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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Technologies Aiming To Improve Work Efficiency And Sustainability: Personnel
Tracking Systems
Halil Kaygisiz1, Abdülkadir Çakir1, Seyit Akpancar, Eyüp Çaki1
1Süleyman Demirel University, Isparta, Turkey
2Rize University, Rize, Turkey
E-mails: halilkaygisiz@sdu.edu.tr, abdulkadircakir@sdu.edu.tr,
sakpancar@yahoo.com,eyupcaki@sdu.edu.tr
Abstract
In this study, by dealing with personnel tracking systems used in business sector, it is
examined their effects on business productivity and sustainability of these effects. Personnel
tracking systems are computer-based electronic systems which enable to record business
entry and exit times and preparation of the daily and monthly reports. It is aimed to increase
business efficiency by ensuring the continuation and sustainability of personnel.
Personnel tracking systems, according to application of RFID (Radio Frequency
Identification), are performed by using biometric and barcode technologies. RFID can work
contactless different from biometric and barcode technologies. RFID is the most common
technology used in Personnel tracking systems because of this advantage.
It is thought that staff awareness will increase on the use of tracking systems in the workplace
with this study discussed the sustainability and dealing with the benefits of the Personnel
tracking systems enabling the detection of workplace entry and exit times of workers.
Keywords: Radio Frequency Identification, Personnel Tracking Systems, Sustainability,
Business Efficiency, Identification Technologies
1. INTRODUCTION
It needs to ensure the control of employees in order to work much more quickly and
efficiently in companies that have many employees. In workplaces, in order to increase the
productivity of personnel and maintain control of the personnel can be achieved by using
tracking systems. Personnel tracking systems: having software and hardware equipments and
developed for monitoring and control of factory staff, are a control mechanism that follows
the monthly fees, all working hours and overtime of staff. With this system, business
enterprises are able to follow, without any fault and forgetting, that staff work how many
days and hours of within a specified period; lost time such as permit, late coming, early going
and

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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

no-coming. Personnel tracking systems are the contemporary systems of the key productivity.
Personnel tracking systems provide to obtain mainly scoring payroll, and a wide variety of
reports related to continuity of control.
2. PERSONNEL TRACKING SYSTEMS
Personnel tracking systems are the systems which provide monitoring work, overtime,
absenteeism, leave, rest periods and the calculation, employees in the workplace is a
workplace inputs / outputs to be authorized. Employers with these systems are intended to
provide the most efficient use of the total workforce.
Thanks to personnel tracking systems, caused by human factor errors are minimized during
the preparation of payroll. In addition, these obtained reports help the top management of
enterprises by lighting the way to get more reliable decisions for the future.
Personnel tracking systems, enterprises that perform calculations by hand due to lost time and
human error factor in the prevention of the damage caused to the economies provided by
businesses, such as follow-up of operational staff brings discipline and modernity. The
business which is able to control the personnel costs of staff and working hours control, can
also capture the chances of becoming more effective in highly competitive markets
(Buyurgan, N. at al., 2009).
Firstly, the follow-up of personnel has been followed up with procedure of the signature. It
has not found safe by business since staff write working hours themselves. In order to ensure
the safety, it needed manpower, that is, an additional staff to control. In order to confirm the
correctness of the staff working hours used card instead of staff constitutes the beginnings of
personnel tracking systems. Punch clocks, has been followed up by giving each individual
named and anonymous tally cards.
After scoring cards, with the systems of barcode cards, personnel tracking have been done.
By developing personnel tracking systems, proximity systems have been used. It has began to
establish a remote connection with the development of devices connected TCP / IP protocol.
With recent technological advances, a lot of systems have become used for personnel
tracking (Pala, Z., 2007).
3. TECHNOLOGIES USED PERSONNEL TRACKING SYSTEMS
In personnel tracking systems, many automatic identification systems are used. The process
of identification automatically makes life easy and most systems are designed for it. Each of
these systems used a different technology, have different characteristics (Pala, Z., 2007).
In personnel tracking systems, automatic identification systems can be grouped mainly in 5
groups (Fig. 1):
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

1. OCR: Optical Character Recognition Systems
2. Biometric Identification System (Face Recognition, Fingerprint recognition ... etc.).
3. Barcode Systems
4. Smart Card Systems
5. RFID: Identification with Radio Frequency

Figure 1. Automatic identification systems (AUTO-ID)
3.1. OPTICAL CHARACTER RECOGNITION SYSTEM (OCR)
Optical character recognition systems (OCR), provides an understanding of different fonts are
read by machines. In scanners, to scan text and images, these systems are used. However,
because the system is expensive, the field of using remains in a narrow frame. There are
personnel tracking systems based on identification of signatures that are taken in entry and
exit of staff.
3.2. BIOMETRIC RECOGNITION SYSTEMS
Biometrics, on the basis of assets can be defined as the science of measuring and counting.
Biometrics, developed to determine the user's identity by recognizing the physical and
behavioral characteristics of a computer-controlled, is a general term used for automated
systems. Therefore, there are not any problems such as forgotten or stolen in the loss of the
card or encrypted systems.
Biometric systems aim to provide access controlled passage of individuals, that is, it is
allowed for authorized persons it is denied to access the passage / the transition to
unauthorized persons (Tuğaç, B., 2007).

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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Types of biometric recognition system used in personnel tracking systems:
• Face Recognition System
• Fingerprint Recognition
• Voice Recognition
• Iris Recognition
• Retina Recognition

(a)

(b)

(c)

(d)

Figure 2. Biometric Recognition Systems a)Face recognition device
recognition device c)Voice recognition device d)Iris recognition device

b)Fingerprint

3.2.1. FACE RECOGNITION SYSTEMS
Facial recognition systems work on the basis of comparison by computer-aided that already
committed to the database face images with an unknown face. These systems are used to
select individuals within the access control or crowd (Fig. 2a). The main problem in facial
recognition systems, with low quality pictures can cause problems in the comparison whom
wearing glasses, etc. accessories (Dağoğlu, M., 2006).

3.2.2. FINGERPRINT RECOGNITION SYSTEMS
The fingerprint is unique and does not change according to age or other characteristics. Every
person has different fingerprints Therefore; fingerprint is one of the most reliable means of
personal authentication (Fig. 2b). The fingerprint is a fingerprint recognition algorithm for
each of the received image is different and unique feature of fingerprint ID code by creating a
customized database extracts and saves. Each fingerprint code at the base of data is different
for each person (Jain, A. K. ve Ross, A., 2004).
3.2.3. IRIS RECOGNITION SYSTEMS
Iris recognition does not require close contact between the user and the reader and is an
useful biometrics technology. The basic idea in iris recognition technologies is to perform on
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

layer of the iris of the eye by taking the picture (Fig. 2c). This image taken from a database
with a person's iris removed and processed in accordance with the characteristic values. Then
this characteristic in the database is used to the aim of comparing (Jain, A. K. ve Ross, A.,
2003).
3.2.4. VOICE RECOGNITION SYSTEMS
Sound biometry, emerged, determining changes over time in the sound frequency, is a system
used to identify the person (Fig. 2d).
The advantage of audio systems is the use of hands and eyes freely, but as in the case of the
excitement, fear and chills, changes in sound volume, speed and quality, make identifying
difficult. In today's technology, voice recognition tools with recorded sound are also possible
deceiving. Therefore, application of this technique is not safe (Dağoğlu, M., 2006).
3.2.5. RETINA RECOGNITION SYSTEMS
Based on the principle scanning the retina by the unique structure of the optical systems is
high reliability of this technology but it is difficult to use, since the user must look at a certain
point. Although technology is adequate, it has not been accepted for this reason (Tuğaç, B.,
2007).
3.3. BARCODE RECOGNITION SYSTEMS
Today, Barcodes are ones of used in many areas and at least one cost-effective automatic
recognition systems.
Nowadays, the generally rectangular, the thickness of the thin lines are drawn parallel to each
other and it is a symbol created by the black bars occurring in the gaps between the lines
(Dağoğlu, M., 2006).
3.4. SMART CARD SYSTEMS
Smart cards are called “smart cards” including plastic cards into the “chips”
(microprocessor). This is known as the main reason for smart cards, high information
transport, processing, using data on the card, write and delete capabilities 'microprocessor' is
carried out through.
The applications of smart card technology opened new fields of application faster than
before, magnetic media, such as to render safe and low cost, which cannot be possible so far
(Jain, A. K. ve Ross, A., 2004).

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3.5. RFID
RFID systems have similarities with smartcard systems. The main differences are adjacent to
smart cards; data is exchanged between the data carrier device and the reader using radio
waves rather than being used with the contact surface offers considerable (Kılınç, T., 2007).
Without human impact/contribution on the RFID system design are motivated to collect
creation of information. It is a newer technology according to barcode technology and a
system having advantages. The use around the world has been increasing year by year (Altun
Z., 2010).
The main advantage of RFID technology systems is characteristic of functioning that does
not require contact with the vision and the line Labels, snow, ice, fog, paint, dirt, inside the
box, and a warehouse-like vehicle can also be read visually and environmentally challenging
conditions. RFID reader with a short response time of 100ms and a lot (several hundred), the
label can be read almost simultaneously. With labels combined with sensors can be obtained
very important information about the status of the product. In RFID technology, it is much
more secure about security on the magnetic cards since the data can be conveyed by being
encrypted thanks to many other features. In addition, not needing physical contact enables
ease of use. For example, with RFID technology credentials can be read in your wallet
(Ismael, N.M., 2010).
4. SUMMARY and CONCLUSION
In this study, it is researched the technologies to improve business efficiency and
sustainability in their workplace in order to ensure that research on tracking systems used by
staff researched used. In addition to increasing the efficiency of business today has great
significance in maintaining the Auto-ID systems, personnel tracking systems with optical
character recognition systems, biometric identification systems, barcode systems, smart card
systems and radio frequency identification system is used. Control technology with the
development of more secure systems can be done by employees in the workplace. Although
Employee tracking systems improve business efficiency, there are lacks in terms of data
security. With the development of future systems more reliable and stable in the workplace
will be provided the maximum level of receiving and maintaining productivity.
REFERENCES
Altun Z. (2010) RFID Okuyucunun Geliştirilmesi. Sakarya University, Ph.D. thesis, 108p,
Sakarya.
Buyurgan, N., Hardgrave, B.C., Baylor, J.L. and Walker, R.T. (2009) RFID in healthcare: a
framework for uses and opportunities, International Journal of Advanced Pervasive and
Ubiquitous Computing, Vol. 1 No. 1, pp. 1-25.
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Dağoğlu, M. (2006) Radyo Frekans Tanımlama Sistem Tasarımı ve Üretimi, Hacettepe
University, Ph.D. thesis, Ankara.
Ismael, N.M. (2010) Radyo Frekans Kimlik Tanımı (RFID), Selçuk University, Ph.D. thesis,
104p, Konya.
Jain, A. K., Ross, A. (2004) Mutlibiometric Systems, Communications of the ACM, Vol. 74,
pp. 34-40.
Jain, A. K., Ross, A. (2003) Information fusion in biometrics., Pattern Recognition Letters,
Vol. 24, pp. 2115-2125.
Kılınç, T. (2007) RFID Sistemlerin İncelenmesi ve Sağlık Sektöründe Kullanılması, Maltepe
University, Ph.D. thesis, İstanbul.
Pala, Z. (2007) RFID Teknolojisi İle Otomasyon Bir Uygulama Olarak: Otopark Takibi,
Yüzüncü Yıl University, Ph.D. thesis, Van.
Tugaç, B. (2007) Radyo frekans ile kimlik tanıma, Yıldız Teknik University, Ph.D. thesis,
İstanbul.

66

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                <text>In this study, by dealing with personnel tracking systems used in business sector, it is  examined their effects on business productivity and sustainability of these effects. Personnel  tracking systems are computer-based electronic systems which enable to record business  entry and exit times and preparation of the daily and monthly reports. It is aimed to increase  business efficiency by ensuring the continuation and sustainability of personnel.  Personnel tracking systems, according to application of RFID (Radio Frequency  Identification), are performed by using biometric and barcode technologies. RFID can work  contactless different from biometric and barcode technologies. RFID is the most common  technology used in Personnel tracking systems because of this advantage.  It is thought that staff awareness will increase on the use of tracking systems in the workplace  with this study discussed the sustainability and dealing with the benefits of the Personnel  tracking systems enabling the detection of workplace entry and exit times of workers.  Keywords: Radio Frequency Identification, Personnel Tracking Systems, Sustainability,  Business Efficiency, Identification Technologies</text>
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Međedovic E., Saračević M., Bisevac E., Mašović S., Kamberovic H.(2011), System
Infrastructure for E-Learning on University of Novi Pazar, 10th International Scientific Professional Symposium INFOTEH-JAHORINA.
Saračević M., Međedović E., Mašović S., Selimović F., Kamberović H. (2011), Application
learning content management systems, virtual classroom and m-learning in enterprises, ICT
for SME2011 - Information and Communication Technologies for Small and Medium
Enterprises, ISBN 978-86-7672-140-5, Technical Faculty "Mihajlo Pupin", University of
Novi Sad.
Saračević M., Međedović E., Mašović S., Selimović F., Kamberović H. (2011), Sistemi za
upravljanje sadržajem učenja kao podrška zaposlenim u preduzećima,
9. Međunarodna
naučno-stručna konferencija - Na putu ka dobu znanja, Fakultet za menadžment, UDC005.94, ISBN978-86-85067-31-0, COBISS.SR-ID: 266277895, Novi Sad.
Saračević M., Mašović S., Selimović F., Novalić F. (2011), Unapređenje informisanosti,
komunikacije i obrazovanja zaposlenih u agrobiznis sektoru i način realizacije primenom
LCMS-a, Naučna konferencija - Agrobiznis2011, u okviru projekta “Bolja saradnja za bolju
budućnost“, Univerzitet u Novom Pazaru.

A Hybrid Digital Video Watermarking Method Based on DCT and DWT
Haldun Sarnel, Kadir Ünal
Dokuz Eylül University, Department of Electrical and Electronic Engineering, İzmir, Turkey
E-mail: haldun.sarnel@deu.edu.tr, kadirunal1985@yahoo.com
Abstract
Digital video watermarking is one of the solutions for copyright protection of digital
multimedia data and draws great attention of both researchers and digital video owners. In
this work, a new hybrid digital video watermarking method which uses the discrete cosine
transform (DCT) and discrete wavelet transform (DWT) is proposed. Each frame is processed
with one of the DCT and DWT methods or a combination of them, half of a frame by the
DCT method and the other half by the DWT method. Selection of the watermarking for each
frame in the video is determined randomly. The proposed method has undergone several
attacks in order to check its robustness and compare to the DCT and DWT methods. The
proposed hybrid method including a watermarking diversity throughout the video improves
robustness against attacks.
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Keywords: Digital video watermarking, discrete cosine transform (DCT), discrete wavelet
transform (DWT), copyright protection.
1. INTRODUCTION
Production and distribution of digital multimedia data have become much easier with the
rapid growth of the internet and other digital technologies, and consequently they can reach a
large number of people in a short time. On the other hand, this introduces copyright
protection problem for the digital multimedia data with a legal owner. To prove the copyright
of digital data, some methods must be applied on the original digital data whatever it is text,
audio, image or video. Digital watermarking methods have been proposed for solving
copyright protection problems (Cox et al. 2002). A secret message what is called a watermark
is embedded to a digital data with a secret key. This process is called digital watermarking.
The watermark can be a random number sequence, copyright messages, ownership
identifiers, binary or gray level images, or other digital data formats. A digital watermarking
method provides the copyright owner with proving his/her ownership by extracting and
revealing the embedded watermark from the digital data in the case of an illegal usage of the
digital data. The original digital data after watermarking can be distributed in a medium and
may receive some manipulations and attacks, intentionally, or unintentionally, so as to
degrade the watermark to disappear. Ideally, the watermark must remain intact, or safely
extractable after the digital data has undergone some attacks to be able to prove the
ownership.
Image and video watermarking methods can be classified in two groups, spatial domain and
frequency domain methods. Spatial domain methods are based on modification of pixels
values in embedding stage of the watermarking. These methods are very simple and have low
computational cost, but are vulnerable to attacks and watermark can be easily distorted.
Frequency domain methods are based on modification of frequency coefficients. The original
content is transformed to frequency domain and coefficients in frequency domain are used to
embed and recover the watermark. The most common transforms are the discrete cosine
transform (Cox et al. 1997, Busch et al. 1999) and the discrete wavelet transform (Xia et al.
1997, Kundur and Hatzinakos 1998). The frequency domain methods are more robust and
have more computational complexity. Hartung and Girod (1999) described a method of
watermarking into both compressed and uncompressed MPEG-2 videos by modifying
selected DCT coefficients. Langelaar and Lagendijk (2001) proposed a watermarking method
that divides the video into groups of blocks and further divides the blocks into groups. A
single watermark bit is embedded into selected DCT coefficients based on their energies
within the groups. Chetan and Raghavendra (2010) proposed a DWT-based video
watermarking scheme that embeds different parts of a single watermark into different scenes
of a video after detecting scene changes.

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In this work, a new hybrid digital video watermarking method which uses the discrete cosine
transform (DCT) and discrete wavelet transform (DWT) is proposed. The watermark is
divided to sub pieces and these pieces are embedded to frames. Each frame is processed with
one of the DCT and DWT methods or a combination of them, half of a frame by the DCT
method and the other half by the DWT method. The proposed hybrid method has undergone
several attacks in order to check its robustness and compare to the DCT and DWT methods.
2. TRANSFORM –BASED DIGITAL VIDEO WATERMARKING
2.1 DCT-based Watermarking
The DCT coefficients D(u, v) of a N x N block p( x, y) in an image are computed as follows.
D(u, v)  C (u )C (v)

N 1 N 1

 (2 x  1)u   (2 y  1)v 
 cos

2N
2N
 


 p( x, y) cos
x 0 y 0

C (u ) 

1
N

for u  0,

C (u ) 

2
N

(1)

for u  1,2, , N  1

The frequency bands of an 8x8 DCT block are shown in Figure 1. The top-left is the zerofrequency component. The lowest frequency band FL and the highest frequency band FH are
not changed. A watermark bit is embedded in the highlighted medium frequency band FM by
modifying its coefficients.
In the DCT-based video watermarking, a frame is divided to 8x8 non-overlapping blocks. A
watermark is embedded to video frames piece by piece. A watermark of size L bits is divided
into m pieces. Since L/m bits has to be embedded in a frame, a subset of L/m block locations
are selected randomly using a secret key. Always this subset is used to embed a watermark
piece Wi into every frame. In recovering stage, the same secret key is utilized to locate those
watermarked blocks. A watermark piece is selected randomly to embed it into the current
frame. Every block in the subset is DCT transformed and its 22 medium frequency band
coefficients are determined. Two uncorrelated pseudo random sequences, R0 and R1, of
length 22 are generated to represent watermark data bits 0 and 1. A single bit is embedded to
one of the blocks with coefficients D(u,v) in the subset by
D(u, v)  aRk (u, v),
DW (u, v)  
D(u, v),

u, v  FM 

u, v  FM 

(2)

where DW is coefficients of watermarked block and a is a strength constant. The balance
between robustness and visibility of watermarking is adjusted by a. The watermarked block is
then back-transformed to spatial domain by taking its inverse DCT.

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Figure 1: DCT frequency bands

LL1

LH1

HL1

HH1

Figure 2: Frequency bands of 1-level DWT

2.2 DCT-based Watermark Recovery
To recover the embedded watermark piece from each frame, first the watermarked blocks are
determined and then the middle band frequency coefficients in their DCT are obtained. The
pseudo random sequences R0 and R1 are computed and correlated with the middle band
coefficients of each watermarked block. The higher of the two correlation values specifies the
recovered possible watermark data bit. As a result, an array of higher correlation value C(n)
and an array of recovered bits U(n) of the watermark piece are obtained for nth bit after all
watermarked blocks are examined. U(n) is (binary) correlated with each of the real
watermark pieces Wi(n) to identify it. If the maximum correlation value is smaller than a
predefined threshold value Tp, U(n) is ignored assuming a failure of watermark detection in
the current frame. When all frames are processed in this manner, a number of recovered
instances Uij(n), indexed by j, of each watermark piece Wi(n) are obtained and recorded.
Correlation values Cij(n) of all recovered bits are also formed from C(n) of every frame.
2.2.1 Reconstruction of Watermark
We use an algorithm for the reconstruction of watermark pieces Vi(n) from their recovered
instances Uij(n) as follows. Set i=0 and count the numbers of 0 bits and 1 bits for every bit
location n in Uij(n) discarding bits for which Cij(n)&lt; T, a predefined bit correlation threshold
value. Those are assumed as incorrectly recovered bits. Then, Vi(n) is assigned the bit with at
least 70% majority of total count for bit n. If there is no such majority, the bit defaults to 0.
This process is repeated after i is incremented until all watermark pieces are reconstructed.
Finally, the entire watermark can be formed by concatenating all watermark pieces Vi(n)
(i=0,1,2,…,m-1) in correct order.
2.3 DWT-based Watermarking
The basic idea of the DWT is to decompose a frame into a sub-image of different spatial
domain and independent frequency districts. 1-level Haar DWT is used in this study for
simplicity. Figure 2 shows the 1-level DWT of an image by frequency bands. The lower
resolution approximation region LL of an image contains the most important pictorial
information, hence, it is not used for watermark embedding. The frequency regions of LH,
HL and HH represent the horizontal, vertical and diagonal details, respectively, of the image.
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A watermark is embedded to video frames piece by piece as in DCT-based watermarking. In
our study, the same watermark piece is embedded to both LH and HL bands. For each bit of
the watermark, a different pseudo random sequence Rn (n=0,1,2,…,L-1 and R={ R1, R2,…})
with length equal to the length of these bands is generated. After a piece of the watermark is
selected randomly, the sequences in R that represents the bits in that piece only are multiplied
by a strength constant and added to both LH and HL band coefficients of the DWT of the
current frame, in a way similar to that in (2). We embed only watermark bits 0 (black pixels
in the binary watermark image) in the DWT-based method to improve imperceptibility of
watermarking. Finally, the frame is transformed to spatial domain by taking its inverse DWT.
In the recovering stage, every sequence Rn is correlated with LH band coefficients of the 1level DWT of the current frame. Every bit n in the embedded watermark piece is recovered
and stored in an array of U1(n) if C1(n) value of correlation of LH band coefficients with Rn
exceeds a threshold value. Otherwise U1(n) defaults to 0. Then, U1(n) is divided into m
pieces and each piece is correlated with each watermark piece Wi(n) to identify which
watermark piece is embedded in the current frame. If the maximum correlation value is
smaller than a predefined threshold value, U(n) is ignored assuming a failure of watermark
detection in the LH band of the current frame. Otherwise, the piece giving the highest
correlation value is overwritten on U1(n). Similarly, correlation of every Rn with HL band
coefficients of current frame yield U2(n) and C2(n). When all frames are processed in this
manner, a number of recovered instances Uij(n) of each watermark piece Wi(n) and the
correlation values Cij(n) of all those recovered bits can be obtained and recorded. Note that
Uij(n) and Cij(n) contains results obtained from both LH and HL band coefficients. The
algorithm for the reconstruction of watermark pieces Vi(n) from their recovered instances
Uij(n) is the same as explained in Section 2.2.1.
3. THE PROPOSED HYBRID VIDEO WATERMARKING METHOD
3.1 Hybrid Watermarking
In the hybrid method, there are three ways to embed a piece of watermark in the current
frame, using DCT, DWT, and a combination of the DCT-DWT transforms. In embedding
stage, one of the three different watermarking algorithms and a watermark piece for the
current frame are selected randomly. Depending on the selection, the entire frame is
watermarked using the algorithms and parameters given in Section 2.1 (for DCT-based) or in
Section 2.3 (for DWT-based) in the hybrid method. If the random selection comes out to be
the combined method, the frame is divided into two equal halves by a horizontal line. The
watermark piece is embedded to the upper half by the DCT-based algorithm and to the lower
half by the DWT-based algorithm. In this case, the concepts are the same except that the
maximum number of 8x8 DCT blocks and size of frequency regions of DWT in a frame will
be halved. The hybrid method is expected to perform better by exploiting the advantages of
the both transform based methods.
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3.2 Watermark Recovery for Hybrid Method
The watermarked video is used as input for the DCT based, DWT based and combined DCTDWT based watermark recovery modules, individually. Some attacks drop several frames
from watermarked frame or change the order of frames in video. This makes any record of
watermarking history of frames void, hence, all three modules must try to recover watermark
data blindly from each frame. The recovering stages of the DCT based and DWT based
watermarked frames are the same as given in Sections 2.2 and 2.3. If watermark data is to be
recovered using The combined DCT-DWT recovery module applies to the upper half of each
frame the DCT-based recovery algorithm and to the lower half the DWT-based algorithm. In
the upper half frame, the same subset of DCT blocks watermarked by the combined method
is located to recover the watermark bits. The outputs of two full frame independent recovery
algorithms (DCT-based and DWT-based) and two half frame recovery algorithms for each
frame are recorded separately. When all frames are processed 4 individual Uij(n), one from
each recovery algorithm, are merged into one. The same merging applies to Cij(n) too. The
algorithm for the reconstruction of watermark pieces Vi(n) from their hybrid-recovered
instances Uij(n) is the same as explained in Section 2.2.1.
Some attacks can distort the watermark data embedded using one specific frequency domain
transform. In this case, the advantage of the hybrid method appears. If one of the transform
based methods cannot resist to some attacks, the other transform based method may hopefully
resist and recover the lost watermark data from either the same frame or other frames.
4. EXPERIMENTAL RESULTS
4.1 Details of Tests
A digital video with 104 frames of size 640x480 and two different watermark data with
dimensions of 20x20 and 24x24 pixels, respectively, are used in the tests (Figure 3).

