Economics and managEmEnt

UNIVERSITY OF DEFENCE / CZECH REPUBLIC

Economics and Management

2013

UNIVERSITY OF DEFENCE / CZECH REPUBLIC

ECONOMICS AND MANAGEMENT

2013

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Economics and Management - p. 4 - 2013 Brno 31 December 2013 Published by University of Defence in Brno

ISSN 1802-3975

EDITORIAL BOARD

EDITOR IN CHIEF Pavel FOLTIN Faculty of Economics and Management, University of Defence, Brno Czech Republic

EDITORIAL BOARD Ladislav ANDRASIK Faculty of Electrical Engineering and Information Technology, Slovak University of Technology in Bratislava, Slovak Republic Ghita BARSAN “Nicolae Balcescu“ Land Forces Academy, Sibiu, Romania Vasile CARUTASU “Nicolae Balcescu“ Land Forces Academy, Sibiu, Romania Miroslav CEMPIREK Faculty of Economics and Management, University of Defence, Brno Czech Republic Marijana CINGULU Faculty of Economics & Business, University of Zagreb, Chorvatsko Petr CECH Institute of Hospitality Management, Prague, Czech Republic Monika GRASSEOVA Faculty of Economics and Management, University of Defence, Brno Czech Republic Frantisek HANZLIK Faculty of Economics and Management, University of Defence, Brno Czech Republic Hubert HRDLICKA Language Training Centre, University of Defence, Brno Czech Republic Josef KALAS Faculty of Economics and Management, University of Defence, Brno Czech Republic Ales KOMAR Faculty of Economics and Management, University of Defence, Brno Czech Republic Miroslav KRC Faculty of Economics and Management, University of Defence, Brno Czech Republic Oto KUBIK Academy STING – Private College, Brno, Czech Republic Marek KULCZYCKI The Tadeusz Kosciuszko Land Forces Military Academy, Poland Stefan KURINIA National Defence University, Warszaw, Poland

Ivan MALY Faculty of Economics and Administration, Masaryk University, Brno, Czech Republic Ivan MRAZ General Staff, Prague, Czech Republic Arpad POHL Faculty of Military Science and Officer´s Training, National University of Public Service, Budapest, Hungary Ladislav POTUZAK Faculty of Economics and Management, University of Defence, Brno Czech Republic Milan SOPOCI Armed Forces Academy of General Milan Rastislav Štefánik, Liptovský Mikuláš, Slovak Republic Oleg STANEK The University of Quebec at Rimouski, Canada Jiri URBANEK Faculty of Economics and Management, University of Defence, Brno Czech Republic Cezar VASILESCU Regional Department of Defense Resources Management Studies (DRESMARA), Brasov, Romania Jaroslav ZELENY Faculty of Economics and Management, University of Defence, Brno Czech Republic Iva ZIVELOVA Faculty of Business and Economics, Mendel University of Agriculture and Forestry in Brno, Czech Republic

EXECUTIVE EDITOR Vitezslav JAROS Faculty of Economics and Management, University of Defence, Brno Czech Republic

Copyright © 2013 All rights reserved. No part of this publication may be reproduced without the prior permission of University of Defence in Brno University Press.

CONTENTS Péter BÁNYÁSZ HOW THE SOCIAL MEDIA MAY BE USED TO PARALYSE THE CRITICAL INFRASTRUCTURE? …………………………………………….......................... p. 7 Romana BARTOŠÍKOVÁ, Kateřina PITROVÁ and Pavel TARABA APPLICATION OF PROJECT MANAGEMENT IN PUBLIC ADMINISTRATION ………………………………………...…………………… p. 15 Mohsen BRAHMI and Sonia ZOUARI CREDIBILITY APPROACH OF MONETARY POLICY AND RULES OF CONDUCT ……………..…………………………………………......................... p. 20 Attila HORVÁTH TERROR THREATS OF CRITICAL INFRASTRUCTURE OF FOOD SUPPLY CHAIN ………………………………………………………………...................... p. 31 Petr HRŮZA and Jan ENGLICH THE DEVELOPMENT OF METHODOLOGY FOR SELECTING AND PROCESSING THE TYPE HAZARDS AND PROCEDURES WITH FOCUS ON THEIR RELATIONS TO CRITICAL INFRASTRUCTURE ………................ p. 44 Jiří NEUBAUER COMPARISON OF STUDENTS’ ATTITUDE TO THE STUDY STATISTICS AT THE FACULTY OF ECONOMICS AND MANAGEMENT ………………..... p. 51 Jakub TROJAN, Tomáš JEŘÁBEK, Jan TRÁVNÍČEK and Eva LUKÁŠKOVÁ ANALYSIS OF THE RESULTS OF RESEARCH OF SOCIALLY RESPONSIBLE MANAGEMENT OF RESTAURANTS IN BRNO TO ACHIEVE SUSTAINABILITY AND ENVIRONMENTAL SECURITY …….................... p. 58 Cezar VASILESCU and Aura CODREANU EFFECTIVE STRATEGIC PLANNING IN MODERN INFORMATION AGE ORGANIZATIONS ……………………………………………………...……….. p. 67 Hana VLACHOVÁ PARTICULAR APPROACHES TO DISCRIMINATION IN LABOUR MARKET …………………………………………………………………………………..….. p. 74 The Authors´ Bibliographies: .................................................................................... p. 82 The Reviewers´ Bibliographies: ................................................................................ p. 84

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The language revision has not been made. The authors are responsible for the papers content.

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HOW THE SOCIAL MEDIA MAY BE USED TO PARALYSE THE CRITICAL INFRASTRUCTURE?1 Péter Bányász Abstract: The social media plays increasing role in our present life. I would like to demonstrate in this article how the new media platform may threaten critical infrastructure systems. I have identified three priorities in this regard; those are all parts of the same structure. The first priority area is open source intelligence. Social media is often used for this purpose. As my second point, I will assess the role of the individual responsibility. Finally, I would raise the attention to the importance of critical infrastructure vulnerability analyses with the involvement of IT experts. To bring “white hat hackers” for the favour with the topic of critical infrastructure protection I consider strong relevance in the promotion of the aims of the defence agencies such as the armed forces, security services, and law enforcement. In the same time highlight certain risks and also some opportunities social media concerns. I propose more public attention for promoting these intentions and, in general for the topic itself, that may lead to get more support from IT specialists, researchers and even from the wide spheres of the public. Keywords: critical infrastructure, social media, cyberspace, OSINT, social engineering 1. Introduction A new era began on 19 July 2012. Barack Obama, the President of the United States submitted the Cyber security Act to the Senate2 that clearly indicates that in our changed world the concept and the methods of warfare have been fundamentally transformed by information operations. This is an important date because it indicates that the increasing demand to give the appropriate answer to one of today's greatest challenges, cyber warfare, is now handled as a priority at the highest level. After all, cyberspace is inherently a kind of space where you cannot apply the kind of warfare that was common practice in the past few millenniums. This kind of development greatly facilitates asymmetric warfare, which can provide extra benefits to terrorists.3 Threats of cyber attacks are no novelty to the people working in the field of security and defence policy. However, the general public (whose ignorance, as we shall see, comes 1

This article was elaborated with the support of the Critical Infrastructure Research Project TÁMOP4.2.1.B-11/2/KMR/001 2 GROSSE, Grant: Obama Administration Supports New Cybersecurity Bill, PC World, 26. Jul, 2012. ISSN: 0737-8939 . See at http://www.pcworld.com/article/259906/obama_administration_supports_new_cybersecurity_bill.html, (Downloaded: 6 October 2012.) 3 Horváth, Attila: Terrorfenyegetettség, célpontok, nagyvárosok közlekedése, Nemzetvédelmi Egyetemi Közlemények. A Zrínyi Miklós Nemzetvédelmi Egyetem Tudományos Lapja. 10. évfolyam 3. (tematikus) szám. Budapest, 2006.

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in handy for the cybercriminals in many cases) and the decision makers do not have sufficient knowledge in this matter. Several studies have drawn attention to the shortcomings in handling the threats coming from cyberspace. These include the study of Attila Horvath from 2010 called „How to explain the necessity of the complex interpretation of critical infrastructure and the importance of its protection” and that of Csaba Krasznay and Laszlo Kovacs from 2010 called “Digital Mohacs – the scenario of a cyber attack against Hungary”. As the authors demonstrate there are currently a lot of shortcomings in these areas. Reflecting these documents, the present study aims to draw the attention of decision makers to the urgency of the development of our weak cyber protection skills. However, this requires a strategic concept applying to several areas: appropriate legislation; education should be extended to raise the user awareness of the citizens as well as to prepare the public for a possible crisis; close collaboration with research units. Failures and damages of critical infrastructure may result from circumstances independent of human activities, such as natural disasters, but also from intentional damage (terrorism4, military attack). We shall only cover this latter herein, more specifically computer attacks against the elements of a critical infrastructure, or more precisely a special area within the scope of cyber protection, namely the hazards generated by social media, the tools of which can be used for attacks against critical infrastructure. 2. Social Media Social media is „a group of Internet-based applications that build on the ideological and technological foundations of Web 2.0, and that allow the creation and exchange of usergenerated content”5 That said, social media tools are the ones used by the users for creating and sharing content, the platform of which is provided by a specific service provider. Such contents may be written, image, video and music formats. Social media tools are thus social networking, image and video sharing sites as well as blogs and micro-blogs. Today, the use of various devices has become so widespread that their role in military science cannot be underestimated. All the more so since some social media tools can be used for military promotion, crisis communication management, communication of the soldiers with their family members, the interpretation of military events to form public opinion6, but it is also great for open-source intelligence, or in extreme cases for influencing the internal political affairs7 of certain nations in our favour8 or for preparing attacks against critical infrastructure, which we are discussing. 4

Nowadays terrorist organisations use computers regularly for online communication, for propaganda and for preparing cyber attacks. As Attila Horváth pointed out „In the organisation of al-Qaeda we can find the most up to date organising principles, for their working they use all the tools and methods of modern communication in a wide range. Because of the international act and pursuit angainst the network and illegal activity, groups separated from each other, unfortunately can efficiently organise and accomplish acts of terror in separate parts of the world.” In. HORVÁTH, Attila: Az élelmiszerellátási lánc kritikus infrastruktúrái, terrorfenyegetésének jellemzői, Hadmérnök, 2009. 5 KAPLAN, Andreas- HAENLEIN, Michael, Users of the world, unite! The challenges and opportunities of Social Media, Business Horizons,2010. 6 See e.g. the shocking video which was made by the syrian rebels, it was uploaded to youtube, and preceded the electric media which took the recordings from the video sharing sites 7 See events of Arabic Spring 8 It might be not accidental that the Iran government/leadership decided to disconnect the country from the internet and develop an own network. Its last step was to prohibit Google services. (According to

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In the following we will examine how critical infrastructure may be paralyzed by the use of social media. There are four areas with relevance to our topic that I want to address: open-source intelligence, personal liability, building a positive perception of the army, one of the aims of which is the involvement of hackers in the protection of critical information infrastructure, and finally a brief note on the role of crisis communication and education. 3. Open Source Intelligence Open Source Intelligence refers to intelligence collected exclusively from publicly available sources and analysed thereafter. Such open sources include traditional and electronic media, the Internet, libraries, studies by experts etc. Since the information is freely available it is obviously no substitute for knowledge derived from classified information, but information obtained from these sources can help you navigate through classified information. Analysis of social media plays a significant role in providing internal security of the United States. FBI uses advanced software to analyse social media in real time and combine the obtained information with information from other sources9. The great advantage of OSINT is that it allows free and real-time access to information for everyone at a relatively low cost. The disadvantages are the large number of available data, and the inaccuracies or intentional misinformation contained in some materials. Let's take a closer look at what kind of data you can access by applying open-source intelligence to the elements of social media. First we will select our target, the seat and sites of which can be found on its official website. Whether this target is public utilities, public transport or other institution serving as critical infrastructure is irrelevant. Afterwards a number of free services are available enabling us to download a satellite image or even 3D map images of the site to be attacked. In many cases video sharing sites can also help attackers in exploring the target since a lot of videos made by amateurs are uploaded to these sites which may provide us with some missing information when searched for purposefully. However, it is important to point out another aspect as well. With a slightly larger than average aptitude for conspiracy, that may reasonably be expected from a group planning to attack critical infrastructure, these may easily be used for sharing information between individual members of the group without arousing any suspicion. Just think about it, by using a smartphone, allowing us to record HD-quality images, we can make important recordings in the vicinity of the target and then disguise them with a legend. After that it only takes a few minutes to upload them to a video-sharing site so that the insiders could watch and find what they need while visitors checking it accidentally shall find just another uninteresting video. Another source for open-source intelligence are the different social networking sites and mobile platforms, which we shall examine from the perspective of personal liability.

official account because of the mocking video of Mohamed), but the truth might be that they’re affraid of a similiar events like the Arabic Spring, In. DIAZ, Jesus: Iran Shuts Down Google, Will Completely Cut Citizens Off the Internet, In Gizmodo, 24. September, 2012., See at http://gizmodo.com/5945862/iranshuts-down-google-will-completely-cut-citizens-from-internet, (Downloaded: 25 September 2012). 9 WITECKA, Magdalena: Social media for National Security, 7th PhD Conference - New trends in National Security, University of Defence, Brno, 2012.

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4. The Individual Responsibility In general, a vast majority of users do not bother with the protection of their personal data or complying with the security guarantees required by the applied IT tools. This is exactly the kind of ignorance taken advantage of by cybercriminals. However, it might be a good idea to split the issue into two parts. Continuing the train of thought of the previous section, a lot of open-source intelligence may be gathered with the unconscious help of careless users10. Although in material terms the use of social media is free of charge in many cases, there is a huge price to pay for the quasi-free usage: we provide these firms with our personal information, our own social network, almost every little detail of our lives, and afterwards the collected information is sold to different companies for advertising purposes. A conference recently published on the Internet examines the statutory data collection of mobile service providers. The lecture of Malte Spitz called “Your phone company is watching” paints a gruesome picture11. Mobile and internet service providers are required by EU and national legislation to store the subscriber-related data such as the duration of conversations, the name of callers and called parties, the date, content and receiving party of text messages sent, the locations where the phone was used and the actual location of the owner for a minimum of six months up to two years. Malte Spitz has made a shocking video from the data stored by the service providers, mapping how often the phone was used and for what purposes, where the owner went and what means of transport he used etc.12. While service providers are required by law to collect these data, we provide access to our data for social media sites voluntarily. Take the example of Facebook that, in response to the European Data Protection complaints has temporarily turned off its facial recognition software in Europe until it can be redesigned to dispel these concerns13. The facial recognition software was introduced last summer by the social networking site. It is capable of automatically recognizing the users registered on the site on the uploaded photos. Today, an increasing amount of social media tools are moving to mobile platforms14. The practical use of smartphones and tablets is provided by different applications. Some applications, whether used on social networking sites, news sites, video sharing sites or maps require different authorizations. The most popular social networking tools require access to the following data, to mention the most important ones: contact details of all our partners, how often and for how long we communicate with these partners, reading our text messages and e-mails, our location using GPS. The vast majority of users have no idea that they actually provide access to these data. Mobile applications obviously carry other risks beyond the above listed security hazards. There may be viruses hidden 10

It was a sensation in 2009 when new chief’s wife of the British Secret Intelligence Service (a.k.a. MI6) posted unguardedly in her facebook profile their contacts and some moments of their private life. WALKER, Kirsty: Farce of the Facebook spy: MI6 chief faces probe after wife exposes their life on Net, In. Daily Mail, 6. June, 2009. ISSN: 0307-7578, See at http://www.dailymail.co.uk/news/article1197757/New-MI6-chief-faces-probe-wife-exposes-life-Facebook.html , (Downloaded: 28. September, 2012.) 11 SPITZ, Malte: Your phone company is watching, In. TED, June, 2012, See at http://www.ted.com/talks/lang/en/malte_spitz_your_phone_company_is_watching.html , (Downloaded: 25. September, 2012.) 12 Tell-all telephone, In. Zeit Online, ISSN: 0044-2070, See at http://www.zeit.de/datenschutz/maltespitz-data-retention, (Downloaded: 7. October, 2012.) 13 SENGUPTA, Somini - O’BRIEN, Kevin J.: Facebook Can ID Faces, but Using Them Grows Tricky, In. The New York Times, 21. September, 2012., ISSN: 0362-4331, See at http://www.nytimes.com/2012/09/22/technology/facebook-backs-down-on-face-recognition-ineurope.html?_r=0, (Downloaded: 22. September, 2012.) 14 Smart phones, tablets

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in popular applications enabling hackers to take control of the phone's camera and transfer the obtained information to the desired location15. The latest results of the Norton Cybercrime Report, one of the world’s largest researches on cybercrimes have recently been published by Symantec 16. The report published annually aims to provide a comprehensive picture of the impact of cybercrimes on consumers as well as the security requirements of the development and application of new technologies. For the 2012 survey more than 13,000 adults in 24 countries were interviewed. The conclusion is startling: every second 18 people fall victim of cybercrime that means one and a half million people per day internationally. When breaking down the financial loss to the individual level, the average direct financial loss per user resulting from online crime amounts to $197 which equals to the monthly food consumption of a typical Hungarian family of four. In the past 12 months 556 million adults fell victim of online crime worldwide, which is more than the entire population of the European Union. This figure means that 46 per cent of adults using the Internet fell victim of cybercriminals last year, similarly to the figures of 2011 (45 per cent). The study highlights the changing trend in cybercrime directed more and more against social networking sites and mobile applications: 15 per cent of the users of social networking sites reported that someone broke into their profiles and used the site on their behalf; one in ten users admits to have fallen for scams or false links spread on social networking sites; while 75 per cent are aware that cybercriminals have turned their attention toward social networks, less than half of them (44 per cent) use a security solution protecting them from the threats of social networking sites and only 49 per cent use the privacy settings to choose who they share the information with; almost one third of mobile phone users (31 per cent) received text messages from unknown numbers asking them to follow a link or dial an unknown number to access a voicemail message. Almost every attacked IT system is equipped with a complex protection preventing or significantly restraining access to information through computer intrusion. To bypass this, attackers have recourse to Social Engineering by means of which the desired information is accessed by gaining the users’ trust, fraud, or even violence and blackmail. By using the above tools we can easily gain the trust of users ignoring privacy considerations or use the obtained information against them. Another aspect of personal liability is the possibility of using social media tools to create zombie networks. Zombie machines are tools that take control of the computer through a malware without the user’s knowledge. In many cases the user does not detect anything because the infected software fulfils an otherwise useful function on the computer, but in the meantime such program elements are installed that may perform undesired operations. The length of this study does not permit me to go into more details on the technical background of cyber attacks so we will only attempt to briefly outline how IT devices can be switched into a zombie network by using social media tools. As mentioned above, the vast majority of users do not use anti-virus software and 15

Kémkedhet utánunk a kamerás telefon [Our own cell phone may spy on us], In. Index, 1. October, 2012., ISSN: 1585-3241, See at http://index.hu/tech/2012/10/01/kemkedhet_utanunk_a_kameras_telefon/, (Downloaded: 1. October, 2012.) 16 Symantec: Norton Cybercrime Report-2012, See at http://nowstatic.norton.com/now/en/pu/images/Promotions/2012/cybercrimeReport/2012_Norton_Cybercrime_Rep ort_Master_FINAL_050912.pdf , (Downloaded: 4. October, 2012.)

