Contemporary Issues In Administration And Management Management Essay

Contemporary Issues In Administration And Management Management Essay As according to the case study about the Accent hotel Group (AHG), which is a family owned business. It has got 7 hotels running four in two major capital cities(4star) and three at an international airport (two 3 star and one 4 star) . The Chairman and Chief Executive Officer of AHG is Daniel Rycart which is also followed by the eight boards of directors. The hotel is operated as a semi-autonomous profit centre and supported by in-house and outsourced services. There are 800 rooms in each hotel and they employ 800 staffs. The hotel offers a number of high class facilities like indoor swimming pool, gym, sauna, bar, restaurants etc. For the quality standards of the hotels, Daniel (CEO) has set a vision of commitment to excellence for the group. Administration: Administration as design and implementation of systems and procedures instigated by management to help meet stated objectives (Mullins, 2007.p.414). So in other words Mullins states that administration is very important in the organization as it performs day to day operational activities to achieve the organizational goals and targets with the different types of departments operating in the organization. Like in the Accent hotel group there are CEO, IT Department, Finance department, Hospitality Hotel services, Human Resource Department, Legal Service Department, Operational Department, Risk Management Department, and Sales Marketing Department who has major roles in administration process. So administration helps them in strategic planning process in order to formulate or implement the strategy through proper guidance and coordination. According to (Richman Farmer, 1977) administration connects all the departments from top level to lower level so there is a flow of information with the necessary suggestions and feedback that helps the top level management to plan for the future. Without the administration it is very difficult to operate because there are number of routine decision-making, operational activities, internal controlling and observation and formulation of strategies and goals takes place (Richman Farmer, 1977). Generally effective administration means the process and systems of administration being run smoothly through proper coordination and controlling of activities, staffs and information in an efficient and effective manner (Richman Farmer, 1977). Through the effective administration, the organisation is benefited in number of ways as it stores the necessary documents of the organization like record keeping, utilizes the resources efficiently and effectively, there is a satisfaction of customer and employees and makes the brand image of the organisation (CfA, 2001). According to the research conducted by the CfA (2003), an organization (Accent Hotel Group) can provide effective administration through: 1. Effective Communication: Communication is the act of exchanging views, news, ideas, process, information, etc. between the sender and receiver (Hartley and bruckmann, 2002). In the organization communication plays a vital role because without the communication, the organization cannot operate its activities. As we know communication helps to send information throughout each and every department. While communicating, ones should use proper language to be effective. Daniel Rycaart could communicate properly with different department (Human Resource, Finance, Operational, etc) so that the information or instructions or rules laid down by him are correct, understandable and to the point so that it will bring effective administration otherwise miscommunication leads to disputes, employee turnover, etc. 2. Resource Allocation: Resources are assets that are required by an organization. For the Accent Hotel Group (AHG) to run smoothly it requires raw materials, human resources, financial resources, etc. These resources need to be managed properly taking in consideration the efficient use of time as a resource. For example if there is lack of resources (i.e. computers, heating, chairs, etc.) then the works will be delayed because of bad working environment and no interest of employees at work might be witnessed. So, allocating the resources and time management helps to make administration effective. 3. Training and Development: According to Torrington et al. (2007) in order to provide effective administration for an organization (like AHG), their staff should be well trained which can be done by providing different types of on-the-job or off-the-job training to increase their capability, knowledge and make them flexible in handling or dealing with different types of problems that are met by the AHG. This brings the commitment to the organization from the employees (Rae. L, 2000). 