(b)

(c)

Figure 3: (a) A frame from the test video, (b) and (c) two watermarks used in the tests.
The test video is also watermarked with the DCT-based and DWT-based methods,
individually, in order to compare their performances to that of the proposed hybrid method.
The tests are performed under 4 different scenarios. The watermark 1 is divided to 2 and 4
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pieces in the scenarios 1 and 2, respectively, and watermark 2 is divided to 2 and 6 pieces in
the scenarios 3 and 4, respectively.
4.2 Results of Simulated Attacks
Noise addition attack adds to the watermarked video two types of noise, salt &amp; pepper’ noise
and Gaussian noise depending on selection. Because a video contains a large amount of
redundancies between frames, frame dropping is an attractive attack to destroy watermark
data. In the tests, the frames of the watermarked videos were dropped up to 70% of the total
number of frames in the test video. The frame averaging attack collects a number of
successive frames and averages them out to generate an output frame. This is repeated at
every frame of watermarked video producing an averaged video. The compression attack is
simulated by compressing the watermarked video using a codec for ‘wmv3’ video format in
MATLAB environment. Median filtering attack smooths images without blurring edges
significantly. Intensity adjustment attack, maps the values in intensity image to new values
such that normalized intensity values less than 0.01 and higher than 0.99 are saturated at 0
and 255, respectively. Contrast enhancement attack applies histogram equalization to every
frame. The normalized correlation value between a reconstructed watermark and an original
watermark is computed and given in Table 1 as a measure of watermark detection robustness
of the tested methods under a given scenario and an attack. Simulation results show that the
hybrid method improves watermark robustness against the tested attacks.
4.3 Imperceptibility and Capacity
Imperceptibility indicates how invisible the watermark is. This requirement has a trade off
relation with two other requirements, robustness and capacity. The imperceptibility of the
watermarked data is measured using peak signal-to-noise ratio (PSNR) between original and
watermarked data. Imperceptibility values of all methods computed from the watermarked
video frames were extremely high (over 80 dB for every frame) so that existence of any
watermark in video could not be visually detected. Capacity is the amount of the data that can
be embedded in a digital data. Increasing the size of watermark data embedded in a video
decreases the visual quality of the video. We can compute the capacity of the DCT based
method only, because in the DWT based method, number of bits to be embedded in a frame
is theoretically infinite. For a given video, capacity of the DCT based method is equal to the
number of blocks with a given size (usually 8) in a frame. The DCT based capacity is 4800
bits/frame for full frame watermarking and 2400 bits/frame for half-frame (i.e., for combined
DCT-DWT based) watermarking.

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Table 1: Performances of the DCT-based, DWT-based and hybrid methods for several
attacks. Given are the normalized correlation values between recovered and original
watermarks.
DCT
Scenario
Attack name
salt &amp; pepper noise density= 0.02
salt &amp; pepper noise density=0.04
Gaussian noise (mild)
frame dropping (70%)
frame averaging over 2 frames
frame averaging over 6 frames
video compression (quality=90)
3x3 median filter
intensity adjustment
contrast enhancement

1
0.98
0.69
0.97
0.99
0.98
0.92
0.87
0.98
0.99
0.99

2
0.98
0.74
0.88
0.98
0.98
0.81
0.70
0.93
0.99
0.99

3
0.97
0.96
0.98
0.97
0.97
0.93
0.86
0.90
0.99
0.98

DWT
Scenario
4
0.91
0.65
0.87
0.87
0.78
0.70
0.72
0.84
0.98
0.98

1
1.00
0.99
1.00
1.00
1.00
0.86
1.00
0.00
1.00
1.00

2
1.00
0.95
1.00
1.00
1.00
0.86
1.00
0.00
1.00
1.00

3
1.00
1.00
1.00
1.00
0.90
0.86
1.00
0.01
1.00
1.00

Hybrid Method
Scenario
4
1.00
1.00
1.00
1.00
0.79
0.58
1.00
0.20
1.00
1.00

1
1.00
0.89
1.00
1.00
1.00
1.00
1.00
0.97
1.00
1.00

2
1.00
0.95
1.00
1.00
0.99
0.99
0.99
0.91
1.00
1.00

3
1.00
1.00
1.00
1.00
1.00
1.00
1.00
0.97
1.00
1.00

4
1.00
1.00
1.00
1.00
1.00
0.95
1.00
0.84
1.00
1.00

5. CONCLUSIONS
In this study, a hybrid digital video watermarking method is proposed. This hybrid method
contains two frequency domain watermarking methods because of their advantages: DCT
based and DWT based methods. Thus, the advantages of the both methods are utilized in the
proposed method. The watermark is divided to sub-pieces and these pieces are embedded to
frames. The hybrid method has better robustness compared to the individual methods it
merges without significant reductions in the capacity and imperceptibility requirements. The
size of a piece of watermark to be embedded into a frame must not be too small. Otherwise
recovery of such small pieces from an attacked video may fail.
REFERENCES
Busch, C., Funk, W. and Wolthusen, S. (1999) Digital Watermarking: From Concepts to
Real-Time Video Applications. IEEE Computer Graphics and Applications, 19, 25-35.
Chetan K.R, and Raghavendra K. (2010) DWT Based Blind Digital Video Watermarking
Scheme for Video Authentication. International Journal of Computer Applications, 4, 19-26.
Cox, I., Kilian, J., Leighton, F. and Shamoon, T. (1997) Secure Spread Spectrum
Watermarking for Multimedia. IEEE Transactions on Image Processing, 6, 1673-1687.
Cox, I., Miller, M. and Bloom, J. (2002) Digital Watermarking, Academic Press, USA
Hartung, F. and Girod, B. (1998). Watermarking of uncompressed and compressed video.
Proceedings Signal Processing, 66, 283–301

335

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Kundur, D. and Hatzinakos, D. (1998) Digital watermarking using multiresolution wavelet
decomposition. Int. Conf. on Acoustics, Speech and Signal Processing, 2969-2972.
Langelaar, G., and Lagendijk, R. (2001) Optimal differential energy watermarking of dct
encoded images and video. IEEE Transactions on image Processing, 148–158
Xia, X., Boncelet, C., and Arce, G. (1997) A Multiresolution Watermark for Digital Images.
Proc. IEEE Int. Conf. on Image Processing, vol. I, 548-551.
Investigation Of Seismic Performance Of Existing Building Strengthened With Cfrp
Ali Demir1, Hakan Başaran2, Duygu Dönmez Demir3
1Department of Civil Engineering, Celal Bayar University, Manisa, Turkey
2Department of Turgutlu Vocation School, Celal Bayar University, Manisa, Turkey
3Department of Mathematics, Celal Bayar University, Manisa, Turkey
Abstract
In this study, the seismic performance of the Merkez Efendi hospital building was determined
with CFRP strengthening methods according to the Turkish Earthquake Code-2007. Firstly,
the building was considered with the masonry walls and without masonry walls and the effect
of the masonry walls to the performance of the building was investigated. Afterwards, the
building was strengthened with CFRP plates to get the required seismic performance level.
Consequently, the seismic performances of the hospital building were compared for these
three cases.
Keywords: Strengthening, Masonry Wall, CFRP, Seismic Performance
1.INTRODUCTION
Buildings are subjected to earthquake, wind, fire etc. during their lifetimes. Sometimes,
addition of a story and change in the purpose of using occur. For these reasons, the
performances of the buildings should be investigated according to the present earthquake
codes of the countries. If the performance of the building is insufficient, it must be
rehabilitated. The Turkish Earthquake Code-2007 (TEC-2007) gives alternative rehabilitation
methods. One should choose the most suitable method for buildings. Chapter 7 of TEC-2007
entitled “Assessment and Strengthening of Existing Buildings” and sets standards for
336

�</text>
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                <text>A Hybrid Digital Video Watermarking Method Based on DCT and DWT</text>
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            <name>Author</name>
            <description>Author</description>
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                <text>Haldun , Sarnel</text>
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          <element elementId="94">
            <name>Abstract</name>
            <description>A summary of the resource.</description>
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              <elementText elementTextId="18051">
                <text>Digital video watermarking is one of the solutions for copyright protection of digital  multimedia data and draws great attention of both researchers and digital video owners. In  this work, a new hybrid digital video watermarking method which uses the discrete cosine  transform (DCT) and discrete wavelet transform (DWT) is proposed. Each frame is processed  with one of the DCT and DWT methods or a combination of them, half of a frame by the  DCT method and the other half by the DWT method. Selection of the watermarking for each  frame in the video is determined randomly. The proposed method has undergone several  attacks in order to check its robustness and compare to the DCT and DWT methods. The  proposed hybrid method including a watermarking diversity throughout the video improves  robustness against attacks.Keywords: Digital video watermarking, discrete cosine transform (DCT), discrete wavelet  transform (DWT), copyright protection.</text>
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            <name>Date</name>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Bantilan, M.C.S, Bantilan F. T. and de Castro M. M., (1992). “Fuzzy Subset Theory in the
Measurement of Poverty”, Journal of Philippine Development, Num: 34, Vol. XIX, pp 97127.
Cerioli A., Zani S. (1990). “A Fuzzy Approach to the Measurement of Poverty”, Income and
Wealth Distribution, Inequality and Poverty, in Dangum, C. and Zenga, M. (eds).
Cheli, B., Lemmi, A. (1995). A Totally Fuzzy and Relative Approach to the Multi
Dimensional analysis of Poverty, Economic Notes, vol 24, pp115- 134.
Miceli, D., (1998). Measuring Poverty Using Fuzzy Sets, Discussion Paper no.38,
NATSEM, University of Canberra.
The State Institute of Statistic of The Republic of Turkey, Households Survey 2003.
World Bank, “Development Reports”, Attacking poverty, World Bank 2000/2001
Washington, D.C.
Zadeh A, Fuzzy sets, Information and Control 8 (1965) 338-353

The Importance Of Erp (Enterprise Resource Planning) Software And Choosing
Criterias For Business
Hakan Çetin1 ,Hakan Akar2
1Akdeniz Universiy, Faculty of Education
Department of ComputerEducationandInstructionalTechnology
2Akdeniz University, Department of Informatics
E-mails: hakanc@akdeniz.edu.tr, hakanakar@akdeniz.edu.tr
Abstract
With the increase of competition and being used information technologies by
business’ effectively, the software that organize flow of information and develop the
interdivisional integration have increased. While this study is emphasizing the importance of
ERP (Enterprise Resource Planning) software for business, reveals choosing criteria. In this
study, firstly, for business ERP system’s basic features, modules and profits are discussed. In
next parts, key considerations when choosing ERP software are emphasized and lastly
discussed how to ERP system put out an approach for business. In consequence of the
discussion, it is seen that Enterprise Resource Planning software for companies' internal
control activities and interdepartmental integration is successful and necessary.
Keywords: ERP, Information Technologies, Planning
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1.INTRODUCTION
The advances in informatics technologies have diminished the world, thus the trade
activities merchandised interstate conveniently can be merchandised all around the world.
These advances have changed business’ commerce routines and approaches. The increasing
competition has led firms seek reliable solutions and ERP software administering the process
which passes from provision to manufacturing via management information systems are
developed [Klaus et al., 2000].
In this process brought up by competition, business should use their sources
effectively and efficiently to be afloat, to stand out among its rivals and come into
prominence (Çelik, 2011). Effective and efficient use of sources depends on administering
the process good and taking right strategic decisions. In this point, informatics technologies
create solutions to business and some data that help the administrators take right decisions.
Being business big or small, producing service or goods are not obstacle to
their information technologies usage. In the future, when information technologies are
inadequate, business will develop new concepts and technologies and they will have to share
their concepts and technologies with other business (İlter, 2007:1-20). The reason for this, in
process of produces more and more innovations and strategic specialities will be required and
these innovation and specialities will be presented to business usages.
Nowadays, it is seen that business that have classic business administering
insight have been disappeared and they leave their places new business that use information
technologies and systems the most efficiently (İlter, 2007:1-20). This study presents some
information which show the importance,usage areas, advantages and disadvantages of ERP
software.
2.WHAT IS ENTERPRISING RESOURCE PLANNING?
Information technologies affect business directly in some areas like electronic
trade, ERP and information administering (Arıkboğa, Kaya, 2000:127). Enterprise resource
planning systems with opportunities in the competitive environment, business will become
more advantageous. Being Material requirement planning (MRP) and Manufacturing
resource planning (MRPII) systems’ developed versions, ERP system is a planning and
communicating system containing all functions of business (Kumar, 2002: 511).
Nowadays, the systems called as ERPII help to manage modules such as
purchase, accounting and finance, quality control, stock management, production planning,
logistic, human resources, customer care (CRM), marketing and provision management from
central location (Aydoğan, 2008: 2). In brief, ERP can be introduced as a software package
that integrates all ongoing flow of information in a company (Çelik, 2011).
ERP softwares are package programs prepared with modular logic. There are a
lot of ERP software on the marketing and nearly all of their basic modules are the same.
Looking at the overall ERP software modules, it is seen that this modules are gathered under
the titles of purchase method, sale and customer care, product design, materials management,
production management, accounting and finance, human resources and the basic application
modules (Aydoğan, 2008: 113).

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Businesses that want to use ERP software, process mapping needs to be
acquainted with how things are primarily. ERP software will be removed this way, a road
map to follow. Process mapping is located in two different options. The first option is the
mapping of the current situation and second option is to use best solution. In ERP software
built on mapping the current situation there are built-in performance and software flexibility,
the likelihood of various problems (Kul, 2009: 211-212).
3.THE DEVELOPMENT PROCESS OF ERP SYSTEMS
In increasing competitive environment business to make themselves
advantageously benefit from the opportunities offered by information technologies. In 1960’s
business used inventory management that makes manually and control system. In 1970’s
MRP systems that assumed as the beginning of ERP systems are developed. The MRP
systems were rendered computer aided by Joseph Orlicky and this system provided the
necessary support for the determination of the amount of material (TMMOB, 2006).
In 1980’s the subject of MRP attracted attentions of software companies and
package programmes were started to develop. In the same years with increasing competition
in business products and production control began to be insufficient. MRPIIs were developed
via incorporated rising values such as logistics, finance, sales and accounting planning in the
system (TMMOB, 2006).
In 1990’sincreasing information traffic in business featured units’
coordination. Besides, with the distribution resources planning and addition integrated
manufacturing to computers, new softwares were needed. The softwares in that all units are
integrated with each other and datas collected in single center in business were developed. To
this developed package programmes were named Enterprise Resource Planning (ERP).
In 2000’s new approaches such as Customer Relationship Management
(CRM) and Supply Chain Management (SCM) emerged by this way there were needs for
non-business information systems. With the inclusion of this approaches to the system by
software companies, the ERP system turned to the ERPII (Bircan, 2009).
At the present time, with the acceleration of internet and business’ moving to
this environment, some functions such as B2B, B2C, intranet, PAM, LMS, job flow
management, Project management are needed. With the combinations of these functions,
enterprise information systems began to be called as e- Businnes.
4.STRUCTURAL FEATURES OF ERP SYSTEM
ERP software can be produced according to the desired sector or needs. no
matter which the industry or field of activity are produced, these softwares’ features are the
same basically. Enterprise Resource Planning systems generally have common features
(Aydoğan, 2008; BayraktarveEfe, 2006):




125

ERP software have a modular structure.
ERP software can be customized to meet the needs of companies and developed.
ERP software has hardwired management system that holds both the master data and
data for business process.
With its single interface and integrated structure, ERP software provides flow of
information to all departments within the business.

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo





To manage data accurately and consistently, real time data entry is needed.
By providing data to be transferred electronically via the Internet and intranets, ERP
software is compatible with today’s information technology.
Because it supports many corporate functions, it has a highly functional structure.

ERP software has a modular structure. These functional modules which are
contained in the modular structure can be expressed as principal components such as
Strategic Planning and Management, Accounting Management, Financial Management,
Production Management, Logistics, Product Development and R &amp; D Management, Sales
and Marketing Management, Human Resource Management, Supply Chain Management, EBusiness Applications, Customer Relationship Management.

5. ERP’S BENEFITS AND SELECTION CRITERIA
ERP system uses a wide variety of software and hardware components. For
ERP software is high cost investment, selection of software is very important to meet the
needs of business. Before choosing the software, firstly business should decide if they will
use ERP system or not. Situations where it is needed ERP software can be expressed as
follows.










If your business suffer from unknown costs,
If problems of only specific persons resolve,
If your actual financial performance is unknown,
If follow up and planning take a lot of time,
If processing errors are increasing,
If the information requested cannot be accessed easily, takes a week to prepare some
reports,
If there are several contradictions in the reports prepared.
If your business suffer from customer loss and customer complaints are increasing,
If existing software restrict the company’s growth,(Onar, 2008).

To be successful the ERP that will be installed in business, it is needed to
choose the software which creates the most appropriate solutions for the organization
structure, technological systems, corporate objectives and strategies to the business. The
process is so important that during the software decision even a small mistake made can
cause of big amount of financial loss. (http://www.sumo.com.tr/erpsecimkriter.html).
Therefore, when choosing an ERP, businesses can follow to this 4-stage:





Identification
Research
Recognition
Analysis and selection of applications.

In identification phase, business should identify its priorities and processes
properly. Secondly, the solutions that matches described system should be investigated.
Candidates’ solution offers appeared in a list that will be obtained from the trail should be
analyzed,demos of software should be looked at, references should be reviewed and
consequently a score should be given to each studied software according to its suitability for
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the process and goals. In the selection process, if an analytical method is used, some criterias
should be based on and the selection should be evaluated according to this criterias. Finally,
before the analysis and selection process, the selection criterias should be determined. There
are 15 criteria most commonly used around the world on this issue. Thesecriterias may be
reduced to 5:






Functionality
Technology and Expertise (Know-How)
Flexibility and Scalability of Application
Cost and Ease of Use
Implementation and Ease of Use

According to known criterias, during the selection of ERP, the method called
as Analytic Hierarchy Process (AHP) is used. In analytic hierarchy process firstly the
selection criterias are ordered among each other, and secondly candidate software are ordered
among each other. According to this order, the decision makers decide the ERP system that
provides optimum benefit (Baltalar, 2008).
ERP systems selected for the purpose of business will provide these contributions in general:
(TMMOB, 2006; Kul, 2009; Aydoğan, 2008)















It speeds up the flow of information via provide the achievement of the desired format
and detailed.
Provides inventory optimization.
Provides an excellent decision support system that increases the competitiveness.
It helps managers make better and faster decisions.
Provides in-house performance monitoring and analysis.
Provides the tools which are needed to sales forecasting, sales channels and dealer
management, market and customer assessment.
Provides increase in manufacturing performance and speed of manufacturing process.
Provides improvement in preparation of orders and financial information.
Provides efficient use of resources, and decrease operating costs by providing
management.
Thanks to flexible structures, provides an easy and rapid adaptation according to the
market conditions and changes in the needs of business processes.
Provides development of a common in-house language and increased coordination
between units.
In order to meet customer needs more quickly, giving the necessary support for the
management of customer relationships, provides increase in customer satisfaction.
Provide the right investment decisions and improve business processes.
Allows customers and suppliers in different regions to share data faster and to
integrate information easily.

6. CRITICISM ABOUT ERP
Even though some positive opinions are indicated, in literature and practice
there are some negative opinions about ERP systems. Actually they are not negative opinions
but they are criticisms. The first one of the criticism aimed at business owners and
administrators. Business owners or managers concerned with the overall costs of purchasing
the software they need, other elements do not receive much more attention (Gör, ve
127

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Güneri,2008). This approach leads to a higher risk to face with. Here are the criticisms made
about ERP (Çelik, 2011).









ERP systems cost high expenditure.
ERP system’s setup takes long time.
These systems have difficulty in adapting to existing and complex softwares.
ERP systems are interested in very large-sized companies.
Implementation of ERP systems are very expensive and require significant
modifications.
The company needs restructuring process in order to use modification system.
ERP systems increases the number of information technology and personnel costs.
Even if ERP systems are installed, additional systems are needed for proper operation.

