talent retention is a challenge in this sector. Economic and regulatory changes have affected this sector. This led to companies adopting short term policies over long term ones. It is also predicted that salary structures would increase slowly with average increment levels at 8% for the current year. Read more at:

http://info.shine.com/article/talent-retention-is-a-big-challenge-for-insurance-firms/8814.html

According to Gary Langer, president of Langer Research Associates LLC in New York "The increase in negative expectations occurred among a disparate collection of groups, indicating a generalized retrenchment". 39% population said that the U.S. economy is getting worse. The Bloomberg Economic Surprise Index touched its lowest level of expansion. The Bloomberg measure of the buying climate declined to 38.1 from 40.4 and personal finances increased to a five-week high of 56.3 from 55.7. Unemployment rate dropped to 5.4%. Read more about this article at:  http://www.bloomberg.com/news/articles/2015-05-21/consumers-expectations-for-u-s-economy-drop-most-since-2013

Investment in real estate plays a vital part in an investment portfolio. People tend to diversify their portfolios and real estate investment provides valuable diversification. There are certain risks associated in real estate investment. It is cash intensive, time consuming and vulnerable due to fluctuating interest rates. Investors should learn from past market scenarios and know when to make the right choices. Real estate offers direct ownership unlike other assets. Private real estate deals are popular among investors as risk of sole ownership can be avoided. Another option for investors is real estate investor trusts (REIT). REIT’s are usually publicly traded companies investing in real estate through purchasing properties. Risks include cost and tax implications and declining net asset values of REITs’ in case of rising interest rates.  To know more, please follow:

http://www.dailyfinance.com/2015/05/22/real-estate-investments-risks/

Are you a seasoned investor and yet you regret making decisions on certain investments? In other words, have you ever thought about going back in time and "do-over" some of your investment decisions? There was never an investor who didn't want to do this. Yes this is a common trait in most of the investors.  What makes us stick to some of these decisions which turn out to be worthless with the passage of time while other decisions might be the reason you become a billionaire. The answer lies in this article: http://blogs.wsj.com/experts/2015/05/05/in-investing-and-in-business-dont-trust-your-feelings/

It was predicted that faster job creation and cheaper gasoline prices would drive the strongest growth rate in America but it is far from expectation. The reason is thought to be the start-and- stop spending by American households that represent almost 70% of the economic activity. It can be seen that there is a trend among the consumers not to spend freely. It is baffling as to why US consumers are being cautious. Interest rates are low; stock market is at an all-time high, home values are recovering, unemployment rate decreased to 5.4% yet things are not turning around. Savings rate went up to 5.7%. Though gasoline prices have fallen expenses on energy bills, food, housing, medical care, education has kept on rising. Wages though being adjusted for inflation cannot benefit the workers. Economists believe that US economy will turn around and the consumers will regain their confidence. Read more at:http://www.marketwatch.com/story/why-consumers-are-so-cautious-2015-05-19?page=1

Corporate profit margins may be narrowing down with the S&P 500 index declining more than 20%. The stock market being overly dependent on wide profit margins is vulnerable. Statistics and various calculative methods show us that the six-decade average profit margin of corporate America is 6.3%. If corporate profitability reverted back to its average, it is likely that S&P 500 would be on its way down.  The stock market would have single digit growth. Way out could be P/E expansion and widening of corporate profit-margins. Opinions differ; many proponents believe the stock market will be affected no matter what the level of corporate profit margins. To know more, follow the link: http://www.marketwatch.com/story/investors-need-to-face-the-possibility-of-a-great-reset-2015-05-20

•  Adoption of digital technologies has led to a customer-centric set of services. These technologies are nowadays demanded by banks, financial services firms and insurance companies.   With the world becoming competitive, sectors such as banking, finance services and insurance industries and product development, delivery and customer engagement are now being driven by a more mobile, social and data driven experience. But, the financial industry is still way behind firms in the consumer and retail markets. Firms in financial industry must ensure that they build a foundation for digital change. Read more at:   http://blogs.sap.com/banking/2015/05/19/digital-innovation-in-banking/

US companies make huge profits by paying employees minimum wage. US taxpayers pay $153 billion public assistance to working families. Now public opinions are divided. They want these corporations to pay workers enough to live decently. A proposed bill in Connecticut states that companies paying below $15 per hour will be imposed a fine of $1 per hour, per worker and this money will be spent on social welfare. Each Walmart in Connecticut costs taxpayers $1 million in social programs; also state pays $486 million in medication and cash assistance.  The bill could be a creator of many positions, and also help to shift the social assistance burden from taxpayers back to employers. The bill though in its initial stages has gained politicians' attention. Read more at:

http://www.fastcoexist.com/3046341/is-it-time-for-companies-to-pay-for-not-paying-enough-the-walmart-tax-gains-momentum