4. Performance Management: It is very much necessary for the AHG to measure the performance of their staff as low performance could decrease the quality standard of the AHG. It is a forward looking and developmental as it provides the platform for the managers to help or support their staff (Armstrong. M, 2000) 5. Culture As of the case study culture plays a vital role in planning, process and systems of the AHG. Culture helps in understanding the behaviour and working background of the organisation because it teaches us through the experience and develops ourselves (Handy. C, 1993). Like if the organization has a culture of helping each other while tackling or facing the problems , good communication between the staffs or co-workers instead of being rude or showing attitude openness then the future staff will also follows the same culture and in the end they will be committed towards the excellence (Schien. E. H, 2004) Conclusion In conclusion, we can conclude above points that administration helps the organization to perform its day to day activities and in strategic planning process in order to achieve the organizational goals and objectives (Mullins, 2007). In order to attain the organizational goals and objectives the administration needs to be effective. Effective administration provides coordination and control of staffs and activities, records documents and information, satisfies the customer and employee, etc (CfA, 2001). So in the Accent Hotel Group, effective administration can be achieved through effective communication, resource allocation, training and development, performance management and culture (CfA, 2003). Hence commitment to excellence can be achieve through effective administration. PART B Commitment to Excellence In commitment to excellence there are two words commitment and excellence in which commitment refers to the act of devoting oneself towards the accomplishment of something and excellence refers to a valuable quality by which one excels (brainyquote.com). So, commitment to excellence in business terms it means being committed towards the achievement of quality standard in terms of price, products, services, materials, etc that highlights the company images and development (Hannagan. T, 2007). According to Hannagan (2007), commitment to excellence is a very useful strategy that is used by many organizations like AHG has also used commitment to excellence in order to make the professional image and develop the organization internally. Because once all the employees are committed then their full interest, positive attitude and behaviour towards the accomplishment and development of organizational goals and objectives can be drawn which is the good advantage for the AHG. Overall it is abo ut diverting towards committing with less freedom in order to achieve quality. So commitment to excellence can be achieved in following ways through: 1. Motivation: Motivation is the desire within a person causing that person to act (Mathis. R.L and Jackson. J.H, 2008.p.72). In other words motivation is the act of influencing the employees behaviour towards the achievement or fulfilment of goals and objectives. It increases the performance, goodwill and overall image. Motivation helps the employees to motivate towards their work which can be done by providing salaries, rewards, promotion, recognition, etc and also through job design, job rotation and job enrichment (Torrington et al, 2007). So when employees would be motivated then they would be fully committed to work towards achieving the excellence. 2. Learning and Development: In regarding to Argyris and Schon (1978), they have defined learning as a process in which the mistakes and errors are ascertained by the organisation and correct their mistakes by improving or increasing their knowledge through learning from experience database. Organization can do so by providing training that develop skills, efficiency, better opportunities, job satisfaction, better inter-personal relationship, etc in order to avoid mistakes and errors in the output result so that quality can be achieved (Torrington et al, 2007). In the office if a person knows what to do, what not to do, what are their targets and goals, etc then it is more likely that they will be committed towards the excellence 3. Leadership: Leadership is defined as the ability to influence people towards the achievement of a common goal (Amandi et al, 2003.p.1077). Leadership is very much important in the organization as it guides, leads or motivates all the organizations staffs towards the goals and targets. So a leader should be visionary, creative, flexible, imaginative, decisional, etc so if an organisation has a leader with that quality then the people working under it will be organized, cooperative, and together and satisfied to be committed to the organization. Continuous Improvement Continuous improvement can be defined as a concept of being or remaining excellent in the field with whatever the circumstance to be in (hutchins.co.uk). It is about continuously finding out even if there are small mistakes or errors and resolving them by eliminating completely from the system or process for the improvement. It helps in growth and development of the organization because it improves products, services and processes. Continuous improvement can be achieved by using: 1. Kaizen (Japanese Management): According to Torrington et al (2008), Kaizen it is a Japanese strategy used as a continuous improvement of the organization. The techniques like Just in Time (JIT) technology which is used for continuous improvement. This teaches the business to start from the very ground level and taking small steps towards improving even small things to big things with the involvement of everyone i.e. managers and workers also. It tells everyday there needs to improvement of something. 