These criticisms are important for the development of the system. Definitely
there are some deficiencies in all systems. The important thing is to complete the missing
parts.
7. DISCUSSION AND CONCLUSION
Development of technology and changing competitive conditions are
promoted many middle-and upper- level business to find different solutions. Integrated
software systems, beginning with using the computers in manufacturing sector has turned
into giant package programmes which is called as ERP at present time.
Before the business use these package programmes, they definetely need to
spend a good software selection process. When literature review and studies associated with
this subject are analysed, it is seen that there is some selection methods the business need to
use during the software selection process. Gorener (2011) used VIKOR technic and analytic
net process (ANP) method during the ERP software selection in his study. There are two
important phase in selection process. First one is to determine the criterias; this phase is
performed by usage of some methods such as Analitical Hierarchy, Analitical net process.
Second one is process of ordering the criterias according to their order of importance. The
rating process is performed by some techniqes such as Vikor, Topsis, Promethee, Electre,
Saw techniques. It is seen that among the sort techniques, Topsis and Vikor give optimum
result in the study that Chu and the others carried out.
The most important process about ERP systems is selecting process, thus
Professional support must be taken. Business sometimes ignores this process cause of its
costs, but it must be remembered that if the software being inexpedient is selected, the
subsequent process will lead to greater financial loss.
No matter how they are named, ERP, ERPII or e-Business , a corporate
information system should produce solutions not only for business within business process,
but also for all employees, suppliers, customers and business partners. In other words, it must
manage bothbackoffice and frontoffice resources (Bircan, 2009).
This study presents ERP software development process and its beneficial
aspects for business. In addition, it contains the important points that business should give
attention and the techniques that are used in this process. Benefiting from ERP systems that
have an expensive and complex structure depends on carrying out the process of selecting
and setupprocess conspiratorially and the attention the business paid.
128

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

REFERANCES
AYDOĞAN, E., (2008), “Kurumsal Kaynak
AraştırmalarDergisi, Yıl 12, Sayı 2, ss.107-118.

Planlaması”,

Türkiye

Sosyal

ARIKBOĞA, D., Kaya, İ., (2000), “Ülkemizde Kurumsal Kaynak Planlaması veMuhasebe
Eğitiminden Beklentiler”, XIX. Türkiye Muhasebe Eğitimi Sempozyumu, 18-20 Mayıs,
İstanbul Üniversitesi İşletme Fakültesi Bildiriler Kitabı, ss.134-147.
BALTALAR, H., (2008), “Analizitik ERP Seçimi”, ERP Akademi
BAYRAKTAR, E., EFE,M., (2006), “Kurumsal Kaynak Planlaması(Erp) Ve YazılımSeçim
Süreci”, Selçuk Üniversitesi, Sosyal Bilimler Dergisi: 689, Sayı 15, 2006
BİRCAN Emre, (2009), “ERP’nin tarihçesi ve WORKCUBE”, www.cfcube.com, erişim
tarihi: 23.04.2012
CHU, M.T.,Shyu, J., Tzeng, G.-H., Khosla, R., (2007),
“ComparisonAmong
ThreeAnalyticalMethodsFor
Knowledge
CommunitiesGroupDecision
Analysis”.
ExpertSystemswith Applications, Vol.33, No.4, 1011-1024.
CELİK,M.,(2011), “Kurumsal Kaynak Planlama Sistemlerinin Muhasebe SüreçlerineEtkisine
Yönelik İMKB’de Bir Araştırma”, Muhasebe ve Finansman Dergisi.
GUPTA,
M.,Kohli,
A.
(2006),
“Enterpriseresourceplanningsystemsanditsimplicationsforoperationsfunction”, Technovation,
26.
Gör, A, G., Güneri F., (2008), “ERP Yazılım Seçiminde ANP Tekniğinin Kullanılması”, 2.
Ulusal Sistem Mühendisliği Kongresi Bildiriler Kitabı, 296-300.
Heizeger, Jay - Render,
Edition,PearsonPrenticeHall

Bary

(2008),

“Operations

Management”,

Ninth

İLTER, H.,Bilgi,K., (2007),Sistemleri Perspektifinden KurumsalKaynak Planlaması: Etkiler
Ve Degerler, İstanbul Ticaret Üniversitesi Sosyal Bilimler Dergisi Yıl:6 Sayı:11 Bahar
2007/2s.1-20)
Klaus, K.,Rosemann, M. ve Gable, G. G., (2000), “What is ERP?, Information
SystemsFrontiers” 2:2, 141-162
Kul, H (2009), “İşletmeler İçin Bilişim Sistemleri Temelleri ve Uygulamaları”, papatya
yayıncılık, İstanbul.
OnarÖ.Mustafa, (2008), “Erp Yolculuğuna Çıkacaklara Öneriler”, Bilişim zirvesi.
V. Kumar, ve diğerleri, (2002), “Enterprise Resource Planning SystemsAdoptionProcess: A
Survey Of CanadianOrganizations” International Journal of ProductionReserch, Vol 40,
No.3, s511.

129

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                <text>In this study, we present a comparison of machine learning technics using antepartum  cardiotocographs performed by SisPorto 2.0 in predicting newborn outcome. CTG is widely  used in pregnancy as a technique of measuring fetal well-being, mainly in pregnancies with  increased risk of complications. It is a non-invasive way for checking the fetal conditions in  the antepartum period. CTG is a continuous electronic record of the baby’s heart rate  acquired via an ultrasound transducer placed on the mother’s abdomen. The information efficiently took out from these recordings can be used to envisage pathological state of the  fetus and makes an early intervention possible before there is a permanent damage to the  fetus. Using features extracted from the FHR and UC signals, the techniques ANN and  Simple Logistic was trained to predict the normal and the pathological state. The dataset  which consist of 1831 instances with 21 attributes was tested by using the methods which is  mentioned above. The CTG recordings were also categorized 1655 of them as normal and  176 of them as pathological by three expert obstetricians’ consensus. They were showed that  ANN and Simple Logistic based methods were able to classify the data as normal and  pathological with 98.5% and 98.7% accuracy, respectively.  Keywords: Cardiotocogram, CTG, SisPorto, Artificial Neural Network (ANN), Simple  Logistic, feotus</text>
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                    <text>Structural Engineering Applications of Artificial Neural Networks
Hakan Başaran, Muhiddin Bağcı
Celal Bayar University, 45140, Manisa, Turkey
E-mails: hakan.basaran@bayar.edu.tr,muhiddin.bagci@bayar.edu.tr
Abstract
In this study, infilled planar frames and confined reinforced concrete section have been
analysed using Artificial Neural Network (ANN). ANN architecture was chosen in which
multi layer, feed forward, and back propagation algorithm was used. The training data of
infill frame used were provided by a finite element model in which non-linearity of materials
and the structural interface were taken into account under increasing lateral load. Using the
proposed analytical model (layered model) were generated the training data for confined
reinforced concrete section. Analytical technique uses realistic material models for confined
and unconfined concrete. After completing the training phase, verification of the performance
of the network was carried out using old (included in training phase) and new (not included in
training phase) patterns. The controls conducted in the test phase. The findings of this
exercise show that the ANN algorithm can be successfully and easily used within reasonable
accuracy in order to decrease computational time in finding infill frame and the momentcurvature relationships of reinforced concrete sections.
Keywords:. Artificial Neural Network, Finite Elements Method, Infilled Frame, Confined
Reinforced Concrete Section, Moment-Curvature
1. INTRODUCTION
The mathematical models have been widely applied for the analysis of infilled frame. Holmes
M (1961) modelled the infill effect occurring in an infilled frame without considering the
effects on the interface between frame and infill. In studies conducted by Smith BS (1962),
the approach of diagonal compression strut was dealt with in a more detailed way. Using a
finite element model, Mallick DV and Severn RT (1967) attained the results without
considering the shear effect on the infill frame interface. With a program they prepared.
Infilled planar frames have been analysed using artificial neural network by Bağcı and
Altintaş (2006). The layered model for confined reinforced sections was first used by Pavriz
et al (1991). Moment-curvature relationships of confined concrete sections were investigated
by Ersoy U and Özcebe G (1997). For some other examples of ANN applications, the reader
433

�is referred to (Jadid MN and Fairbairn DR (1996), Lee et al (1992), Avdelas et al (1995),
Karlık et al (1998).
In this study, the stiffness, moment and shear force values on frame for five different height
of infill wall are calculated using finite elements method (FEM). The behavior values of
confined reinforced concrete sections subjected to flexure and axial load are obtained by
using analytical solution (layered model). The calculated key values are used in training a
multi-layer, feed forward, back propagation artificial neural network (ANN). The outcomes
of training phase were then tested using the data set reserved for this the network purpose.
The findings of this exercise have shown that the ANN algorithm can be successfully and
easily used within reasonable accuracy in order to decrease computational time in infilled
frame and confined section problems.
2. PARAMETRIC STUDIES
Dimensions of infilled frame given by Fiorato AC and Sözen M (1973) in Fig. 1 are shown,
and the materials properties are listed in Tab. 1. The lateral load (P) was applied at the top left
hand corner of the frame in Fig. 1a in 20 increments of 10 kN each.

Figure 1a. Frame-infill wall 1b. Mesh model of with full infill wall

434

�Table 1. Properties of material
Modulus of
elasticity

Compression
Strength

2

Tension Strength

Poisson

(kN/m2)

Ratio

2

(kN/m )

(kN/m )

Frame

2.85x107

3.1x104

3x103

0.2

Infill

1.7x107

3.1x104

2.8x103

0.2

The wall was modelled mesh of quadrilateral-shaped isoparametric plane stress elements as
shown in Figure 1b. The results of a numerical study are given in Tab. 2, with respect to
whether the infill fills the space among the frame. Infill height is h with  being ranging
from 0 and 1 (=1, =0.8, =0.6, =0.4, =0.2 and bare).
Table 2. Results of FEM

Infill Loadheight
P

Stiffness
(infill / no
infill)

(kN)

Left
column
shear
force

Left
column
moment

Infill Loadheight
P

Stiffness
(infill / no
infill)

(kN)

Left
column

Left
column
Moment

shear force
/lateral load (Infill / no
infill)

(Infill / no
infill)

/ lateral
load
h

435

10

5,65700

0,19000

0,19000

20

5,65700

0,19000

30

5,65700

40

0,4h

10

1,3140

0,51400

0,87900

0,19000

20

1,2570

0,54200

0,91900

0,19000

0,19000

30

1,2170

0,55000

0,93800

5,65700

0,19000

0,19000

40

1,2050

0,55200

0,94700

50

5,57100

0,19000

0,19000

50

1,2000

0,56000

0,94700

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

�It has been seen that the effect of infill gets clear only when it reaches at 0.4 for the value at
the initial step of loading, though the stiffness of, infilled frame reaches at 5.7 fold, a rather
high number, local failures occurring in the infill as a result of increasing dimensionless load,
leads to a decrease in the overall stiffness of the system.
Shear strength of the column increases with the height of infill. When the height of infill
reached at the value of 0.8h, it was seen that the shear force of the column was 50 % higher
than the shear force it carries when it was a bare frame. In this case, “short column” verifies
its effect. When the height of infill was organised at the height of storey, it was seen that it
was useful in term of shear strength of column.
Input parameters are lateral load (P) and height of infill (h) values. Output parameters are
stiffness (infill /no infill), shear force / lateral load and moment (infill / no infill) at the
loaded column. As it is known, in neural network applications, the input values and output
values can be reduced to the values between 0-1. That is the normalization process, which is
done in this work dividing P’s by 220 and dividing h’s by 1.1h. The output values were
also divided by 5.7 stiffness ratio, 0.7 shear force ratio and 1.1 moment ratio, which were the
highest values that we used in our application. Training was performed for the heights of wall
h, 0.8h, 0.6h, 0.4h, 0.2h and bare and for loads of frame 10, 40, 70, 110, 150,190. As known,
the general aim in the training process is to teach the relations between input and output
values to the program and to obtain good answers to different input values with the possible
lowest error rates. Values obtained from the numerical procedure (FEM) are used in the
network training. A special code was used for ANN exercise by Karlık, B et al (17). It is
adapted and fitted to our application with some changes. ANN architecture with multilayered, forward feeding and backward propagation algorithm was chosen for the training.
The ANN architecture used is a 2:9:9:3 multi-layer architecture as shown in Fig. 2. Exact and
ANN values of output are compared in Tab. 3 for various h and P values. For these training



FEM  ANN / ANN

number of output
values, the ANN algorithm produced results with average error
less
than 0.2 %. The maximum value for FEM / ANN is about 1.0351 in 0.4h infill height and 70
kN load value.

436

�Figure 2. Network Architecture for infilled frame

Table 3. The results of ANN and FEM in training
Left column
Infill
Height

Lateral
load
kN

Solution
Method

Stiffness ratio
(Infill / no
infill)

FEM/
ANN

Left column
Shear force/lateral
load

FEM/
ANN

Moment
ratio

FEM/
ANN

(Infill / bare)
FEM

5.65699

10

0.18999

0.19000

0.9977
ANN

5.67016

FEM

5.65699

40

0.9984
0.19030
0.18999

0.19000

1.0136
ANN

5.58108

FEM

4.77100

70

1.0004
0.18992

4.79018

FEM

3.97100

0.9650
0.19688

0.21499

0.25199

0.9960
ANN

1.0246
0.18543

0.9963
0.21580

1.01.91
0.24728

h
110

0.28000

0.34500

1.0105
ANN

3.92982

FEM

3.66800

150

0.9961
0.28110
0.31999

0.39299

0.9976
ANN

3.67685

FEM

3.51399

190

0.9859
0.32458

1.0051
0.39100

0.35999

0.42000

1.0034
ANN

0.9858
0.34998

0.9830

3.50218

0.36621

0.9942
0.42245

In Fig. 3, the mean square errors (MSE) in training versus iteration numbers are shown for
problem. After 1600 iterations, the mean square errors dropped drastically. For more than
15000 iterations, our architecture 2:9:9:3 used in the analysis possesses the lowest total error
values.
25,00

% MSE

20,00
15,00
10,00
5,00

437

0,00
0

200

400

600

800

1.000

Number of ıteration

1.200

1.400

�Figure 3. Mean Square Errors (MSE) based on iteration numbers for infilled frame
Different input values were applied to the program for testing the neural network and the
results were obtained in milliseconds. Testing was performed for height of wall h and for load
values of frame 20, 60, 100, 140, 180. In Tab. 4, we compare the test phase results of ANN
and FEM.
Table 4. Test Phase Results for infilled frame

Load
of
Infill P
wall
kN

Stiffness
ratio

Height

20

60

h

100

140

180

438

Method (Infilled /
no infill)

FEM

5,65700

ANN

5,64500

FEM

5,18800

ANN

5,22100

FEM

4,1140

ANN

4,2550

FEM

3,73100

ANN

3,68000

FEM

3,54200

ANN

3,53400

Left
Column

FEM

Left
column

/

shear force /

Moment
ratio

ANN

/lateral
load

(infilled/

1.0021

0.9937

0.9669

1.0138

1.0022

0,19000
0,18600
0,19500
0,19700
0,27000
0,27130
0,31000
0,3088
0,35000
0.3485

FEM
ANN

FEM
/
ANN

no infill)
1.0215

0.9898

0.9953

1.0038

1.0043

0,19000
0,19120
0,21400
0,2134
0,32600
0,31600
0,38000
0,37290
0,41400
0,41485

0.9938

1.0028

1.0316

1.0190

0.9998

�

FEM  ANN / ANN

number of output ) obtained is obviously about 0.269. The
The average % error (
maximum value for FEM / ANN is about 1.0316 in 100 kN load value. From an engineering
point of view, these errors are considerably low. The other parametric study has been
conducted to observe the effect of different variables on behavior of confined reinforced
section shown in Fig. 4.

Figure 4. The cross-section considered in analyses.
Variables selected to incorporate in the expression of moment-curvature are compressive
strength of concrete (fck), the ratio of the axial load to the axial load capacity (N/No), yield
strength in transverse reinforcement (fsh), space of transverse reinforcement (s), diameter of
transverse reinforcement (Ø), ratio of longitudinal steel (), yield strength of longitudinal
steel (fyk) as shown in Tab. 5. Where TY, TH, CvC, CoC , , M are yield in tension,
hardening of reinforcing in tension , cover crushing, core crushing, strain at maximum
moment, and maximum moment, respectively.
The results obtained from Tab.5 demonstrates no very significant effect on Moment capacity
from compressive strength (fck) in case of pure bending (N=0). The compressive strength
becomes effective with increasing axial load. Maximum moment capacity shows changes of
±25% due to ±25% compressive strength variation. The increasing compressive strength
causes the decrease in ductility.
As level of the axial load (N/No) on the cross-section increases, ductility decreases. Increase
in ductility with decreasing axial load is very significant. It is interesting to note that,
although the section considered is well confined, the behavior becomes very brittle under
high levels of axial load. The upper limits imposed on axial loads in seismic codes results
from such considerations.
Table 5. The results according to different variables of confined concrete section

439

�It is seen that yield strength in transverse reinforcement (fsh) has no effect on behavior for
all levels of axial load. The spacing of the lateral reinforcement (s) in the confined section is
ineffective on behavior at low level of axial load. The maximum moment capacity and
ductility increase when spacing of the lateral reinforcement is reduced with increasing axial
load. As ductility increases with diameter of transverse reinforcement (Ø), it has no very
effect on moment capacity. The crushing of core concrete delays with increasing diameter of
transverse reinforcement. The diameter of transverse reinforcement becomes effective with
the increasing axial load. The quantity of longitudinal reinforcement (ρ) has an important
effect on behavior of the confined section. Maximum moment capacity causes increasing
10% due to a the quantity of longitudinal reinforcement variation 30%. The quantity of
longitudinal reinforcement has very significant effect on behavior at low level axial load. The
moment capacity decreases with the higher axial load . The quantity of longitudinal
reinforcement is ineffective on ductility. The yield strength of longitudinal bar (fyk) is
effective parameter in case of pure bending. Maximum moment capacity causes changing
±10% due to a yield strength of longitudinal reinforcement variation ±30%.
In this study , a neural network program which was written by Karlık et al. (1998) in
PASCAL was used . Seven variables for input and six variables for output values were
considered in the application. As it is known, in neural network applications, the input values
and output values can be normalized to the values between 0-1. It is seen that the best results
were obtained with learning rate  of 0.7, and momentum value µ of 0.9. The number of
nodes in the hidden layer was changed for new trials. 1000 iterations were performed for each
440

�node number between 1 and 0, and the errors were obtained from the program per 100
iterations. The chances in % error values of 1000 iterations due to the number of hidden layer
nodes are shown in Fig 5. Finally, the lowest errors were obtained in the order of 7:12:13:6
which means 7 input values, 12 and 13 nodes in hidden layers and 6 output value. Thus, the
network architecture would be as in Fig 6

Figure 5. The error changes due to the number of nodes in the hidden layer 1000 iterations.
The training iterations were increased to 5000. So, we obtained as low as 0.07% average
errors, which is reasonably good for ANN applications. The change in errors can be seen in
Fig. 7..

Figure 6. ANN architecture for confined sections

441

�% error

1,2
1,1
1
0,9
0,8
0,7
0,6
0,5
0,4
0,3
0,2
0,1
0

500

1000

1500

2000

2500

3000

3500

4000

4500

5000

Number of iterations

Figure 7. The error change at ANN architecture (7:12:13:6) for confined sections
ANN values of output are compared in Tab. 6. The average error between analytical and
Analytical ANN / ANN
numberof solution
ANN (
) is produced less than 0.2 %. The maximum difference
(Analytical / ANN) for TY, TH, CvC, CoC, and M is about 0.965, 0.978, 1.039, 0.961 ,
0.962 , and 0.976 , respectively. From an engineering point of view, these errors are
considered low.

Table 6. Training process and results for confined sections

A comparison of test and analytical values is given in Tab. 7. The average

error

Analytical ANN / ANN
numberof solution
(
) obtained is obviously about 0.33%. The maximum difference
(Analytical / ANN) for TY, TH, CvC, CoC,  and M is about 0.967, 0.966, 0.972, 0.968 ,
0.991 , and 0.992 , respectively. From an engineering point of view, these errors are
considered low.

442

�Table 7. Testing process and results for confined sections

4. CONCLUSION
In this paper, an alternative numerical and analytical technique, an ANN algorithm is used in
the analysis of infilled frame and confined reinforced section. Neural simulation of numerical
and analytical procedure is given in this study. To reduce the calculation time of the
microprocessor of system, a new computer program is used by the ANN method, which gives
answer in milliseconds. ANN architecture was chosen in which multi layer, feed forward, and
back propagation algorithm is used. The training data of infill frame are provided by a finite
element model in which non-linearity of materials and the structural interface were taken into
account under increasing lateral load. For the inelastic static analysis, an incremental iterative
procedure is adopted. Using the proposed analytical model (layered model) are generated the
training data for confined reinforced concrete section. Developed model is using layered
modeling technique and capable of taking into account; crushing of cover and core concrete,
strain hardening of steel and effect of confinement on core concrete. After completing the
training phase, verification of the performance of the network was carried out using old
(included in training phase) and new (not included in training phase) patterns. The controls
conducted in the test phase.
ANN algorithms can not of course replace totally the conventional numerical and analytical
techniques, since they need some key values for training. However, in the analysis infilled
frame and confined reinforced sections, they can be implemented as an efficient
supplementary tool reducing drastically the computational cost. Modeling process in neural
network is more direct, since there is no necessity to specify a mathematical relationship
between input and output variables. The trained ANN is able to produce quick results in the
analysis of infilled frame and confined reinforced section with the same degree of accuracy as
numerical and analytical model. Therefore, the trained ANN may be used in practice for the
design of infilled frame and confined cross section as on alternative to the time consuming
numerical and analytical procedure.