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neglects the importance of protecting IT devices. It is a general trend on social networking sites that various entertaining applications are used for fun. These applications often take advantage of the inauspiciousness, naivety or ignorance of people17, whereby in the “mildest” case access is requested or viruses are downloaded to the user's computer18. The threats of phishing and machines infected with viruses have been discussed previously so I will not cover them again. However, it is essential at this point to emphasize the importance of raising the user awareness of the citizens. The U.S. Army provides an excellent example thereof since they published a handbook19 on social media in February 2011 with several recommendations including those on the presentation of the required security settings20. This type of education is not merely intended to avoid the undesired - and in many cases illegal - use of personal data or to protect IT devices from being used for unconscious participation in the above mentioned scenarios. We think it is equally important to prepare the citizens for an eventual attack against or failure in critical infrastructure. 5. Marketing Now that we have discussed the threats and risks of social media, let's talk about the positive opportunities provided by this tool. In chapter “Protection Options” of the previously mentioned study “Digital Mohacs”21 the authors declare that it is essential for defence planning purposes to involve the hackers in the protection of critical infrastructure. However, this requires strategic thinking creating the possibility of building a positive perception of the army. This can be achieved by using the social media. Don’t forget that the famous Anonymous22 group was formed by the members of a forum called „4chan” which launched several attacks over the years in order to influence the internal decision making process of different nations and in many cases they did succeed. In order to reach these hackers a new strategy is required that includes 17

An excellent example the "what’s your indian name?" application, which was used by over 8000 users. Aftwerwards it turned out that application was developed by a jewelry shop, and they used all of the datas of the users for their ad campaigns, In. BERÉNYI, Konrád: Pukkadjatok meg, In. Onlinemarketing blog, 12. December, 2011., See at http://onlinemarketing.blog.hu/2011/12/11/pukkadjatok_meg, (Downloaded: 7. October, 2012. ) 18 In this case the hackers usually made fake news about the celebrities (e.g. see somebody drunked or naked) to exploit the credulousness, naivety, curiousity of the users to infect the computers by clicking on the link. 19 Online and social media division, Office of The Chief of Public Affairs: U.S. Army Social Media Handbook, 1500 Pentagon, Washington DC, January, 2011., See at http://fbmonitor.com/social_media_handbook.pdf, (Downloaded: 29. September, 2012.) 20 The risks of such an incident to be illustrated from 2007: New helicopters arrived to an Iraqi base, which were photographed and uploaded to the community sites by using mobile phones of the soldiers from the base. They did not expect that the mobile phone recorded the geolocational data that were fallen into hands of the insurgents, who destroyed 4 AH-64 Apache helicopters by indirect mortar fire. See in: MARTON, Péter.: Hírszerzési trükkök: iraki gerillák vs. Apache helikopterek [Intelligence tricks: Irqi guerillas vs Apach helicopters] In. Kprax blog, 16 March 2012 See at http://kprax.blog.hu/2012/03/16/hirszerzesi_trukkok_iraki_gerillak_vs_apache_helikopterek, (Downloaded: 28. September, 2012.). 21 The expression of „Digital Mohács” reflects to the historical event, the battle of Mohács (29 August 1526 A.D.) when Turks defeated the army of Louis II king of Hungary and Bohemia. At this moment not only the battle was lost, but the king and the country as well. KOVÁCS, László-KRASZNAY, Csaba: Digital Mohács, Nemzet és Biztonság, Budapest, 2010. 22 ANDERSON, Nate: Who Was That Masked Man? In. Foreign Policy, 31. January, 2012. ISSN: 00157228, See at http://www.foreignpolicy.com/articles/2012/01/31/who_was_that_masked_man, (Downloaded: 29. September, 2012.)

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the popularization of the army with the help of web 2.0 tools since these are the areas that offer a real chance of addressing hackers and “digital natives”23. 6. Crisis Communication Finally I would like to talk about the role of social media in crisis communication. Nowadays news are consumed primarily through social media, thus it is a perfect platform to broadcast information in an emergency situation besides the standard media. Its great advantage is that the information is displayed in real time. Remember when the Americans assassinated Osama Bin Laden in Pakistan: a nearby resident, without knowing what the actual event was, broadcasted it live on Twitter. The hazards and risks are known. Are we ready? References [1]

ANDERSON, Nate: Who Was That Masked Man? In. Foreign Policy, 31. January, 2012. ISSN: 0015-7228, See at http://www.foreignpolicy.com/articles/2012/01/31/who_was_that_masked_man. (Downloaded: 29. September, 2012). [2] BERÉNYI, Konrad: Pukkadjatok meg, In Onlinemarketing blog, 12. December, 2011. See at http://onlinemarketing.blog.hu/2011/12/11/pukkadjatok_meg. (Downloaded: 7. October, 2012). [3] DIAZ, Jesus: Iran Shuts Down Google, Will Completely Cut Citizens Off the Internet, In. Gizmodo, 24. September, 2012. See at http://gizmodo.com/5945862/iran-shuts-down-google-will-completely-cutcitizens-from-internet. (Downloaded: 25. September, 2012). [4] GROSSE, Grant: Obama Administration Supports New Cybersecurity Bill, In. PC World, 26. Jule, 2012. ISSN: 0737-8939, See at http://www.pcworld.com/article/259906/obama_administration_supports_new_cy bersecurity_bill.html. (Downloaded: 6. October, 2012). [5] HORVÁTH, Attila: Az élelmiszerellátási lánc kritikus infrastruktúrái, terrorfenyegetésének jellemzői, Hadmérnök, 2009. ISSN: 1788-1919, p.441. [6] HORVÁTH, Attila: How to explain the necessity of the complex interpretation of critical infrastructure and the importance of its protection, Hadmérnök, 2010. ISSN: 1788-1919. [7] HORVÁTH, Attila: Terrorfenyegetettség, célpontok, nagyvárosok közlekedése, Nemzetvédelmi Egyetemi Közlemények. A Zrínyi Miklós Nemzetvédelmi Egyetem Tudományos Lapja. 10. évfolyam 3. (tematikus) szám. Budapest, 2006. ISSN: 1417-7323, p.16. [8] KAPLAN, Andreas. HAENLEIN, Michael: Users of the world, unite! The challenges and opportunities of Social Media, Business Horizons, 2010. ISSN: 0007-6813. [9] Kémkedhet utánunk a kamerás telefon, [Our own cell phone may spy on us], In. Index, 1. October, 2012. ISSN: 1585-3241, See at: http://index.hu/tech/2012/10/01/kemkedhet_utanunk_a_kameras_telefon/. (Downloaded: 1. October, 2012.). [10] KOVÁCS, László, KRASZNAY, Csaba. Digital Mohacs – the scenario of a cyber attack against Hungary, Nemzet és Biztonság, 2010. ISSN: 1789-5286. 23

PRESNSKY, Marc: Digital Natives, Digital Immigrants, On the Horizon. MCB University Press, Vol. 9 Iss: 5, pp.1 – 6 No. 5, 2001.

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[11] KOVÁCS, László: Informatikai hadviselés kínai módra, Nemzet és Biztonság, 2009. szeptember ISSN: 1789-5286. [12] MARTON, Péter: Hírszerzési trükkök: iraki gerillák vs. Apache helikopterek, [Intelligence tricks: Irqi guerillas vs Apach helicopters]. In Kprax blog, 16. March, 2012. See at http://kprax.blog.hu/2012/03/16/hirszerzesi_trukkok_iraki_gerillak_vs_apache_ helikopterek. (Downloaded: 28. September, 2012) [13] Online and social media division, Office of The Chief of Public Affairs: U.S. Army Social Media Handbook, 1500 Pentagon, Washington DC, January, 2011. See at http://fbmonitor.com/social_media_handbook.pdf , (Downloaded: 29. September, 2012). [14] PRENSKY, Marc. Digital Natives, Digital Immigrants, On the Horizon. MCB University Press, Vol. 9 Iss: 5, pp.1 – 6 No. 5, October 2001. ISSN: 1074-8121 [15] RÁCZ, Lajos: Informatikai hadviselés nem csak kínai módra, Nemzet és Biztonság, 2010. február ISSN: 1789-5286. [16] SENGUPTA, Somini- O’BRIEN, Kevin J. Facebook Can ID Faces, but Using Them Grows Tricky, In. The New York Times, 21. September, 2012. ISSN: 03624331, See at http://www.nytimes.com/2012/09/22/technology/facebook-backsdown-on-face-recognition-in-europe.html?_r=0 , (Downloaded: 22. September, 2012.). [17] SPITZ, Malte: Your phone company is watching, In. TED, June, 2012. See at http://www.ted.com/talks/lang/en/malte_spitz_your_phone_company_is_watchin. html , (Downloaded: 25. September, 2012.). [18] Symantec: Norton Cybercrime Report-2012, See at http://nowstatic.norton.com/now/en/pu/images/Promotions/2012/cybercrimeReport/2012_N orton_Cybercrime_Report_Master_FINAL_050912.pdf. (Downloaded: 4. October, 2012.). [19] Tell-all telephone, In. Zeit Online, ISSN: 0044-2070, See at http://www.zeit.de/datenschutz/malte-spitz-data-retention. (Downloaded: 7. October, 2012.). [20] WALKER, Kirsty: Farce of the Facebook spy: MI6 chief faces probe after wife exposes their life on Net, In. Daily Mail, 6. June, 2009. ISSN: 0307-7578, See at http://www.dailymail.co.uk/news/article-1197757/New-MI6-chief-faces-probewife-exposes-life-Facebook.html. (Downloaded: 28. September, 2012.). [21] WITECKA, Magdalena: Social media for National Security, 7th PhD Conference - New trends in National Security, University of Defence, Brno, 2012. ISBN: 97880-7231-876-6.

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APPLICATION OF PROJECT MANAGEMENT IN PUBLIC ADMINISTRATION Romana Bartošíková, Kateřina Pitrová and Pavel Taraba Abstract: Public administration in the Czech Republic has undergone a great development in the last few years. As a result, more dynamic and turbulent environment for the private and public sectors is increasing pressure on the quality of services provided by public administration. The use of modern management tools in the public service is a way to respond to changes in the reform of public administration and ever new tasks and responsibilities which are delegated to municipalities and regions. In this paper, the authors focus on the use of project management in the public sector. Project management is one of the major trends in contemporary management. When applying methods of project management within business firms in the Czech Republic, the situation has changed in many ways during the last ten years. The principles of project management are no longer just the prerogative of multinational corporations, but still more widely applied in the Czech companies and even in the public sector and non-profit organizations.

Keywords: project management, public sector, project, methods, quality. 1. The role of the public sector Just as in the commercial sector organizations adapt to the changing demands of the market, public sector organizations, regions, cities and municipalities are also forced to adapt public services not only to legislative changes, but also changes in the perception of public services. The clients of public institutions, citizens and legal persons require fast, affordable and quality services. The situation in the private sector is even easier; there is at least one basic measure of success in business and thus the rate of profit. Public authorities, regions, cities and municipalities are obliged to work diligently on them to get to a certain level and to compare this level with those of other state agencies. The aim is that this level should be the same and uniform for all organizations. The purpose of the functioning of public sector organizations is particularly meeting the needs of others, rather than their own, and societal goals should overbalance economic objectives. These are mainly services that provide people with basic life and social needs such as health, safety, housing options, education, cultural and social activities, social services, information, mutual aid, etc. The public sector is represented by the public administration, which comprises a set of institutions with central or territorial jurisdiction. [1] The civil service is the backbone of a modern state, as well as banks are the backbone of our current economy. It is therefore necessary to coordinate effectively the modernization of the central government and it is essential to ensure the modernization of the central government professionally and organizationally in the future. New technologies and the development of the society must be faster and better reflected in the central administrative offices and state administration. An effective system of

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central government is a prerequisite for effective work of modern central administrative authorities and just such authorities can better serve citizens and government. [1] 2. Project management and its significance Kerzner [1] defines project management as the sum of activities consisting of planning, organizing, managing and controlling resources of the company with relatively shortterm objective that has been set for the implementation of specific goals and objectives. According to the most recognized world professional association of project managers Project Management Institute (PMI) [6] project management is the application of knowledge, skills, tools and technologies to activities so that they meet the requirements of the project. In order to meet the specific objectives of the project three bases of project management must be defined: time - the limit for planning the sequence of sub-project activities, availability of resources - are assigned to the project and will be continuously used and drawn, costs - are a manifestation of financial resource use in the time distribution. [9] In connection with the project objectives the notion of Triple Constraint of Project Management is often mentioned, which is the optimal balance of three requirements (results, time, resources) [3] and Rosenau [8] state that the Triple Constraint defines a project: its design specification, schedule and cost (money or hours worked on it) and that the key requirement that 'Triple Constraint' illustrates the need to achieve three separate goals simultaneously - not only one of them. Triple Constraint can be schematically shown as follows, which also emphasizes the interdependence of all three parameters (Fig. 1).

Figure1: Bases of Project Management [9]

According to the PMI [6] project is a temporary endeavour made to create a unique product, service or a certain result reconciling the three independent goals. It is obvious that the various projects are comparable in terms to the requirements of the design, schedule and cost specification. Depending on the complexity we divide projects: investment projects, non-investment projects, [5] mixed projects. In a public report there are major projects which are the subject of investment investment projects. The investment project is a set of technical and economic studies 16

used for the preparation, implementation, financing and efficient operation of the proposed investment. The construction investment project usually includes architectural and environmental studies as well. Non-investment projects are called as "soft" projects. These are projects of the organization, system, training, focusing on innovation, know-how, consultancy, etc. The processing is usually easier than for investment projects. [7] It should be noted that there are also mixed projects that include both investment and non-investment part. The project has the character of the process, it is developing at the time of its existence, and it can be found in various stages (initiation, planning, coordination, monitoring and closure), which are called lifecycle of the project. Notice that the utilization of resources (cost and staffing of project personnel) gradually increases to a plateau as the project transitions through its initial start-up, organizing and planning and execution of work and reduces dramatically as project deliverables get completed and the project eventually draws to a close. There are also changes in "resistance" against additional changes and sensitivity to risks of uncertainty during the project. [9] During the project many methods, techniques, tools and procedures are used. Some of them fit, after their adaptation, to almost any project, others have limited application in the project management. Those which can be used at almost any time include: Opportunity Study – an opportunity study precedes the project itself, which then serves as a tool to achieve its fulfilment. It must take into account the situation in the interior (the organization itself) and external environment (expected market developments, for example) of the organization undertaking the project. Feasibility Study / Analysis – presents a detailed analysis and evaluation of the various options of the project. Logical Framework Method – it is a method that can be used in every project phase. Using this method it is possible to introduce the project and all of its basic variables (purpose , goal , outputs, key activities , preconditions , risks) simply , clearly , concisely , but comprehensively, understandably to all stakeholders. Work Breakdown Structure Method (WBS) – represents the decomposition of the project or the distribution / division of the project into smaller parts. The aim of this method is to structure, hierarchise and rationalize the large number of project tasks (operations, activities) in a clear and understandable form. Earned Value Management Method (EVM) – this is a project management system that oversees compliance with deadlines in combination of pumping costs. [2] Use of the principles of project management not only in the public sector has many benefits but there are also some problematic aspects of project management. According to Svozilová benefits of project management can be defined in the following list: All activities included in the project are assigned with roles and responsibilities regardless of any changes of the implementation staff. Time and cost framework for implementation is clearly identified. Implementation project resources are allocated for the duration of the project, and then they are released to other projects or used which allows greater flexibility and efficiency in the use of these resources. Conditions for monitoring of the actual course versus timetable are created; in the course of implementation some variances from the plan can be defined, and direct corrective actions can be effectively pointed. Division of responsibilities for project management and escalation rules allows continuous control without excessive supervision by the customer / project sponsor. 17

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Management principles contribute to obtaining the consent of the meeting or exceeding the planned project objectives. System approach to management of the project generates a lot of information, preferably applicable to the implementation of other projects. [9]

3. Research use of project management in public administration in the Zlin region Because of the low costs associated with data collection, opportunities to reach all representatives of municipalities with extended powers and municipalities with authorized municipal office and also low time requirements, the chosen method of the survey was a questionnaire. This method, however, has some limitations. The main disadvantage can be regarded as relatively lower number of properly completed questionnaires, the extent to which a particular set of issues and potential survey respondents are substantial workload. The sample consisted of 25 respondents. They were approached by representatives of 13 municipalities with extended powers and 12 municipalities with authorized municipal office. The final number of the processed questionnaires was twelve, what represents the return of 48 %. The questionnaire included three open-ended questions where there was the level of use of project management methods in the organizations of the respondents. The data were collected during the months of July and August. The questionnaire was sent out by e-mail. The main objective of the questionnaire survey was to map the level of utilization of project management methods of the public sector in the Zlín Region. The first question survey focused on the discovery if councillors of municipalities with extended powers and municipalities with authorized municipal office in the Zlín region use methods of project management. The survey shows that only 42% of organizations in their activities use project management. First they started to use project management in 2003 and two municipalities on the use of project management methods have been currently preparing for the training: "Making the Community Development" organized by the Ministry for Regional Development (MMR) and the Regional Office of the Zlín Region (KÚZK) in September 2013. Thanks to the second question it was found in which areas the addressed respondents use methods of project management. The survey results confirmed the assumption of the authors that the methods of project management are primarily used for larger investment projects financed by the EU; there is a need to engage more sections of the municipality into the process, or external capacities. Methods of project management in the public sector are mainly used in investment projects, especially in these processes: definition of the project plan, project definition, process grant applications, project approval to implementation, vendor selection, project implementation, acceptance realization, drawing financial support, transfer to the management and use of, final evaluation of the project, service, complaints and correction, end of life phase of the project, project quality management, project change management, project risk management, project publicity, record keeping and archiving documentation, etc. Project management is used not only for investment projects where the external sources of subsidies are utilized, but also to address other complex issues (projects) that require the cooperation of staff from various departments and external entities respectively (e.g. preparation of the construction and operation of a senior citizens home or quality methods introduction). Respondents using project management methods agreed on the use of Opportunity Study, Feasibility Study / Analysis and Work Breakdown Structure Methods. Only in three cases it was stated that the organization uses the Logical Framework Method. The

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Logical Framework Method is used mainly for communication with stakeholders of the project. The survey also implies that respondents in large investment projects in addition to the necessary project documentation (project documents, itemized budget of tender documents, etc.) attach also when applying Environmental Impact Assessment - EIA. Promoters are demonstrating that their project has no negative impact on the environment. The final task of the survey was to identify the main advantages and the main shortcomings of project management in public sector organizations in the Zlín Region. The main benefit of project management in terms of public reports can be considered the adjustment of project management system, which is based on the project team and the responsibilities and competences of individuals. With a clear definition of individual responsibilities the separate work is done, however, all the team members are informed by the project manager on the progress of the project as a whole thanks to the regular deliberations. Sharing of information among project team members through a comprehensive information system contributes to the above mentioned advantage. The greatest deficiency in project management in public sector organizations in the Zlín region can be considered low interest in these methods, complications resulting from the incorporation of these methods into the management process within the existing organizational structure. We can conclude that in the field of project management the public sector organizations in the Zlín region still show many shortcomings (only 42% of respondents use these methods) and it is evident that it is necessary to pay attention to the development of project management. The use of project management methods is one of the ways to effectively administer and the public sector in the Czech Republic. References [1] [2] [3] [4] [5]

[6]

[7]

[8] [9]

BARTOŠÍKOVÁ, R. Quality improvement in Public sector through the CAF model. In: Public Management 2010. Warsaw: AON, 2010. BENDOVÁ, K. et. al. Základy projektového řízení. Olomouc: Univerzita Palackého v Olomouci, 2012. DOLEŽAL, J., MÁCHAL J. and LACKO, B. Projektový management podle IPMA. 2., aktualiz. a dopl. vyd. Praha: Grada, 2012. KERZNER, H. R. Project Management: A Systems Approach to Planning, Scheduling, and Controlling. Sixth edition. New York: Wiley, 1998. MALÁČ L, 2010. Projektový management. [online]. Praha: Regionální poradenská agentura [vid. 10. prosince 2013]. doi: http://www.forum2000.cz/files/2000023948b8df8cee5/Regionalni_poradenska_ agentura_projek.management.ppt. PROJECT MANAGEMENT INSTITUTE. A Guide to the Project Management Body of Knowledge: PMBOK(R) Guide. Fifth Edition. Newton Square: Project Management Institute, 2013. PROSPECTUS, 2011. Klíč k přípravě projektů. [online]. Praha: Stredočeský kraj [vid. 10. prosince 2013]. doi: http://www.krstredocesky.cz/NR/rdonlyres/241BE44E-BF61-43E6-BC9DAD76F2359955/0/Klic_tvorba_projektu.pdf. ROSENAU, M. D. Řízení projektů. Brno: Computer Press, 2003. SVOZILOVÁ, A. Projektový management. 2., aktualiz. a dopl. vyd. Praha: Grada, 2011. 19

CREDIBILITY APPROACH OF MONETARY POLICY AND RULES OF CONDUCT Mohsen Brahmi and Sonia Zouari Abstract: This paper has for essential vocation to lead a detailed, overview, on the various controversies of the approach of credibility of the monetary policy and its degree of the efficiency, as well as the diverse rules of conduct since the new classic economy to the recent works. To do it, we presented a chronology of literature in this theme, the rational anticipation of the approach of the new classic economy, towards the temporal incoherence Kydland and Prescott (1977), to activist rules of Taylor. Underline in particular the recent works following the extension Ball (1999) rule.