2. Total Quality Management (TQM): TQM is defined as comprehensive approach to improving competitiveness, effectiveness and flexibility through planning, organising and understanding each activity and involving each individual at each level (Oakland, 1994.p.40). TQM mainly focuses on the quality control, quality assurance and quality management through which it satisfies the customers, less faulty products, motivates employees and competes with rivals with the chance of expansion and diversification. Since TQM is a continuous process that facilitates employee empowerment, involvement and participation, is customer focused and all that helps in continuous improvement of an organization (Torrington et al, 2007). 3. Benchmarking: In contrast with the Oakland (1994), benchmarking can be defined as improving the performance of the organisation by marking its progress to other leader competing in the market place. It is basically setting targets or goals of another successor that he/she/organization will achieve to set targets in a certain time in order to increase their performance or growth and development. It is also a continuous process as it compares the other companies process and systems and how they are operating in order to design plan to improve their performance and be continuously innovative at all the times (Torrington et al, 2007). It also facilitates the creation of organizational culture that is outward-looking and learning oriented which means comparing the other companies systems, process, etc (Hannagan, 2008). Conclusion From the above information what it says is commitment to excellence helps the organization to be committed towards excellence that is quality, develops the performance of the staff and makes the professional image of the company (Hannagan, 2007). So Accent Hotel Group can achieve commitment to excellence by motivating the staff, leading the staff and providing learning and development to the staff. Continuous improvement helps the organisation to develop consistently and to be or remain best in the field (hutchins.co.uk). Continuous improvement can be seen in the Accent Hotel Group through total quality management, benchmarking the success and using Japanese strategy-Kaizen. REFRENCES Mullins, L. J. (2007) Management and Organisational Behaviour. London: Financial Times-Prentice Hall. Richman, B. M. and Farmer, N. (1977) Leadership; Goals and Power in Higher Education. Jossey-Bass. Council for Administration (2001, 2003) Business and Administration Skills Survey. London Hartley, P. and Bruckmann, C. G. (2002) Business Communication. London: Routlegde. Rae, L. (2000). Effective Planning in Training and Development. London: Kogan Page Limited. Armstrong, M. (2000) Performance Management: Key Strategies and Practical Guidelines. 2nd Edition. London: Kogan Page Limited. Handy, C. (1993) Understanding Organisation, 4th Edition. USA: Oxford University Press Schien, E. H. (2004) Organizational Culture and Leadership, 3rd Edition. San Francisco: Jossey-Bass. Hannagan, T. (2007) Management: Concepts and Practices, 5th Edition. Financial Times/Prentice Hall. Mathis, R.L and Jackson, J.H. (2008) Human Resource Management, 12th Edition. USA: Thompson South Western Inc. Argyris, C. and Schà ¶n, D. (1978) Organizational Learning: A Theory of Action Perspective. Addison-Wesley Amandi, B., Oppedisano, J. and Sherman, H. (2003) Leadership Theory and Practice: A Case in Point, Management Decision, 41(10): 1076-1088 Torrington, D., Hall, L. and Taylor, S. (2007) Human Resource Management, 7th Edition. Europe: Financial Times/Prentice Hall. Oakland, J. (1994:40) cited in MDP (2010) BSc (Hons) Management and Business Administration: Contemporary Issues in Administration and Management, Part 2. Bangor: MDP Hannagan, T. (2008) cited in MDP (2010) BSc (Hons) Management and Business Administration: Contemporary Issues in Administration and Management, Part 2. Bangor: MDP http://www.brainyquote.com/words/ex/excellence162353.html Accessed on: 08/03/11 http://www.brainyquote.com/words/co/commitment146024.html Accessed on: 08/03/11 http://www.hutchins.co.uk/tr_contimp.aspx Accessed on: 08/03/11

Are monopolies necessarily less efficient than perfect competition Essay

This essay will look at efficiency between both a monopoly and a perfect competition, and whether a monopoly is necessarily less efficient than perfect competition. Using diagrams and equations reflecting the optimal choice of output, marginal revenue and marginal cost for monopolies, I will explain how efficiency is affected by low levels of production. At the same time monopolies can increase efficiency due to their ability in price discrimination, they price people differently and therefore people pay what they truly believe the good is worth. There needs to be a clear description of the differences between monopoly and perfect competition as well as efficiency; an analysis of deadweight loss and natural monopoly is also important with regards to the monopolies efficiency. Therefore even though a competitive economy is efficient and a monopoly suffers from certain inefficient levels of production it is not necessarily less efficient than perfect competition. A monopoly is a single supplier within a market that chooses to produce at any point on the market demand curve; they appear when other firms find it unprofitable or impossible to enter a market. The market becomes affected by high barriers to entry, which are split into technical and legal barriers. Technical barriers are created when the production of a good produces decreasing marginal and average costs over a wide range of output levels; in this situation, large scale firms are low cost producers. Another technical barrier to monopolies is their ability to discover a low cost production technique