443

�REFERENCES
Holmes M.1961. Steel Frames with Brick Work and Concrete Infilling. Proc. Instn. Civ.
Engrs. 19: 473-498
Smith BS.1962. Lateral Stiffness of Infilled Frames. Journal of Struct. Div. ASCE. 8, 183-99
Mallick DV and Severn RT. 1967. The behaviour of infilled frames under static loading.
Proc. Instn. Civ. Engrs. 38, 639-656.
Bağcı M., Altıntaş G.2006. Artificial Neural Network Analysis of Infilled Planar Frames,
Proceedings Of ICE, Structures &amp; Buildings 159(1), 37-44.
Parviz S, Jongsung S, and Jer-Wen H. 1991. Axial / Flexural Behavior of Reinforced
Concrete Sections / Effects of Design Variables. ACI, 88, 17-21.
Ersoy U.and Özcebe G.1997. Moment-Curvature Relationship of Confined Concrete
Sections. First Japan-Turkey Workshop On Earthquake Engineering, Ankara, Turkey, 10-21.
Jadid MN and Fairbairn DR.1996, Neural-network Applications in Predicting Momentcurvature Parameters from Experimental Data. Engineering Applications of Artificial
Intelligence, 9, 309-319.
Lee Y, Oh SH., Hong HK., and Kim MW.1992. Design Rules of Multi-Layer Perceptron.
Science of Artificial Neutral Nets in Structural Mechanics. Structural Optimisation, 1710:
329-339.
Avdelas AV, Panagiotopoulos PD, and Kortesis S.1995. Neutral Networks for Computing in
the Elastoplastic Analysis of Structures. Meccanica, 30: 1-15.
Karlık B, Özkaya E, Aydın S, and Pakdemirli M.1998. Vibration of beam-mass system using
artificial neural networks. Computers &amp; Structures, 1998, 69: 339-347.
Fiorato A. C., Sözen M. A.1973. An investigation of the interaction of reinforced concrete
frames with masonry filler walls. Structural research series report No. 370, University of
Illinois, Urbana.

444

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                <text>Structural Engineering Applications of Artificial Neural Networks</text>
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                <text>In this study, infilled planar frames and confined reinforced concrete section have been  analysed using Artificial Neural Network (ANN). ANN architecture was chosen in which  multi layer, feed forward, and back propagation algorithm was used. The training data of  infill frame used were provided by a finite element model in which non-linearity of materials  and the structural interface were taken into account under increasing lateral load. Using the  proposed analytical model (layered model) were generated the training data for confined  reinforced concrete section. Analytical technique uses realistic material models for confined  and unconfined concrete. After completing the training phase, verification of the performance  of the network was carried out using old (included in training phase) and new (not included in  training phase) patterns. The controls conducted in the test phase. The findings of this  exercise show that the ANN algorithm can be successfully and easily used within reasonable  accuracy in order to decrease computational time in finding infill frame and the momentcurvature  relationships of reinforced concrete sections.  Keywords:. Artificial Neural Network, Finite Elements Method, Infilled Frame, Confined  Reinforced Concrete Section, Moment-Curvature</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

c.

Managers analyze Financial Statements to capture a 1 2 3 4 5 6 7
company's financial position for a given period. This allows
users of financial information to analyze and compare the
health of one company to another.
d. I am satisfied at how my system is set up at this time.
1 2 3 4 5 6 7
e. Sometimes it happens that accountants make mistakes 1 2 3 4 5 6 7
purposely, the only solution for this is termination.
Thank you for your participation.

The link between deposit insurance
And banks’ risk taking
Göçmen Yağcilar Gamze, Demir Yusuf, Kalkan Gürkan
Suleyman Demirel University, Isparta, Turkey
E-mails: gamzeyagcilar@sdu.edu.tr, yusufdemir@sdu.edu.tr
Abstract
Deposit insurance is an insurance system that guarantees bank deposits of people in case of
bank failure or a run on the bank. The system is first introduced in 1933 for Turkey and taken
its final form with regulations in 2004. Deposit insurance in Turkey is handled by Savings
Deposit Fund Insurance and according to the latest regulations compensation limit covers a
maximum of 50,000 TL per depositor per member institution. Deposit insurance system
which is adopted in most countries has various advantages for both individuals and banks.
However academic debates commonly focus on whether this system encourages banks to take
excessive risk. In this context the purpose of this study is to analyze the link between deposit
insurance and bank risk taking. For this purpose, a panel regression analysis is applied to the
ratio of deposits under insurance to total deposits and basic risk measures of banks operating
in Turkey during 2004-2010.
Keywords: Deposit insurance, bank risk taking, panel data regression.
1. INTRODUCTION
Banking sector is special with its nature of financing long term investments with relatively
short term deposits. This feature makes banks vulnerable to various types of risks both from
market and from themselves. One of the threats towards banking system is the sudden
withdrawals of large amount of deposits which is known as bank runs. This brings the need of
applying some regulatory techniques to maintain “safety and soundness” of banks. Deposit
insurance system is used as a regulatory tool in most countries for many years. The aim of
such a system is to provide banking sector’s stability preventing banks from being subject to
runs. Carapella and DiGiorgio (2004:77) define this system as:
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�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

“…an instrument through which the banking system guarantees that funds deposited by the
public in a bank are independent of solvency and liquidity conditions of the bank itself, so
that depositors may be sure of being reimbursed at any time”.
Deposit guarantees are designed to protect small and usually uninformed depositors (Silva,
2008:28) from losses depending on bank defaults, while protecting banking system’s stability
(Aydın, Başar, et al., 2006:246). Thus, it reduces the likelihood of bank panics and protects
banks from facing the problem of excessive and unexpected deposit withdrawal (Şıklar:
2004:243).
Deposit insurance system has various advantages for both depositors and banks. However
academic debates commonly focus on whether this system is a source of moral hazard which
reduces incentives of depositors to monitor their banks while encourages banks to take
excessive risks (Silva, 2008; Beck, 2008:8; Boyd, De Nicola, 2005:1330; Bartholdy, Boyle et
al., 2003:701; Bossone, 2000).
In Turkey, the system is first introduced in 1933 and taken its final form with regulations in
2004. Deposit insurance in Turkey is handled by Savings Deposit Fund Insurance and
according to the latest regulations compensation limit covers a maximum of 50,000 TL per
depositor per member institution. From this point of view, the purpose of this study is to
investigate whether the amount of insured deposits affects the risk taking incentives of
individual banks. According to our knowledge, this is the first study which analysis the bank
level effects of deposit insurance system in Turkey. Originality of the study also depends on
the deposit insurance proxy variable used in the analysis.
The rest of this paper is organized as follows: Section 2 looks at the related literature. Section
3 describes data and variables and Section 4 introduces the methodology used in our empirical
analysis. Section 5 presents the empirical findings. Finally in Section 6 we conclude.
2. Literature Review
Demirgüç-Kunt and Detragiache (1999) tested the effect of deposit insurance on bank
stability. Using the data of 61 countries during 1980-1997, the study found that explicit
deposit insurance tends to be detrimental to bank stability.
Ninimaki (2000) analyzed the joint effect of competition and deposit insurance on banks’ risk
taking when the riskiness of banks can not be observed by depositors. According to the
results, if the bank is monopoly or banks compete only in the loan market, deposit insurance
has no effect on risk taking. But introduction of deposit insurance triggers risk taking if there
is competition in deposit market. In a similar study, Wu and Chi (2006) aimed to find out the
relationship between competition and risk taking. They found that this relationship depends
on the interactions of market structure between loan and deposit markets, deposit insurance
and depositors’ risk aversion. Focusing on the effects of deposit insurance, the results suggest
that with full deposit insurance coverage an increase in competition for deposit will trigger
moral hazard problem while an inverse impact occurs under competition for loan. If the
deposit insurance system is not introduced, then the risk taking behaviors of banks depend on
depositor’s risk internalization.
Bartholdy, Boyle et al. (2003) used data from 13 countries to investigate the relationship
between deposit insurance and deposit risk premiums. Results suggest that insured deposits
have a lower risk premium compared to the uninsured deposits. Another result of the study is
that relationship between the risk premium and the maximum dollar value of insurance

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coverage is non-linear that means moral hazard incentives are recognized and priced by
investors.
Gropp and Vesala (2004) investigated the impact of deposit insurance on EU banks’ risk
taking during 1990s. The results suggest that the introduction of explicit deposit insurance
system may significantly reduce risk taking. The authors also found some evidence that
explicit deposit insurance might be a useful way to limit the safety net, increase market
monitoring of banks and reduce moral hazard.
Leaven and Levine (2008) assessed the relationships among risk taking of banks, their
ownership structures and national bank regulations including deposit insurance system. Their
results suggest that the impact of deposit insurance on banks’ risk taking varies depending on
the ownership structure of banks. If the bank is widely-held, deposit insurance has not have a
significant impact on risk taking. On the other hand if bank has a majority owner, bank risk
increases significantly with an increase in deposit insurance.
Silva (2008) has introduced deposit insurance in a model of information based bank runs.
Results show that the net effect of deposit insurance on the equilibrium demand deposit
contract is to raise its value and also the risk of runs. So deposit insurance induces moral
hazard.
Ioannidou and Penas (2010) analyzed the effect of deposit insurance on the risk taking
behavior of banks. Using the case of Bolivia, the authors compared the risk taking behavior of
banks before and after the introduction of deposit insurance system in December 2001. Their
main findings indicate that the introduction of deposit insurance system led to an increase in
the probability of a bank originating a subprime loan. The results also suggest that banks do
not increase collateral requirements or decrease loan maturity to compensate for the extra risk.
Cross sectional analysis confirm the consequence that banks take more risk after the deposit
insurance system is introduced.
Angkinand and Wihlborg (2010) analyzed whether deposit insurance systems and ownership
structures of banks affect the degree of market discipline on banks’ risk taking. They found
that total effect of explicit deposit insurance coverage on risk taking is shown as a U-shaped
curve. This indicates that risk taking is minimized at a positive and partial insurance coverage
level where market discipline is at its strongest.
Ng, Lim et al. (2010) searched the relation between explicit deposit insurance and risk taking
of banks in Malaysia during 2004-2007. The authors found that explicit deposit insurance had
different effects on various risk factors. After the introduction of deposit insurance scheme,
only two risks, interest rate risk and risk-weighted capital ratio deteriorated. Deposit rate,
credit risk, liquidity risk and core capital ratio were not significantly changed for the postintroduction period.
3. Data and Variables
To analyze the effects of deposit insurance on banks’ risk taking, we used annual bank level
data of 27 banks continually operated in Turkey during 2004-2010 (from the beginning of
implementation of the latest deposit insurance regulation to the present). Following Ng, Lim,
et al. (2010), we aimed to understand the effects of the insured deposits/total deposits ratio (as
the proxy of explicit deposit insurance) on banks’ risk taking and activities. For investigating
banks’ risk taking behaviors, following variables are selected:

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Table 1: Definition of Variables
Variables

Acronyms

Definition

Deposit insurance

DI

Insured deposits/total deposits

Credit Risk

NPL

Non-performing loans/total loans

Liquidity Risk

LIQ

Liquid assets/short term liabilities

Interest Rate Risk Exposure

INT

Interest rate sensitivity of balance sheet and
*
off-balance sheet position/total capital

Capital Adequacy Ratio

CAR

Capital as a fraction of risk-weighted assets

4. Methodology
Following the existing literature, the main hypothesis of this study is that banks tend to take
more excessive risks if their ratio of insured deposits to total deposits is higher. In order to
investigate this assumption, we applied regression analysis to our panel data set of 189
observations including 27 banks and 7 years. Effects of insured-deposit-rates on several risk
factors are analyzed separately. So our key independed variable is deposit insurance (DI). An
Ordinary Least Squares technique is used; because it is suitable to use for the econometrics of
panel data because of the double individual dimensions of the data (Batisse, 2001). Random
effects technique is selected in estimations according to the data structure.
Definitely, insured-deposits-rate is not the only variable determining the risk levels of banks;
but the others wouldn’t be considered in the context of this study. In our empirical analysis,
we just add three control variables to improve the explanatory power of DI. These variables
are;





Crises Dummy: The global financial crisis quite likely has affected the level of risk
variables. The crisis has begun in 2007 but its effects are experienced in Turkey
especially in 2009. We can understand this looking at the negative growth rates of the
economic indicators (mainly Gross Domestic Product-GDP growth) in 2009. So the
variable takes “1” for 2009 and “0” for other years.
Real GDP: Gross Domestic Product is expected to have an impact on the risk levels of
banks affecting their borrowers’ solvency as well as risk appetite of banks. Data is
obtained from www.dpt.gov.tr.
Inflation: Proxied by producer price index. Basic impact of inflation is expected to be
on interest rates. Inflation also increases the uncertainty of the future for borrowers,
depositors and for banks. So the variable is expected to have a positive effect on risk
levels. Data is obtained from www.dpt.gov.tr.

*

Ratio of the difference between the liabilities subject to repricing within one year and the assets subject to
repricing within one year plus off-balance sheet position to total capital

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5. Empirical Results
Applying OLS technique to our panel data set, we have found that the effect of deposit
insurance is significant only for two variables. These variables are NPL (non performing loan
ratio) and LIQ (liquidity ratio). The directions of these effects are consistent with literature
and with our expectations.
Results suggest that the amount of insured deposits over total deposits has a positive and
significant effect on NPL supporting the “moral hazard” argument. According to this
argument, deposit insurance makes banks less sensitive in screening and monitoring of loans
and this attitude increases the level of NPL.
Another significant effect of DI is on LIQ and the direction of this effect is negative as
expected. This result suggests that when the insured deposit rate is higher, i.e. bank’s
responsibility is undertaken by government, bank’s incentive to invest in liquid assets in order
to meet its obligation is destroyed.
Interest rate sensitivity (INT) is affected positively by DI. It means that banks become less
careful in matching assets and liabilities according to the time remaining to repricing. But this
effect is not statistically significant.
Deposit insurance affects Capital Adequacy Ratio (CAR) negatively. Banks consider deposit
insurance as compensation towards their potential losses but if their obligations are insured by
the government, they don’t consider equity necessary. However, this effect is not statistically
significant.
In determination of LOAN variable, DI gets negative coefficient but it is not significant. In
the equation of DEP, DI gets positive coefficient but this effect is insignificant either.
Table 2- Empirical Results
Depended Variable

Coefficient of DI

Probability

R2

NPL

0.090385

0.0940*

0.019856

LIQ

-0.303803

0.0454**

0.094406

INT

0.003329

0.4712

0.021026

CAR

-0.081813

0.2556

0.075056

LOAN

-0.904939

0.5806

0.024697

DEP

0.056876

0.2336

0.021429

* Significant at %10 significance level
* Significant at %5 significance level

6. Conclusion
Deposit insurance is a system which guarantees repayments of deposits to depositors and in
this way protects financial system’s stability preventing bank runs. However, there is a
common suspicion in academic literature on whether this system leads banks to behave less

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prudently and encourages them to take excessive risks. This question is widely investigated in
academic researches and common view is that the system is a source of moral hazard.
In Turkey, deposit insurance system is being held for many years under various politic
attitudes. For example during 1990s, deposit insurance covered 100% of deposits in each
bank. Since 2004, coverage limit is discounted to 50,000 TL for each depositor in each bank.
In this context, the aim of this study is to determine what kind of results occurs at bank level
by implementing this new system. To analyze the possible effects of deposit insurance
system, we applied Ordinary Least Squares method to our bank level data including a panel of
27 banks operated in Turkey during 2004-2010. The key independed variable of this study is
the amount of insured deposits over total deposits (DI). The aim of the study is to determine
the effects of DI on various kinds of risk factors and activities. We considered three risk
factors which are credit risk (NPL), interest rate risk and liquidity risk. Other depended
variable are Capital Adequacy standard ratio (CAR), loans/deposits ratio (LOAN) and
deposits/total assets ratio (DEP). Supporting the moral hazard argument, results suggest that
deposit insurance raises credit risk which is proxied by NPL ratio. Insured deposit rate also
has a deteriorating effect on banks’ liquidity. On the other hand, the variable isn’t found
related with interest rate risk, capital ratio, loan ratio and deposits ratio.
Basing on these findings, we suggest that regulatory institutions should focus on the moral
hazard of banks to eliminate the adverse effects of the system. In order to explore whether the
impact of deposit insurance on banks changed after the latest regulation, a further analysis is
necessary.
REFERENCES
Angkinand, Apanard, C., Wihlborg, (2010), “Deposit Insurance Coverage, Ownership and
Banks’ Risk Taking in Emerging Markets”, Journal of International Money and Finance, Vol.
29, 252-274.
Aydin, N., Başar M., Coşkun, M., (2006), Bankacılık Uygulamaları, Anadolu Üniversitesi Ya.
No. 1711, Eskişehir.
Bartholdy, Jan, Glenn W. Boyle, R.D. Stover, (2003), “Deposit Insurance and the Risk
Premium in Bank Deposit Rates”, Journal of Banking and Finance, Vol. 27, 699-717.
Batisse, C., (2001), “Externalities and Local Growth: A Panel Data Analysis Applied to
Chinese Provinces”, International Conference of the Chinese Economy, Has China Become a
Market Economy?, May 17-18 2001, France.
Beck, T., (2008), “Bank Competition and Financial Stability: Friends or Foes?”, World Bank
Policy Reseach Working Paper, No. 4656, pp. 1-30.
Bossone, B., (2000), “What Makes Banks Special? A Study of Banking, Finance and
Economic Development”, World Bank Working Papers, No. 2408, pp.1-66.
Boyd, J.H, de Nicola, G, (2008), “The Theory of Bank Risk Taking and Competition
Revisited”, the Journal of Finance, Vol. 60, No. 3, 1329-1343.
Carapella, F., G. Di Giorgio, (2004), “Deposit Insurance, Institutions and Bank Interest
Rates”, Transition Studies Review, Vol. 11, no. 3, 77-92.
Demirgüç-Kunt, A., E. Detragiache, (1999), “Does Deposit Insurance Increase Banking
System Stability? An Empirical Investigation”, World Bank Policy Research Working Paper,
No. 2247.
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Gropp, Reint, Jukka Vesela, (2004), “Deposit Insurance, Moral Hazard and Market
Monitoring”, European Central Bank, Working Paper Series, No. 302.
Ioannidou, Vasso, P., M.F. Penas (2010), “Deposit Insurance and Bank Risk Taking:
Evidence from Internal Loan Ratings”, Journal of Financial Intermediation, Vol. 19, 95-115.
Keeley, M.C., (1990), “Deposit Insurance, Risk and Market Power in Banking”, The
American Economic Review, Vol. 80, No. 5, 1183-1200.
Leaven, L., R. Levine, (2008), “Bank Governance, Regulation and Risk Taking”, NBER
Working Paper Series, No: 14113.
Ng, Tuan Hock, Lim, Y.S., Tan N. L., (2010), “Deposit Insurance and Bank Risks: The Case
of Malaysia”, European Journal of Economics, Finance and Administrative Sciences, Issue
18, 19-27.
Ninimaki, J-P., (2000), “The Effects of Competition on Banks’ Risk Taking with and without
Deposit Insurance”, Bank of Finland Discussion Papers, No. 21.
Şıklar, İ, (2004), Finansal Ekonomi, Anadolu Üniversitesi Ya., No. 1588, Eskişehir.
Silva, Nancy (2008), “Deposit Insurance, Moral Hazard and The Risk of Runs”, Central Bank
of Chile Working Papers No. 478.
Wu, R-J, C-P, Chi, (2006), “Competition, Deposit Insurance and Bank Risk Taking”,
http://centerforpbbefr.rutgers.edu/2006/Paper%202006/16AS02-056-Chien-Ping%20Chi.pdf.
www.dpt.gov.tr
www.tbb.org.tr
Control of a chaotic finance system with passive control
Selçuk Emiroğlu, Yılmaz Uyaroğlu, Etem Köklükaya
Sakarya University, Electrical Electronics Engineering Department, Turkey
E-mails: selcukemiroglu@sakaryaedu.tr, uyaroglu@sakarya.edu.tr, ekaya@sakarya.edu.tr
Abstract
In this paper, complicated dynamical behavior of a finance system is investigated. The change
in behavior of finance system from stable behavior to chaotic behavior is shown with varying
some system parameters. In addition, chaotic finance system with passive control is
considered and the stability of the controlled system is investigated. In order to control the
chaos in finance system, the controller is designed based on passive control technique.
Designed controller is applied to the chaotic finance system for stabilization of system. After
controller is added to the system, the change in behavior of finance system from chaotic
behavior to stable behavior is shown with passive control.
Keywords: Chaotic finance system, chaos control, passive control

125

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          <element elementId="50">
            <name>Title</name>
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              <elementText elementTextId="18022">
                <text>The link between deposit insurance  And banks’ risk taking</text>
              </elementText>
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          <element elementId="96">
            <name>Author</name>
            <description>Author</description>
            <elementTextContainer>
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                <text>Göçmen , Yağcilar Gamze</text>
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                <text>Deposit insurance is an insurance system that guarantees bank deposits of people in case of  bank failure or a run on the bank. The system is first introduced in 1933 for Turkey and taken  its final form with regulations in 2004. Deposit insurance in Turkey is handled by Savings  Deposit Fund Insurance and according to the latest regulations compensation limit covers a  maximum of 50,000 TL per depositor per member institution. Deposit insurance system  which is adopted in most countries has various advantages for both individuals and banks.  However academic debates commonly focus on whether this system encourages banks to take  excessive risk. In this context the purpose of this study is to analyze the link between deposit  insurance and bank risk taking. For this purpose, a panel regression analysis is applied to the  ratio of deposits under insurance to total deposits and basic risk measures of banks operating  in Turkey during 2004-2010.  Keywords: Deposit insurance, bank risk taking, panel data regression.</text>
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                <text>2012-05-31</text>
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                    <text>SCHEIN, Edgar H, “Organizational Culture”, American Psychologist, Vol. 45, No. 2, pp.
109-119, 1990.
SIMSEK, M. Şerif, H. Serdar Öge, Human Resources Management with Strategic and
International Perspectives, Gazi Publishing, Ankara, 2007.
SPOKANE, Arnold R., Eric J. Luchetta and Matthew H. Richwine, “Holland’s Theory of
Personalities in Work Environments”, Career Choices and Development, Jossey-Bass, San
Francisco, pp. 373-427, 2002.
SOUTGATE, Nicole, An Exploration of Career Salience, Career Commitment, and Job
Involvement, Master Thessis, Masters in Industrial Psychology at University of the
Witwatersrand, Supervisor: Dr. Andrew Thatcher, 2005.
TUZ, Melek Vergiliel, “Kariyer Planlamasında Yeni Yaklaşımlar”, U.Ü. Journal of Science
and Literature Faculty, Vol. 4, No. 4, pp. 169-176, 2003.
TYLOR, Edward B., Primitive Culture: Researches Into the Development of Mythology,
Philosophy, Religion, Art, and Custom, Volume I, John Murray Albemarle Street, London,
1871
YOUNG, Richard A, Ladislav Valach and Audrey Collin, “A Contextualist Explanation of
Career”, Career Choices and Development, Jossey-Bass, San Francisco, pp. 206-255, 2002.