Keywords: controversies, credibility, monetary policy, rules. 1. Introduction To allow the realization of the economic and social objectives fixed by public authorities, the monetary authorities have to watch the supply of the economy in means of payment, by fighting the gene which would pull an expansion justified the volume of these means; in other words, the authorities have to define and apply "a monetary policy". We define generally the monetary policy as the action which uses the control of the offer of the currency by the central bank, as instrument of realization of general objectives of economic policy: the monetary policy is indeed only one of the instruments of the economic policy [1] as specifies it Patat, J. (1986). Accurately monetary policy is made by the example of actions to influence the economic mechanisms and achieve the objectives of economic policy. Economic policy in principle designed to optimally perform the elements of what is called the "magic square" maximum growth, full employment, price stability and balance of the balance of payments. However, with the development of capital markets and the increasing openness to the outside, the direct instruments have gradually disappeared especially in the eighties. For cons, the regulation of interest rates declined in most developed countries, that is to say that monetary policy in these countries has the interventions on the money market to drive interest rates in order major promote its reputation and credibility. Thus, the credibility of monetary policy is, therefore, a crucial issue in many models. Indeed, the term credibility [2] is the degree of confidence to the public that shows the determination and ability of the central bank to achieve the stated objectives. In a word, if actual inflation and expected inflation are identical, the overall economic situation is, by definition, better ... As he had said Johnson D. (1998). Besides, a highly credible monetary policy reduces the degree of uncertainty surrounding the objectives of the monetary policy. The central element of the frame of conduct of the monetary policy of a bank is its strategy of targeting of inflation the objective of which consists in maintaining the inflation in a target range which goes from 1 to 3 %. This strategy allows to measure clearly the credibility of the monetary 20

policy and to improve the pre-visibility of the inflation. To follow this strategy the central bank has to be independent from the government in the determination of its monetary policy because an independent bank has to explain openly and clearly the reasons of its decisions. This measure is essential to protect its credibility and assure the efficiency of its operations. If a central bank is not independent, it risks abandoning its first objective: the fight against the inflation and of loss also any credibility. Thus, for credibility and build reputation, the European Central Bank (BCE) has mobilized two sets of means, are the first and the second are structural and strategic behavior. In this context, many theories describe analyzes on "credibility" including: the work of Kydland and Prescott (1977), followed by the theory of Barro and Gordon (1983), Rogoff (1985) and the theory of Walsh (1995). In the context of this paper, we propose to define, first, the concept of credibility (§ 1) we based in particular on the work of Cukierman and Fisher. We also emphasize the difficulty to measure quantitatively the credibility relating for example the results of a study Khaber, Parisot and Mourier on the yield curve of interest. Then (§2), us shall try to present the various theories of the credibility of the monetary authorities (the theory of Kydland and Prescott [1977] pursued by Barro and Gordon [1983], Rogoff [1985], and the theory of Walsh [1995]). In (§3), we shall present the advantages regarding arbitration between flexibilities of the monetary policy insuring the stability of economic fluctuation and the credibility of the monetary policy anti-inflationary character within the world market. 2. The concept of credibility of the central banks The concept of central bank credibility is at once very simple and very complicated to understand. Indeed, it is based on intuitive notation of linking the actions of monetary authorities that provides the public for these actions. More public expectations are close to what is really the central bank, and it is credible. In reality, it was added to this basic definition, many economists who work refined the concept of "credibility" include: A work. Cukierman (1986), Fisher (1984) and some attempts have been made to the R. Khaber, C. Priscott and J. L. Mourier (2001). 2.1. The credibility according to Cukierman A. (1986) Cukierman (1986) defines how the broader concept of economic credibility "fiscal policy or monetary commonly used in the future is credible if, given the policy goals, it is in their best interests to announce policy when the time comes. It is not credible that the best course of action when the reaction is different from the action announced earlier this time" [3]. Other elements support this definition. In particular, since the notion of credibility is inextricably linked to the anticipation, the analysis of the reputation of the monetary authorities may be better founded. Cukierman explains that monetary results of unanticipated by the public occur frequently, what he calls "monetary surprises." Assuming that these surprises are sole responsibility of the authorities that trigger when they wish, the public will become aware from a time these constant changes. Simply put, this awareness may not be immediate but gradual. 2.2. The credibility according to S. Fisher (1984) Fisher [4] resumes this analysis by insisting on the fact that what is important in this type of approach; it is the speed with which the public fits his anticipations to the surprises "concocted" by the monetary authorities. The correlation established by Fisher is the following one: "the more the anticipations quickly fit and the less the costs of the deflation will be raised" .En effect, this conception is fundamental when the monetary policy is directed in a discretionary way because with the rules of conduct, the surprises 21

are more limited by definition. Also, implicitly this definition implies that the credibility is positively bound with the capacity of the authorities to be had the monetary control. It is so, the more it is precise and the more the surprises can be correctly measured; thus correctly interpreted by the public. 2.3. Other attempts on the concept credibility: R. Khaber, C. Parisot and J-L. Mourier (2001) It remains true that the concept of credibility is of order qualifier, it is very difficult to test empirically. Indeed, few attempts have been made, however, we can cite the example of Khaber, and C. Parisot, J. L.Mourier (2001) sought to assess the credibility through the slope of the yield curve of interest [5]. Differential rate long / short rates are understood as a measure of inflation expectations. Under these conditions, the volatility of this measure response slope (or sensitivity) expectations. Therefore the slope reacted strongly, more expectations change. However, if monetary policy is credible, economic agents do change their forecasts rarely hence the sensitivity is low. Limitations of the model are affected by the results obtained by these authors measured a higher volatility in the United States compared to the euro area yield curve, between 1999 and 2001, while at the same time, the credibility effective U.S. is much higher than European. In this perspective, D. Johnson (1998) stated that "the credibility of monetary policy is a crucial issue in many models. Indeed, the term credibility is the degree of confidence that the public's apparent determination and the ability of the central bank to achieve the objectives it has announced. In a word, if actual inflation and expected inflation are identical, the overall economic situation is, by definition, better. Credibility is therefore a notion immaterial and indescribable. Once the principle of credibility is defined, many theories describe analyzes on "credibility," as we shall see in the following section: the work of Kydland & Prescott (1977), which represent the first economic uses the notion of credibility which find their origin, followed by the theory of Barro and Gordon (1983), Rogoff (1985) and the theory of Walsh (1995). 3. Credibility of monetary policy: a review The first economic uses of the notion of "credibility" find their origin in the works of Kydland and Prescott (1977). In these canonical models, the confrontation enters on one hand the "inflationary way", which indicates the distance between the level of activity considered optimal by the authorities and the level "nature" corresponding to the balance of markets, and on the other hand the degree of aversion of these same authorities for the inflation decides on the inflation of balance rationally anticipated by the agents. So, these authors were able to define taxonomy of the possible balances and the associated levels of inflation [6]. By incorporating an objective of stability of the inflation into the function - objective of the government, we can conclude that the more the aversion for the inflation is strong, the more the effective inflation is low, and more the credibility is assured. The credibility here is jointed in the strong aversion for the inflation. 3.1. The works of Kydland and Prescott (1977): «Introduction of the concept of temporal incoherence» With the increasing instability of the world markets and the failure of the economic policies, certain number of economists put the known accent the role of the anticipations of the agents and their reactions to any decision of public authorities, by analyzing the monetary policy and the behavior of the agents thanks to the theory of games and the inflationary way of the discretionary politics. Indeed, the monetary 22

authorities which follow a discretionary regime can create more change and cause more inflation than the private agents anticipate it. So, this category of the private agents understands the intentions of the political decision-maker. And train on this base their anticipations. This is the work of Kydland and Prescott (1977) have examined by introducing the concept of "time inconsistency" and who are the primary economic uses of the notion of 'credibility' of the monetary authorities. The authorities, therefore, tend to deceive private agents regarding future inflation by implementing monetary policy different from that announced it is not credible, that is to say that there is a effect of "time inconsistency." In an article published in 1977, Kydland and Prescott come to define what is a temporally coherent policy "time consistent" time "t" as follows: "... at any point of time, the chosen policy is the best, given the current situation. Indeed, at time 't', if the policy maker takes a coherent decision that is to say according to the characteristics of current and past economics, this is referred to as optimal decision if and when credible performance of economy depend only on political decisions - past and present - not future decisions. In their article - Rules rather than discretion: the inconsistency of optimal plan Kydland and Prescott show that: "the selection of a decision which is better, given the common (current) situation and a correct of evaluation of the situation at the end of period does not allow the maximization of the function of social objective...". L' temporal incoherence of the policies optimal and defined as follows: a policy which is optimal at time t0 and follows a surprised inflation, is not it any more in next periods, considering the rational anticipations of the agents. For Kydland and Prescott, there is temporal incoherence or dynamic incoherence when a political decision to set in the future and to announce at the time of the formulation of an optimal said plan, does not seem any more optimal at the time of its realization, and it unless new information is happened. 3.2. The theory of Barro and Gordon (1983) Governments are encouraged to cheat on their intentions and seek to cause "inflation surprises". Indeed, these authors consider in their model [8] as a first step or two policies is non-cooperative game: a monetary policy defined by a standard that must be folded with the policymaker imperative and discretionary policy that the policy maker takes each time the decision that seems best. In a second step, the authors consider cheating policies where the policy maker is not completely transparent, it can cheat in this case, between economic agents and public decision-makers, the game is not done once and for all, but it repeats and the authors speak of reputational considerations. However, due to private agents perfectly informed, there is no gap between actual inflation and expected inflation: not paid cheated. And to achieve a balance, nothing is better than having built its reputation and the central bank is then able to achieve a lower inflation rate that eliminates the inflationary bias [9]. Their utility function is of the form:

Where (p: the rate of inflation effective.

the rate of inflation anticipated.)

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The central bank (BC) wishes a low inflation but also an excess of inflation with regard to that anticipated by the private sector where from of a function of utility 'U of the shape, Utility of the central bank: , Where

and b are positive constants.

The monetary authorities are incited to cheat to maximize their utility by announcing an anti-inflationary hard politics (policy), to act on the anticipations which they question to stimulate the activity: indeed, the inflation anticipated by the private agents is zero and the central bank maximizes its utility (Max: -a p² + b p) using unanticipated inflation. We put: p = (b/2a), as a consequence, the utilities will be respectively: Where,

.

& But the game repeats and the private agents eventually anticipate this behavior. Where from the anticipated inflation becomes: , What is going to cancel their loss of utility precedent but also reduces the utility of the public authorities . All in all, we find ourselves with an all right credible absence between both parts on no inflation. The interactions of the anticipations result in an inflationary bias and at the end on losses to be well with regard to a public credible not inflationist cancelling the losses of utility for all the agents . Besides, this inflationary bias is raised all the more as the economy is in recession or with a level of public debts raised. 3.3 The theory of Rogoff (1985) Rogoff proposes to choose a central banker, who has a strong aversion to inflation, a conservative central banker in which agents can trust, meaning that the term conservative adhere less inflation than others. In a simplified formulation Rogoff, the objective function that maximizes the central bank to set monetary policy can be written in the form (the form is taken from here Aubin (1995): ; Where This function is associated with a utility function of the public authority, representing the collective preferences, which can be written as follows with: . With parameter θ, positive, characterizes the preferences of the community. Θ is more strong and greater relative preference for full employment and low relative aversion to inflation. The analysis shows that Rogoff collective expected utility gain is associated with the choice of a parameter (α) is strictly positive and less than θ, . This correspond to the idea of conservatism of the central banker, that is to say one more attachment respectively for has the objective of price stability. In a simplified 24

formulation also a cooperative game between the public authority and the central bank can keep the same expression of the utility function of the public authority and assume, in view of the developments of the previous section, that the usefulness of the central bank UBC depends only on the objective of price stability. It would also:

The solution of cooperative balance would then be given by the maximization of:

With: So:

and

Obviously, the parameter ' α’ has some formulation in Rogoff can be interpreted as a combination of both institutions to define the monetary policy. All the question becomes then that of the choice of the level-headedness granted to each, that is the parameter ‘λ’ who measures the pressure exercised by the government on the bank in the orientation of the monetary policy. The analysis of Rogoff (1985) in term of optimal conservatism supplies a possible solution for this parameter. 3.3. The theory of Walsh (1995) Walsh (1995) uses the notion of incentive contracts. These should help to make credible in the eyes of society, monetary policy announcements made by the central banker. To do this, make sure it is in the interest of the latter not to go back on his word. One way to do this is to specify a fine proportional to the difference between the actual inflation rates is the target (anticipated). According to Walsh, just penalize the central banker, if inflation is higher than the target set by the government. This contractual mechanism is supposed to encourage the central bank to meet its objectives and to keep his word. Its implementation is however almost impossible: the uncertainty concerning the measure of the inflation, the mechanisms and the deadline of transmission of the monetary policy towards the inflation, as well as on the shocks being able to strike savings(economies) is such as we cannot claim to consider the central banker as solely responsible for distances in the objective. 3.4. The contribution of Johnson (1998): «tests of credibility of monetary policy» Johnson (1998) was able to formulate a study in which it is proposed to test the credibility of monetary policy in a sample of countries that have adopted inflation targets, due to assess its effectiveness in terms of the expectations of inflation. Thus, Johnson (1998) suggested the following definition: "the credibility of monetary policy is a crucial issue in many models. In a word, if actual inflation and expected inflation are identical, the overall economic situation is, by definition, better'. In each country, the forecaster is called ‘I’ provided a forecast of inflation for the current calendar year t and for the next year t+1. The inflation rate taken for target by the authorities of the country ‘C’ is .Johnson formulated a testing-model which serves to make out a will at to analyze the credibility of targets announced regarding inflation, under the following shape: (1) 25

Johnson formulated a testing-model which serves in Within the framework of this model, the equation (1) can be ré - expressed so: (2) To widen model, Johnson began by specifying that the effective inflation in countries ‘C’ during year‘t’, noted , deviates from the target according to the following formula: (3) The combination of the equations (1 and 3) gives: (4) The left-hand side of the equation being the error of forecast of the forecaster I for year t and the country C. 4. The worldwide market of the capital: adoption of a new monetary policy and arbitration between flexibility – credibility The analysis of the effectiveness of the monetary policy in the stabilization of the economy, studied for a long time by Barro and Gordon (1983), highlights a relation between the private agents and the monetary authorities. The monetary authorities direct anticipations of the agents by the announcement of a well defined policy. This orientation is all the more effective as the agents grant a confidence to the authorities and believe in the respect of the announced policy. Consequently, the effectiveness of the monetary policy is related on the convictions of the agents and thus to the credibility of the announced policy. Indeed, a credible monetary policy can solve the problem of temporal inconsistency. Faced with this situation, two solutions have been proposed: the first is to define rules that contingency can respond to macroeconomic imbalances, while the second gives freedom of action increasingly important central banks. These solutions highlight the context of arbitration between credibility and flexibility in monetary policy. 4.1. Criticisms addressed to the discretionary policies As the work of Kydland & Prescott (1977), Barro & Gordon (1983) already discussed above; since 1976, the contribution of Lucas (1976) showed that the indiscriminate use of these discretionary methods-traditional-like tool optimal monetary control in the presence of rational expectations, may lead to a high variability of production and intolerable damage and failure of monetary policy. Throughout its deliberations, R. Lucas demonstrates that these rules and discretionary passive do not consider the phenomenon - feedback - private actors that are designed to know in advance the political rules of the policy maker. The theoretical arguments did not miss. From the new classical economics whose current developed in the United States during the Seventies, prolonged put bends curve of Philips of it by showing that if anticipations of the monetary authorities of the future rates of inflations are rational, an expansionist monetary policy can have a positive effect on short-term inflation. Only the random not anticipated components of this policy affect the real economy. However, the concept of credibility of the monetary policy was the object of a debate within the new classics dice the Seventies. 26

Another criticism is aimed at policy discretionary monetary authorities are powerless to create a systematic deviation of the natural rate of unemployment and the actual price level relative to the level anticipated. Other work, more extensive in terms of credibility, analyzed in the section Kydland & Prescott of (1977), Barro & Gordon (1983) and K. Rogoff (1985), these theorists have widespread credibility analysis of R. Lucas, while showing that the practice of these discretionary policies by policy makers tend to have positive effects even optimal, even in the short term. So long term will counteract the economic situation and leading to massive bankruptcies due to the absence of a cooperative equilibrium between makers / private agents - that Kydland & Prescott (1977) have defined: time inconsistency - the choice of the parts in question. 4.2. The rules of monetary policy rules activists In order to determine the type of rule is most appropriate to guide the conduct of monetary policy, so we must have a criterion to evaluate its effectiveness [10]. However, the effectiveness of the policy is defined by reference to its credibility. 4.2.1. The original rule of Taylor The original Taylor rule was introduced by Taylor (1993). It is a research problem that aims to determine a rule "activist" monetary policy and its terms of inclusion in the decision making process of the Central Bank [11]. For some economists, it is presented as an alternative to discretionary actions of monetary authorities. It is not fixed to a standard monetary growth, but adjusted by reference to the evolution of the endogenous variables. Its simple formulation is a relationship that relates the rate of short-term interest controlled by the Central Bank, inflation and the "output gap". For the United States between 1987 and 1992, Taylor has the following rule: (1.1) Taylor notes that this “hypothetical” rule very simple rather accurately reproduces the evolution of the rate of the federal funds and supposes that the central bank reacts in a way equivalent away from the rate of inflation and the gap of the production. It allots to the parameters of reactions same value 0.5, although these coefficients could is differed in other countries. Definition of variables: : The interest rate of the federal fund manager quarter t’ r : The real interest rate average annual : The inflation rate for the year under quarter t’ : Inflation target or average inflation : The output gap, which is the difference between actual GDP and trend GDP. : The inflation gap, which represents the difference between actual inflation and the inflation target. Thus, according to this code of conduct, who’s objective to maintain the stability of the output and price level, the monetary authorities must adjust the level of short-term interest rate each time there is deviation of inflation and/or the output compared to their targeted levels. : Real GDP. Y*: The real or potential trend GDP whose growth rate is estimated in the United States with 2.2% a year, between (1984.1 and 1992.3). . Where : is -log- of potential GDP.