and having ownership over productive resources therefore preventing the formation of other firms. Legal barriers occur when a monopoly is created by the government as a matter of law, there is the creation of a patent that allows the one firm to use the basic technology for a product. Varian describes how monopolies arise within his writings, he states that monopolies develop when the minimum efficient scale is large relative to the size of the market, then the industry becomes a candidate for regulation or other forms of government intervention. A second way a monopoly may arise is when a number of different firms in an industry collude and restrict output in order to raise prices and therefore increase their profits. This form of industry is referred to as a cartel (Varian, 1996, p. 418-419). From this we can see that if demand is large relative to the MES (minimum efficient scale) a competitive market will arise, if it is small, a monopoly structure is possible. This is influences by both the technological level and economic policy influencing the size of the market. Before we analyse the efficiency of monopolies in comparison to perfect competition, it is necessary to set the basis of measurement for both the monopolies and perfectly competitive firms. This is set out in the First Theorem of Welfare Economics; which explains the relationship between perfect competition and the efficient allocation of resources. Attaining a Pareto efficient allocation of resources requires that the rate of trade off between any two goods should be the same for all economic agents. In a perfectly competitive economy, the ratio of the price of one good to another provides the common rate of trade off to which all agents will adjust. Because all agents face the same prices, all trade off rates will be equalised and an efficient allocation will be achieved (Snyder and Nicholson, 2005, p. 471). Varian however states that the First Theorem of Welfare Economics says nothing about the distribution of economic benefits; market equilibrium might not be a â€Å"just† allocation (Varian, 1996, p. 510-511). Therefore in essence the Theorem states that a competitive economy is efficient, if a monopolist behaves non-competitively then he is behaving inefficiently. It is seen that monopolies create a Pareto inefficient level of production, relative to perfect competition; monopoly involves a loss of consumer surplus for demanders. Some of this is transferred into monopoly profits, whereas some of the loss in consumer surplus represents a deadweight loss of overall economic welfare. Snyder and Nicholson describe Pareto efficient allocation as an allocation of resources, where it is not possible through further reallocations to make one person better off without making someone else worse off (Snyder and Nicholson, 2005, p. 467). Varian further explains that a competitive industry operates where price equals marginal cost, while a monopolised industry operates where price is greater than marginal cost; therefore a higher price creates a lower output (Varian, 1996, p.411-412). [pic] From the diagram above we can see that if we get the firm to behave as a competitor and take the market price as being set exogenously. Then we would have (Pc, Yc) for competitive price and output. If the firm recognised its influence on the market price and chose its level of output so as to maximise profits, we would see monopoly price and output (Pm, Ym). Since P(y) is greater than MC(y) for all the output levels between Ym and Yc, there is a whole range of output where people are willing to pay more for a unit of output than it costs to produce it. Clearly there is potential for Pareto improvement (Varian, 1996, p. 412-413). A measure of efficiency can be produced by analysing the total surplus for a given market; this is seen by subtracting the total cost from gross consumption benefits. The higher the level of total surplus the more efficient production becomes. If perfect competition leads to an efficient output level and a monopoly leads to less output then perfect competition, it must therefore be less efficient since the monopolist produces less than the total surplus maximising level of output. Areas B and C represent the deadweight loss of a monopoly. As we move from the monopoly level of output to the competitive level of output we â€Å"sum up† the distances between the demand curve and the marginal cost curve to generate the value of the lost output due to the monopoly behaviour (Varian, 1996, p. 414-415). The loss arises because consumer gain from increasing output is larger then marginal cost but monopolies are not able to produce more. The output produced by a monopoly may not be the only thing brought up into question; quality is also an important factor regarding the efficiency of a monopoly. Whether a monopoly produces a higher or lower quality good than would be produced under competition depends on demand and the firm’s costs. The difference between the quality choice of a competitive industry and the monopolist is that the monopolist looks at the marginal valuation of one more unit of quality assuming that output is at its profit maximising level. The competitive industry looks at the marginal value of quality averaged across all output levels. Even if they were to both opt for the same output level, their quality preferences may be different. John Jewkes gives an explanation of the grounds upon which a single producer monopoly would defend its cause. The case