The Factors Determined To The Improvement In The Least Developed And Developing
Countries: Testing A Model
Gözde Ergin, Adil Oğuzhan
Trakya University, Department of Econometrics
Abstract
Finding the different ways of the improvement as a multidimensional process causes
different improvement ways in all countries in the world. The economic improvement that
cause a structural changing is very important in all economies all over the world and it is
necessary for the least developed countries at the same time. These countries have solved the
phenomena of poverty, unemployment, low life standards and unimproved. The
differentiation in the socio-cultural structures of the least developed and developing countries
effect the improvement in a positive way.
In the study, the socio-economic factors of improvement and a classification according
to the gross national product levels per person in the least developed and developing countries
have been done by taking the definition accepted by World Bank into consideration. There are
fifteen countries in the classification of the least developed and developing countries. The
data of thirty-three factors in the comparison of these countries have been obtained from the
data source of World Bank, OECD, EUROSTAT and UN (2000 – 2009).
610

�The Statistical and Casual Models in the kinds of econometric models have been
estimated with ‘’Panel Model Method’’. For choosing the suitable model, the test for
choosing model ‘’Hausman’’ has been used. As a result, the factors determined to the
improvement of the countries in a different improvement levels have been discussed and the
comments related to them have been made.
1.INTRODUCTION
The concept of economic development could be defined as the process of increasing of
material wellbeing, abolishing the poverty, the input in production and the usage of these
outputs as a result and besides, as an activity of the protections of the level of the socioeconomical standards of the society in order to use them more actively and with different
methods for the production process.
The problems of individuals and the world increase gradually because of the increase of the
world population and the globalization. In todays world, where the incomes of the individuals
raise, the distribution of income gets worse and the poverty increases, the importance of the
development problematic dramatically increased. In a world which gets smaller with the
expansion of communication tools due to globalization, the level of information acquisition of
both countries and individuals has risen. Therefore, solutions are sought through development
policies for the alternating lifestyles, economies and the differentiation in countries’ and
individuals’ socio-cultural structures.
Development, having multiple aspects, has various angles and these bring about different
development periods in each country. For that reason, development is defined in different
ways by various people and thinkers.
Economic Development is very important in every economies and it nearly becomes
compulsory for the low-level of development countries. Because, these countries can only
find a solution for poverty, low-living standarts and backwardness entity with economic
development. But on the other hand when examining for advanced tecnology, development
shows necessity for maintaining current growth rate in advanced tecnologies (Jain &amp; Ohri,
2007:2)
Development carries meaning of recovering economy and in any case of negativities for
underdeveloped countries. As known,it should be tried to be developed and handled with all
defects in this issue and origins of these defects for achive successing in a weak issue. The
biggest step of developing should be provided the process of developing with handle by
looking cause and effects of deficincies in economy. Development not only developt in terms
of economy, but also known as social and politically changes and positive contributions of
these changes.

611

�2.Development Theories
After from 1950s, a lot of development theories suggested to the world.(boyacıoğlu, 200:2728). The major ones of these theories are known as The Development Theory of Rostow, The
Balanced Development Theory and Unbalanced Development Theories. According to
Rostow’s development theory in 1960, the development countries are the countries surpassed
the stage of traditional society,transition,rising,maturity, and the mass consumption.
In the countries which is in the stage of traditional society occur an intense agricultural sector
and the functions of the limited production and modern scientific-technical practices.
Education and infrastructure investment in the transition stage society have a dramatically
increasing and bring about new initiatives.
.In rising stage the composed profit returns to
investment and technology is started to use successfully at all sectors. Anymore, the societies
in the maturity stage use their sources in the areas having modern technology. While their
production and exportation are increasing, parallelly the requiremenst for new import goods
are increasing, as well. As for in the stage of mass consumption, the per capita income arise
and the society starts concentrating on consumption rather than production.Impetus between
these stages is the expediting economic growth as returning internal and external austerity to
enough amount investment. (Dolun ve Atik, 2006: 8).
Balanced development aims a condition of equilibrium in the economy.The economic events
occured in the underdeveloped society rely on the complementarity link.In terms of thought,
complementarity is the important factor of the balanced development and it is not an
instrument to realize the balance situation but it is an directive item.The balanced
development model rests on the mutual dependence.As a first, it is the mutual dependence in
production.On one hand, every economic group have to find income and look for the market
for its outcome .As a second, it is that every income growth create an enhancement in
demand.
The balanced development with balance, food products with clothing, agricultural feedstock
with industrial products, public enterprises with other investments and such as production
for the export and domestic demand are asked to arised for many other ecomomic situations
.
According to Rosentein-Roden respected the pioneer of balanced development in order to
increase income and demand are needed benefical and healthy investments.Concerted
investments are going to increase income and demand.Thus, investment in parts is not enough
both increasing demand and income.Overall, coordinated investments in Rosentein-Roden
model supplies with the external savings.
With the aim of comparing economic development and economic growth, an organized
schedule is given below.
With the aim of comparing economic development and economic growth, an organized
schedule is given below.
612

�Content

Economic Development

Economic Growth

Economic Development refers to either mutations
savings and national (mutations betwen institutional
and tecnologic) frame or progressive mutations of
economic structure.

Economic Growth is an increase in capacity of an
ecenomy to produce goods and services like
investment, savings and revenues.

Economic Development refers to benefit from unused
resources in underdevelop countries.

Use

Economic Growth is related with development
of low-used sources from developed contries to
use in optimum way.

Development, equilibrium rate is connected with the
raising of high steady state.

.Growth is connected with general steady and
graduaded raise at the rate of investment and
outcome.

Economic Development implies the problems of
underdevelopment countries.

Economic Growth implies the problem of
developed countries.

Action

Creates both qualitative and quantitative mutations in
economy.

Creates only quantitative mutations economy.

Scope

Connected with all mutations in economy.

Connected with small motations in economy.

Boost
(büyüme)

Definition

3. Panel Data Analysis
When T numbered observations of N numbered econometric units are dealed together
establish panel data model. Assets belonging to any year establish the cross section of the panel; the
assets the economic units take by years establish the time sector. In other words, across every
econometric unit there is a time series. Panel data analysis model is the model where economic
relations are presumed using time sector cross. (Powel, 2010: 1).
4. A Model Test Regarding Development Factors Affecting Development at
Underdeveloped and Developing Countries
Taking into consideration the development factors affecting the development of developing
and underdeveloped countries with the condition of benefiting from panel data, the Socio-Economic
variables of countries taking place at the panel model are defined as below.

X 1 : Research- Development Cost GDP %

X 2 : GDP Per Capita(Year )

X 3 : Rural Population’s % Among Total Population

X 4 : The Rate of Urban Poplation in the Overall
Population

X 5 : Death Rate ( 1000 Person)
613

X 6 : Tax Revenue GDP %

�X 7 : İnfant Death Rate (1000 İnfant)

X 8 : Agricultural Rate % in GDP

X 9 : Service Sector % in GDP

X 10 : Industrial Sector % in GDP

X 11 : Import of Good and Service % in GDP %

X 27 :FDI %in Net Capital Inflow

X 12 : Export of Good and Service % in GDP %

X 13 : GDP Rate

X 14 : Real Inflation Rate

X 15 : Unemployment Rate

X 17 : The Number of Scientfic Article

X 19 : Expectancy of Life (Year)

X 18 : Electrical Consumption Per Capita

X 20 : Inflation Rate

X 22 : Cultiroted Land (Hek.)

X 23 : The Rate of Employed In Industrial Sector

X 24 : The Rate of Employed In Service Sector

X 25 : Dependency Rate

X 28 : Comminication Revenue

X 29 : Energy Import % in GDP

X 30 : The Rate of Big Urban in Over Population

X 31 : Women at the Parliament

X 32 : The Rate of Population ( Year)

X 33 : GDP per Capita($)

4.1. Approximation Results According to Panel Model of Underdeveloped Countries
Under this chapter underdeveloped countries are Uzbekistan; Kyrgyzstan; Ethiopia; Kenya,
Nepal, Bangladesh and Afghanistan. These countries are considered as underdeveloped ones according
World Bank’s definitions. For these countries different approximation models of social and economic
sector will be tested.
Table 1: Approximation Results of Underdeveloped Countries Social Sector According
to Panel Model
Model I

Constant Effective Model

Variables
C
X19?
X25?
X30?
X31?

Random
Effective
Model

Coefficients

Coefficients

-6.672591
(0.2953)
3.505694
(0.0047)
-1.995913
(0.0007)
1.940735
(0.0044)
0.103846
(0.0518)

-1.786856
(0.7641)
2.428435
(0.0139)
-1.605449
(0.0037)
1.279782
(0.0045)
0.132759
(0.0077)
Random
Effects
(Cross
0.136976

Fixed Effects (Cross)
_UZB--C
0.099859

614

Model II

Model III

Model IV

Model V

Pooled Least
(LSDV)Model

Fit Panel Data Model
using GLS, removing
Autocorrelation and
homoscedasticity

Robust
Score

Coefficients

Coefficients

Coefficients

3.505694
(0.0047)
-1.995913
(0.0007)
1.940735
(0.0044)
0.103846
(0.0518)

8.353807
(0.000)
.5925234
(0.000)
-1.352025
(0.000)
.1943402
(0.000)
.05734
(0.000)

-1.516349
(0.897)
2.367225
(0.166)
-1.583195
(0.014)
1.244267
(0.195)
.1343365
(0.015)

-6.572731

-

-

-

�_KIR--C
_ETOP--C
_KEN--C
_NEPAL--C
_BANG--C
_AFG--C

-1.402104
0.571702
0.641290
0.470263
-0.696803
0.315794

-0.869378
0.178319
0.633556
0.270047
-0.483477
0.133956

-8.074695
-6.100889
-6.031301
-6.202328
-7.369394
-6.356797

-

-

R

2

0.847275

0.506778

0.847275

-

-

R

2

0.821389

0.476426

0.821389

-

-

Se

0.215075

0.220746

0.215075

-

-

∑ e2i

2.729168

3.167381

2.729168

-

-

14.23175

-

14.23175

62.08698

-

32.73143

16.69666

32.731

-

-

0.000000

0.000000

0.000000

-

-

-0.092336

-

-0.092336

-

-

0.260999

-

0.260999

-

-

0.048013

-

0.048013

-

-

1.167119

-

-

Log
likelihood
F-statistic
Prob(Fstatistic)
Akaike info
criterion
Schwarz
criterion
HannanQuinn criter.
DurbinWatson stat
Wald-ist.

LM
corr(u_i,Xb)
F u_i=0
sigma_u
sigma_e
Rho

1.167119

1.009085

-

66.79

-

399.78

-

-0.8864
25.72
.76597963
.21507476

108.83
0 (assumed)
.48702719
.21507476

-

-

-

.92692184

.83680818

-

-

-

Table2: Panel Model of Approximation Results Economic Development Sector of
Underdeveloped Countries’
Model I

Constant Effective Model

Variables
C

615

Coefficients
-21.94974
(0.0544)

Model II

Model III

Model IV
Fit Panel Data Model
using GLS,removing
Autocorrelation and
homoscedasticity

Model V

Random
Effective
Model

Pooled Least
(LSDV)Model

Coefficients

Coefficients

Coefficients

Coefficients

8.061894
(0.0137)

-

10.48043
(0.000)

8.83934
(0.000)

Robust
Score

�X22?

1.808341
(0.0157)

Fixed Effects (Cross)
_UZB--C
0.570444
_KIR—C
2.574761
_ETOP—C
-2.399361
_KEN--C
0.266447
_NEPAL—
1.172460
C
_BANG--C
-0.874519
_AFG--C
-1.310231

-0.144044
(0.4889)
Random
Effects
(Cross
0.416194
0.075481
-0.598519
0.407666

1.808341

-.3189611
(0.000)

-.1946205
(0.025)

-21.37930
-19.37498
-24.34911
-21.68330

-

-

-0.181637

-20.77728

-

-

0.137800
-0.256984

-22.82426
-23.25998

-

-

R

2

0.684503

0.006429

0.684503

-

-

R

2

0.648883

-0.008183

0.648883

-

-

0.301551

0.316311

0.301551

-

-

5.637852

6.803588

5.637852

-

-

-11.16097

-

-11.16097

50.3867

-

19.21651

0.439978

19.21651

-

-

0.000000

0.509375

0.00000

-

-

0.547456

-

0.547456

-

-

0.804427

-

0.804427

-

-

0.649528

-

0.649528

-

-

0.663113

0.459701

0.663113

-

-

-

0.44
82.60

-

256.57
-

5.04
-

-0.9727

0 (assumed)

-

-

-

16.40
1.6653277
.30155042
.96825253

.39296918
.30155042
.62938698

-

-

-

Se

∑

2
ei

Log
likelihood
F-statistic
Prob(Fstatistic)
Akaike info
criterion
Schwarz
criterion
HannanQuinn criter.
DurbinWatson stat
Wald-ist.
LM
corr(u_i,
Xb)
F u_i=0
sigma_u
sigma_e
Rho

4.2. A Model Test According to the Economic Development of Underdeveloped Countries
When the economic factors dimension of improvement models of underdeveloped countries is
seen as a panel model, Constant Effective Model has been estimated as a first model. In the estimation
of this model all economic variables has been added to the model as explanatory variables.

616

�The Hausman Test was applied to understand which model is more coherent at the above
approximated Fixed Effect Cross Model and Random Effects. The results are below.
Table 3: Hausman Determination Model Test Results
Correlated Random Effects - Hausman Test
Pool: Untitled
Test cross-section random effects
Chi-Sq.
Statistic Chi-Sq. d.f.

Test Summary
Cross-section random

7.819711

Prob.

1

0.0052

Because the test result is p&lt;0.05 the hypothesis is denied and FEM is preferred. In addition the

 i of the countries statistic meaning test is approximated at LSDV model III.
4.3. Panel Model Approximation Results of Developing Countries
Under this chapter as developing countries; Azerbaijan, Argentina, Brazil, Bulgaria, China,
Mexico, Turkey and Kazakhstan are taken. These countries are considered as developing ones
according World Bank’s definitions. For these countries different approximation models of social and
economic sector will be tested.
Table 4: Panel Model of Approximation Results Economic Development Sector of Developing
Countries
Model I

Model II

Constant Effective Model

Variables
C
X8?
X18?

Coefficients
1.205352
(0.5830)
-1.417998
(0.0000)
1.281596
(0.0000)

Fixed Effects (Cross)
_AZER—
-0.481379
C
_ARJ--C
0.479222
_BRE--C
0.072678
_BULG—
-0.609218
C
_CHN--C
0.386770

617

Model III

Model IV

Model V

Random
Effective
Model

Pooled Least
(LSDV)Model

Fit Panel Data Model
using GLS, removing
Autocorrelation and
homoscedasticity

Robust
Score

Coefficients

Coefficients

Coefficients

Coefficients

-1.417998
(0.0000)
1.281596
(0.0000)

8.461126
(0.000)
-1.315091
(0.000)
.3027834
(0.010)

2.974038
(0.332)
-1.443142
(0.000)
1.059926
(0.004)

-0.460849

0.723973

-

-

0.464491
0.013988

1.684574
1.278031

-

-

-0.427305

0.596134

-

-

0.265768

1.592122

-

-

3.536970
(0.0721)
-1.449383
(0.0000)
0.988897
(0.0001)
Random
Effects
(Cross

-

�_MEK--C
_TC--C
_KAZ--C

0.019974
1.092678
-0.960724

-0.059541
0.996506
-0.793057

1.225326
2.298030
0.244628

-

-

R

2

0.868931

0.679488

0.883863

-

-

R

2

0.260507

0.671163

0.868931

-

-

4.750457

0.268295

0.260507

-

-

-0.563648

5.542612

4.750457

-

-

59.19276

-

-0.563648

9.971518

0.000000

81.62015

59.19276

-

-

-

0.000000

0.000000

-

-

0.264091

-

0.264091

-

-

0.561845

-

0.561845

-

-

0.383469

-

0.383469

-

-

1.472890

1.202092

1.472890

-

-

-

163.24
129.86

-

174.48
-

76.11
-

-0.5420

0 (assumed)

-

-

-

29.98
.66598321
.26050657
.86729755

.4772026
.26050657
.77040971

-

-

-

Se

∑

2
ei

Log
likelihood
F-statistic
Prob(Fstatistic)
Akaike
info
criterion
Schwarz
criterion
HannanQuinn
criter.
DurbinWatson
stat
Wald-ist.
LM
corr(u_i,
Xb)
F u_i=0
sigma_u
sigma_e
Rho

Table 5. Hausman Determination Model Test Results
Correlated Random Effects - Hausman Test
Pool: Untitled
Test cross-section random effects

Test Summary
Cross-section random

Chi-Sq.
Statistic Chi-Sq. d.f.
6.672753

2

Prob.
0.0356

Because the test result is p&lt;0.05 the hypothesis is denied and FEM is preferred. In addition the  i of
the countries statistic meaning test is approximated at LSDV model III.

618

�Table 6: Panel Model of Approximation Results Social Sector of Developing Countries

Model I

Model II

Model III

Pooled Least

Sabit Etkili Model

Tesadüfi Etkili
Model

(LSDV)Model

Katsayılar

Katsayılar

Katsayılar

11.25996

30.32038

Değişkenler

Model IV

Model V

Fit Panel Data Model
using GLS, removing
Autocorrelation and
homoscedasticity

Robust
Score

Katsayılar

Katsayılar

7.424574

31.62741

(0.000)

(0.000)

C

X25?

X30?

(0.0407)

(0.0000)

-7.450049

-6.270002

-7.450049

.0323962

-6.833261

(0.0000)

(0.0000)

(0.0000)

(0.868)

(0.000)

9.174063

0.856127

9.174063

.2843438

1.173124

(0.0000)

(0.0001)

(0.0000)

(0.000)

(0.009)

Fixed Effects (Cross)

Random Effects
(Cross

_AZER--C

-9.249312

-1.556559

2.010649

-

-

_ARJ--C

-5.165218

0.628508

6.094744

-

-

_BRE--C

3.671319

0.593179

14.93128

-

-

_BULG--C

-2.847708

-0.949942

8.412254

-

-

_CHN--C

14.45671

-0.236747

25.71667

-

-

_MEK--C

-1.194810

1.310704

10.06515

-

-

_TC--C

-0.779853

0.497350

10.48011

-

-

_KAZ--C

1.108873

-0.286492

12.36884

-

-

R2

0.886835

0.527576

0.886835

-

-

R2

0.872286

0.515305

0.872286

-

-

Se

0.257151

0.326793

0.257151

-

-

619

�e

4.628865

8.223100

4.628865

-

Log-Lik.

0.473513

-

0.473513

-100.2685

42.994

60.95

-

-

2
i

F -Statistic

-

Prob(F-statistic)

0.000000

0.000000

0.000000

-

-

Akaike info
criterion

0.238162

-

0.238162

-

-

Schwarz
criterion

0.535916

-

0.535916

-

-

Hannan-Quinn
criter.

0.357540

-

0.357540

-

-

Durbin-Watson
stat

1.493082

0.852996

1.493082

-

-

Wald-ist.

-

85.99

-

311.09

72.20

LM

-

58.48

-

-

-

-0.9951

0 (assumed)

-

-

-

F u_i=0

71.25

-

-

-

-

sigma_u

7.0313029

.43614757

-

-

-

sigma_e

.25715142

.25715142

-

-

-

rho

.99866425

.74204622

-

-

-

corr(u_i, Xb)

5.CONCLUSION
The development of economies is possible trough achieving a better position of the
accepted criteria and indicators of development. Societies and countries can be categorized
among developed countries when they manage to realize the necessary conditions of
development. The variation among development factors and socio-economic levels of
countries has led to the establishment of categories of developed, under developed and
developing countries.
Development is a well-rounded process, thus because of its well rounded face the
difference of development processes in each country is dissimilar. Economic development
brings also structural change which is very important for every economy but in countries
where the development level is rather low, is almost compulsory. Because these countries can
bring solution to their poverty, unemployment, low level of living standard and
underdevelopment trough economic development. The diversification of socio-cultural
structure of underdeveloped countries affects positively the development. In these countries
culture has limited effect upon economic actions and brings a slow development process.
620

�In developed countries development is a necessity to prolong existent growth rate. In
these countries it is aimed to upgrade the living standards of people trough economic
development. In developing countries the first target of development which is the skewness of
the economy and inequality brings also poor level of living. In these countries the sociocultural development criteria are in low levels and the existence of a traditional cultural
approach hinders development.
According to the evaluations of social criteria of underdeveloped countries in this
essay, life expectations, the rise number of women at the parliament and the increase of life
percentages in metropole together with the decrease of dependence rate, affects positively the
development. These factors have shown that they are an important step towards development
level of the underdeveloped countries. It is arrived to conclusion that in undeveloped
countries the decrease of rural population and exports has positive effects upon development.
When we look to the suggestive variations of the social criteria model of developing
countries, we see that while the increase of life percentages in metropole increases
development, the increase of dependence rate has negative effects upon development.
According to economic criteria, the increase of the agricultural sector at GDP affects
negatively the development. The increase of per capita electric consumption is an important
indicator of development for the developing countries.
Therefore the increases in prosperity and positive economic activities are only possible
trough economic development. In conclusion via development policies is possible to create
more modern societies.
REFERENCE
Balgati, H. Badi, ‘’Forecasting With Panel Data’’, Journal of Forecasting, Wiley İnterScience,
January, 2008, s.155-156
Balgati, H. Badi, Econometric Analysis of Panel Data, Third Edition, John Wiley &amp; Sons Ltd,
England, 2005, s.7-99
Balgati, H. Badi; Bresson, Georges; Pirotte Alain, ‘’Joint LM Test for Homoskedasticity in a
One-Way Error Component Model’’, Syracuse University, Department of Economics and
Center for Policy Rearch, New York, October, 2005, s.4-6
Berber Metin, İktisadi Büyüme ve Kalkınma, 3. Baskı, Derya Kitabevi, Trabzon, 2006, s.2217
Boyacıoğlu, Ebru, ‘’Gelişmiş ve Gelişmekte Olan Ülkelerin Kalkınma Kriterleri Açısından
Karşılaştırılması ve Türkiye İçin Öneriler’’, Doktora Tezi, 2007, s.68
Cypher, James M., Dietz, James L., The Process of Economic Development, Published by
Routlegde, Oxon, 2009, s.147-148
Dinler, Zeynel, İktisada Giriş, Ekin Dağıtım, Bursa, 2009, s. 587
Dolun, Leyla; Atik, A.Hakan, ‘’Kalkınma Teorileri ve Modern Kalkınma Bankacılığı
Uygulamaları’’, Ekonomik ve Sosyal Araştırmalar Müdürlüğü, Ekim, 2006, Ankara, s.6-8
Dülgeroğlu Ercan, Kalkınma Ekonomisi, Uludağ Üniversitesi Basımevi, Bursa, 2000, s.42
Gasper, D., Developments Ethics: An Emergent Field?, eds: R. Prendergast &amp; F. Stewart, St.
Martin’s Press, 1994, New York.
621