27

Based on these two economic variables in equation (1.1) can be written as follows:

So,

(1.2)

This equation translates the level of the target interest rate of short-term determined on the basis of inflation gap, the output and the interest rate of balance . 4.2.2. New alternative efficiency policy rules Goldman Sachs (1996), in its contribution “International The Economic Analyst”, while basing itself with the initial rule of Taylor (1993) showed that the introduction of an anticipation of inflation, thus leads to a bringing together of the behavior of the central banks which must consequently act with preventive measure [12]. Thus the rule of Taylor generalized can be rewritten as follows: (2.1) Where : The nominal interest rate, : The expected inflation rate and : inflation target. Determining the anticipated interest rate is difficult. But when setting its inflation target so it reduces the volatility of inflation and output and also tau current interest. Another change is the inclusion of the lagged interest rate as a determinant of current interest rates. This adjustment reflects the policy of smoothing interest rates. 4.2.2. The contribution of Levin, Wieliand and Williams (1999) While being based on the initial rule of Taylor, Levin, Wieliand and Williams (1999) added interest rate delayed to this initial rule. Thus, their objective is to improve the performance of this simple rule of Taylor by the deduction of the volatility of the production, inflation and interest rates [13]. The rule of Levin, Wieliand and Williams (1999) is formulated as follows: (2.2) Where, : the degree of smoothing and : the nominal interest rate. To: α = β = 0.5; Equation (1.4) becomes: (2.2) Thus, Levin, Wieliand and Williams (1999) noted that the rules which are not very sensitive to uncertainty, those which include the inflation gap compared to the rate concerned, the output gap and delayed interest rate. 4.2.2.3 Model Ball, L. The choice of the model representing the formation of inflation and the output gap is of major importance, since the model is simpler; the optimal monetary policy rule will be readable and easily communicated. It may be that it is better to leave some variables or delays from the moment they do not induce excessive reduction in the level of loss. For this, we used a much simpler model. This is the model of L. Ball (1997). This model 28

provides a Taylor rule type that best presents the advantage of being easily understood and communicated [14]. It is as follows:

Where,

;

;

;

is the output gap at a quarterly frequency, is the deviation of quarterly inflation expressed as an annualized percentage relative to its target is the real interest rate expressed as the difference between the average money market rate quarterly frequency and quarterly inflation. and white noises. Equation (1) describes the output gap as a function of the interest rate controlled by the monetary authorities in the past period and the output gap in the previous period. This equation corresponds to an IS curve. Equation (2) shows the formation of inflation in the current period as a result of inflation already made in the previous period, as well as the output gap recorded in the same period earlier. It is a Phillips curve. L. Ball (1999) proposes a model from which it recommends monetary policies having the form of the rule of Taylor and imposes restrictions on the coefficients of the output and the inflation of the rule making it possible to check the efficiency of this rule [15]. Thus, in open economy the rule of Taylor is reformulated by L. Ball (1999) and is consequently said: the rule of Ball (1999) which is given in the following form: (3) With : is the nominal exchange rate; : represents the nominal exchange rate and balance : the long-term inflation, defined by Ball, to eliminate the effects of temporary or transitory exchange rate changes. (f, g, h): the weighting coefficients respectively of the variability of inflation gap, the output gap and the exchange rate gap. 5. Conclusion The debate on the status and credibility of monetary authorities took a new dimension after the rational expectations revolution. To revive the economy, the monetary authority must choose targets consistent with its means of action to become credible. Indeed, the conduct of monetary policy is ensured only if its credibility. Therefore, a central bank has an incentive to increase its monetary credibility in guaranteeing the achievement of the inflation target becomes more consistent with that of production. Several monetary policy rules have been used and validated theoretically and empirically by some researchers, whose primary aim of maintaining inflation rates to the lowest level. In this context, the monetary authorities have implemented other policies such as the exchange rate regime and targets of monetary aggregates. Despite some positive results, these schemes are ineffective. Thus several authors, like Kydland & Prescott (1977), Gordon & Barro (1983) and other, underlined the inflationary bias of the discretionary policy of the monetary authorities since the dilemma inflation/unemployment constitutes a cost for the company, however their contributions consist in finding combinations optimal of this economic problem leading thereafter to an optimal solution which thus makes it possible to minimize these social costs which are already generated by these passive rules. Where a proposed use rules activists (who are most important in terms of efficiency and credibility) monetary policy that would prevent the monetary authorities to return on discretionary decisions announced. 29

References [1] [2]

[3] [4] [5]

[6]

[7] [8] [9] [10]

[11]

[12]

[13]

[14] [15]

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PATAT, J. P. 1986. Currency, financial institutions and monetary policy.Edition Economica, 1986, p 227. JOHNSON, D. 1988. On the credibility of Monetary Policy: International Evidence Based on Surveys of Expected Inflation’. In; Price Stability, Direct Inflation targeting & monetary policy. Conference make in bank of Canada on May 1997, Ottawa, Bank of Canada, p389. CURKIERMN, A. 1992. Central Bank Strategies, credibility and Independence: Theory and evidence’, Cambridge: MIT Press.pp.21-46. FISHER, S. 1984. Contracts, credibility and disinflation’, working paper n° 1339, NBER, April 1984. KHABER, R. PARISOT, C. and MOURIER, J. L.2001. The yield curve does measure the credibility of central banks? ', Economic Issues No. 27, September 2001, pp. 18-20. KYDLAND, F. E. and PRESCOTT, E. C. 1977. Rules rather than Discretion: the Inconsistency of Optimal plans’, Journal of Political Economy, vol.85, June, 473491. BARRO, R. J. and GORDON, D. B. 1983b. Rule, discretion and reputation in a model of monetary policy’, Journal of Monetary Economics, vol12, 107-121. BARRO, R. J. and GORDEN, D. B. 1983a. A positive theory of Monetary Policy in a Neutral Rate Model’, Journal of Political Economy, 91 (6), 586-610. AUBIN, C.1999. l’analyse positive de la politique monétaire, revue d’économie politique, 22-24. LEVIN, A., WIELAND, V. and WILLIAMS, J. 2003.The performance of forecast-based monetary policy rules under model uncertainly’, American Economic Review, Volt 93, n°3, June, 263-299. TAYLOR, J. B. 1999.The robustness and efficiency of monetary policy rules as guidelines for interest rate setting by European central bank‘. Journal of Monetary Economics, Volt 43, n°1, 655-679. TAYLOR, J. B.1993. Discretion versus Policy Rules in Practice, Carnegie Rochester Conference Series on Public Policy, n°39, 1993, North Holland, 195214. LEVIN, A. WIELIAND, V. and WILLIAMS, J.1999. Robustness of simple monetary policy rules under model uncertainty’. American Economic Review, Vol. 93 N°3 June, 263-299. BALL, L. 1997. Efficient Rules for Monetary Policy’, working paper n°5952 National Bureau of Economic Research. 123-151. BALL, L. 1999. Policy Rule for Open Economies. In monetary policy rules, Chicago, University of Chicago Press 1999, 125-156.

TERROR THREATS OF CRITICAL INFRASTRUCTURE OF FOOD SUPPLY CHAIN1 Attila Horváth Abstract: This article describes the terror threats to the food supply chain through the demonstration of the vulnerability of its critical infrastructure. From the terrorist point of view, the components of the food supply chain are easy to destroy. Fortunately the terrorist attacks against such targets are not very frequent in the so-called modern terrorism era. However, due to the vulnerability of the food and water supply the risk of such attacks should be considered very seriously. This paper touches on the areas relevant to the topic, such as the problems of the broader interpretation of security and the characteristics of terrorism.

Keywords: security, critical infrastructure, food supply chain, vulnerability, terrorism, terror threat. Motto: “For the life of me, I cannot understand why the terrorists have not attacked our food supply because it is so easy to do” Tommy Thompson 1. Introduction This paper describes the characteristics of the terror threat to one of the most important sub-systems of critical infrastructure: the food supply chain. Fortunately neither the global public opinion nor the food safety or security specialists have much experience regarding terrorist attacks against the different components of the food supply. Yet it would be a serious mistake to underestimate this risk, since terrorist attacks against agricultural production, the food industry, food distribution or drinking water supply could endanger the health and lives of several tens and hundreds of thousands of people. These days the security of the food supply is to be treated as a very complicated area. The problem has more aspects than simply the agricultural, medical, animal health and commercial ones. Considering its social, economic and political significance, the elaborately structured food supply chain with its many participants must be examined from a security point of view as well. The relevance of this topic is supported by the food scandals of the past decades, which also highlight the vulnerability and sensitivity of the food supply chain.

1

This artice was elaborated with the support of the Critical Infrastructure Research Project TÁMOP4.2.1.B-11/2/KMR/001.

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2. The importance of the broader interpretation of security In order to understand the importance of dealing with the reliability of the food supply chain, we have to start by addressing the broadened interpretation of security. First of all, we can emphasize the fact that securing continuous and normal operation becomes a determinate issue for more and more areas. The food supply chain is one of those areas. No wonder, since food and drinking water supply is a delicate area which has always been considered a security category, to some extent at least. In the past decades there have been fundamental changes in the interpretation of security. Originally the ultimate question of security standpoints and security policy opinions was, and actually still is, this: what falls under the concept of security? It can be thus a fundamental dilemma to decide what to classify under security policy issues. This may and should raise several questions. However, these questions are hard to answer. Scholars and politicians have been debating for decades in the scholarly literature on security policy what should, might or could be classified under the concept of security. The security policy interpretations created directly after the end of the second World War inevitably became entangled in the possibility of a war to be fought with mass destruction weapons and the bipolar world order. The competition that was formed between the two world systems due to their perceived antagonisms mainly took place on an ideological, social and military level. Looking back on this era it is hard to find a single area (including arts, culture, science and sports as well) which could remain unaffected by the spirit of the so-called Cold War. Luckily no open armed conflicts raised between the two leading superpowers (the USA and the Soviet Union) and the two biggest military alliances affiliated to them (the NATO and the Warsaw Pact, respectively). The horror of a nuclear war could fortunately be avoided by the Earth and mankind. Politicians, military leaders and scholars of a sound mind were aware even in the era of the bipolar world order that a total nuclear war simply could not be won. Even in the darkest period of the cold war, security experts could notice the issues threatening social, political and economic stability. However, the assessment of these security risks could not undermine the primacy of the classic interpretation of military security either in politics or in security studies. In Western democracies the opinions on security started to open up in the 1970’s (Walt 2006). There were serious debates between those arguing for opening and those believing in the classic military interpretation. There was a lively discourse going on between politicians, experts and scholars on what should be included in security studies (Buzan – Waever – Wilde, 2006). Analysing this discussion would require detailed epistemological explications, nevertheless we can ascertain that before the cold war was over security ceased to remain solely a military topic. After the end of the bipolar world order the “brave new world” anticipated by public opinion including intellectuals (mostly in Europe) would not arrive. Many threats that were manageable, degraded or even controlled in the bipolar world order era became a serious risk factor. This is also proved by the broadening of ethnical and religious conflicts in the Balkans in the 1990’s. Nowadays it is a generally accepted opinion by security experts that not every threat should be considered a security policy issue. There is an agreement that in order to classify as such, there should be an actual threat to life and the necessity of taking exceptional measures to manage the relevant risks (Buzan – Waever – Wilde, 2006). That criteria accepted, the interpretations of security in national and international scholarly literature are as nuanced as the interpretations of the concept of terrorism, which is considered one of the greatest threats of our days. There are significant differences in assessing the risk level of the different types of threats, even in countries having similar geopolitical weight. There are a lot of examples confirming this. The risk 32

of ethnical and religious conflicts is assessed differently in countries where such crises are improbable. The content of terror threat varies significantly in Afghanistan, Pakistan and the developed Western countries or Central Europe, which is considered a peaceful region in this respect. After the end of the bipolar world order in the 1990’s politicians, military leaders and security experts worldwide had to face threats like nuclear war (though showing a falling trend)2, the intensification of ethnical and religious conflicts, unresolved territorial disputes, international terrorism, organized crime, global disparities, mass migration, overpopulation, environmental pollution. The list of possible threats to international political, social and economic stability could be continued. There is enough material for several studies on security policy to discuss how and when the focus of evaluating threats shifted in the past decade and a half. The phenomena accompanying the development of the postmodern society are interesting for the philosophers as well. One of them was Jean Baudrillard, the famous French philosopher and sociologist deceased in 2007, who mentioned threats like natural disasters, global warming or scientific (such as gene maps, the moral aspects of genetic engineering) and technological (mostly in the field of telecommunications) discoveries (Horrock C.). The continuous and reliable operation of the food supply chain should absolutely be considered a security issue as well since in accordance with the above mentioned criteria it represents a massive threat to life, the minimization of which requires exceptional measures. For reasons to be described later on, the vulnerability of agricultural production, the food industry, the distribution and sales processes can be considered particularly high amongst different economic and social activities and networks. 3. The most important trends of terrorism nowadays The food supply chain cannot be examined without a brief overview of the most important trends of international terrorism. It is almost a commonplace to say that the goals of terrorists show significant variations depending on their ideological, religious or ethnical affiliation. There is one common thing though: in order to reach their goals, they would do whatever it takes. Nowadays terrorist groups add a catchy and often pathetic sound to their creed and advertise it broadly. Only those fanatic “fighters” are granted membership to a terrorist group who can absolutely identify themselves with the political goals declared by the leaders of the group and fully accept the tools of terrorism. When recruiting members, it is important that the prospective member should be willing to make the biggest personal sacrifice in the name of the “cause”. If a prospective member accepts the goals and organizational culture of the terrorist group, he is only one step away from committing a suicide attack, against which there are no real means of protection (Horvát,. 2007). The main goal of terrorist organizations is actually the undermining of the authority of the state and the legitimacy of the government by diminishing the sense of security. Their actions also aim to destabilize the existing regimes. They expect that the “success” of these often bloody terrorist attacks will prove how weak public institutions are and thereby causing massive public disappointment. When analysing the activities of terrorist organizations the intention of getting the government to limit human rights and the freedom of people becomes visible as well. In dictatorial countries the intention of terrorist groups may differ slightly by aiming to force the authorities to take more 2

The threat of nuclear war after the end of the bipolar world order did decrease, but at the same time there is an increasing threat that mass destruction weapons will fall in the hands of countries or terrorist groups representing a high level of security risk either in a certain region or globally.

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strict actions against dissidents. It is also the intention of terrorists to create an atmosphere where people cannot live in freedom and without fear, and where they cannot enjoy fundamental freedoms. From this point of view terrorism represents some major security challenges for countries and societies since the attacks involving deaths may undermine people’s trust in the political institutions. The history of terrorism has been sectioned many different ways by many people. David C. Rapoport dates the formation of modern terrorism back to the 1880’s. He divides the years that have passed since into four waves, namely: 1. „Anarchist wave”. 2. „Anticolonial wave” from the 1920’s until the second half of the 1960’s. 3. „New Left wave” from the 1960’s until 1979. 4. „Religious wave” since 1979 (Rapoport, 2006). Rapoport’s standpoint may be debated but truth remains that nowadays the extreme Islamic terrorism has intensified. Conclusions drawn from the past activities of such groups indicate that these terrorist organizations, unlike the former European extreme left organizations, do not simply wish to change the Western social system but to eradicate the entire Western culture and way of life (Rostoványi, 2002). Nevertheless we cannot put an equal sign between the Islam religion and terrorism, even if the extreme Islamic terrorist groups have undoubtedly become stronger in the past decade. Even back in the early 1990’s it was no exaggeration to say that due to the amplification of globalisation amongst others, terrorist groups have become international and their activities have broadened. The globalisation of terrorism did not end with joint trainings and providing training bases. The conclusions drawn from secret service reports and the analysis of security experts indicate that the cooperation between the different terrorist groups expands not only to logistical assistance and providing financial background but also to the preparation of certain attacks and to participation in the execution. After the end of the bipolar world order relationships have developed between international terrorism and the ever stronger international organized crime. One of the reasons it is considered dangerous is because terrorist organizations have new financial resources thereby at their disposal to finance their illegal activities. According to security experts it is not simply international terrorism that we talk about but rather a network of terrorist organizations. There are several smaller organizations within a big terrorist group which are either linked to each other or operate independently. In terms of organization, applied tools and methods it comes as no surprise that al-Kaida, this international terrorist organization which was led by Osama bin Laden until his death, is considered the most dangerous terrorist group. According to analysts al-Kaida is now “the network of terrorist networks”. (Wilkinson, 2005) AlKaida represents a serious threat in almost every Islamic country but unfortunately they have been able to prove several times that they represent a real threat to Western countries as well. The al-Kaida terrorist network is built up by using the most up-to-date organizing principles, and their operation is supported by every device and method of modern communications. (Horváth, 2006) Due to their illegality and the international haunt against the network the groups operate independently, isolated from each other, and sadly they are very effective in organizing and executing terrorist attacks worldwide. The group of targets of the terrorist attacks is continuously changing. It is almost a commonplace to say that he locations chosen as targets for the terrorist attacks are relatively easy to attack. The time and place is chosen so that the attacks could be “successful” at a relatively low risk. In the first era of the so-called modern terrorism (late 1960’s and early 1970’s) the terrorist groups chose relatively predictable “targets”, 34

such as politicians, soldiers, judges, prosecutors, businessmen and other public figures. Nowadays this trend is reversed and most of the targets of terrorism are victims chosen almost absolutely randomly. These terrorist attacks are located in public places, that is to say facilities or devices frequently visited or used by a mass of people. These include marketplaces, nightclubs, shopping malls, public institutions, public transport vehicles and passenger terminals. Terrorist groups undoubtedly concentrate on and aim to maximize the number of victims and to grab the attention of the media at any rate (Horváth, 2007). 4. Conclusions drawn from past terrorist attacks against food supply Based on the official statistical data, in the history of modern terrorism the terror threat regarding food and water supply is negligible. The transport systems, or even the shopping malls and nightclubs are more likely targets of terrorist actions. Based on our experience so far food supply is more likely to be affected by actions of a terrorist nature and other crimes. Yet it would be a serious mistake to underestimate this risk, since no thorough analysis is required to realize that terrorists apply newer and newer methods, even at places considered safe before. Based on the general characteristics of terrorism and the experiences of past terrorist attacks against the food supply chain it is evident that terrorist actions against the components of food and water supply represent a real threat for the future. At this point at least two terrorist attacks against the components of the food supply chain should be evaluated. One event took place in Western Europe but the actual target was the economy of Israel; the other happened in the United States. In January and February 1978, during the preparation period of the Egyptian-Israeli peace process, there was a serious attack against the export of Israeli citrus fruits. In a short period of time several oranges contaminated with mercury were found in the United Kingdom, the Netherlands, Belgium, the Federal Republic of Germany, France, Sweden and Denmark. Luckily enough the consumers did not have to face too serious consequences of the deliberate poisoning. In the Netherlands five people were taken ill resulting from eating these citruses. (Mohtadi – Murshid, 2006). Concurrently with the illnesses and the discovery of the toxic oranges a terrorist group calling themselves the Arab Revolutionary Army sent a letter to the government of 18 Western and Middle Eastern countries (including Romania and Yugoslavia) saying that they poisoned the oranges in the name of the Palestinians deprived of their rights. According to a statement issued later by the terrorist group another reason for the poisoning was to sabotage the Israeli economy (Sprinzak – Karmon, 2007). Despite the relatively small number of casualties the terrorist action fulfilled its goal since Western European importers lost trust in dealing with Israeli citrus fruits for several years. After the terrorist action the citrus export of Israel decreased dramatically and it took years to restore the trust of consumers. The contamination with mercury of the Israeli citrus fruits remains to be a controversial topic amongst experts. According to the Israeli authorities and analysts the oranges were shipped to the port of either Rotterdam or Antwerp. Official investigations concluded that the poisoning might have taken place in the ports as well. Others suggested that the fruits were poisoned in the distribution warehouses or in the shops. Dr. Paul Wix, a noted British expert of the time also excluded the possibility that the poisoning took place in Israel. Wix conducted examinations testifying that the fruits would have become rotten by the time the consignment arrived in Europe. The results of the various investigations suggested that if the oranges were contaminated in the European ports, distribution centres or shops the Palestinian terrorists needed help and supporters. 35