was raised by the British Oxygen Company Ltd, which produced four points for its protection. The monopoly itself was achieved purely as a result of efficiency; the monopoly supply within the industry is more efficient than any other arrangement. With capital equipment being extremely costly and transport charges high, there would either be a duplication of equipment keeping costs up or there would be many local monopolies catering for local markets. The company had kept its prices and profits without exploiting its monopoly position, as well as keeping a strong record in research and technical progress. In this case the commission discovered that the monopoly was using its position to charge higher prices, however they accepted that there might be technical advantages in the creation of monopolies (Jewkes, 1958, p. 16-17). It seems as though there will need to be a form of regulation so as to create monopolies which keep to the efficient level of production. Technically all the regulator has to do is set price equal to marginal cost, and profit maximisation will do the rest. However, this analysis leaves out the fact that it may be that the monopolist would make negative profits at such a price. [pic] Here the minimum point of the average cost curve is to the right of the demand curve, and the intersection of demand and marginal cost lies underneath the average cost curve. Even though the level of output Ymc is efficient, it is not profitable. The natural monopolist will be unable to cover its costs and therefore run out of business. If the government was to regulate it then a point such as (Pac, Yac) would be a natural operating position. Here the firm is selling its product at the average cost of production, so it covers its costs, but it is producing too little output relative to the efficient level of output. The government may interfere and operate the natural monopoly, they let it operate where price equals marginal cost and provide a subsidy to keep the firm in operation; however it may be viewed that subsidies represent inefficiency (Varian, 1996, p. 416-418). Governments often choose to regulate natural monopolies which can affect the behaviour of regulated firms and may not necessarily lead to an efficient outcome. The idea that competitive pressures produce maximum technical efficiency may not necessarily be true; competition does not guarantee that inefficiency will not arise. The assumptions that surround perfect competition and their production of maximum technical efficiency include; firms maximising profits, they have complete knowledge of available techniques and associated costs and that there is free entry. The first two assumptions apply to monopolies and perfect competition, the final assumption states that free entry guarantees maximum technical efficiency. However at best free entry guarantees a higher level of efficiency; this is because it eliminates inefficient firms. It is not a suitable explanation for superior efficiency, since there may be other sources of efficiency, including scale economies which favour monopolies (Schwartzman, 1973, p. 759-762). There can be greater efficiency from a monopoly if we were to take price discrimination into account. Price discrimination is the practise whereby different buyers are charged different prices for the same good. It is a practise which cannot prevail in a competitive market because of arbitrage: those offered lower prices would resell to those offered higher prices and so a seller would not gain from discrimination. Its existence therefore suggests imperfections of competition (Gravelle and Rees, 1992, p. 274). A monopoly engages in price discrimination if it is able to sell otherwise identical units of output at different prices. If the firm is able to identify and separate each buyer, they may be able to charge each buyer the maximum price they would be willing to pay for each good; this is referred to as perfect or first degree price discrimination which extracts all consumer surpluses and creates no deadweight loss. In first degree price discrimination the monopolist can extract all the consumer surplus of each buyer. Total output of the good is at the level at which each buyer pays a price equal to marginal cost; thus we have the â€Å"competitive outcome†. Monopoly does not distort the allocation of resources, and so we have a Pareto efficient outcome, with the monopolist receiving all the gains from trade. Any objection to monopoly would therefore have to be on the grounds of equity, fairness of the income distribution rather than efficiency (Gravelle and Rees, 1992, p. 276). It is evident that price discrimination produces a more efficient outcome since buyers are paying the amount which they believe the good is worth. If one buyer wants the good more then another then he should be willing to pay more for it. It is extremely difficult for a monopoly to separate each individual buyer; a less stringent requirement would be to assume that the monopoly can separate its buyers into a few identifiable markets. This third degree price discrimination requires the monopoly to know the price elasticity’s of demand for each market, and set price according to the inverse elasticity rule. MC= (a) (b) We let ei and ej be the price elasticity’s of demand in the respective sub markets, equation (b) therefore comes out of a re-arrangement of equation (a). If ei=ej, then clearly there will be no discrimination, but there will be as long as the elasticity’s are unequal