�Ghatak, Subrata, İntroduction to Development Economics, New York, 2003, s. 113
Hsiao, Cheng, Analysis of Panel Data, Cambrıdge University Press, Second Edition, New
York, 2003(8-11-12-14-15-33).
Jain, T.R.; Ohri, V.K., Indian Economy, Issues in Economic Development &amp; Planning in
India and Sectoral Aspects of Indian Economy, V.K. Publication, New Delhi, 2007, s.2
Jain, T.R. ; Bajaj, Balbir Kaur; Gupta, Ashok; Sandhu, AS, Development Economics, Star
Offset, Delhi, 2007, s.160-161
Jain T.R., Malhotra Anil, Development Economics, V.K. Publication, New Delhi, 2009, s.167
Pazarlıoğlu, M.V., Kilen Gürler, Özlem, ‘’Telekominikasyon Yatırımları ve Ekonomik
Büyüme: Panel Veri Yaklaşımı’’, Finans Politik &amp; Ekonomik Yorumlar, Cilt:44, Sayı: 508,
2007, s.39
Powel, James L., Panel Data Models, Departmant of Econometrics University of California
workingnotes, Berkeley, 2010, s:1
İlkin, Akın, Kalkınma ve Sanayi Ekonomisi, İstanbul Üniversitesi Yayını, İstanbul, 1988,
s.13-221
Kızılgöl, Özlem; Üçdoğruk, Şenay, ‘’ 2002-2006 Yılları Arasında Türkiye’de Yaşam
Standartları ve Yoksulluğa İlişkin Mikro Ekonometrik Analizler’’ ,2009, s.6
Thomas, Clive Y., The Rise of the Authoritarian State in Peripheral Societies, Monthly
Review Press, New York, 1984, s.51-50
Tüylüoğlu, Şevket; Çeştepe, Hamza, Kalkınma Ekonomisi, ‘’Kalkınma Teorilerinin Temelleri
ve Gelişimi’’ Editörler: Sami Taban- Muhsin Kar, Ekin kitapevi, Bursa, 2004, s.44-45
Yaffee, A. Robert, ‘’A Primer of Panel Data Analysis’’, Social Sciences, Statistics &amp;
Mapping, Connet İnformation Tecnology at New York, September, 2003, s.1-2
Yavilioğlu Cengiz, ‘’Geri Kalmışlık Olgusu ve Ekonomistik Kalkınma Teorileri (Eleştirisel
Bir Yaklaşım)’’, C.Ü. İktisadi ve İdari Bilimler Dergisi, Cilt:3, Sayı:2, Sivas, 2002, s.7-60
http://www.diffen.com/difference/Economic_Development_vs_Economic_Growth
http://econ.worldbank.org/WBSITE/EXTERNAL/DATASTATISTICS/0,,contentMDK:2042
0458~isCURL:Y~pagePK:64133150~piPK:64133175~theSitePK:239419,00.html
(01.10.2010)
http://data.worldbank.org/indicator/SP.POP.GROW (27.09.2010)
http://data.worldbank.org/indicator/SL.AGR.EMPL.FE.ZS(27.09.2010)

622

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                <text>Finding the different ways of the improvement as a multidimensional process causes  different improvement ways in all countries in the world. The economic improvement that  cause a structural changing is very important in all economies all over the world and it is  necessary for the least developed countries at the same time. These countries have solved the  phenomena of poverty, unemployment, low life standards and unimproved. The  differentiation in the socio-cultural structures of the least developed and developing countries  effect the improvement in a positive way.  In the study, the socio-economic factors of improvement and a classification according  to the gross national product levels per person in the least developed and developing countries  have been done by taking the definition accepted by World Bank into consideration. There are  fifteen countries in the classification of the least developed and developing countries. The  data of thirty-three factors in the comparison of these countries have been obtained from the  data source of World Bank, OECD, EUROSTAT and UN (2000 – 2009). The Statistical and Casual Models in the kinds of econometric models have been  estimated with ‘’Panel Model Method’’. For choosing the suitable model, the test for  choosing model ‘’Hausman’’ has been used. As a result, the factors determined to the  improvement of the countries in a different improvement levels have been discussed and the  comments related to them have been made.</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

The Investigation On Sustainability Of Total Quality Management In Higher Education
Through Deming’s Pdca Cycle

Göktaş Pinar, Çetinceli Esra
Süleyman Demirel Üniversitesi
Isparta Meslek Yüksekokulu,Isparta Türkiye
E-mails: pinargoktas@sdu.edu.tr,esracetinceli@sdu.edu.tr

Abstract
Total Quality Management (TQM) is an approach that seeks to improve quality and
performance which will meet or exceed customer expectations. This can be achieved by
integrating all quality-related functions and processes throughout the organizations. Total
Quality Management (TQM) is an integrated organizational effort designed to improve
quality at every level. In a TQM effort, participation of all members of an organization is
very important about sustainability. The term sustainability has become popular in policyoriented research as an expression of what public policies ought to achieve. According to
Brundtland, sustainable development is development that meets the needs of the present
without compromising the needs of future generations to meet their own needs. Sustainability
management, the ability to direct the course of a company, community, organization, or
country in ways that restore and enhance all forms of capital (human, natural, manufactured,
and financial) to generate stakeholder value and contribute to the well-being of current and
future generations. TQM as a management system could be expanded to include components
of sustainability.
The methods for implementing this approach come from the teachings of such quality leaders
as Philip B. Crosby, W. Edwards Deming, Armand V. Feigenbaum, Kaoru Ishikawa and
Joseph M. Juran. For example W. Edwards Deming in the 1950's proposed that business
processes should be analyzed and measured to identify sources of variations that cause
products to deviate from customer requirements. Deming created a (rather oversimplified)
diagram to illustrate this continuous process, commonly known as the PDCA cycle for Plan,
Do, Check, Act.
In higher education, this study is aimed that offering sustainability of quality education
among the most important goals for university strives to achieve. Moreover the purpose of
this study is to increase the degree of quality awareness, practice, and appreciation of using
PDCA cycle in higher education. As a result, in this study it is mentioned about relationship
between sustainability of total quality management in higher education using by PDCA cycle
technique.

114

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Keywords: Total Quality Management, PDCA Cycle, Sustainability, Sustainability
Management, Higher Education

1.DEFINING OF QUALITY, TOTAL QUALITY MANAGEMENT, DEMING CYCLE
AND SUSTAINABILITY

The concept of "quality" has been contemplated throughout history and continues to be a
topic of intense interest today. Quality presently is addressed in numerous academic and trade
publications, by the media, and in training seminars; it is perhaps the most frequently
repeated man-tra among managers and executives in contemporary organizations. In a recent
survey, executives ranked the improvement of service and product quality as the most critical
challenge facing U.S. businesses (Zeithaml, V. A., Parasuraman, A., &amp; Berry, L. L. 1990.).
Quality has been described as "the single most important force leading to the economic
growth of companies in international markets"( Feigenbaum, A. V. 1982)
“TQM is a structured attempt to re-focus the organisation’s behaviour, planning and working
practices towards a culture which is employee driven, problem solving, stakeholder oriented,
values integrity, and open and fear free. Furthermore, the organisation’s business practices
are based on seeking continuous improvement, the devolution of decision making, the
removal of functional barriers, the eradication of sources of error, teamwork, honesty, and
fact-based decision making”(Ghobadian and Gallear, 1996)
TQM is a management system consisting of values, methodologies and tools aimed at
satisfying or preferably exceeding the needs and expectations of the customers with a reduced
amount of resources. (Bergman &amp; Klefsjö, 2003).
The founders of modern quality management and organization excellence - Crosby, Demings
and Juran among others - considered ethics, principles and respect for people as key
principles. For example, Crosby (1986) stated that: ‘‘the organizations will prosper only
when all employees feel the same way and when neither customers nor employees will be
hassled’’. Deming’s (1986) 14 points highlighted the ‘‘driving out of fear’’. He advocated an
organizational climate where dealings between managers, employees and customers were
conducted on an ethical basis. ( Crosby, P. (1986)

1.1.Deming Key Principles
1."Create constancy of purpose towards improvement". Replace short-term reaction with
long-term
planning.
2."Adopt the new philosophy". The implication is that management should actually adopt his
philosophy,
rather
than
merely
expect
the
workforce
to
do
so.
3."Cease dependence on inspection". If variation is reduced, there is no need to inspect
manufactured
items
for
defects,
because
there
won't
be
any.
4."Move towards a single supplier for any one item." Multiple suppliers mean variation
115

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

between
feedstocks.
5."Improve constantly and forever". Constantly strive to reduce variation.
6."Institute training on the job". If people are inadequately trained, they will not all work the
same
way,
and
this
will
introduce
variation.
7."Institute leadership". Deming makes a distinction between leadership and mere
supervision.
The
latter
is
quotaand
target-based.
8."Drive out fear". Deming sees management by fear as counter- productive in the long term,
because it prevents workers from acting in the organisation's best interests.
9."Break down barriers between departments". Another idea central to TQM is the concept of
the 'internal customer', that each department serves not the management, but the other
departments
that
use
its
outputs.
10."Eliminate slogans". Another central TQM idea is that it's not people who make most
mistakes - it's the process they are working within. Harassing the workforce without
improving
the
processes
they
use
is
counter-productive.
11."Eliminate management by objectives". Deming saw production targets as encouraging
the
delivery
of
poor-quality
goods.
12."Remove barriers to pride of workmanship". Many of the other problems outlined reduce
worker
satisfaction.
13."Institute
education
and
self-improvement".
14."The transformation is everyone's job".
The Deming Cycle
W. Edwards Deming in the 1950's proposed that business processes should be analyzed and
measured to identify sources of variations that cause products to deviate from customer
requirements. He recommended that business processes be placed in a continuous feedback
loop so that managers can identify and change the parts of the process that need
improvements. As a teacher, Deming created a (rather oversimplified) diagram to illustrate
this continuous process, commonly known as the PDCA cycle for Plan, Do, Check, Act:

PLAN: Design or revise business process components to improve results
DO: Implement the plan and measure its performance
CHECK: Assess the measurements and report the results to decision makers
ACT: Decide on changes needed to improve the process ( Tague, 2005)
Deming's PDCA cycle can be illustrated as follows:
Deming's focus was on industrial production processes, and the level of improvements he
sought were on the level of production. In the modern post-industrial company, these kinds of
improvements are still needed but the real performance drivers often occur on the level of
business strategy. Strategic deployment is another process, but it has relatively longer-term
variations because large companies cannot change as rapidly as small business units. Still,
strategic initiatives can and should be placed in a feedback loop, complete with
116

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

measurements and planning linked in a PDCA cycle. To illustrate the relationship of business
unit processes to strategic processes, we may construct two nested PDCA cycles:

Figure 1: PDCA Cycle
This 'wheel within a wheel' describes the relationship between strategic management and
business unit management in a large company. There are actually several separate business
units, of course, each with its own set of metrics, goals, targets and initiatives. But this figure
illustrates the idea that the business activities constitute the DO part of the overall strategic
effort. ( Tague, 2005)
1.2.Definition of Sustainability
According to Brundtland (1987): This is the most commonly quoted definition and it aims to
be more comprehensive than most: Sustainable development is development that meets the
needs of the present without compromising the needs of future generations to meet their own
needs.It contains within it two key concepts: The concepts of needs, in particular the essential
needs of the worlds poor, to which overriding priority should be given, and: The idea of
limitations imposed by the state of technology and social organization on the environments
ability to meet present and future needs.

2.SUSTAINABILITY OF TOTAL QUALITY MANAGEMENT IN HIGHER
EDUCATION
In this study at first, factors of quality in higher education are determined. These
factors are; students, lecturers, management, physical conditions, social life on campus,
career planning and shareholders. To improve quality in higher education, it can be used
PDCA cycle. In this context when PDCA cycle is analysed, the first stage is plan. In this
stage:
Plan: At first, quality improving team are created and then sub-quality improving
team are created. To improve each factors of quality in higher education, the following are
planned.




117

Students: incresasing the success, socialization and motivation
Lecturers: increasing job satisfaction and institutional commitment, supporting
(Project, study..)
Physical Conditions: tracking technology, improving quality life in campus, studies
for students with disabilities (on-campus transportation, row, lift...)

�3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo






Management: supporting projects and studies, increasing motivation of personnel and
students
Social Life on Campus: increasing sports activities and artistic works (theatre,
concert…) increasing the activity of club works.
Career Planning: raiseing awareness of students about career planning, leading to
students
Shareholders: the creation of public and private sector cooperation, meeting of
students and industry managers with career days, sectoral promotion, providing
internship opportunities.

When this study is applied, in the stage of “DO”; the above mentioned plans are carried out,
in the stage of “CHECK”; plans and actualized are compared, in the stage of “ACT” as a
result of comparison,the necessary arrangements will be made.

3.CONCLUSION
In this study, to improve quality in higher education, with Deming’s PDCA cycle, sustainable
total quality management in higher education is aimed. Deming’s PDCA cycle has four
stages. These are “Plan”, “Do”, “Check” and “Act”. When all phases occurs, their
sustainability will be provided by making the necessary changes in future periods. So,
students, lecturers, physical conditions, management, social life on campus, career planning
and shareholders such factors’ quality will be increased. In this context, university’s quality
standard will be increased and it will contribute to positive image of university. This study
which is fulfilled the stage of “Plan” (Deming’s PDCA cycle), in the future period will be
able to improve in terms of the other stages Deming’

REFERENCES
Bergman, B. &amp; Klefsjö, B. (2003), Quality From Customer Needs to Customer Satisfaction,
Second edition, Studentlitteratur, Lund.
Crosby, P. (1986), Quality Without Tears: The Art of Hassle Free Management, McGrawHill, NY.
Deming, W.E. (1986), Out of The Crisis, MIT Press, NY.
Ghobadian and Gallear, (1996). Ghobadian, A and Gallear, D. (1996) “Total Quality
Management in SMEs”, OMEGA -International Journal of Management Science, Vol. 24.
Feigenbaum, A. V. (1982) , Quality and Business Growth Today. Quality Progress.
Parasuraman, A., Berry, L.L. and Zeithaml, V.A. (1990), An Empirical Examination of
Relationships in an Extended Service Quality Model, Marketing Science Institute,
Cambridge, MA.
Tague, N.R. (2005), The Quality Toolbox, Second Edition

118

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                <text>Total Quality Management (TQM) is an approach that seeks to improve quality and  performance which will meet or exceed customer expectations. This can be achieved by  integrating all quality-related functions and processes throughout the organizations. Total  Quality Management (TQM) is an integrated organizational effort designed to improve  quality at every level. In a TQM effort, participation of all members of an organization is  very important about sustainability. The term sustainability has become popular in policyoriented  research as an expression of what public policies ought to achieve. According to  Brundtland, sustainable development is development that meets the needs of the present  without compromising the needs of future generations to meet their own needs. Sustainability  management, the ability to direct the course of a company, community, organization, or  country in ways that restore and enhance all forms of capital (human, natural, manufactured,  and financial) to generate stakeholder value and contribute to the well-being of current and  future generations. TQM as a management system could be expanded to include components  of sustainability.  The methods for implementing this approach come from the teachings of such quality leaders  as Philip B. Crosby, W. Edwards Deming, Armand V. Feigenbaum, Kaoru Ishikawa and  Joseph M. Juran. For example W. Edwards Deming in the 1950's proposed that business  processes should be analyzed and measured to identify sources of variations that cause  products to deviate from customer requirements. Deming created a (rather oversimplified)  diagram to illustrate this continuous process, commonly known as the PDCA cycle for Plan,  Do, Check, Act.  In higher education, this study is aimed that offering sustainability of quality education  among the most important goals for university strives to achieve. Moreover the purpose of  this study is to increase the degree of quality awareness, practice, and appreciation of using  PDCA cycle in higher education. As a result, in this study it is mentioned about relationship  between sustainability of total quality management in higher education using by PDCA cycle  technique.Keywords: Total Quality Management, PDCA Cycle, Sustainability, Sustainability  Management, Higher Education</text>
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                    <text>Importance Of Training Aimed At Production In Businesses:
Educational Studies Carried Out By The Turkish Private Sector
Gökhan Ofluoğlu1, Sibel Buzkan2, Sadık Kiliç1
1Zonguldak Karaelmas University
Faculty of Economics and Administrative Sciences
Department of Labor Economics and Industrial Relations
İncivez – Zonguldak
2Zonguldak Karaelmas University
Faculty of Economics and Administrative Sciences
Department of Business Administration
İncivez – Zonguldak
Emails: gofluoglu@yahoo.com, sibelbuzkan@yahoo.com, kilicsadik80@gmail.com

Abstract
There are basically three kinds of educational activities in the World and in Turkey. These
are formal/organized education, non-formal education, and informal education. In this age the
importance of informal education is increasing. This is due to the inadequacy of formal
education and its complementary, non-formal education, for the postfordist contexture of
production. In Turkey, businesses do not play a part in any of these three kinds of educational
activities. However, their active output are getting larger and larger from formal to informal
education. While there is an indirect participation of the businesses on this issue in formal and
non-formal education, in informal education there is direct participation. Actually, the core of
informal education constitutes the learnings experienced in the work place.
In this study, within the training aimed at production in the businesses, apprenticeship
workshops which are implemented within the frame of formal education and vocational
training which is the extension of formal education, as well as various educational activities
and informal education which are implemented within the formal education are discussed.
The necessity of informal education and its further connection to productivity is emphasized.
Keywords: Productivity, Formal Education, Non-Formal Education, Informal Education.
1.INTRODUCTION
There have been studies on the issue of the importance of education beyond measure. Most of
these studies emphasized the importance and necessity of education. Indeed, when education
is handled efficiently a lot of important development, including productivity follow. In this
study, educational activities in Turkey are argued. Not the full extent of the educational
547

�activities, but only the activities which the businesses participate in in the process of
education are dealt with. However, educational issues, as they pose an integrated lot, have
occasionally been excluded. In the study, it is assumed that there is a closer relation between
informal education and productivity and with a presupposition the relation between education
and productivity is often assumed to be positive.
Assessment and evaluation is one of the leading issues of economic requirements of our time.
Above all, assessment provides focusing and scrutinizing in case there is a problem. Various
productivity assessments are made. The assessment applied is shaped according to the goal
pursued and data provided. In this manner, classification related to productivity assessment
can be made according to its extent, its field of application, and according to the scientific
discipline. (Akçay, 2011:37-44). Productivity assessments according to their extent are
divided into two as follows: with a single factor and with multiple factors. In single factor
measurements, not only labor productivity but also capital productivity is assessed. In
productivity assessments with multiple factors, on the other hand, input is evaluated as a
whole. At this point, labor and capital are evaluated simultaneously and sometimes inputs
such as energy and supplies are also attached(OECD, 2001:12). Speaking of productivity, in
essence, we comprehend the input-output ratio.
Labour productivity analysis at macro level is calculated either as amount of productivity or
value of yield per laborer or work done per hour. Instead of productivity value, sometimes
wage level can be applied in productivity analysis. However, research has been done
indicating that sometimes the wage level and productivity level are not the same(Dearden,
Reed, Reenen, 2005:22). In Turkey, since 2005, apart from the first quarter of 2009, labour
productivity has displayed a steady increase (General Directorate For Productivity, 2012:1).
Table 1: Productivity Charts
Country/Disctrict
Name

Work Done Per Hour Annual Labour Productivity Rate of
GDP
Per
capita Increase
(USA=100)
2005 2006 2007 2008 2009 2010

Turkey

44,7

5

4.6

4.7

-0.9

-4.4

3.1

Germany

90,7

1.2

3.6

1.7

-0.1

-2.5

1.4

France

97,7

1.5

2.8

0.3

-1.7

-0.2

1.7

England

78,3

1.2

2.2

1.8

-0.5

-2.1

0.9

USA

100

1.5

0.8

1.2

0.7

2.1

3

OECD Total

75,3

1.5

1.7

1.6

-0.1

-0.3

2.2

G7 Countries

87,6

1.6

1.4

1.2

0.1

0.2

2.4

Source: (online), http://stats.oecd.org/Index.aspx?DatasetCode=LEVEL, and
(Online), http://stats.oecd.org/Index.aspx?DatasetCode=PDYGTH, 2012.
548

�In reference to Table 1, Turkey is considerably behind the other countries and regions with
regard to productivity of workforce per working hour while sharp increases and decreases are
perceived at productivity growth.
This calculation is favourable when we consider labour productivity as input-output ratio .
Yet, when we try to focus on reasons of increase and decrease of labour productivity we do
not have much data because there are a lot of elements effecting labour productivity.
Although some of these may be dependent on other factor productivities such as capital and
provisions they may also be independent of them. A business or an economy are each an
open system. Labour productivity both at macro economic level and management level are
effected by environmental factors extensively. Thereby, the fluctuation of labour productivity
takes form by the influence of intermediary factors. At that point it becomes difficult to
clarify labour productivity. Multi-factor productivity analyses are developed to overcome this
drawback. Moreover calculations are made to indicate which factor is higher (Triplett,
Bosworth, 2003:27). However, these are also far from taking environmental factors into
consideration. A lot of internal and external environmental factors such as the structure of
industrial relations, competition, the international openness of the market and Research and
Development activities effects productivity (Dawkins, Rogers, 1998:196).
“Micro economic reforms” implemented in Australia since 1980 are leading sample cases on
this issue. For, these reforms are an effective insidence of environmental factors.
Privatizations, repealing or reducing the protective taxes against international trade, labour
market deregulation, lifting the impediments in getting into the markets are some of these
reforms (Borland, 2012). It is argued that these reforms have positive effects on productivity
in many researches made in Australia (Mckenzie, 2005). The allegations in these researches
are also supported by ampirical data.
Consequently, there are tens of factors that affect labour productivity. Yet, there is such a fact
that uneducated society is unskilled at the same time. In this respect, the impact of education
on productivity, though it is not possible to prove empirically, has a positive effect.
Education in the World and in Turkey can basically be divided into three. These are formal,
non-formal and informal education. Formal education (with diploma); is the term given to the
kind of education classified traditionally as pre-school, primary education, secondary
education and higher education. Non-formal education (certificated) is qualified as the
supplementary of formal education and apprenticeship and vocational training in Turkey can
be evaluated in this context. As for informal education, it encompasses the education beyond
the two denoted education types above and rather related to educational activities performed
by private sector. These educational activities are set up to make up some shortcomings.
There is usually no diploma or certificate; even if there is a certificate it does not have much
formal value. The core of informal education constitute the kind of training, commonly,
denoted by the expression “uncertificated” which refers to on-the-job-training. Nonetheless,
educational activities arranged to supply with the interests and requirements of the workers of
a business are in the range of informal education (İSO, 2012). Besides, an educational
activity sometimes goes under more than one category. Particularly, non-formal and informal
education may be confused. Hence, certificate is awarded at some kinds of informal
education.
Human Capital Theory also seperates general (formal) and private (informal) education from
one another. Formal education is not an education studied solely for a particular employer or
work place or work. Throughout an individual’s life formal education has the quality of being
549