It raised the question of who could have supported this previously unheard of Palestinian terrorist group. Israeli secret services suggested the involvement of the socalled German Revolutionary Cell, an organization supporting the Palestinian case, but no clear evidence was found to confirm this allegation. This terrorist group raised suspicion because they placed an explosive device in front of the German office of the Israeli company Agrexco on 20 July 1978 (Sprinzak – Karmon, 2007). Be as it may, by contaminating the Israeli oranges the terrorists achieved a greater “success” than by the assassination attempt against the Israeli export company. When considering the longterm conclusions drawn from this case, the real question is not who was behind this terrorist action. This case draws more attention to the vulnerability of the food supply chain, which has intensified since then due to the effects of the globalised food trade. The other high-profile case took place in the United States in the city of Dalles (Oregon, Wasco county). A group led by Bhagwan Shree Rajnees of Indian origin, calling himself a religious guru, used salmonella bacteria to influence municipal elections (Mohtadi – Murshid, 2006). The poisoning resulted in no fatalities but 751 people were infected and 45 of them required medical treatment in a hospital (Carus 2001). The members of this religious sect used possibly the weakest subsystem of food supply, restaurant services, for the purposes of intentional contamination, that is to say they “delivered” salmonella to the consumers through the salad bars of the restaurants. Another interesting aspect of this case is the fact that the local public health authorities first excluded the possibility of deliberate contamination, and it was proved only a year later that this community used water contaminated with salmonella bacteria to water the salad plants they later delivered to eight different local restaurants. Due to the relatively small number of terrorist actions, in order to assure the security of the food supply chain it is not enough to simply draw conclusions from these terrorist attacks. We get a much more comprehensive picture if we analyse the events threatening food safety either deliberately or incidentally. Incidental events include for example the cases of food poisoning committed by negligence or inattention. There are almost daily reports in the international and the Hungarian press on deliberate and occasionally massive cases of food poisoning. These crimes are very dangerous to public health and they mainly serve business interest or revenge purposes (sabotage). The consequences of incidental and deliberate food poisoning are similar to the eventual effects of terrorist actions on public health and economy. Therefore by evaluating other threats to food safety useful insights can be gathered for the analysis of the terror threats regarding the food supply chain. The conclusions drawn from animal diseases and food poisoning cases were used for a good reason when determining the guidelines and tasks of the critical infrastructure for food and water supply. In the 1990’s, after the terrorist attacks against American interests, one tower of the WTC in New York and a federal building in Oklahoma City, the regulation of the protection of critical infrastructure became an urgent task in the USA. In this decade the United States suffered several terrorist attacks against its foreign interests with serious implications. The interactions of the so-called critical infrastructure and their dependence on the telecommunication system called for the implementation of a new, integrated security method. However, food and water supply were not mentioned as a separate protected critical infrastructure sub-system in the guidelines and presidential orders issued in the late 1990’s (Monke, 2007). At the end of the 1990’s the terror threat of the food supply chain was not considered high. The opinion of experts who wanted to include food safety in terrorist risks was not taken seriously (Chalk, 2003). It seemed to be an irrefutable argument against those who realized this threat that the number of terrorist attacks against food and water supply systems was “negligible”. In presidential 36

directive 63 on Critical Infrastructure Protection, issued on 22 May 1998 by President Clinton, food supply was not listed as a separate protection area. According to the presidential directive the determinative sectors of the critical infrastructure protection system are telecommunications, energy, logistics, transportation, public health services, justice and water systems (Moteff, 2011). After the terrorist attacks of 11 September 2001 in the USA the tasks related to the protection of critical infrastructure had to be reconsidered, since after the terrorist actions against the twin towers of the WTC and the Pentagon the government anticipated an eventual biological or chemical attack. In the presidential order issued by George Bush on 8 October 2001 food and water supply were included in the list of priority critical infrastructure sectors. This was later affirmed by the National Security Strategy issued in July 2002 (Moteff, 2011). The security of agriculture and the food industry has become one of the most important national security issues. In the meantime the European Union also defined the principles of critical infrastructure, with the protection of the food supply system ranked as a priority issue. Food supply and water supply, together or separately constitute an independent sector of critical infrastructure protection on the community level and the member state level as well. The protection of the critical infrastructure of the food supply chain in the USA and in the EU covers protection against disasters and infections as well besides protection against terrorism. 5. Characteristics of the vulnerability of the food supply chain Due to the relatively low number of terrorist attacks and their considerably lucky outcomes the risk level of terror threats against the food supply chain is not reflected properly. Some say that in the 21st century the biggest threat to public health will be terrorism (WHO. Report, 2008). You might debate the validity of this statement but its conclusions should not be questioned. The level and nature of the risk requires the assessment of the risks and eventual outcomes of terrorist attacks in every sector of the food and water supply. The terror threat to the food supply chain lies in its vulnerability. The vulnerability of the food supply chain in our days is perfectly characterized by the following quote: “For the life of me, I cannot understand why the terrorists have not attacked our food supply because it is so easy to do”. This shocking statement was made by Tommy Thompson, the Health and Human Services Secretary of the United States in December 2004 in an interview for the New York Times. This paper will not deal with the appropriateness of this statement from a political and security point of view. Nevertheless, the opinion of the Health and Human Services Secretary expresses how the components of the food supply chain constitute an easy target for terrorist groups. Probably the most dangerous method against food production, distribution and consumption is bioterrorism (Lakner, Kasza - Ózsvári, 2012). In order to evaluate the risk of terror threat, an overview of the basic characteristics of the food supply chain is required. In the modern business economy the conception of the supply chain is based on the cooperation of the participants of the production, distribution and sales processes, from the place of origin of the raw materials up to the end users. The seemingly simple system of the supply chain, composed of purchasing, production, distribution and sales is actually very complex with multiple stakeholders, and its processes are extremely hard to control (Bowersox, 2013) In certain areas the framework for the cooperation has been formed earlier, such as the concept of the supply chain, for example in military logistics (Báthy, 2008). The formation of the food supply chain is inherently based on the close cooperation of all the participants of food production, processing and trade. Practically the food supply 37

chain has been formed naturally during the past few centuries. The principles and methods of modern business economy obviously affect the agricultural sector, the food industry and trade as well. Therefore the supply chain concept is applied in this sector as well, making the area even more vulnerable. This is due to the fact that in the globalised system the networks of the food supply are very hard to control even for the experts in agricultural economics. What does networking and globalisation mean in terms of the vulnerability of and the terror threat to the food supply chain? This is perfectly illustrated by the fact that it is practically impossible to narrow the problem down to its Hungarian aspects since due to the phenomenon of the previously mentioned networking, the processes of agricultural production, food processing and trade are separated in time and place as well. On one hand it means that a terrorist action taking place far away from us might have some repercussions in Hungary as well. On the other hand, Hungarian export products may be contaminated in domestic or foreign distribution centres and commercial units, meaning that the repercussions are to be born at a place far away from the country. The poisoning of the Israeli citrus fruits illustrates perfectly that the direct consequences occur at the place of consumption, whereas the indirect economic consequences occur at the place of origin. If we examine the vulnerability of the food supply chain and compare it to the vulnerability of other networks categorized under critical infrastructure we will see that this structure is one of the most vulnerable from several aspects. This calls for the inspection of the areas, objects and services of the food supply chain that are likely to become a target of the terrorist groups. The possible targets of food and water supply are: 1. Objects and territories of research centres. 2. Plant cultivation areas. 3. Farming sites. 4. Facilities and territories of livestock breeding. 5. Processing industry. 6. Water supply bases and facilities. 7. Logistics (from production to the consumers, processes of warehousing, storage, distribution and transportation). 8. Restaurant services. 9. Retail and wholesale trade. In the international scholarly literature the scope of possible targets is marked along the entire food supply chain, which is from the producers to the consumers. However, there are differences in prioritizing the listed possible targets in the American scholarly literature and the WHO documents (Monke, 2007, WHO, Report 2008). The laboratories, experimental areas and objects of research centres should be included amongst the possible targets listed in the scholarly literature. It is mostly environmentalist groups opposing animal and plant testing who would perform a terrorist attack against the research centres. Such an attack took place in Portugal in 2007 when more than 1 hectare of land of genetically modified wheat was set on fire (Europol, 2008). The inclusion of animal, plant and public health authorities controlling the food supply chain on the list of targets should be considered. This phenomenon used to be sporadic because although the actions of these extreme environmentalist or “animal friendly” terrorist groups were not harmless, they were never of a massive nature. However, the situation has changed. When examining the trends of terrorism, we can see two examples in the series of serious terrorist attacks that took place in India in 2008, where 38

terrorist groups attacked the healthcare facility to which the people injured in one of the several explosions at multiple locations were transported, thereby impeding their treatment. By eliminating the controlling authorities parallel to a terrorist attack against agriculture, the food processing industry or even the distribution and consumption system, the accurate assessment of the situation and the elimination of the consequences could be paralyzed. The intense vulnerability of the food supply chain actually originates from the fact that it is very easy to execute a terrorist attack, a sabotage or any other crime in the areas and workflows of production, the processing industry, the distribution and trade system and the consumption structure (households, public catering and restaurant services). In the rural sector the growing and grazing areas are enormously large. It is impossible to provide full protection from a food safety point of view. It is too simplistic to say that it is impossible to set a guard next to every single cornfield or cattle. In an era when modern security systems are widespread, protection is not to be provided in the classic way. However, these are such large areas that are indeed very hard to protect. That is why the trends of terrorism suggest that logistic chains, and more specifically food supply might become potential targets (Foltin, 2011). The vulnerability of the production processes is only one component of the vulnerability of the food supply chain. When listing the potential targets it is evident that several processes and infrastructural elements should be protected. In a densely populated area there are thousands of commodity warehouses, food processing factories, distribution centres, commercial units, restaurants and food-transporting vehicles. If we add households to this list it will become evident that protection is required for a very complex system of multiple stakeholders. The problem is intensified by the fact that different foodstuffs require the application of different processing methods and handling regulations. That is why there are different channels for luxury goods, drinking water, dairy, raw meat, vegetables or fruits. Conclusions drawn from incidents related to food supply indicate that the weakest link is trade (Kasza, 2012). 6. Possible outcomes of a terrorist attack with serious consequences Our experience indicates that known terrorist groups have not targeted food and water supply so far. The emphasize is on “so far”. Considering the nature of international terrorism there are no guarantees that it will remain the same in the future. From a food safety point of view no sharp distinction should be made between terrorist actions and crimes. As discussed earlier, the low number of terrorist attacks against the food supply chain fortunately does not allow us to draw far-reaching conclusions or direct experience. However, food poisoning cases committed by negligence or intentionally do serve with useful conclusions on public health impacts to people. In this regard we should discuss the root causes and implications of the food poisoning cases with serious consequences. 1. In 1981: 800 people died and 20,000 people were taken ill due to consuming bad cooking oil. The oil contained a chemical element that was harmful to human health. This was probably the poisoning case that resulted in the biggest number of fatalities. 2. In 1985: In the United States 170,000 people were infected with S. typhimurium through bad milk.

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3.

In 1991: According to the WHO almost 300,000 people caught hepatitis in Shanghai, China after eating bad mussels. This is considered the biggest food poisoning of history so far by many. 3 4. In 1994: Due to a transportation issue (the vehicles were not properly disinfected) 224,000 people caught an infection of S. enteritidis in 41 states of the USA. 5. In 1996: In Japan 8,000 children became ill from Escherichia coli O157:H7 after eating contaminated radish at school, some of them died (WHO. Report, 2008). The above examples show clearly that a terrorist attack against a deliberately chosen target of the food supply chain may result in more lives and morbidities than the previous actions in the history of the so-called modern terrorism. Besides impacts on public health, other serious consequences are to be expected, some of which are highlighted below: 1. High fatality and morbidity rate. 2. A decline in public trust towards food supply, public administration and the government. 3. Serious consequences for the economy, not only in the agricultural sector. 4. Provisioning difficulties, prolonged disruption of food supplies. 5. Considerable costs of the mitigation of damages and reconstruction (Chalk, 2003, WHO. Report, 2008, Monke, 2007). In today’s globalised food supply chain the above mentioned impacts of an eventual terrorist attack with serious consequences would not be limited to one country only. Therefore their mechanism cannot be interpreted solely on a local or regional level. The decline of public trust in the political and public administration system may lead to serious riots in the short run. It happened before in the United States, although it was not triggered by a terrorist action but by the so-called Big Blackout in New York. The long-term political impacts would endanger the democratic institutions and principles because people would turn to extreme parties promising public safety. On the other hand, government agencies might be weakened to such an extent that chaos would break out in the society. The economic impacts would not be limited solely to the primary sectors, that is agriculture and the food processing industry. There would be serious direct and indirect damages to transportation, trade, tourism and even the banking sector. The costs of protection and the elimination of the consequences would cause a significant strain on the national budgets. There has been such a case recently in the agricultural sector, more precisely cattle breeding, although it was not triggered by a terrorist action. The damages caused by the foot and mouth disease in the United Kingdom in 2001 amounted to an estimated 2.7 to 3.2 billion GBP, and an additional 1.3 billion GBP was spent on compensation (Chalk, 2005). Considering the aforementioned consequences it becomes evident that a terrorist attack with serious consequences against the food supply chain would impact several areas in a complex way. It is also a big issue how to tackle incidents of and terrorist attacks against the food supply chain. Providing trustworthy and accurate information is as important as the preparedness of the authorities and the relevant professionals. Using such events for the purpose of political marketing after the danger has passed may result in very severe economic disadvantages (Kasza, Lakner, 2006). Moreover, premature and hasty statements intensify social distrust. The bean sprout scandal in Germany in 2011 is a good example of that. Due to the premature statements the confidence of the public opinion in the policy makers was 3

Others say that the distribution of the Chinese milk products contaminated with melamine has had much more serious consequences than the massive food poisoning in Shanghai in 1991. However, at this point no meaningful official data are available.

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shaken. Moreover, these hasty announcements caused severe damages to the vegetable growers in Spain and Central Europe. Protection is also hampered by the risk that terrorist groups would use biological components against which no antidote exists simply because none were required so far (Chalk, 2003). The risk of a potential terrorist attack against the food supply chain besides its vulnerability actually lies in the possibility of contaminating animals, plants and semifinished or prepared food which will contaminate people in turn. Actually the easiest way to infect the human body with biological pathogens dangerous to human life and health, causing fatalities and morbidities is via the food supply chain. The water supply system is similarly vulnerable. It is not too difficult to poison water bases or the components of the water supply system. An eventual infection with a harmful or lethal pathogen would have catastrophic impacts mostly in big cities. Another source of terror threat is the possibility of religious or other groups emerging out of nowhere, planning to reach their goals through terrorist actions against food supply. Breeding harmful biological components such as salmonella bacteria requires no specific knowledge or enormous financial investment, but their application could result in considerable damages. 7. Conclusions We might pose the question whether an effective protection method exists with regard to terrorist attacks against the food supply chain. Due to the aforementioned vulnerability issues there is no effective protection. However, this does not mean that food security cannot and should not be enhanced. On the contrary, it would be a grave mistake to neglect this problem. Protection against terrorist attacks of the food supply chain can be used in the elimination of the animal and public health related, social, political and other consequences of disasters, animal and plant diseases and food poisoning cases committed either by negligence or intentionally. The tasks of prevention, protection and response could provide enough material for several studies or even a monograph. For reasons of brevity these could not be discussed in this article. However, this article would be incomplete if the author did not make the most important recommendation in his opinion with regard to protection. This can be summarized as follows: the comprehensive expansion of the critical infrastructure protection programme to every area of food supply with the involvement of every stakeholder. The building and maintenance of prevention, protection and response capabilities on the national and international level as well. Fortunately terrorist attacks against the food supply chain are not very frequent. However, such eventual incidents might result in severe consequences. Conclusions drawn from recent incidents comparable only to disasters can provide us with insights into the adverse health effects of such actions. Experts are in a great debate on how “bold” terrorist groups are regarding biological terrorism (Lakner, –Kasza, Ózsvári, 2012). In the postmodern societies there is no doubt that the nature of terrorism is changing continuously. Targets are getting softer and softer so attacking the extremely vulnerable food supply chain is an obvious opportunity. The vulnerability of this sector is partly due to the fact that in our globalised world the impacts of a well organized action would present themselves in several countries. It is a priority issue for the maintenance of prevention, protection and response capabilities to handle these tasks through the protection of critical infrastructure on the overall social level. In order to achieve this, the collaboration of international, national and private organizations is required. That is the only way to have a certain immunity against the bad scenario pictured in the motto. 41

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[19] Kasza, Gy - Lakner, Z (2006): The bird flu in mind of Hungarian consumerslessons and experiences of a direct-question survey. Acta Agraria Kaposvariensis. 2006. Vol. 10, No. 2, pp. 229-237. [20] Lakner, Z - Kasza Gy - Ózsvári L (2012): A bio terrorizmus története és jelentősége. Magyar Állatorvosok Lapja. 7. Paper 134. pp. 433-441. [21] Mohtadi, H. – Murshid (2006): A Global Chronology of Incidents of Chemical,Biological,Radioactive and Nuclear Attacks: 1950-2005. U.S. Department of Homeland Security (Grant number N-00014-04-1-0659). Washington D.C. [22] Monke J. (2007): Agroterrorism: Threats and Preparedness. CRS Report for Congress. Congressional Research Service. Washington DC. [23] Moteff, J. D. (2008): Critical Infrastructures: Background, Policy, and Implementation. CRS Report for Congress. Congressional Research Service. Washington D.C. qq frisebb [24] Rapoport, D. C.: The Four Waves of the Monern Terrorism. In.: Rapoport, David C. (eds). Terrorism. Critical Concept in Political Science. Volume IV. The Fourth or Religius Wave. Routledge Taylor & Francis Group. London, New York, 2006/b pp 3-30. [25] Rostoványi, Zs. (2002): A terrorizmus és globalizáció. In.: Tálas Péter (szerk): Válaszok a terrorizmusra avagy van-e út az afganisztáni „vadászattól” a fenntartható globalizációig. SVKH– Chartepress Kft, Budapest, pp. 71–84. [26] Sprinzak, E. – Karmon E. (2007): Why So Little? The Palestinian Terrorist Organizations and Unconventional Terrorism. [27] Thompson, C. M. (2006): The bioterrorism threat by non-stage actors: hype or horror? Naval Postgraduate School Monterey, Canada 93943-5000. [28] WHO. Report (2008). Terrorist Threats to Food: Guidance for Establishing and Strengthening Prevention and Response Systems. Available at: http://www.who.int/foodsafety/publications/fs_management/terrorism/en/ [29] Walt, S. M. (2006): A biztonsági tanulmányok reneszánsza. In.: Póti László (szerk). Nemzetközi Biztonsági Tanulmányok. Zrínyi Kiadó. Budapest, pp. 9–52. [30] WHO. Report (2008). Terrorist Threats to Food: Guidance for Establishing and Strengthening Prevention and Response Systems. Available at: http://www.who.int/foodsafety/publications/fs_management/terrorism/en/. [31] Wilkinson, P. (2005): International Terrorism: the Changing Threat and EU’s response. Published by Institute for Security Studies. European Union, Paris. Chaillot Paper October Number 84. pp. 53.