Counter party credit risk is becoming important nowadays; advanced risk management methods are being implemented in power and financial-services sectors. Transportation infrastructure industry lag behind but the need is immediate. Technicality in rail infrastructure is complex, thus the need for assessing risk. Failures are growing due to lower rated original equipment manufacturers (OEM). It is necessary to integrate systematic assessment of credit risk into the supplier selection process. Minimum rating requirement could be a way out allowing customers to control and lower the risk of supplier default.  This increases transparency, improves efficiency of risk assessment and facilitates monitoring of counterparties.  Customers of railway projects should learn from the available risk assessment methods and use them to their benefit. Read more at:

http://www.mckinsey.com/insights/risk_management/managing_supplier_risk_in_the_transportation_and_infrastructure_industry

It's high time to move away from the old adage "Sell in May", because the market is on its way to double its year- to-date returns. Marketing axioms, rules of thumb may be comforting than investing logic but do not show the best path for investment. This concept though statistically proven to be nonsense does not discourage investors. Historical stock market data shows return from May through October might be more than the others on an average. Transaction costs, taxes on profits cannot be avoided by investors as trading volumes in summer months being consistently on the lower side. This leads to fewer trends and influence traders to get out as it is not worth to stay in the market. People believe that market loses from May to November with the worst in October, which is not the truth as research shows. Read more at: http://www.marketwatch.com/story/when-it-gets-to-may-you-might-as-well-stay-2015-05-16?page=1

According to McNett (CMRP, Life Cycle Engineering), KPI (key performance indicators) should contain objectives, source, performance criteria and action plan to be effective. KPI helps managers to evaluate a company's performance and spot weak points which need manager's attention. According to Michael Porter (strategy professor at the Harvard Business School), KPI should be related to organizational goals and strategy, so that an organization can have a sustainable growth. Strategic asset management plans help to convert organizational goals into asset management objectives. Asset management functions support the company's goals and objectives. So, KPI helps to achieve organizational asset management objectives. Performance and evaluation of assets not only include technical performance, but also the performance of the physical asset portfolio. Read more at: http://www.industryweek.com/maintenance/monitoring-asset-management-strategy-execution-kpis

According to the World Bank report, there is a fall in the growth rate of developing countries like East Asia and China. According to the Washington-based lender, growth in China is going to be 6.7% in 2015 and 2016 from 6.9% growth in 2014.  And according to the World Bank, developing East Asia countries excluding China is expected to grow at 5.1% in 2015 and 5.4% in 2016 from 4.6% in 2014. Reason for China, is slow down in its policies that aimed at putting its economy in a more sustainable way.  And higher US interest rates and an appreciating US dollar may raise borrowing costs. Read more at:

 http://www.moneycontrol.com/news/world-news/world-bank-cuts-east-asia-growth-forecast-warnsrisks-to-outlook_1355974.html?utm_source=ref_article

According to David Bannister (editor at Banking Technology magazine), there has been a change in retail banking in the UK in recent years. A steady change has been noticed in the type of organizations that provide banking services and the way that both these new and incumbent providers transact with customers. However, change may be driven by the non-financial organizations as well. In many cases, these organizations are well known consumer brands with collections of customer loyalty. One such category is UK supermarkets which enjoy positive perceptions among their customers, thus suggesting that they are providing better customer satisfaction than banks. So, banks must retain focus on improving customer sentiment and make sure that people do not switch. Read more at: http://www.bankingtech.com/248682/the-rise-of-the-challenger-banks/

According to Bjorn Cumps (digital banking professor and director of the Centre for Financial Services at Vlerick Business School), retail banks would find it very challenging to increase net bank income because of the recent financial crisis. So, the only way these banks can look for possible future growth is via technology. Retail banks have been testing with new technology like mobile banking apps, prepaid cards, QR-code based payments, digital advisors, social media analytics tools and location-based services etc. The true winners in retail banking will not be the ones who approve new technology but is the one with new financial ecosystem, including tech companies, energy companies, retailers, real estate agents, notaries, lawyers and many other service providers, offering integrated services that create genuine customer value. Read more at: http://www.theguardian.com/sustainable-business/2014/oct/07/retail-banks-growth-hopes-technology-value-customer-apple-pay