�used in various jobs. However, non-formal education comprises some special gains and in
general these gains cannot be transfered from one workplace to another(Viele, 2010:584).
Formal education which is agreeable with the Fordist production structure and its
complementary non-formal education cannot be satisfying enough for today’s markets. For,
postfordist production structure requires keeping the current workforce appropriate to the
volatile market conditions. Similarly, replacement of centralized planning by the market
oriented economic system emerged in 1980s corroborated this course. In this context, the
sample case presented by Lechener (1999:74) for East Germany is basically feasible to a large
extent for the other countries as well. That is; in place of formal and non-formal education
funded by state, informal education funding of which is undertaken by those who need the
education and private sector organization becomes widespread. There is a common belief that
there is a linear and positive connection between education and productivity. Moreover,
economists perceive the widespreading of education as the crucial element of economic
growth(Vinovskis, 1970:550). A lot of writers, such as Schultz, declare that productivity will
rise with the rise of the qualities of workforce(Arrow, 1962:172). As educational level
increases, possibility of easy adaptation to the changes that occur and structure that is more
suitable to technological developments is constituted. Hence it is a known fact that education
also generates a lot of positive externality(Nelson, Phels, 1965:75). The common belief that
relation between formal education and productivity is positive is one of the fundamental
hypothesis of Human Capital Theory.
Arrow considers the method of learning named “learning by doing”, substituted by the
concept of experience, important in many aspects. In view of Arrow, it is not possible not to
observe the importance of experimentation in the growth of productivity (1965:156). Romer
(1986:1002) articulated that, in long term growth, instead of falling marginal productivity of
the classical theory, rising marginal productivity should be debated on the issue of
“knowledge”. According to Romer, when a company’s or an individual’s knowledge
increases this situation cannot be restored by the company or the individual and the
knowledge spreads.
On the issue of decreasing productivities law, which creates indecision, asserting that laborcapital correlation can be positively sloped, there is emphasis on the importance of education,
knowledge and learning on the basis of approaches which weakens the basic assumptions of
the classical theory.
The internal development model elements consist of surge of knowledge, public expenditures
and impact of human capital, constitute the models that are developed as an alternative to
classical theory. In this respect, Kar and Ağır (2006) who examined the years between 1926 –
1994 reached the finding that spending on education increased growth. At another study
researched between the years 1969 – 2001, it is observed that the impact of human capital on
growth is more explicitly highlighed (Taban, Kar, 2006:175). In the same manner, yet in
another study researched between the years 1960 – 2004, it is observed that growth and
education influence one another mutually(Şimşek, Kadılar, 2010:115). Similar findings are
reached in the studies researched between 1950 - 2000(Serel, Masatçı, 2005) and between
1923 – 2005 (Özsoy, 2009). The impact of formal education on productivity is realized in an
adjournment. The return of today’s formal education investments are gained after quite a long
time. The situation on non-formal and informal education is a little different. In these
educational types, as there is the question of supplying certain necessities, the impact on
productivity is expected at a much earlier time. We must also take into consideration that
550

�education that is not befitting for the necessities, may lessen productivity instead of enhancing
it. In essence there are two kinds of education aimed at productivity: the first one is standard
(knowledge) and the second one is flexible (aimed at outcome). Today’s educational activities
tends rather towards the second one. Some of the causes of this are: structural changes such
as: privatization, deregulation, decentralization and authorization; for the companies
becoming more international; labour market becoming more flexible, quality and productivity
becoming a strategic instrument in engendering a new market; strategic management
becoming more valuable than hierarchical management; human resources and human skills
being conceived as the most important productivity factor gradually and others (Prokopenko,
North, 1997:A-3).
In education – productivity corrolation, without doubt, the gainings of education related to
work ( the informal education) emerges in a shorter time and it has more direct effect
(Dearden vd, 2005:23). But, the acquisition provided after any educational investment and its
impact on the productivity is quite difficult to assess. Moreover, assessing solely the
production encompasses crucial complications. Labour productivity, on the whole, denotes
output coinciding employment per hour. To find this output in service sector is even more
difficult(Bolino, 1981:5). Service industry is the sector which has the broadest area of the
present day. The business evaluations in this sector are more compelling and evaluation
outputs less precise.The difficulties endured at performance evaluation in this sector are also
valid at productivity evaluation. In this context, Lee’s categoric division between businesses
can be taken into account. Lee divides businesses into two as those that can be evaluated
definitely and those that cannot be evaluated definitely(1985:324). It is possible to make
precise and trustworthy evaluations with works that we can come to a conclusion and count
substantially. The second one is the works that we are trying to evaluate the transformation
process between input and output or means-end relations. The target is whether the
organization is progressing or not and whether it is effective and efficient or not for which the
process requires a variety of behaviours to reach the means-end. The expansion of the service
sector has increased the number of businesses the evaluation of which is difficult to make. In
a research it is found out that education given to industrial sector provided a rate of increase
of productivity more than the education given in services sectors(Maglen, Hopkins, Burke,
2001).
Undoubtedly, every country has some educational problems. However, when we compare
Turkey with countries such as Germany, France and England, we observe that the problems in
Turkey is at a larger dimension.
Table 2: Principal Indicators In Education

Name
Country

Educational
Participation
Expenditures As Of
Age
GDP Percentage
Range 18-24
of
In Education

Rate
of Number
of
Participation Of students
per
Age Range 25-64 teacher (2009)
In Education(Lifelong Learning)

Turkey

2,82 (2006)

26,4

2,5

21,1

England

5,40 (2008)

45,4

19,4

15,8

551

�Germany

4,55 (2008)

55,9

7,7

16,6

France

5,58 (2008)

55,3

5

14,6

Europe 15

4,97 (2008)

53,4

10,4

-

Source:
data
compiled
from
EUROstat
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/themes, 2012.

.

(Online)

In the context of both formal and non-formal education, it can be observed that with compare
to other European countries Turkey has quite unfavourable indicators. Particularly with
indicators related to participation to education and educational expenditures there is a distinct
difference. When the fact that the population of Turkey is comperatively young is considered,
the importance of these negative indicators are doubled.
Further additions can be made to Table 2. The rate of illiterate population, the rate of
schooling, ranged from preschool to higher education, financial troubles, crowded classes
despite excess supply of teaching staff applicants are some of them. To sum up, Turkey’s
educational problems are structural. EU membership is a favourable aim at overcoming these
problems. Whether full membership to EU is actualized or not it is essential for Turkey to
take measures on the issue of education(Gediklioğlu, 2005:70).
2. Participation To Educational Activities In Businesses
Turkish private sector administrations participate in educational activities within the frame of
some exceptional applications of formal education, the workplace applications of non-formal
education and informal education. Contribution to formal and non-formal education shows up
in indirect ways whereas informal education is a matter of direct contribution.
3. Formal Education
Businesses participate in formal educational activities in connection with apprenticeship
applications within the scope of vocational high schools and vocational colleges of higher
education. In this respect, it will be more precise to confine the subject matter to vocational
high schools and vocational colleges of higher education. However, not only apprenticeship
applications are taken into consideration about this issue, but also the common problems of
vocational education is dealth with. For, these issues are interlocking issues and their solution
requires an integrated point of view.
There are a lot of vocational highschools in service. These are basically divided into two;
vocational schools like : industrial vocational highschools, trade vocational high schools,
islamic vocational high schools, vocational schools for girls, vocational schools of justice and
vocational schools of health constitute the first division and the second division constitutes the
technical high schools. There is a relatively negative structure in question from the scope of
vocational education when compared to economically developed countries according to the
percentage of vocational and technical highschools in secondary education.
Table 3: The Percentage of Vocational and Technical Highschools Within Secondary
Education in Turkey

552

�199697
Percentage of Vocational %45,8
and
Technical
Highschools
Within
Secondary Education

199900

200203

200506

200809

200910

201011

%39,56 %32,59 %36,2

%40,7

%42,9

%44

Source : TÜİK, “Educational Statistics”, (Online), www.tuik.gov.tr, 2012.
As seen on Table 3, the percentage of vocational and technical highschools from 1996-1999
school years of 45,8% continuously decreased until school year 2002-03 reaching the bottom
line of 32,59 % . The percentages that are already behind a lot of western countries
diminished lesser and lesser, until it turned to rising trend from 2004 on, coming closer to the
level of 1996. During this process vocational schools have lost a lot of respectability in the
public eye. Without doubt, the changes on the coefficient applied at university entrance exams
is the main reason why this process is endured (Şahin, Fındık, 2008:79). The circumstances
gave rise to qualitative losses so much so that it overshadowed the quantitative losses that
arose in this respect. Vocational highschools, became the primary educational institutions
preferred by the students who fell below the level of avarage. Therefore, even if the
coefficient comes up to balance today, it will not be able to solve the problem automatically.
German Vocational Educational System could be an agreeable target to enhance the labour
productivity of vocational highschools because Germany holds one of the most successful
educational systems in the World. In this system named The Dual System, predominantly, the
age groups of 15 – 22 get education. 3 – 4 days a week is spent in workplace and 1-2 days a
week at school. Two-thirds (2/3) of the time spent at school is filled by vocational subjects
(BMBF, 2003:34). Those who graduate from this system may also carry on with the
university education. Approximately 2/3 of the age group is involved in The Dual System
(ibid:7). Companies contribute in financing directly, and completely set an example of good
corporatism. A large majority of students who graduate take place in working life, gaining the
status of being “skilled”.
German dual system virtually displays non-formal educational characteristic. But, majority of
vocational education -leaving apprenticeship education aside- materializes within the scope of
formal education. When German system is targeted, 49 we can easily affirm that we are far
behind this aim.
German dual system is also presented as a leading example model by The World Bank.
Hence, this model is even suggested for those countries which are specified as “developed” .
It is frequently disclosed that this model also provides a significant amount of cost advantage.
Herein, Bennell ve Segerstrom (1998:280)’s comments should be given heed. In their view,
German dual system depicts a unique characteristic. Between employers and their uppermost
organizations, workers and labour unions and the government an intrinsic corporatism is in
question and the roots of this characteristic is extended even to middle ages.
49 See Esin Özdemir, “The Role of German Vocational Education System and Inferences on
Vocational Education in Our Country and Chamber System” for further information on determining
the German system as an aim and why this system is determined, TOBB European Cooperation
Board, (online). www.tobb.org.tr 2012
553

�It is, in essence, absurd to determine corporatism as a target because corporatism (the
democratic corporatism) is a social structure that occurs spontaneously and is generally
related to culture. However, some of the technical characteristics of German dual system may
be determined as target. The application side of apprenticeship of formal education in Turkish
vocational educational system remains quite primitive with compare to the German dual
system. Training period, summer applications of vocational highschools of health the duration
is as long as it is determined in their programs and it is stipulated 300 hours in other
vocational highschools and between 30 work-days (240 hours) and 60 work-days in
vocational colleges in universities. (Vocational Education Regulations, art.59).
One can easily reach to the conclusion that on the whole the implementation applied as two
days of school and three days of workshop at workplace is important and necessary in the
evaluation with regard to productivity in the final year of vocational schools. Hence, by this
means the students have a chance to get to know the work environment. But with regard to the
length of time it can easily be suggested that it is not sufficient. At the same time, there is
grave distrust on the way this short period is put to use.
Principally, the best method of learning is learning by practice (Karcı, 2009:101). Turkey
must absolutely move vocational education to workplaces in steady paces. At workplace also,
it must definitely be operative and forceful. To attain this, both students’ and employers’
awareness must be raised. Broad responsibilities are conferred upon universities, chambers
of industry and commerce and local authorities on this issue.
The concerns of vocational education is not solely confined to secondary education. In higher
education (tertiary education) similar problems exist. It is a known fact that two years spent
in higher education is insufficient, besides, this period is spent with theoretical subjects.
Again if we take the implementations in Germany into consiredation, in Germany at higher
education institutions equivalent to vocational colleges that take 7 semesters, minimum 2
semesters of apprenticeship training is stipulated. Before training starts, minimum 12 weeks
workplace apprenticeship is stipulated as well. Besides, the students who succeed in
graduating are entitled a diploma as engineers (Karcı, 2009:104).
3.1. Non-formal Education
The non-formal education is constituted by Apprenticeship Training Centers (MEM),
Community Colleges (HEM) and other non-formal educational establishments in Turkey.
There are totally 392 MEM ( Apprenticeship Training Centers) in Turkey, nearly 300
thousand students take courses in these centers. There are three formal levels which are
respectively apprenticeship, journeymanship and workmanship as a result of which students
are granted a workmanship certificate and are allowed to open their own workplace. HEM, on
the other hand, arranges three kinds of courses. These are: reading and writing courses,
vocational technical courses and social cultural courses. Among these only vocational
technical courses are directly related to labour market. Yet, it is observed that even these
courses are generally aimed at people outside labour or employment (especially the
unemployed are considered). Hence within the body of HEM there are 3,4 million trainees
(Turkish Statistical Institute : TUİK, 2010:2). Within the category of other elements various
schools, centers and institutes exist. Advanced Technical Schools For Girls, Applied School
of Art and Craft For Girls, Applied Industrial Apprenticeship Schools, Adults Technical
Training Center, Adult Training Center of Hotel Management and Tourism, Open Education
Vocational – Technical School, Tourism Training Centers are some of them(Kenar, 2009).
554

�In view of Kenar (2009), the most important component of non-formal education is
apprenticeship training. Apprenticeship training is a part of vocational education. There nearly
300 thousand participants receiving apprenticeship education, the number of which
corresponds to 10 % of the total vocational education. The programs of apprenticeship
education that vary between 2 to 4 years is decided by the boards of “provincial employment
and vocational education”.
Educational activities done by İş-Kur, The Turkish Employment Organization is within the
range of non-formal education. By the establishment of unemployment insurance fund, at the
educational activities of the Turkish Employment Organization a huge amount of increase
occurred within active employment policies. Hence, in the body of labour training courses,
while there was 130 courses and 3868 participants, the amount rose up to 1888 courses and 32
206 participants in 2008 (İş-Kur :The Turkish Employment Organization, 2012). The number
of participants reached 224 thousand between January and November in 2011 (General
Management Of The Turkish Employment Organization, 2011). Specialized Vocational
Course Centers UMEM Skills’10 project and (apprenticeship) or on-the-job training covers
quite reformist practices and it is related to our subject more closely.
The project of Specialized Vocational Course Centers, consists of educational activities which
are set up to overcome the existing structural unemployment. However, as the activities
implemented lead to acquiring a more qualified workforce, it should be expected to effect
productivity. The project of Specialized Vocational Course Centers: UMEM commenced by
signing a protocol between TOBB (Turkish Union of Chamber and Commodity Exchanges,
Ministry of Labor And Social Security, Ministry of Education, TOBB (Turkish Union of
Chamber and Commodity Exchanges University of Economy and Technology and for the
time being it is spread to 81 provinces. In this sense, it displays a good public-private sector
cooperation. The components of the project is consist of strenghtening the foundation of
education, analysis of labour market requirements, matching/replacing implementation
(selection of course trainee, placing to apprenticeship and job replacement of the successful
participants) and the application of the newly envisaged courses. The target aimed as a
consequence of the project is to employ the course trainee in the particular workplace
(UMEM Skills’10 project, 2012). The number of course trainees within the context of
Specialized Vocational Course Centers Project rose up to 35 thousand between January –
November 2011. 20 TL pocket money is given to the course trainees daily.
Another reformist activity by İş-Kur, The Turkish Employment Organization is on-the-job
training (apprenticeship). In 2011 5209 participants practiced on this rather new
implementation of training, which is very few in number. However, by the objective set by
the Ministry Of Labour And Socail Security (MOLSS), deputy under secretary, it is aimed at
rising this amount to 400 thousand until 2015 (Tan, 2011:10). There is no doubt that in case
this figure is reached, a considerable amount of distance will be covered. Is-Kur provides the
participants’ financial support (20 TL daily) for on-the-job training which lasts 6 months.
Besides, in the context of “Operation to Promote Young Employment”, encouraging on-thejob training is planned, again, by the support of İş-Kur :The Turkish Employment
Organization (İş-Kur :The Turkish Employment Organization, 2011:92).
These are pivotal activities because we believe that on-the-job training is the kind of
education that has the biggest impact on productivity. This should not come to mean that
theoretical education should be totally disregarded. The necessity of certain basic theoretical
study is an undeniable reality. Thus, we should avoid making a generalization for all
occupational groups because in some occupational groups, intensive theoretical discussions
555

�are necessary. In this generalization rather the professions in the context of the occupational
education is emphasized.
3.2. Informal Education
The significance of informal education is increasingly better understood in Turkey,like in the
World. Informal education comes out with two of its aspects. The first one is a completely
informal education (i.e. uncertified), where there is no setup of any kind for education. All
sorts of knowledge and skills a worker in any workplace learns on his/her own is in this
coverage. The second one is not totally informal. In case of resolving the educational demand
of some or all of the workers of a business on any subject, the education acquired by means
of purchasing a service is also informal education. This is because in the end of the training,
on the whole, either a certificate that may not be transfered to another business is given or
else, no certificate of the sort is given at all.
For the informal education to have a positive effect on productivity, before all, this education
has to be productive, itself. The minimum terms for this kind of education to be productive
are as follows:
Need-base education analysis: An educational activity done when there is no need to do it
may cause the fall of productivity. what is targeted in analysis is to determine the absence of
any of the three characteristics of an employee. These are knowledge, skills, and attitute.
There is no need for education if there is no inadequacy with any of these characteristics.
Instructional design: In line with the specified necessities, first the present situation is
examined. At this point, the matter of circumstances concerning what to learn and by whom
and the learning medium and its limitations (such as time and money) are important. These
are called educational conditions. The present situation as well as other circumstances are
related to the motivation of the participants and the desired output. After these conditions are
assessed, a method of teaching is selected and practiced (Reigeluth, 1999:9).
The evaluation of the results: Undoubtedly the most complicated stage is this one. Business
managers and their co-workers wish to know the impact of the educational investment on
productivity. An investment has costs. These costs are consist of direct and indirect costs.
Educators’ pay, cost of organisation are direct costs. On the other hand, as the worker is away
from work for that period of time, this causes a loss of labour. Besides, an opportunity cost
also arises at this point. Managers make educational investment with the expectation that
these costs will be covered by means of a productivity increase. When faced with the
difficulty of calculating the productivity increase, with their intuition, they perceive whether
the cost is covered or is not covered. The way to bring this beyond a thought is to activate the
process which is known as chain of impact. After an educational investment the following
stages must be evaluated respectively (Philips, 1997:5-6):
Reaction: Whether the anticipation of participation to an educational program is met or not, is
a concern of the satisfaction gained from the program. The level of satisfaction is usually
assessed by a post educational survey. However, in the end of this survey whether new
knowledge or skill is acquired or not cannot be determined.
Learning: It is the study of the evaluation of what the participants gained by the end of the
program. The evaluation, although other methods are also used, is assessed by an examination
by the end of the program. Yet, the result achieved does not reveal any information about the
application of the acquired knowledge about on-the-job practice.
556

�Job applications: The skills learned must be practiced on the job. At this stage, it has to be
evaluated whether the acquired skill is applicable on the job or not by various methods.
Commonly, this is actualized in a few months period after the program. The outcome of this
stage, is a significant assessment that reveals the success of the program. Still, this also does
not give a clue whether the job application of the skills contributes to organizational success.
Business impact: At this stage, whether the organizational objectives are achieved or not is
scrutinized. For instance, customer satisfaction, quality, outputs and costs are some of those.
However, these also do not reveal information about the amount of the cost of the program.
Return on investment: This is the final stage of the assessment. In this, the financial profit is
tried to be calculated. That is, answer to the question: “ Does the program meet the costs?” is
searched. The other name for this assessment is cost-benefit analysis.
In the book that Philips wrote in 1994 there were only four levels (1994:7). In 1997, by the
addition of “business impact” the levels rose up to five. As it is summed up on Table 4, the
value of the knowledge acquired at the assessments increase by the rise of the level. Similarly,
the power of displaying the actual results and the difficulty of evaluation is growing. But the
rate of usage diminishes.
Table 4: Chain Of Impact
Chain of Impact Value
Knowledge
Level 1
Frequent

of Power
Exposing
Results

of Rate of Usage
The

The least Valueable

Difficulty
Evaluation

The least powerful

of

Too

Easy

(Reaction)
Level 2
(Learning)
Level 3
(Behavior)
Level 4
(Results)
Difficult

The Most Valuable

The Most Powerful

Very Rare

Source, 1994: 7)
Human Resources managers or experts assume significant responsibility in informal
education as the unit that determines the educational requirement of the employers are Human
Resources Managements. The duty of Human Resources management is to keep the staff in
the required number and the qualification available for the business. To this purpose
providing workers outside the workplace may be in question as well as the preparation of the
present workers to prospective positions by being trained. The latter is more recognized and a
more preferred alternative. In respect to this, education is one of the primary duties of the
human resources management.