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THE DEVELOPMENT OF METHODOLOGY FOR SELECTING AND PROCESSING THE TYPE HAZARDS AND PROCEDURES WITH FOCUS ON THEIR RELATIONS TO CRITICAL INFRASTRUCTURE Petr Hrůza and Jan Englich Abstract: The article is aimed at presenting the current state of development of the “Complex Automated Information System for Remote Management of Crisis Situations in Rail Transport with Focus on Critical Infrastructure” project, the overall objective of which is to create a comprehensive model of information system allowing its users to activate remotely the procedures for dealing with emergencies in rail transport. The basic methodology for selecting and processing the hazard types and procedures has been developed and validated in the current phase of the project.

Keywords: information system, crisis situation 1. Introduction The issue of critical infrastructure is high on the agenda worldwide. The current European security science prefers bringing solutions for the areas of power industry, transport and information technologies. The authors and their workplaces participate in a number of projects focused on three above-mentioned sectors of critical infrastructure. Solving the issues in transport sector is significant, because rail transport as a subsector of critical infrastructure plays a significant role in Central Europe. The project VG20122015070/Ministry of Interior of the Czech Republic on the “Complex Automated Information System for Remote Management of Crisis Situations in Rail Transport with Focus on Critical Infrastructure”, called KISDIS, started in 2012. The goal of the KISDIS project is to develop an expert information system, which would effectively combine crisis management of rail transport with regional crisis management. The currently used systems have been developed in different departments as autonomous systems and at present they do not enable users to share information on an emergency situation effectively and quickly. Therefore experts on rail transport and regional crisis management co-operate in the project. The first stage included the information analysis of available materials abroad with the aim to find similar projects carried out in particular European countries. The outcomes of the analysis confirmed that the electronic support for the management of crisis situations in rail transport has not been solved in any of the countries included in the survey. The second stages of the project in 2013 are aimed at developing the methodology which will exploit earlier defined types of hazards in the area of rail transport of the Czech Republic. With regard to the overall goal of the project it was necessary to define a functioning data set, which will be the basis for the future expert information system. The outcomes of initial stages are very original. The proposed methodology has been 44

tested in the conditions of rail transport and it is assumed that it will be certified on a national level. The outcomes of initial stages have become a real basis for the functioning of future complex information system for remote management of crisis situations in rail transport. 2. Analysis for the Methodology of Selecting and Processing the Type procedures The initial analytical phase has been focused on updating a large information base. The procedure of activities according to the methodology represents the first step in the process of planning the measures for managing the crisis situations. The following assumptions have been considered by a project team for the selection and processing of general type procedures. Generally, type procedures for the management of crisis situations may be processed as: general procedures for management (approach to management) of any crisis situations, general procedures for the approach to management of a crisis situation in traffic, general procedures for the approach to management of a crisis situation on railway, partially specific procedures (e.g. for a location train – train station – railway). The general procedure should ensure the elimination of possibly even the most serious consequences, and in case the real consequences will not be so far-reaching, the prepared procedure will be finished in the phase which will not occur and the next step will not be taken. The development of consequences of an emergency depends on the following: the intensity and duration of a cause, the place and time (period) of occurrence of an emergency, the readiness of organization for managing an emergency (summary of preventive measures including mainly personnel and material support). The primary purpose of preparation of procedures has to be the effort to prevent the impact (development) of causes, or eliminate their chaining. At first a general type procedure has been elaborated and then concretization of individual procedures followed. The development of a general type procedure assumed the fact that common procedures for managing crisis situations had already been introduced in an organization. Therefore the outcomes have not been verified at this stage. In case of general procedures it was not necessary to set the limits under which a problem was not tackled. The list of 41 type procedures altogether has been compiled as the basis for further research. Table 1 General type procedure

Serial No 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

Procedure – general type procedure Reception of a report about the occurrence of crisis situation Record into a “diary“ Verification of the report and collection of additional data Initial assessment Issuance of necessary instructions Coordination with basic elements of integrated rescue system Call a crisis staff (starting the automatic system) Activation (call) of own emergency forces and equipment Information to a superior Information to co-operating organizations on the change of situation Preparation of the 1st meeting of crisis staff

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Serial No 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41.

Procedure – general type procedure Meeting of crisis staff Send a reconnaissance (task, composition, equipment) Assessment of where and how the source of crisis situation is effective Measures taken in order to prevent the developmnet of crisis situations Activation of other element of integrated rescue system Call for other forces and equipment Selection of suitable (necessary) regulation measures Notice on regulation measures Information for own employees Information for public (media) Invitation of experts from own resources Invitation of experts working out of the system Employment of specialists Start of rescue clearance work Issue of protective aids Cover of live force Conduct of evacuation Clarification of the impact of crisis situation Clarification if and when a crisis situation may develop Declaration (request for declaration) of a state of crisis Contingency (contemporary) solution dealing with restoring the operation of a system Check-up of functionality of own resources for managing a crisis situation Request for the release of emergency supplies Organizing the export of supplies to a stricken area Enquiry about causes Initial estimate of damage and losses Permanent elimination of consequences Measures taken to prevent similar situations Definite numerically expressed damage and losses Possible liability for offenders

After that a general type procedure has been subdivided into three groups related to preventive, rescue and clearance activities. Then a particular general type procedure has been developed for each group (preventive, rescue, and clearance). If it is information on the possibility of occurrence of a crisis situation, it will be a preventive procedure. A real crisis situation will be managed according to a rescue procedure. General clearance type procedure follows the previous activities connected with an imminent rescue of human lives and properties. The general preventive type procedure has been elaborated in detail and includes 28 specific procedures. Each procedure includes a list of tasks which have to be fulfilled. Part of the list is shown in the following chart.

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Table 2 Part of the list of specific procedures and tasks

Serial No Procedure Reception of a report on the possibility of occurrence of a 1. crisis situation Verification of report 2. 3. 4. 5. 6.

Task Record the documentation

report

into

the

Conduct the verification of report Make clear what group (type) of Initial assessment hazard it is 1) Find a person responsible for a Collection of additional data particular area and contact him/her from the area of possible 2) Ask questions aimed at occurrence of crisis situation implementation of measures to eliminate particular hazard Call a meeting of a crisis staff Determine the time and place of (start of automated system) meeting of a crisis staff ……. ……

General rescue type procedure and general clearance type procedure are also elaborated in the above-mentioned way. Information has been updated on the protection of critical infrastructure in the transport sector in Germany, Poland, Austria and the Slovak Republic. Information was also collected on the critical infrastructure hazard assessment in the above mentioned countries. Attention has been paid to the changes of support for restoration and reconstruction of damaged railway lines and facilities in the neighbouring countries. Special attention has been paid to the current outcomes of the projects within the 7th EU Framework Programme aimed at improving the long-distance control of rail transport and the information support of crisis management. Extensive analyses have been the basis for setting the further procedure within the KISDIS project. The principle precondition for work with the methodology selecting the hazard types is the fact that rail transport is considered to be a compact system. For the needs of the research the rail transport infrastructure is divided into individual railway lines and stations. When appropriate parameters are acquired the railway lines (or their parts) may be considered as being of certain type. Standardized documentation, which is elaborated for such a type, can be distinguished in a particular situation only by a number and name of station. Similarly, if the railway stations are classified into five categories, it is sufficient to elaborate documentation for one type of station and distinguish different stations by different names in operational documentation. The procedure of activities according to the methodology represents the first step in the process of planning the measures for managing the crisis situations on rail and requires a good knowledge of the assessed railway line, terminology of transport, logistic and construction guidelines of the Railway Infrastructure Administration (hereinafter RIA). The methodical instructions enable not only the selection of hazard types from the list provided by the railway controller crisis information system. The methodology is logically ordered in compliance with the definition of hazard as one source of risk. Prior the final determination of particular type of hazard it integrates the completed analyses into one table in the order which is introduced in the KISDIS programme software environment. The KISDIS programme enables its users to repeat the selected procedures in compliance with the development of a real situation up to the state, when lives and properties are not threatened and the rescue operations eliminate the causes of crisis situation. 47

3. The Model of System Employment The KISDIS information system consists of control and monitoring nodes. It includes at least one control node with the KISDIS Windows system (see Figure 1) and at least one monitoring node with the KISDIS Internet system (see Figure 2). In case of need a monitoring node of another information system may be added to the KISDIS system. The main part of the KISDIS Windows system consists of three main components: KISDIS Windows Client, KISDIS Windows Mobile, KISDIS Windows Server. The KISDIS Windows Client component will serve for inserting and editing the information on the management of crisis situations in the database. The KISDIS Windows Client component will be installed into the crisis manager´s work station. The KISDIS Windows Mobile component will serve for receiving, displaying and reverse sending of information on the duties of task forces. This component will be installed into the task forces´ mobile phones. The KISDIS Windows Server component will provide the exchange of information between the KISDIS Windows Client and the KISDIS Windows Mobile components. The information will be stored into the KISDIS database. Each control node will have one KISDIS database. The mutual independence of all three components has been chosen as the main criterion of functionality of the whole KISDIS Windows system. Thus each component has been operational even in case the other components are not. The following Figure shows the basic employment of individual components of the KISDIS Windows information system and their inter-relations (see Figure 1).

Figure 1: Basic KISDIS Windows model of employment

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The surrounding co-operating information systems are standard e-mail servers enabling communication through IMAP and SMTP protocols and database servers or database files. Smart phones and Internet infrastructure are also parts of surrounding co-operating systems. The KISDIS Internet system consists of the network of servers – nodes of the “KISDIS Internet Server” type and remote users – nodes of the “Remote user” type. The servers use HTTP server for providing information in the form of web pages. The servers may mutually update their data through the port types of web services. Server also implements the port types for the third parties´ information systems – node “Another remote server” (see Figure 2). The remote users cannot communicate directly with each other within the KISDIS network; they are in the role of a client.

Figure 2: KISDIS Internet – basic model of employment

4. Conclusion The first outcomes of the KISDIS project have been published in the paper. The universal employment of the proposed expert information system in relation to the administrator of critical infrastructure and public administration is a prerequisite for its future employment in the Czech Republic and possibly in other EU countries. The authors of the project believe that other activities of the project will result in the certification of the developer methodology on a national level. The primary goal of the project is to improve the information support of crisis management in two different areas – in rail transport and municipal crisis management.

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References [1]

Crisis Plan of the Ministry of Transport of the Czech Republic, No: 32/2005-CNP, 15th March 2005. Prague, Ministry of Transport, 2005. [2] Dvorak, Z., Sventekova, E.: Evaluation of the resistance of critical infrastructure in the Slovak Republic. Zrenjanin, Technical Faculty Mihajlo Pupin, Serbia, 2012. [3] Dvorak, Z., Leitner, B., Sventekova, E., Sousek, R.: Managing of risks in railway transport, Institute of J. Pernera, University of Pardubice, Czech Republic, 2011. [4] Dvorak, Z., Sousek, R. Englich, J.: Preparation for solution of crisis situations in railway transport in the Czech Republic. Logistyka i transport, Poland, 2007. [5] Dvorak, Z., Leitner, B., Milata, I., Novák, L., Sousek, R.: Theoretical background and software support for creation of railway transport model in crisis situations, The 14th world multi-conference on systemics, cybernetics and informatics., Orlando, Florida, USA, WMSCI 2010. [6] Nařízení vlády č. 432/2010 Sb., o kriteriích pro určení prvku kritické infrastruktury. In: Krizové zákony, Hasičský záchranný sbor, Požární ochrana, podle stavu k 19. 3. 2012. Ostrava: Nakladatelství Sagit, a.s., 2012, s. 43-49. Edice ÚZ – úplná znění předpisů, číslo 898. ISBN 978-80-7208-919-2. [7] Sousek, R., Dvorak, Z.: Risk identification in critical transport infrastructure in central Europe with focus on transport of dangerous shipments. The 13th world multi-conference on systemics, cybernetics and informatics.,Orlando, Florida, USA, WMSCI 2009. [8] Sousek, R. et al: Methodology of critical transport infrastructure objects identification. Pardubice, Czech Republic, University of Pardubice, 2010. [9] Sventekova, E., Dvorak, Z.,: Performance testing of critical transport infrastructure element. Zrenjanin, Serbia, Mihailo Pupin Technical Faculty, Serbia, EMC 2012. [10] Narušení funkčnosti dopravní soustavy velkého rozsahu, Ministry of Transport of the Czech Republic No: 116/2010-030-CRS, 1st November 2010. [11] Vidrikova, D., Dvorak, Z., Kaplan, V.: The current state of protection of critical infrastructure elements of road transport in conditions of the Slovak Republic. Kaunas, Lithunia, Kaunas University of Technology, 2011.

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COMPARISON OF STUDENTS’ ATTITUDE TO THE STUDY STATISTICS AT THE FACULTY OF ECONOMICS AND MANAGEMENT Jiří Neubauer Abstract: The main topic of the article is the comparison of students' attitude to the study statistics at the Faculty of Economics and Management, University of Defence in Brno. In 2008, second-year students were given a questionnaire aimed at finding out students’ opinions on this subject, what had caused them greatest difficulties, how they had prepared for the exam and which software they had used when processing a seminar paper. The same survey was also conducted in 2013. The paper describes the results and comparison of responses from the years 2008 and 2013 by selected statistical methods.

Keywords: statistics, teaching, questionnaire survey, statistical software 1. Introduction Almost all university students of economic and technical faculties encounter statistical data processing along with basic knowledge of probability and statistical analysis. This subject is also taught at the Faculty of Economics and Management, University of Defence in Brno. Statistics is a part of the bachelor's degree program curriculum together with subjects such as Mathematics, Economics, Computer Science, Law, etc. The course of statistics contains elementary data processing, foundations of the theory of random variables, basics of theory of estimation and hypothesis testing. In general, Statistics is not one of their favourite subjects, like Mathematics or other exact academic disciplines. The fundamental questions of a lecturer are how to explain the principles of statistics to students, and how to attract students and increase their interest in the subject. It is, therefore, important to obtain student feedback, to know what students think about the subject taught, what causes them the greatest difficulties, how they prepare for lessons or exams, which study materials or software they use when processing a seminar paper, etc. Probably one of the most common ways to obtain this information is a questionnaire survey (see [2], [8]). Second-year students were given a questionnaire aimed at finding out students’ opinions in 2008. The same survey was conducted in 2013. Selected statistical methods were used in the evaluation questionnaire; it was especially the χ2 test of independence in the contingency table, the Wilcoxon test and test of equal proportions (see [1], [6] or [8]). 2. Statistical software Nowadays, the use of modern computer technology in the teaching process is inevitable. In the case of statistics, an academic discipline that deals with the processing and analysis of data, the need to use computers along with the appropriate software is indisputable.

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Not long ago, scientific calculators were used for numerical calculation, and, even today, they are still a helpful tool. However, statistical analysis via computer provides more useful and instant outputs. Besides numerical calculation, we can mention tables and graphs which describe the range of monitored variable characteristics. These outputs help the students understand the “philosophy” of statistics. The computers which entered this area several decades ago are essential for almost all contemporary statistical methods. One can find a great deal of statistical software on the market, such as SPSS, Statgraphics, Minitab, Statistica, SAS, QCExpert, Matlab (statistics toolbox) and so on. These products differ, for example, in a range of offered methods and analysis, in graphical interfaces, in user's accessibility, or in universality. It is necessary to mention the R programming environment which offers a potential alternative to these products. R was created on the basis of a stripped-down version of S language. The code for R was released in 1995 under the GPL (General Public License), which means it can be freely downloaded (http://www.r-project.org/). The basic statistical analyses in R are described, for example, in [3].

Figure 1: Selected answers from the questionnaires in 2008 and 2013

Selecting the appropriate software for teaching is influenced by many factors. One problem is the accessibility of the chosen software at the university, since the price of the required multi-license is not often low. Another problem is the accessibility of this software to the students, because not only should they be able to use it at the university but they should also be able to use it at their homes or dormitories in order to make their 52

study more effective. A common disadvantage of these professional products is their limited use of the student's individual work at home. This drawback of statistical software could be solved with freeware (usually in English) or, at least partially, with Excel, which is part of MS Office. An undeniable advantage is that it is widespread among students, and, that computer laboratories are equipped with Excel. It is not special statistical software. Nevertheless, the tabular nature of Excel enables us to utilize several implemented tools and interesting features. We have decided to choose MS Excel for the purpose of statistical teaching and have created the STAT1 spreadsheet (see figure 1, it can be freely downloaded at http://k101.unob.cz/stat1/). This tool contains one-dimensional descriptive statistics with frequency tables and graphs, point and interval estimates and hypothesis tests (selected normality tests, one and twosample tests of the mean, the variance and the proportions). The aim was to prepare a tool to help students understand the basis of statistics easily and naturally, to succeed in getting into principles of statistics, and not to be afraid of using statistical tools effectively and reasonably. The described tool is a part of the textbook [5] used now in the course of statistics at our faculty. 3. Questionnaire survey It is undoubtedly beneficial to identify possible links among students’study results. For example, the article [9] analyses relationship between results in English language test and the Learning potential test at the Faculty of Economics and Management. (These two tests are parts of the entrance exam.) The basic objective of our survey was to determine the attitudes and opinions of students on the subject of statistics and analysis of changes. The first questionnaire survey was carried out in 2008; the survey was answered by a total of 64 respondents. The same questionnaire was given to 73 students in 2013. The first part of the questionnaire is focused on comparison of study results in selected subjects of the curriculum, particularly in Statistics, Mathematics, Economics and Computer Science. For the purpose of comparison, we used the old grading scale from 2008 (grades 1, 2, 3 and 4). Therefore, the results from 2013 were converted to the old scale in following manner: A, B = 1; C, D = 2; D = 3 and F = 4. It should be noted that only successful students of Statistics responded to the questionnaire. When evaluating the exam results of the subjects observed, we are not surprised. Better results occurred in Computer Science and Economics, but worse in Mathematics and Statistics. Results are summarised in table 1. It contains basic descriptive statistics of grades in 2008 and 2013; the last two columns show the results of the grades comparison using the Wilcoxon rank test (see [1], [6] or [8]). Continuity correction was applied when calculating the Wilcoxon rank test. At significance level 0.05, we can see the change in the grades in Mathematics (p-value is less than 0.05), at significance level 0.10, we can see the change in the grades in all subjects except for Statistics. Table 1 Descriptive statistics and grades comparison in 2008 and 2013 – Wilcoxon test 2008 2013 Wilcoxon test

mean median st.dev. mean median st. dev. 2 0.870 2.452 3 0.708 Mathematics 2.141 2 0.767 2.082 2 0.777 Comp. Science 1.828 1.922 2 0.762 2.164 2 0.707 Economics 2.203 2 0.800 2.384 3 0.757 Statistics

statistic 1898.0 1922.0 1928.0 2046.5

p-value 0.03848 0.05758 0.05876 0.17404

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More interesting, however, are the results of the relationships between Statistics and other subjects which the following analysis brings (table 2). These relationships were analysed by χ2 test of independence (see [1], [6] or [8]). The tests were conducted in such a manner that conditions of good approximation were fulfilled. In contrast to the results from 2008, when it was shown that there is dependence between the results of the subjects of Mathematics – Computer Science, Mathematics – Statistics and Computer Science – Statistics (at significance level 0.10 also between Mathematics and Economics), in 2013, independence was rejected for the subjects of Mathematics – Computer science and Mathematics – Statistics (at significance level 0.10 also between Computer Science and Statistics). If we look at student evaluations (marks) in each year, we find that the results in Mathematics and Statistics are generally worse than in Computer Science and Economics (see table 3). Results in Mathematics and Statistics are comparable, as expected. Similarly, according to the Wilcoxon test it is not possible to say that the achievements in Computer Science and Economics are different. The required statistical analyses were calculated in R, where the significance level of the tests was 0.05. Table 2 Tests of grades independency – χ2 test