at the profit maximising point. We can see that in maximising profit the monopolist will always set a higher price in the market with the lower elasticity of demand (Gravelle and Rees, 1992, p. 274-275). All the monopolist needs to know is the price elasticity of demand for each market and set price according to the inverse elasticity rule. In conclusion it is evident that monopolies create inefficiency due to the low output levels which they produce at. A monopoly produces at a level where price is greater then marginal cost and therefore its output is reduced, in comparison to perfect competition where price is equal to marginal cost. Taking regulation into account still means that a monopoly is inefficient since it is being supported by subsidies from the government. However perfect competition is not necessarily more efficient then a monopoly firm, when looking at the basic assumptions of perfect competition in terms of efficiency, we can see that a difference arises due to free entry within the market. It is easy to assume that just because there is free entry it means that firms are forced to reach their highest point of efficiency, there is an increase however the maximum is not guaranteed. At the same time if a monopoly price discriminates it can achieve strong levels of efficiency. Therefore a monopolist is not necessarily less efficient than firms within perfect competition. C B Pm Pc Ym Yc MR Demand MC Output Price AC MC Demand Output Price Pac Pmc Yac Ymc Losses to the firm from marginal cost pricing [pic] [pic].

Wacoal International Aspect

Thai Wassail's general financial overview, from the year 2007 to year 2010, its total liabilities has been around 500 to 600 million baht, but in 2011, it has rose up to about 1,000 million baht, which will be further discussed in the later topic. As for its equity, it has been quite stable for the past five years, ranging from around 4,000 to 5,000 million baht. Capital Structure: Debt Financing vs.. Common Equity Financing A firm's capital structure consists of debt financing and common equity financing.Thai Wassail's debt o equity ratio is very low, so we can see that it prefers to use equity financing over debt financing. There are several reasons to a firm's financing decision by looking at the advantages and disadvantages of each method. When a firm chooses to use debt financing, it would have to pay the cost of debt, which is the interest expenses. Advantage of using debt to finance is that the interest payments can be deducted from the business income taxes. However, disadvan tages include the high cost of interest rates and high probability of bankruptcy when a rim's unable to repay the debt.We can assume that Thai Waco do not prefer to finance its funds through debt due to these two advantages. Thai Waco instead chooses to use more of the equity financing; it would be through the use of retained earnings or through the issuance of new stocks. Advantage is that it will not have to keep up with the costs of interest payments to bank loans or debt finance, allowing the capital to be used solely on business activities. The funding source for Thai Wassail's operations and investments came from its UAPITA and accumulated profits, without any debts carrying interest burdens.According to the financial statements at end 2010, the company had total liabilities of Baht 582. 96 million and shareholders' equity of Baht 5,036. 50 million. The company's liabilities shown in the financial statement consisted mostly of trade account payable and accrued expenses, which explains why the total liabilities have risen up to 582 million baht in 2010 compared to 2009. Long-Term Investments Thai Waco has registered long-term investments total of around 2,059 million baht, s compared to 1,586 million baht in the previous year, which shows an increase of 473 million baht.This was due to the largely increase in investment in debt securities and debentures. Thai Wassail's long-term investments are classified into three segments. First segment includes the investment in related companies consisting of around 912 million baht. With its outstanding investments in other companies within the same group through cross-shareholding, such investments can support its related industries, which would in turn contribute to the company's operations. Second segment includes investment in other companies consisting of around 41 5 million baht.By investing in several other businesses, Thai Waco could spread its risk over such business diversification. These companies have th eir own management authority, so there won't be any interference of Thai Waco as they are completely independent. As the result of such investments, the company could be well assured of the support in the steady supplies of materials, components, products, services, know-how, together with favorable dividend benefit from the Meany's satisfactory performances.The last segment is the investment in debt securities consisting of around 731 million baht. Reducing Foreign Exchange Rate Risk Thai Wassail's business operation relies heavily on imports and exports in the foreign currencies, so they are exposed to the risks from foreign exchange rates fluctuation. Therefore, the company uses financial instruments such as the forward contracts in order to reduce exposure to such fluctuations in foreign currency exchange. It will help to protect Thai Waco from movements in exchange rate by establishing the ate at which was agreed upon to be settled.