557

�The in-house trainings that are implemented in businesses and educational activities that they
materialize by the method of purchasing services from private educational institutions play an
important role in informal education in Turkey. But besides this, it is known that they
contribute in the process with seminars, conferences and many other educational activities at
universities by the collaboration of universities and the industry. Apart from this, it is viewed
that institutions such as Small and Medium Industry Development Organization (KOSGEB)
also take part in informal education . Hence, KOSGEB (Small and Medium Industry
Development Organization) provides financial support for the firms that require education and
these educational activities are appraised within informal education.
Findings in the research named “Occupational Education In Enterprises Research Results”
made by The Turkish Statistical Institute (TUİK) in 2007 have significance from the
perspective of our subject. In this research, it is possible to get an idea about the rate of
informal education in Turkey. But there are no completely informal, that is, unplanned
educations here. Unplanned informal education is continuously effective anytime anywhere.
Table 5: Rate of Businesses That Provide Training For Their Employees Among All
Businesses, 2007
Case of Producing Occupational Kind Of Occupational Training
Training
Activity

The Size
Workplace
Group

The Rate of The Rate of The Rate of The Rate of
Enterprises
Enterprises
Enterprises
Enterprises
Providing
No Providing
Providing
Providing Other
Of Occupational
Occupational
Occupational
Forms
Of
Education
Education
Education
Occupational
Activities
Activities
Courses
Education

Total

68,0

32,0

17,1

23,7

10-49

70,6

29,4

14,7

21,7

50-249

59,7

40,3

23,7

30,0

250+

53,4

46,6

35,6

34,2

Source: TUİK (The Turkish Statistical Institute).
When Table 5 is studied, as the the size of workplace grows, it is seen that the rate of
providing occupational education increases. It is a known fact that The Human Resources
Management units in larger, more corporate firms are more effective. Yet, it is seen that,
including even half of those whose workplace is over 250 employees and 32% of the total
businesses organize educational activity.
Graph 1: The Rate of Enterprises Providing Occupational Education According to Course
Types,
2007

558

�Source: TUİK(The Turkish Statistical Institute).
The educational activities of (TUİK) The Turkish Statistical Institute are extended to two
divisions, as “courses” and “others”. Courses can be provided internally, organized by the
businesses as well as externally, by paying for the services. The other activities are on-the-job
guided training, rotation and exchange in offices, employment visits, quality and learning
circles, self-directed learning, participating in conferances, workshops, commercial fairs,
seminars etc. All these are typical examples of informal education.
On Graph 1, the provision of education according to course types and the size ofworkplace is
outlined. It is observed that in Turkey providing an external course is preferred rather than
the others. As the workplace gets larger, especially when the number of employees it holds
becomes more than 250, it is seen providing internal courses is preferred close to 70%.
By and large, the rates commonly indicate that informal education in Turkey is yet at the
phase of development. Without doubt, informal education compared to other education types
has a more effective potential for productivity. This potential has to be used as productively as
possible. Educational need analyses are held in informal education in Turkey.
Generally, educational activities are initiated according to the analyses results. It is gradually
understood better that when the issue of education, which brings out substantial costs for the
businesses that operate by the rules of market economy is governed effectively it has a
beneficial potential that exceeds the costs. By the information obtained from Chamber of
Industry In Istanbul50 , as to whether businesses provide the education in their own
organizations or get external education, educational need-base analyses are held. No
information has been received on educational planning. However, as an educational activity
cannot be implemented without planning, this has to be initially reconciled. That is, no matter
what kind of education is talked about at a certain rate a well-designed educational planning is
made.
The last stage of informal education is evaluation. In Turkey, just like in the world we are
confronted with the same chart (Table 4). In the end of the interview with Istanbul Chamber
of Industry, a finding of impact assessment after all of the types of education organized is
reached. After the impact assessment , the findings show that transition to learning level is
fifty percent less. It is concluded that the third level (job application) is rarely a matter and
no data are reached in the fifth level application.
50 Istanbul Chamber of Industry Expert Hakan Çoban is interviewed. We are obliged to extend our
thanks to Hakan Çoban, Expert and to İSO, the biggest chamber of Industry in Turkey for the
invaluable information given on informal education.
559

�In essence, it is natural that chain of impact process works in this manner. Hence, each stage
of chain of impact process, although carries on complementing one another, adds some cost.
In this respect, the calculation of the return of informal education is a concern of academics
rather that firms. To conclude, the calculation of investment return seems to remain as an
academic activity-area for some more time to come. By means of some research, it is proved
that this return is at quite a high level. (McLinden, Davis, Sheriff, 1994:140).
Life-long education in particular is a concept which covers formal, non-formal as well as
informal education within its scope. By concept, it is indicated that rather informal education
is emphasized. In accordance with the law no. 5544 issued in 2006, Vocational Qualification
Authority is established. The aim of this institution is to determine the fundamentals of
competence in national technical and vocational areas by taking national and international
occupational standarts as a base, and to establish and administer the national competence
system necessary to implement assessment and evaluation, and to inform and certify related
activities. The professions that require minimum bachelor’s degree are excluded by this law
(Law No.5544, article. 1).
One of the most important functions of Vocational Qualification Authority(Professional
Competency Board) is to award professional competence certificate. Definitions of all
existing professions, standards of duty, operation and success, competence related to the
instruments used, knowledge and skills requirements, manner and behavior requirements and
finally assessment and evaluation criteria are presented in detail. Although completing these
impressive studies in a short time is difficult, its progress is known to be rapid. Professional
competence certificate is awarded to the labourers who could achieve these standarts. All of
these are formed within the framework of national competency. The congruence of National
competencies to European Qualifications Framework (AYÇ) still continues. European
Qualifications Framework is made up of 8 stages and certification is awarded by these stages.
These certifications mean legalizing informal and non-formal education.
Via the life-long learning process, a rough calculation is made for an individual who goes
through all stages of formal education and is included in the nonformal education regularly
every year and is found that the time spent for formal and nonformal education remains 15%
and 85% of the time is spent in informal education (Borat, 2009:12). Endeavours for the
extention and legalization of this sort of education of no-cost to the public result in
noteworthy developments.
4. CONCLUSION
Although the interdependence of productivity-education is subject to debate, the impact of
education on productivity is an undeniable reality. In Turkey, formal education has multidimentional structural problems. Problems concerning vocational education constitute one of
the central problems of formal education. The rate of vocational education is comperatively
lower. Apprenticeship application is inadequate quantitavely and is undetermined
qualitatively.
Within the scope of non-formal education, apprenticeship education and a lot of certificate
awarding educational activities are conducted. Apprenticeship education is the most
effectively administered area of on-the-job training, which is the best way of learning. Yet, it
has been aimed at a comperatively restricted area and a comperatively restricted amount of
people. İş-Kur, The Turkish Employment Organization, increased its efficiency by using
560

�unemployment insurance fund, which produced significant outcomes for nonformal
education. The project of Specialized Vocational Course Centers, UMEM, and on-the-job
training practices are recognized as extremely successful projects.
Informal education in the World, as well as in Turkey, is widespread. As the effort to
overcome the shortages of knowledge, skills and attitude of employees in informal education
outweigh, it has to be emphasized that these kinds of education are more attached to
productivity. The establishment of Professional Competency Board (Vocational Qualification
Authority) and the acceptance of European Qualifications Framework is an important
development at the point where the knowledge and skills learned for informal education are
officially acknowledged.

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Comparison Study of Approaches to Measuring Poverty Implementing Fuzzy Set and
Classic Set Using The Household Data of Turkey
Alparslan Abdurrahman Basaran1,Murat Alper Basaran2
1Hacettepe University, Faculty of Economics and Administrative Sciences, Department of
Public Finance, 06800, Ankara, Turkey
2Akdeniz University, Faculty of Engineering, Management Engineering Department,
07425,Alanya, Turkey
E-mails: aab@hacettepe.edu.tr, muratalper@yahoo.com

Abstract
Poverty is one of the issues several industrialized and developing countries encounter in the
world. No country is exempt from this problem and its consequences. The top list item of the
agendas of both countries and international agencies is related to diminishing poverty. Before
taking action against it, countries and agencies need to measure poverty based on collected
data. It is a sophisticated issue having several dimensions. So far measuring it with available
data has resulted with indicators which show some deficiencies. When poverty is considered,
it is a linguistic term and has a vague concept as mentioned in the theory of fuzzy set.
Therefore, a new approach is proposed in the literature to examine it in order to overcome
those deficiencies mentioned when classic tools are employed. On the other hand, fuzzy set
theory is a mathematical tool used for linguistic calculations. For example, when said that
income level is low. Actually everybody knows what it means. But what it means changes
depending upon the perception of the person. Therefore, measuring low income is a
problematic area. Fuzzy set theory enables practitioners to calculate those linguistic terms. In
this study, the household data of Turkey of the year 2003 collected annually based on almost
25000 is used to calculate both classic poverty indicator(s) and fuzzy poverty indicator in
order to compare those measures. In the end we will show that fuzzy poverty indicator can be
comprehensive in some comparisons. Also, it provides more information in terms of
understanding the concept of poverty

564

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                <text>Importance Of Training Aimed At Production In Businesses:  Educational Studies Carried Out By The Turkish Private Sector</text>
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                <text>Gökhan , Ofluoğlu</text>
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                <text>There are basically three kinds of educational activities in the World and in Turkey. These  are formal/organized education, non-formal education, and informal education. In this age the  importance of informal education is increasing. This is due to the inadequacy of formal  education and its complementary, non-formal education, for the postfordist contexture of  production. In Turkey, businesses do not play a part in any of these three kinds of educational  activities. However, their active output are getting larger and larger from formal to informal  education. While there is an indirect participation of the businesses on this issue in formal and  non-formal education, in informal education there is direct participation. Actually, the core of  informal education constitutes the learnings experienced in the work place.  In this study, within the training aimed at production in the businesses, apprenticeship  workshops which are implemented within the frame of formal education and vocational  training which is the extension of formal education, as well as various educational activities  and informal education which are implemented within the formal education are discussed.  The necessity of informal education and its further connection to productivity is emphasized.  Keywords: Productivity, Formal Education, Non-Formal Education, Informal Education.</text>
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                    <text>3rd International Symposium on Sustainable Development, May 31 - June 01 2012, Sarajevo

Porter, M. E. (2009). The Competitive Advantage of Nations, States, and Regions, Harvard
Business School, Advanced Management Program.

OECD, (2007). Competitive Regional Clusters: National Policy Approaches,
(http://www.oecd.org/document/2/0,3746,en_2649_33735_38174082_1_1_1_1,00.html),
(22.04.2012).

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Council for research on international economic relations, New Delhi.

Vietor, R.H.K. (2006). Strategy, Structure, and Government in the Global Economy, Harvard
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World Economic Forum, The Global Competitiveness Report, (2009-2010).

World Economic Forum, The Global Competitiveness Report, (2010-2011).

World Economic Forum, The Global Competitiveness Report, (2011-2012).

Implementation Of Critical Path Method And Project Evaluation And Review
Technique

Ali Göksu, Selma Ćatović
International Burch University,Faculty of economics Management and information
technologies
Sarajevo, Bosnia and Herzegovina

Abstract
Because of the growing effects of the globalization in various business environments,
the manufacturing industry is expected to be effective and yet efficient. According to this, in
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planning, scheduling and controlling a project, which is a combination of various activities,
project management techniques (PERT and CPM) are used. Therefore, the research question
is How will the implementation of CPM and PERT influence the effectiveness and efficiency
of furniture company ''Dallas''? The answer to this question is relevant in oder to point out the
importance of those methods in reducing the project completion time and costs. The data are
taken from the furniture company ''Dallas'' and it will be combined with literature reviews.
The research study is fueled by the following objectives: First is to determine the activities
that are involved in the manufacturing proces in selected company. Second is to demonstrate
the benefits, as well as the drawbacks that those methods might create in the organization.
And third is to demonstrate the influence of CPM and PERT in the entire furniture industry
and its competitiveness. Implications of this research paper are evaluation of the project
completion time and control of the resources, in oder to see that the project is completed
within the planned time and cost by using mentioned methods. At the end of the study, the
result is expected to help all the individuals as well as the companies to understand more the
concept of CPM and PERT methods in reducing the project completion time and costs.

Keywords : CPM, PERT, Furniture Company, Optimization

1.INTRODUCTION
Planning, Scheduling (or organising) and Control are considered to be basic Managerial
functions, and CPM/PERT has been rightfully accorded due importance in the literature on
Operations Research and Quantitative Analysis. Far more than the technical benefits, it was
found that PERT/CPM provided a focus around which managers could brain-storm and put
their ideas together. Most important, it became a useful tool for evaluating the performance of
individuals and teams. The research study is fueled by the following objectives: First is to
determine the activities that are involved in the manufacturing proces in selected company.
Second is to demonstrate the benefits, as well as the drawbacks that those methods might
create in the organization. And third is to demonstrate the influence of CPM and PERT in the
entire furniture industry and its competitiveness. This paper comprises the possibility to
generate importance of CPM and PERT methods in reducing the project completion time and
costs in furniture industry. The study can gain advantages that are helpful in the continuous
progress of the investigation. One of those advantages is to cover the literature gaps
concerning the past studies related to the same subject. In addition, through the collection of
information, the study can emphasize the idea about the methods applied in production
process in furniture industry.

1.1.Previous Literature Review In This Field
Since the development of CPM and PERT during the 1950s, the techniques have been
the subject of hundreds of research papers, but little work has been done in the area of the
time-cost problem in furniture industry. Research has generally been focused on PERT, since
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the deterministic CPM presents few problems of interest. Feng, Liu, &amp; Burns, (2000)
presented a hybrid approach that combines simulation techniques with a genetic algorithm to
solve the time-cost trade-off problem under uncertainty. Lu and Li (2003) suggest that
redundant relationships be removed before the backward pass, but they do not provide a
procedure as to how to remove them. In response to some shortcomings of the CPM model,
Kuchta (2002) proposed a fuzzy method to measure the criticality of project activities and the
whole project. In another study, Jassbi (2008) proposed a fuzzy inference system to
determine activities’ criticality in deterministic networks. Mota (2009) presented a model for
supporting project managers to focus on the main tasks of a project. They used a multiple
criteria decision aid (MCDA) approach and considered several points of view in their study.

2.MATHEMATICAL PROGRAMMING
Mathematical Programming (MP) is the use of mathematical models, particularly
optimizing models, to assist in taking decisions. The term 'Programming' antedates computers
and means 'preparing a schedule of activities'. Mathematical Programming is more restrictive
in what it can represent than other techniques and it is very suitable for problems involving
blending, continuous flow processing, production and distribution, and strategic planning.

2.1.Critical Path Method
CPM is for projects that are made up of a number of individual "activities." If some of the
activities require other activities to finish before they can start, then the project becomes a
complex web of activities. Risk analysis modules can be used as an enhancement of CPM. In
such case, the assumption is that deterministic analysis can provide a solid basic schedule and
budget unless risk events interfere. Either way, potential risk events, their likelihoods, and
their anticipated effects are listed in a risk register.
Float (slack) - amount of time that a task can be delayed without causing a delay to:
subsequent tasks (free float)
project completion date (total float)

Critical path is the sequence of activities which add up to the longest overall duration. It
is the shortest time possible to complete the project. Any delay of an activity on the critical
path directly impacts the planned project completion date (there is no float on the critical
path). A project can have several, parallel, near critical paths. An additional parallel path
through the network with the total durations shorter than the critical path is called a subcritical or non-critical path.
Critical activity – activity with zero float .

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2.2.Project Evaluation and Review Technique

Program (Project) Evaluation and Review Technique (PERT) is a project management
tool used to schedule, organize, and coordinate tasks within a project. It is basically a method
to analyze the tasks involved in completing a given project, especially the time needed to
complete each task, and to identify the minimum time needed to complete the total project.
PERT assumes a beta probability distribution for the time estimates. For a beta distribution,
the expected time for each activity can be approximated using the following weighted
average:
Expected time = ( Optimistic + 4 x Most likely + Pessimistic ) / 6
This expected time may be displayed on the network diagram. To calculate the variance
for each activity completion time, if three standard deviation times were selected for the
optimistic and pessimistic times, then there are six standard deviations between them, so the
variance is given by: [ ( Pessimistic - Optimistic ) / 6 ]
The variance in the project completion time can be calculated by summing the variances
in the completion times of the activities in the critical path. Given this variance, one can
calculate the probability that the project will be completed by the certain date assuming a
normal probability distribution for the critical path.

3.FURNITURE INDUSTRY
The furniture industry is essentially an assembling industry, which employs various raw
materials to manufacture its products. They range from wood and wood based panels to
metals, plastics, textile, leather and glass. The European furniture sector comprises
around 150,000 companies, generates a turnover of almost €126 billion and an added value of
€38 billion and employs around 1.4 million people (EU27, 2006). From 2005 production
volumes increased slightly but in 2008 this positive trend was reversed and production
dropped again. Major factors of competitiveness for the sector consist of research and
innovation, skills and quality, design and added value, knowledge and know-how, together
with better access to third country markets.
3.1. Current trends in Bosnia

A major trend is taking a page from the past and giving it a fresh new look. Old
furnishings are looking new again, adding features and new tricks of the trade to give them an
updated look that is perfect for today's homes. After years of dulled hues and beige, walls are
coming alive with colors. Some are even adopting an extremely bright palette to rid their
home of the bland colors associated with bland economic times. Others are adding just a
splash of color to make a room really pop. Another current trend is adding décor that is
influenced by the music scene. Furniture is all about comfort, too. Look for large, overstuffed
pieces and ergonomic designs that welcome you to relax and recharge. Modular furniture is
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still popular, since it allows those on a budget to mix and match furnishings. This style is
especially popular in urban communities, which tend to also gravitate toward modern and
contemporary furniture, which by the way never seems to go out of style.

3.2.Manufacturing Process
Before start of manufacturing of any furniture product a desired design is selected.
Selection of elegant design is important to ensure attractive finished product. The seasoned
wood blocks are cut into desired shape and slices according to the requirement of design.
The slices of wood are molded into the desired shape according to the design. Carving means
different elegant pattern carved in the wood. Quality of carving depends on the skills of the
labor. Once the different pieces are carved &amp; molded than these parts/pieces are assembled
or fixed together to give the shape to the final product. Assembled product is grind to make
the surface smooth. Once the surface is smooth, finishing material is applied to make the
surface ready for paint or polish. After the base is prepared final finishing is applied
depending on requirement in term of paint/polish. Upholstery of fabric is carried out
according requirement of design.

4.IMPLEMENTATION OF CPM AND PERT (Example)

This paper describes the implementation of the traditional PERT/CPM algorithm for
finding the critical path in a project network. An example of manufacturing furniture with
various activities will be used. The completion time of each activity is not known with
certainty; only estimates are available. It is expected that final, quantitative results will point
out the importance of implementing those methods in planning, scheduling and controlling a
project in terms of providing effectiveness and efficiency of furniture company.

4.1.About the Dallas Company
Dallas is a family company with twenty years tradition in producing upholstery and with
more than 1000 employees. The company works in two countries, Serbia and Federation of
Bosnia and Herzegovina. In its rapid progression, the Company has developed its own retail
network with department-store chain in all bigger towns of Serbia, Bosnia and Hercegovina,
and Montenegro. Dallas strategy is to expand in European and overseas markets on long
terms, to win them with its quality, design and popular prices. The company management is
turned towards future, because Dallas is the name that inspires confidence and security,
whose business background is based on customers’ satisfaction. For more, visit
http://www.dalas.rs/ .

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4.2.Collecting and processing data
The applied method in the study is the processing of primary data as a result of direct
interview with an expert team in furniture company. In primary data collection, qualitative
and quantitative methods can be used, as primarily quantitative study may uses qualitative
results to help interpret or explain the quantitative findings. The key point here is that the
collected data are unique to this research and, until it is publish, no one else has access to it.
It is important to know in advance what questions to ask/areas to cover – they are ‘imposed’.
When all needed data are provided, then the steps of CPM and PERT can be followed.

4.3. Reasearch Question
The following is the basic question of research paper: How will the implementation of
CPM and PERT influence the effectiveness and efficiency of furniture company ''Dallas''?
If there is a single critical path, there is still only a 50% probability of the project being
completed by the target date, since mean activity times are used to calculate the completion
time of the project. If there are numerous possible critical paths the probability may be much
less than 50%. This may be costly if there are penalties for late completion of the project. The
complete distribution of project completion time needs to be considered when crashing. Since
there may be numerous possible critical paths, crashing a given activity by one time period
will not necessarily reduce the completion time of the project by one time period. The
expected reduction in project completion time must be considered in addition to the time/cost
slope when selecting an activity to be crashed.

4.4.Defining Problem
To answer to research question, six products from different product lines have been
selected. In order to define ‘critical path’, project duration and cumulative project costs for
all of this products, time and cost of all activities in production process need to be presented
in table. The obtained findings are expected to show that these techniques considerably
reduce the project completion time. All findings will be compared with previous data of the
company (project duration and cumulative project costs of selected products). This paper
will help to all managers in furniture industry to implement CPM and PERT to their projects,
and by doing that, they will improve effectivness and efficiency of their organizations.
Futhermore, it may challenge other researchers to fullfil gaps in literature reviews related to
this topic.

4.5.Study Restriction
PERT is a probabilistic tool used with three and its basically a tool for planning while
CPM is a deterministic tool and also allows and explicit estimate of and control of time.
PERT is more suitable for R&amp;D related while CPM is best suited for routine and those
projects where the project is performed for projects where time and cost estimates can the
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first time and the estimate of duration be accurately calculated. The probability factor is
major in PERT while in CPM the deterministic factor is more so values outcomes may not be
exact.

5.RESULT
CPM and PERT considerably reduce the project completion time in furniture comapany
Dallas. At the end of the study, the result is expected to help all the individuals as well as
the companies to understand more the concept of CPM and PERT methods in reducing the
project completion time and costs. Apparently, as it is expected the final, quantitative results
point out the importance of implementing those methods in planning, scheduling and
controlling a project in terms of providing effectiveness and efficiency of furniture company.
The same routine have been done on six selected products and obtained findings showed that
these techniques considerably reduce the project completion time. All findings are compared
with previous data of the company (project duration and cumulative project costs of selected
products). Because it confirms the hypothesis, this paper will help to all managers in
furniture industry to implement CPM and PERT to their projects, and by doing that, they will
improve effectivness and efficiency of their organizations.

6.CONCLUSION
One of the most challenging jobs that any manager in furniture companies can take on is
the management of a large-scale project that requires coordinating numerous activities
throughout the process of making the final product. A myriad of details must be considered in
planning how to coordinate all these activities, in developing a realistic schedule, and then in
monitoring the progress of the project. Fortunately, two closely related operations research
techniques, PERT (program evaluation and review technique) and CPM (critical path
method), are available to assist the project manager in carrying out these responsibilities.
These techniques make heavy use of networks to help plan and display the coordination of
all the activities. They also normally use a software package to deal with all the data needed
to develop schedule information and then to monitor the progress of the project. Project
management software, such as MS Project in your OR Courseware, now is widely available
for these purposes.

REFERENCES

[1] Dan Trietsch , Kenneth R. Baker, PERT 21: Fitting PERT/CPM for use in the 21st
century, International Journal of Project Management 30 (2012) 490–502, Available
online at www.sciencedirect.com
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[2]
Ghaleb Y. Abbasi, Adnan M. MukattashCrashing PERT networks using
mathematical programming, International Journal of Project Management 19 (2001)
181±188, Available online at www.sciencedirect.com

[3] Nasser Eddine Mouhoub, Abdelhamid Benhocine, Hocine Belouadah, A new
method for constructing a minimal PERT network, Applied Mathematical Modelling 35
(2011) 4575–4588, Available online at www.sciencedirect.com

[4] Pierpaolo Pontrandolfo, Project duration in stochastic networks by the PERT-path
technique, International Journal of Project Management 18 (2000) 215±222, Available
online at www.sciencedirect.com

[5] Rafael Herrer&amp;'as Pleguezuelo, Jos&amp;e Garc&amp;'a P&amp;erez, Salvador Cruz Rambaud, A
note on the reasonableness of PERT hypotheses, Operations Research Letters 31 (2003)
60 – 62, Available online at www.sciencedirect.com

[6] S.M.T. Fatemi Ghomi, E. Teimouri, Path critical index and activity critical index in
PERT networks, European Journal of Operational Research 141 (2002) 147–152,
Available online at www.sciencedirect.com

[7] U.,A., Bakshi and A.,V.,Bakshi, (2010) Network Analysis, Technical Publications,
Pune

[8]

http://www.eudoxus.com/lp-training/1-what-is-mathematical-programming

[9]

http://www.mindtools.com/critpath.html

[10] http://www.netmba.com/operations/project/pert/

[11] http://people.brunel.ac.uk/~mastjjb/jeb/or/netanal.html

[12] http://www.stanford.edu/class/cee320/CEE320B/CPM.pdf

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