2008 2013 statistic p-value statistic p-value Mathematics-Computer Science 14.225 0.00081 14.812 0.00061 5.930 0.05156 0.564 0.75441 Mathematics-Economics 8.916 0.01159 9.711 0.00779 Mathematics-Statistics 7.749 0.02077 1.720 0.42322 Computer Science-Economics 15.268 0.00048 5.754 0.05631 Computer Science-Statistics 4.257 0.11902 1.563 0.45764 Economics-Statistics Table 3 Grades comparison – Wilcoxon tests

2008 2013 statistic p-value statistic p-value Mathematics-Computer Science 2465.5 0.03498 3363.5 0.00309 2351.5 0.12553 3270.5 0.00974 Mathematics-Economics 1982.5 0.73968 2775.0 0.62906 Mathematics-Statistics 1909.0 0.48011 2520.5 0.54595 Computer Science-Economics 1525.0 0.00823 2091.5 0.01581 Computer Science-Statistics 1646.0 0.04190 2190.5 0.04446 Economics-Statistics The second part of the questionnaire deals with the study of statistics. We can say that 60 % of the students encounter statistics at our faculty for the first time. The rest of them had had awareness of statistics before attending the course of statistics (a secondary school or another university). What is slightly surprising is that after finishing the course, 57 % of university students perceive statistics as an academic discipline almost identical or very similar to mathematics, using the same or similar way of thinking (50 % in 2008). We can identify no change in the proportion. This result points to the ongoing lack of understanding of the difference between mathematics and statistics. The question about the difficulty of statistics has not brought any surprises, 51 % (50 % in 2008) expressed the fact that statistics is rather difficult for them, 23 % (34 % in 2008) consider statistics as a subject reasonably challenging with the need to think 54

more. Only 23 % (14 % in 2008) said that statistics is very difficult and hard to understand. This fact is also confirmed by teachers. Comparing results from 2008 and 2013, we can identify no significant changes in answers. With regard to the fact that students consider statistics rather difficult, we wanted to find out what caused them such problems. 59 % (56 % in 2008) of the students saw the biggest problem in finding links among different parts of statistics, such as the descriptive statistics, the probability and the inductive statistics. Another difficulty in the study of statistics was a new language and a new way of thinking which is used (25 %, resp. 28 % in 2008). The subsequent question revealed that 33 % (42 %) of the students in their view understood the nature of the subject matter at home when doing their homework or later during revision which indicates a significant decrease. However, 45 % (38 %) of the students reported that they understood the principles in the study for the test, and 8 % (6 %) even thought that they basically misunderstood. A deeper analysis demonstrates that understanding the studied subject matter is associated with the exam evaluation. The use of computers is likely to affect students' views on the practical application of technical means. The third part of the questionnaire is focused on the use of computers during study. According to the students, 84 % of them have access to a computer at home and at the university, 18 % only at home (84 % and 18 % in 2008). The survey also shows that 67 % of the respondents can work with a computer completely independently and without any problems and 29 % of them occasionally need help (48 % and 40 % in 2008). As we can see, there is a significant increase in computer literacy. This result can be considered quite satisfactory; the use of computers in the study of statistics plays an increasingly important role. Nevertheless, the link between the results of the examination and students’ computer skills were not proved. In the last part, the students answered questions connected with their study of statistics. A relatively large proportion of students, a total of 73 %, said that they did not understand the new subject matter after the lecture, or their level of understanding was very low (similar results as in 2008 – 72 %). The situation changed after the seminars. However, the increase of understanding in 2008 was not significantly greater than in 2013. In this context, it should be noted that the STAT1 spreadsheet was used during the seminars (the descriptive and the inductive statistics) which saved time in the numerical calculations and this reserve could be used by teachers for the commentaries and explanations of the results obtained. With regard to the opinion on STAT1, 88 % of the respondents consider it a very good tool and 11 % quite a useful tool (64 % and 33 % in 2008). There is a positive increase in popularity of this tool (a significant rise in the proportion). This opinion corresponds to the use of this spreadsheet, because 82% of the students used it when preparing for all or some of the seminars, 17 % up to 2 times, but only 1 % had not used STAT1 at all. In 2008, we obtained proportions of 50 %, 33 % and 17 % which indicates a very significant shift in the use of this tool, not only in schools but also at home. The link between students’ opinions on the usefulness of this tool and the use for the statistical computation during the course was also proved. The following question focused on the use of different parts of the STAT1 spreadsheet: 68 % of students used it for descriptive statistics, 77 % for normality tests, 77 % for the computation of point and interval estimates and 80% for hypothesis testing. None of the respondents answered that he did not used it for any part of the statistics analysis. The previous survey gave results of 61 %, 69 %, 63 %, 47 % and 6 % (did not use of STAT1). The results obtained demonstrate the increasing popularity of computer data processing. We are also interested in their opinions about computer-aided study of this subject. 68 % (45 % in 2008) of the students considered the current version of STAT1 to be sufficient, 23 % (28 % in 2008) of them would appreciate an enlarged version of 55

the spreadsheet. 7 % (25 % in 2008) of the respondents required professional statistical software, and approximately 1 % (2 % in 2008) believed that computer support was not needed. We can see and prove that there is a change in the opinions on the use of statistical software in teaching.

Figure 2: Selected answers from the questionnaires in 2008 and 2013

4. Conclusion Let us summarize the results obtained from both questionnaire surveys. It can be said that from 2008 to 2013 there was deterioration in student evaluation (grades) in Mathematics, Computer Science and Economics. This trend was not significant only in the case of Statistics. Regarding the relationships between the subjects due to the resulting exam evaluation, we have not reached any surprising conclusions. Grades in Statistics are related to grades in Mathematics and Computer Science. The link between grades in Statistics and Economics has not been proved. When comparing “average” grades we can say that students achieve better results in Economics and Computer Science than in Statistics. On the other hand, we can identify no difference between 56

Mathematics and Statistics. These conclusions are valid for both survey years. According to our findings, students consider Statistics more or less difficult. Its popularity is comparable with Mathematics. The main reasons may be the difficulty in finding connections between different parts of statistics and a new language and a new way of thinking. Comparing the student computer skills in 2008 and 2013, we conclude that computer literacy has increased. This finding can be considered quite satisfactory because the use of computers in the study plays an increasingly important role. We can see a positive rise in popularity of the STAT1 spreadsheet. The advantage of this tool is that it contains only methods studied within the course. Professional software enables users to perform a number of statistical analyses. However, we can use only a fraction of the available options for teaching purposes. This complexity may be a disadvantage because the elementary analysis in this environment is sometimes complicated for beginners. Another advantage is, of course, that it is free and freely accessible. In the coming years we will continue with the teaching statistics using the STAT1 spreadsheet, which will be continually supplemented by other tools. References [1] [2]

[3]

[4] [5]

[6] [7]

[8] [9]

ANDĚL, J. Základy matematické statistiky. Praha: Matfyzpress. 2005. 358 s. ISBN 80-86732-40-1. ČECHOVÁ, I., BERÁNKOVÁ, J., ZERZÁNOVÁ, D., NEDOMA, R., a H. HRDLIČKA. Military Professionals and their Language training: research projects’ finding. Economics and Management. 2012, 2012/1, p.15-24. NEUBAUER, J. Selected Statistical Methods in R. In: XXIX International Colloquium on the Management of Educational Process. Brno: UO. 2011. 239249. ISBN 978-80-7231-780-6. NEUBAUER, J., SEDLAČÍK. M. a O. KŘÍŽ. Aplikace STAT1. 2012. http://k101.unob.cz/stat1/ NEUBAUER. J., SEDLAČÍK. M. a O. KŘÍŽ. Základy statistiky: aplikace v technických a ekonomických oborech. Praha: Grada. 2012. 236 s. ISBN 978-80247-4273-1. OLOFSSON, P. Probability. Statistics. and Stochastic Processes. Hoboken: John Wiley & Sons. 2005. ISBN 978-0-471-67969. R Development Core Team, R: A language and environment for statistical computing, R Foundation for Statistical Computing, Vienna, Austria, 2009, http://www.R-project.org. ŘEZANKOVÁ, H. Analýza dat z dotazníkových šetření. Praha: Professional Publishing, 2011. 223 s. ISBN 978-80-7431-062-1. SEDLAČÍK, M., ČECHOVÁ, I. a L. DOUDOVÁ. “Be Born as Successful Mathematics or Language Learner: Myths, True or False”, Journal on Efficiency and Responsibility in Education and Science. 2013, 6(3), p. 14-25. ISSN 18031617. [on-line] www.eriesjournal.com/_papers/article_219.pdf [2013-09-30].

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ANALYSIS OF THE RESULTS OF RESEARCH OF SOCIALLY RESPONSIBLE MANAGEMENT OF RESTAURANTS IN BRNO TO ACHIEVE SUSTAINABILITY AND ENVIRONMENTAL SECURITY Jakub Trojan, Tomáš Jeřábek, Jan Trávníček and Eva Lukášková Abstract: The main goal is to show the state of corporate social responsibility in the hospitality sector on the case study of Brno. Paper presents outputs of research held between years 2011 and 2012. Paper wants to discuss how standard principles naturally implemented in sustainable regional development are adapted in private hospitality sector dealing with sustainability and security. Using advanced statistical tests we confirm several hypotheses that could contribute to a better knowledge of the state of corporate social responsibility.

Keywords: corporate social responsibility, sustainable development, hospitality, tourism, Brno 1. Introduction Management of organizations operating in the restaurant facilities segment is undergoing developmental changes in today's dynamic age which they deliberately use to adapt to the changing framework of consumer behavior due to economic recession. The question is, in what way is this development reflected in the issue of sustainable development in the corporate environment? In line with the specifics of the corporate sector it looks like a suitable approach for evaluation of the sustainability issues view of corporate social responsibility whose economic outlook is a frequent topic of discussions (most recently in [12], earlier for example [7], [16] or [5]). Corporate social responsibility (CSR) is directly based on three pillars of sustainable development [6] and doesn't mean merely "environmentally friendly" behavior in terms of the environmental pillar of sustainable development (e.g. the use of environmentally friendly appliances, waste sorting, etc.) but at least equally important are the social and economic pillars. The importance of the social pillar lies primarily in the sense of taking into account the role of the entity in the community, in which the given entity offers their services, and assessing the strength of the links on civil society [18], [4]. Systematic consideration of the sustainability of economic activities [13] is a tool that companies consciously and systematically build with the purpose of developing and creating profit in the economical pillar [3]. Starting from the recent theories of regional development (collectively [2], respectively [21]), centers of innovations are the key centers (poles) of growth indicating the direction of further development. In the practice of European regional policy, they are generally identified with big cities [17]. In the case of the Czech Republic and in this context we are talking specifically about the capital city of Prague and statutory city of Brno, and respectively about the other regional administrative seats having the role of mesoregional center [10]. The article focuses on the analysis of the potential for a sustainable approach towards the management of restaurant facilities in the area of the Brno, while we consider a sustainable approach to be behavior in line 58

with the characteristics of a socially responsible company. The aim is to demonstrate how (and if ever) CSR is incorporated in the management of restaurant facilities as a representative sample of the food services sector in the statutory city of Brno. The secondary aim is to take into account the principles CSR in restaurant facilities within the prism of the three basic pillars of sustainable development: economic, social and environmental. 2. Materials and Methods The analysis presented here is based on long-term research of restaurants in Brno, which was implemented between 2011 and 2012 in the form of field collection of primary data and subsequent validation with secondary data. It is also based on the principle of methodological triangulation to validate data [8] with respect to the concept of ESPECT [11], which provides a wider view on sustainable development of the area, in and beyond the concept of the three pillars of sustainable development. Primary data collection was obtained from a standardized questionnaire that was subdivided into three parts: the identification part, auxiliary part and core part. Identification questions clearly classified the research subject, the independent variables in the auxiliary part enabled researches to obtain auxiliary input for further analysis, and the core issue questions addressed the state of CSR within the company management. The core questions are methodologically divided between the thematic pillars of sustainable development. Data obtained this way was complemented by interviews with restaurant owners, managers, staff and guests. Data was compared with publicly available sources depending on their nature (e.g. statements on company websites, other findings uncovered as the working group prepared the Tourism Development Program of the city of Brno [15]). Obtained information was verified using procedures that are independent of data collection using the questionnaires above but allowing for specification and verification of results, in accordance with the principles of triangulation methodology [8]. As a referential, companies which met the following criteria were chosen as food service facilities: the food service facility works the entire year, 7 days a week, the food service facility has at least 20 seats, the food service facility has table service, there is a menu. The criteria conditions allow greater comparability of data and virtually eliminate atypical or unconventional forms of the food service facilities. Specifically, the first criterion allows the exclusion of occasional seasonal restaurants, food stands and student's cafeteria facilities; the second criterion eliminates bar facilities, gaming facilities and small cafes; the third criterion excludes fast food restaurants and street bistros etc. The research locations consisted of all the city districts in the area of the statutory city of Brno, with the exception of Brno-Center (as shown in map in Figure 1). Due to its location, size, and function, Brno-Center is atypical because it has significant differences from the rest of the city as provable for example by statistics captured in regular censuses [20]. Its integration into the rest of the sample will be the subject of continued research planned for years 2012-2013.

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Figure 1: Spatial delimitation of the research subjects in the area of the city of Brno Source: authors

3. Characteristics of the Sample Commonly used statistical methods were used to analyze the research. In addition to descriptive statistics, used particularly in the following section dealing with characteristics of the examined sample, especially nonparametric methods were used for determining the statistical significance of tested hypotheses. It was a commonly used test of goodness of fit, as well as the Kruskal-Wallis ANOVA and the MannWhitney tests. To determine the strength of dependence upon confirmation of statistical significance, we are working with Pearson´s and Cramer's contingency coefficient. We also use Cohen's d coefficient η2. One can use as an example [1] or [9] to become familiar with the methods. An integral part of the methods used is the logical judgment of the authors. The survey consisted of 191 food service facilities located in the 26 city districts, except the Brno-Center as shown in Figure 1. Evaluations of individual facilities were carried out based on the environmental, economic and social pillars of sustainable development. 4. Results As a part of the above sample's environmental pillar, it was found that almost 43% of the facilities have been using equipment ensuring energy savings, while significant proportion were using energy saving light bulbs, light sensors, and using appliances that have A++ energy efficiency ratings. Waste sorting is being done by 60% 60

of the surveyed facilities when it comes to handling leftovers, the majority of leftovers is disposed of in the garbage – almost 70 % of the facilities, the rest of the monitored facilities provide a significant part of their leftovers as food for livestock, or they offer them for free to the homeless. Organic food is used for preparing meals by more than half of the surveyed facilities, of which about a third use at least a proportion of 50 percent or more. The survey also examined what form of packing is used for food delivery and for taking food from the facility. Here it was found out that a classic menu box is used at a 74% rate, and to a much lesser extent, aluminum foil or plastic wrap is used. The last referenced indicator of the environmental pillar was the free offer of tap water. This option is offered at a little less that 64 % of all surveyed facilities. In the case of evaluating indicators of the economic pillar the number of jobs provided by individual facilities has been primarily monitored. It was shown that most of the monitored restaurants – about three quarters – offer a maximum of 9 jobs, more than 16 jobs were offered by only about 19 % of the questioned facilities. Another conclusion is the fact, whether owners of each facility are familiar with the Code of Ethics of the Czech Association of Hotels and Restaurants (AHR CR) and whether they are members, or are at least considering membership in that association. Here it was found, that nearly 62 % of the surveyed facilities do not know the Code mentioned above, of which the vast majority do not consider membership in the AHR CR. In the case of the remaining facilities whose owners are aware of the Code, 8% are members of the association or are considering membership. Another object of the research was to find out, if there are restaurant chains in the above defined parts of the city, and specifically whether the analyzed facilities operate in multiple locations, not just in the city of Brno. The results of the survey confirmed that less than 20% of the monitored facilities operate in more than one location. An equally important indicator of the economic pillar is the origin of the equipment suppliers. Here it was confirmed, that the vast majority of facilities are using services of suppliers whose official residence is located in the Brno-city district. Lastly, in the scope of this pillar, it has been monitored, whether the owners or serving staff respectively, are educated in trade and services with a focus on hospitality, preparing them for working in their profession. It turned out that the amount of owners educated in this field was less than 61%, of which about two thirds attained their education by studying at a secondary school of the hotel industry. The remaining third studied in professional programs, training as vocational cooks or waiters. When it comes to serving staff, less than 43% of all employees in monitored facilities have the demanded education – e.g. hotel industry schools and similar programs. In the course of evaluating the social pillar, the primary addressed were an approach to the health and physically disabled staff (and respectively the guests), the attitude of the facility owners towards further training of staff, the level of language competence of the wait staff, gender structure of the employees, and attitude of the facility towards the support of charitable (or other non-profit) activities. The research has shown that positions for people with reduced work capacity are offered by only 11 % of the monitored facilities. In contrast, almost 60 % of the surveyed restaurants provide wheelchair access. In the case of language skills, it was shown that in almost 85 % of the restaurants in Brno, the staff speaks at least one of the world's languages. English, and respectively German dominate. In the case of continuous education of staff, barely 20% of the management if the companies surveyed support the completion of courses and seminars by employees. When it comes to charitable activities, it was found that less than one fifth of restaurants contribute to some non-profit or governmental organizations. Among the supported entities, nursery schools, shelters and orphanages 61

appear most often. The last indicator monitored within the scope of the social pillar was the gender ratio of employees. In 47 % of cases this ratio is balanced, in 29 % of cases, it is dominated by men. 5. Tested Hypotheses A statistical description of the obtained data using the advanced statistical methods mentioned above was studied in regards to the following hypotheses: H1: The use of some form of energy saving method is typical for members of the AHR CR. We assume that the lead professional organization supports (at least formally) the concept of social responsibility. H2: Efforts to reduce energy consumption is related to the continued education of restaurant staff. The premise takes into account the fact, that awareness and effort on energy saving as a part of the economic and environmental pillars of sustainable development grows together with the increasing social status of greater education. H3: Creating jobs for disabled people is related to the relationship of the restaurant owner towards the membership in AHR CR. As in H1 we expect the influence of the umbrella organization. The hypothesis does not take into account the legal obligation to employ disabled people. H4: Further training of the staff is related to the relationship of the owner of the restaurant towards membership in AVH CR. Education of employees represents both the social and economic pillars of sustainable development. The premise is based on the same foundation as H1 and H3. H5: The focus on language abilities of employees comes primarily from employers educated in the field. The hypothesis reflects both the social and economic pillars of sustainable development. With language skills there is an additional multiplier effect due to the potential development of tourism. H6: Further education of employees if supported mostly by owners educated in the field. It is logical reasoning to interpret emphasis on further education as a support of the social capital of employees. H7: The use of some form of energy conservation is typical mostly for larger restaurants. The hypothesis monitors the impact of the economic crisis and rising energy costs that are reflected in aggregate in large enterprises. H8: Dealing with leftovers varies with the size of the restaurant. The reasoning behind the hypothesis is trying to optimize the biological components of waste management in larger companies to save time, while the secondary effect supports the environmental pillar of sustainable development. H9: The fraction of organic food is rather higher in larger restaurants. The trend of following a growing consumer demand for organic food products, concerns the environmental and social pillars. We assume that it is more important for larger restaurants. H10: Food delivery is typical mostly for larger restaurants. Food delivery services are by nature a rather negative aspect of the environmental pillar of sustainable development. We assume, that it is offered by larger restaurants to diversify their range of services. H11: The language skills of operating personnel increase with the size of a restaurant. This premise depends on the assumption that with the increasing size of the enterprise there is growing effort to cover a wider base of clients/customers. Its effect is the promotion of the social pillar of sustainable development and investment into human capital.