Graduate School Admissions Exams Masters Degree Tests

If youre applying to graduate, law, medical, or business school youll be required to take a standard entrance examination. Isnt jumping through the hoops entailed in earning a college degree enough? Not in the eyes of graduate admissions committees. Few students relish the idea of standardized tests, but they help admissions officials determine who is capable of withstanding the rigors of graduate school. Why? Standardized Exams Standardized Comparisons Standardized exams are thought to measure an applicants potential to succeed in graduate school. A high grade point average (GPA) indicates success at your college or university. Standardized tests permit fair comparisons of students from a variety of universities and colleges with potentially differing grading standards. For example, consider two applicants with GPAs of 4.0, but from different universities. Is the 4.0 from the state university similar to the 4.0 from the ivy league college? Standardized tests are also the basis for awarding fellowships and other forms of financial assistance. Which Exam is Right for You? Applicants to graduate school complete the Graduate Record Examination (GRE), which tests verbal, quantitative, and analytical abilities. The Graduate Management Admission Test (GMAT) is taken by prospective business school students also measures verbal, quantitative, and analytical skills. The GMAT is published by the  Graduate Management Admission Council, which oversees graduate programs in business. Recently some business schools have started to accept the GRE as well as the GMAT (students may take either), but be sure to check the requirements of each program.   Prospective law students take the Law School Admission Test (LSAT), which measures reading, writing, and logical reasoning. Finally, students who hope to attend medical school take the Medical College Admissions Test (MCAT). How to Prepare for Standardized Exams Most standardized graduate-school tests are designed to identify potential success or capacities for success, rather than measure specific knowledge or achievement. While some subject knowledge is essential (the Medical College Admission Test, for instance, evaluates fluency in the sciences), most standardized tests seek to judge a candidates thinking skills. That said, they really do require knowledge, specifically quantitative (math) skills, vocabulary, reading comprehension skills, and writing skills (the ability to construct an articulate, persuasive, argument). The math is reported as basic knowledge gained at the secondary school level (high school). That doesnt mean that you can expect to coast through the exam effortlessly. Take time to bone up on algebra and geometry at the minimum. Likewise most applicants find that they need to increase their vocabulary. All applicants can benefit from practice taking the exam and learning strategies for each section. While you can study o n your own with a few good test prep books (LSAT, MCAT, GRE, GMAT),   many applicants find a formal review course very helpful.   Your score on the GRE, GMAT, LSAT, or MCAT is critical to your application. Exceptional standardized test scores can open up new educational opportunities, especially for students with weak applications because of low GPAs. Many grad programs use standardized exams as screens, filtering applicants by score. However, note that although performance on standardized tests is a strong factor in the admissions process, it is not the only element that will net you an acceptance to the graduate school of your dreams. Undergraduate transcripts, recommendation letters and an admissions essay are other considerations.