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H12: Contributing to a non-profit organization is typical for larger restaurants. The size of the company is in direct relation to the most typical expression of CSR [19]. The support of local community and the social pillar of sustainable development is a part of self-presentation, but also a part of efforts to lower the tax base. H13: The further education of employees is supported mainly by larger restaurants. The hypothesis is based on the same assumptions as H11, while also focusing on the general component of education as human capital (not only specifically language). 6. Analysis of Hypotheses The analysis focuses only on these hypotheses which were confirmed by the already mentioned statistical testing. The remaining hypotheses were left without detailed interpretation as statistically insignificant. Of the hypotheses mentioned above, six were confirmed: H1, H3, H8, H11, H12 and H13. Individual results of applied tests are shown in Table 1. Tests were carried out in programs Statistica 10 MR1 and Matlab 7.13 (2011b). Table 1: Results of statistical tests

Hypothesis H1 H2 H3 H4 H5 H6 H7 H8 H9 H10 H11 H12 H13

Method Pearson's chi-squared test Pearson's chi-squared test Pearson's chi-squared test Pearson's chi-squared test Pearson's chi-squared test Pearson's chi-squared test Mann-Whitney U test Kruskal-Wallis ANOVA Kruskal-Wallis ANOVA Mann-Whitney U test Kruskal-Wallis ANOVA Mann-Whitney U test Mann-Whitney U test

P-value 0.00200 0.82000 0.03400 0.25000 0.51000 0.34000 0.97000 0.00900 0.25600 0.39000 0.02700 0.04500 0.00003

Power significance P=0.25; C=0.26 P=0.19; C=0.20 2 η =0.04 2 η =0.07 d=0.3 d=0.6

By using statistical analysis, we found that the restaurants with the biggest interest in energy saving are those that have positive attitude towards membership in AHR CR. But there is only a weak dependence (Table 1). Hypothesis H1 is valid, and at least in this case we can talk about the confirmation of the influence of and occupational organizations on the behavior of their members. Naturally, there are more variables affecting the result (for example the motivation of savings and others), and despite the statistical importance of confirmed hypotheses, we cannot generalize the conclusions consequent to it without problems. As a part of testing hypothesis H3, the statistical importance between working positions for disabled people and a positive attitude towards membership in AHR CR was confirmed. So it is shown that with increasing positive attitudes towards the membership in AHR CR the amount of working positions for disabled people grows. The dependence is weak (Table 1). In this case the ethical code of the association in line with the legal obligation of employers is able to prove the effect of professional associations. Significant effect in this result is represented by 63

the fact that larger facilities (which are often members of professional organizations) are able to offer more working positions to disabled people. However, considering the strength of dependence, we cannot give a definite confirmation of the explanatory variable. Statistical importance can be identified even in the way leftovers are handled depending on the size of a restaurant. Here we confirmed medium-strong dependence when larger restaurants offer their leftovers to the homeless or as food for livestock. Smaller restaurants usually dispose of leftovers in the garbage. So hypothesis H8 was confirmed. There is a noticeable trend leading towards the optimization of waste management, while as a side effect developing a significant component of CSR in the form of support for the social pillar of sustainable development. Another finding is the fact that operating personnel in larger restaurants have better language skills, in some cases by four or five foreign languages. With a decreasing restaurant size comes a decrease in language skills of the operating personnel with a medium-strong dependence. In this case the hypothesis H11 is confirmed by the state of management trends in larger food service facilities. Larger facilities, by default, offer services to a number of clients who as total arises also increases the spectrum of nationalities, which in turn, adds pressure to offer a wider range of communication languages. By testing hypothesis H12, there was confirmed a weak dependence showing the positive relation between the increasing size of a restaurant and the increasing will to support non-profit organizations. This fact is related to the confirmation of the most common form of CSR in larger companies, which is represented by contributions to the non-profit sector. The effects on charitable giving from a tax allowance and marketing support take shape in the social pillar of sustainable development. The social pillar of sustainable development is also supported in the area of further education, in the scope of the confirmed hypothesis H13. The relation between supporting employees in further education and the size of the restaurant was, in this case, shown to be medium-strong. Owners of larger restaurants tend to support further education of their employees compared to their colleagues owning smaller restaurants. The outcome can be related to the tax allowances for education or the ability to receive educational grants for bigger employers. Larger facilities also having motivational programs and benefits that can support employees in their professional development. In our research case however we talk about larger facilities supporting social capital and investing in the social pillar. 7. Discussion Complex research, including exploration of attitude towards sustainable development in the corporate environment, was focused on the sector of food services in a "growth pole" area – the statutory city of Brno. We have assumed that innovations with respect to sustainable development are concentrated in larger cities. From the result´s statistics, which contained a set containing 191 subjects, ensues a rather reserved approach towards fulfilling principles of sustainable development identified as a concept of corporate social responsibility. In the corporate sector, it is obvious and predictable that the most preferred and implemented pillar is the pillar of economic development. However, this trend could not be statistically confirmed in a broader context. The pillar of economic development is secondarily reflected in the social pillar which is the pillar that most often creates statistically provable dependencies. These dependencies are most often related to the size of the company and membership in an umbrella professional association (in the case of the represented 64

research we speak specifically of AHR CR). Although it is highly probable that some of the presented hypotheses can be explained further (by variables not observed in this research), the statistical significance was confirmed. Using the triangulation method [8], the results were discussed with owners of the surveyed facilities. The owners’ interpretations usually accented different reasons than ones related to the awareness of corporate social responsibility. After the promise of anonymity facilities then drew attention to the fact that although their actions in CSR appear as a support of sustainable development, it is entirely latent, or even for selfish reasons (tax allowances, advertisement, public relations etc.). These results problematize the default assumption that the idea of sustainable development in the corporate sector is actually alive and represented by current circumstances of the food services sector, it is an artificially fueled activity occurring as a secondary effect of other interests. Another topic of further research may be the perception of customers and the question of whether these consumers expect and perceive CSR in restaurant facilities at all (this was methodologically addressed for example in [14]). 8. Conclusions Frequent misrepresentation of the definition of the phrase "sustainable development" is typical, especially in the field of regional development. Taking into account the fact that the private sector significantly contributes to the formulation of regional development [21], then the research of elements of sustainable management of the corporate sector is a crucial question. This article has tried to analyze the incorporation of elements of sustainable development, organized into its' three pillars and represented by the concept of corporate social responsibility. CSR is usually not at first glance associated with sustainable development even though it creates the most distinctive manifestation of sustainable development in the corporate sector. In the example of restaurant facilities from selected city districts, not only behavior to the analyzed subjects, but also analysis of the relation between components of CSR is shown in the regional context. Acknowledgement The research is theoretically framed by outputs from the specific research project Global environmental changes and their impact to Earth landscape (MUNI/A/0902/2012) based on model research partially financed by College of Business and Hotel Management. References [1] [2]

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BREKKE, K. A., KVERNDOKK, S., NYBORG, K. An Economic Model of Moral Motivation. In Journal of Public Economics 87 (9–10): 1967–83, 2003 CARROL, A. B. Corporate Social Responsibility: Evolution of a Definitional Construct. In Business Society, 1999; 38; 268, 29 p. CESPA, G., CESTONE, G. Corporate Social Responsibility and Managerial Entrenchment. In Journal of Economics and Management Strategy 16 (3): 741– 71, 2007. DENZIN, N. K., LINCOLN, Y. S. Handbook of qualitative research. Thousand Oaks: SAGE Publications, p. 643, 1994. GROVES, R. M., FLOWER, F. J., COUPER, M. P., LEPKOWSKO, J. M., SINGER, E., TOUTANGEAU, R. Survey Methology. New York: Wiley, 2. edition, 488 p. 2009 ISBN: 978-0470465462. HAMPL, M. Geografická organizace společnosti v České republice: Transformační procesy a jejich obecný kontext. Univerzita Karlova v Praze, Přírodovědecká fakulta. Praha: 2005. 148 s. ISBN 80-86746-02-X. HYNEK, A., HYNEK, N. Bridging the gap between the theory and practice of regional sustainability: a political-conceptual analysis. Bratislava, Geografický časopis, Vol. 59, s.49-64, 2007. KITZMUELLER, M., SHIMSHACK, J. Economic Perspectives on Corporate Social Responsibility. In Journal of Economic Literature 2012, 50:1, 51–84. KULDOVÁ, L. Společenská odpovědnost firem: [etické podnikání a sociální odpovědnost v praxi]. Kanina: OPS, 2010. ISBN 978-80-87269-12-1. MOHR, L., WEBB, D., HARRIS, K. Do Consumers Expect Companies to Be Socially Responsible? The Impact of Corporate Social Responsibility on Buying Behavior. In Journal of Consumer Affairs 35 (1): 45–72, 2001. PACASOVÁ, M., HRDINOVÁ, B., PISKOVSKÁ, H., TROJAN, J. Program rozvoje cestovního ruchu města Brna 2010 - 2015. Brno: Magistrát města Brna, 2010. 252 s. PATON, D., SIEGEL, D. The Economics of Corporate Social Responsibility: An Overview of the Special Issue. In Structural Change and Economic Dynamics 16 (3): 309–12, 2005. PUGA, D. European regional policies in light of recent location theories. Journal of Economic Geography, Oxford University Press, Vol. 2, p. 373-406, 2002. ISSN 1468-2702. SAETHER, Kim T.; RUTH V. Aguilera. Corporate Social Responsibility in a Comparative Perspective. In Crane, A., et al. The Oxford Handbook of Corporate Social Responsibility. Oxford: Oxford University Press. 2008 ISBN 0199211590. TROJAN, J., TRÁVNÍČEK, J. Udržitelný rozvoj v korporátní sféře: Corporate Social Responsibility restauračních zařízení na území statutárního města Brna. První vydání. Brno: Vysoká škola obchodní a hotelová, 2012. 47 s. ISBN 978-8087300-17-6. TROJAN, J., TRÁVNÍČEK, J., JEŘÁBEK, T. Udržitelný rozvoj v oblasti restauračních zařízení: společenská odpovědnost brněnských firem. In Journal of Tourism, Hospotality and Commerce, 02/2013, Vysoká škola obchodní a hotelová, ISSN 1804-3836. In print. WOKOUN, R. et al. Regionální rozvoj. Východiska regionálního rozvoje, regionální politika, teorie, strategie a programování. Linde Praha, a.s., Praha, 2008, 482 p. ISBN 978-80-7201-699-0.

EFFECTIVE STRATEGIC PLANNING IN MODERN INFORMATION AGE ORGANIZATIONS Cezar Vasilescu and Aura Codreanu Abstract: The field of strategic management has offered a variety of frameworks and concepts during last period of time, many with the declared aim of “taking business and its management seriously.” Strategic planning can help an organization to build its sustained competitive advantage in the face of an uncertain marketplace, but requires new ways of thinking in order to create feasible alternatives. This article examines how the Chief Information Officer (CIO) can use strategy and planning as an enabler to meet the mission of an organization. The analysis focuses on some common problems that occur in strategic planning. Managers need to identify these potential issues, so that they can recognize and deal with them if they arise in their own strategic planning. A systems approach is taken which presents planning as an open inclusive process that seeks to produce flexible systems capable of growth and adaptation to meet changing needs and missions.

Keywords: Strategic planning, Mission, Vision, Strategic plan 1. Introduction When we discuss about strategic planning, we should clearly understand if it is different from normal planning and if so, what make strategic planning different from day-to-day planning. Obviously we plan to be prepared for some expected or unknown event. In the climate of near constant change we are experiencing, organizations have to continue to deliver their missions, thus it’s essential to consider the effect of that change on their future direction. In this paper we will cover some of the different perspectives that exist on strategic planning and we will consider the drivers that are forcing us to plan and finally consider what constitutes strategic planning in information resources management. The challenge for any organization is to manage change and not to be managed by it. 2. Strategic Planning So what is strategic planning and what does it offers to an organization? Planning takes place at many levels, from the day-to-day planning that ensures the delivery of short term goals/activities, to the long term planning that affects the structure and future direction of an organization. Strategic planning is concerned with high-level issues that often relate to an organization's existence and usually takes a long-term view. One of the most suitable definitions states that strategic planning is “… a specialized planning method for organizations based on the three core elements of a clearly defined mission statement, acknowledgement of basic values that must be expressed in its actions and a vision of desired future outcomes” [1]. The documented result of the strategic planning process is the strategic plan. The strategic plan is a guide to achieving the mission of the organization. It is a great 67

communication tool and a way of informing what the organization intends to do and how it intends to achieve its Vision. The strategic plan is also a mechanism for connecting planning programs and initiatives with the organization budget. Based on an analysis of the facts from many organizations, we can identify some indicators that reveal the strategic planning process is imperfect and the strategic planning is malfunctioning or not serving its basic purposes: The process of producing the strategic plan means to put more effort into the publication of the document than into the development of the content; Planning is withheld to a small group of planners (not all the senior leadership is involved); The process of producing the strategic plan take place somewhere outside the organization, separated from the normal work process; The existence of internal memos which dictate that the vision statement will be completed today, by a specific time in the afternoon; The strategic plan is not easily accessible / available to be read; Few persons from the organization ever read the strategic plan and even more, the senior leadership is not expecting the employees to read it. Those indicators show whether an organization is really conducting strategic planning with a view to improving how they meet their mission, or whether they are just following a legislative requirement and do not understand the true purposes of strategic planning. A poor planning become a mean in itself, rather than a mean to an end. More effort appears to go into producing the plan as a finished publication than in the development of the content. As a result the strategic plan is often ignored and is ineffective in helping the organization adapt to major changes in the future [2]. To conclude, strategic planning is not just a programming function, where the chronological component of the plan or its publication itself becomes the most important product. What should distinguish between good and poor strategic planning is the thinking involved in the development of the plan and not the programming. The focus needs to be on strategic thinking not strategic programming. We should properly consider and plan for the unknown and unexpected that we may face in the future, rather than planning for the easy and expected things. To be effective, the strategic plan must be read and understood at many levels throughout the organization. Everyone should recognize their role in supporting and delivering the requirements of the plan. Similarly, everyone should recognize that the plan is relevant to the mission and purpose of the organization. The process by which good strategic plans are produced should be different. For example, leadership has the responsibility to ensure the plan is developed, but good strategic planning does not assume that only the leadership has the right answer; some of the ideas from lower levels of the organization may well be exactly what is required. In the same time, we have to consider that organizations that are currently profitable will have a hard time convincing senior management (and less likely employees) that a change in how people behave is necessary or worth the organizational pain [3]. The future of the organizations and what they will become in 5 years does not yet exist, we have to create it. Our actions and decisions (both individual and collective) will create the future. This is the nature of strategic planning - organizations must plan for the unknown. We can react to the unknown or we can shape the unknown, but only effective strategic planning can make the difference between shaping and having to react. Regardless the perspective one adopts, the fundamental purpose of planning is to integrate organizational efforts in achieving a common goal [4]. 68

In today’s world, we need a change in the way in which we think. If we assume the future is predictable then our planning becomes linear and internally focused. If we assume the future is unknown and we are planning in a time of uncertainty, we have to acknowledge the existence of risks and the fact that old ways of working may not be adequate. It is widely accepted the fact that how we think governs how we act. Regarding the planning aspect, if we think on “short term” we will (in most cases) inevitably plan only in the “short-term”. Similarly, if we think in a narrow mindset, then we will only be able to plan in a similar manner. 3. Strategic Planning and Information Resources Management (IRM) Every organization should connect their investment in Information Technology with improved program effectiveness and service delivery. The development of a Strategic Plan assist the organizations to focus on results and performance, linking budgets, planning and performance targets, and contributes to the recognition of information systems’ role in delivering improved performance. From an Information Resources Management perspective, the strategic plan is a mechanism that allows the Chief Information Officer (CIO) to connect the strategic objectives of the organization to programs and initiatives that involve information systems. Establishing this connection serves to make senior leadership aware of how information systems contribute to the mission and vision of the organization. The characteristics of an organization's key decision-makers influence strategy and subsequent organizational performance [5]. Strategic Planning is not just required by legislation, it is also a good business practice. Only by adequate planning can organizations be prepared for the future, particularly the ones that experience or anticipate greater changes. Organizations need to display the following characteristics: Accountability; Alignment; Awareness; Adaptability. Planning as Accountability In this specific context, planning as accountability means the organization intends to provide and can demonstrate value for money. Best practices worldwide show that a successful organization will always include in its strategic plan at least the following elements: A comprehensive mission and vision statements; General goals and objectives for major activities and operations; Strategies to achieve these goals and objectives; The relationship between the long-term goals and objectives and the annual performance goals; Key external factors (beyond internal organizational control) that could influence the accomplishment of the goals and objectives; Realistic performance measurements; A description of how program evaluations will be used to revise the strategic goals.

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Planning as Alignment In this specific context, planning as alignment is interpreted in the light of all organization’s components is working together to achieve the mission and strategic planning promotes / provides: An integrated structure; Autonomous (but coordinated) actions through out the organization; Organizational cohesiveness through a shared sense of direction, intent and purpose; Shared values, beliefs and assumptions; Concentration of effort; Flexibility for responding to a changing environment. Planning as Awareness In this specific context, planning as awareness means an organization understands the environment and customers it is serving. Its strategic planning process contributes to an increasing visibility of responsive intent to the customer, reduces the information overload and indicates creative ability to adapt to change. Planning as Adaptability In this specific context, planning as alignment means an organization can be responsive in a world of constant change. 4. Common Issues in Strategic Planning The strategic plan needs to address high-level issues and include a long-term view. Above all it is concerned with achieving organization’s mission and adapting to what the organization and stakeholders decided it needs to become. In other words, the Strategic Plan addresses where the organization must go or what it must become, why it needs to change, and how it gets there, all while achieving its mission. In order for a suitable planning process to be put in place several issues need to be addressed. The most common concern is the way we plan. The common understanding of planning is best expressed through the following questions: Where is the organization going? Why is it going there? How will it get there? How will we know that the organization is getting there? The synthesis and result of the above questions is expressed by three basic organizational concepts: Mission, Vision and Plan. The Mission specifies “what the organization does, its very purpose”, the Vision express “what the organization intends to be in the future, where it is going”, while the Plan explains “how to get to the Vision, while achieving the Mission”. The development process for the vision is a tricky one. Thinking about wow do organizations develop and then achieve their vision takes us back to an issue raised before, that of “strategic thinking” rather than “strategic planning”. The process of understanding where an organization needs to go is far more valuable than the process of planning. After all if the destination is incorrect, then no amount of planning will get you to where you should be. The mission statement and vision statement create a suitable framework for the planning process to be put in place. One common mistake is to establish a too ambitious vision for the organization. The reality of strategic planning tells us that the vision should be challenging but must be at least theoretically attainable. The vision is therefore a “TO-BE” state which differs significantly from the present “AS-IS” state. 70

Setting the vision is therefore very important, leadership must be open to ideas and aware of the uncertainty and change that faces the organization. Because visions can be very powerful motivators (consider only the challenge “This nation should commit itself to achieving the goal, before the decade is out, of landing a man of the moon and returning him safely to Earth” [6]), we must however, be very careful not to simply create a slogan. Therefore, there is a strong requirement to visualize the vision - what would it mean to the organization if we achieved it. The strategic plan must recognize why the organization is going in a specific direction. Reasons include pressure from customers and stakeholders, changes in technology and work practices or an existing failure to achieve the organization’s mission. A common issue regarding the strategic plan is the tendency to consider it finalized (as an activity) in the moment when its documented format is issued. The point here is the plan without a subsequent action is wasted effort and it is just “shelf ware”. If you are going to achieve your vision, the organization must undertake course of action that derives from the strategic plan. However “... sometimes strategies must be left as broad visions, not precisely articulated, to adapt to a changing environment” [7], so in other words occasionally being too specific on the approaches derived from the strategic plan is a mistake. The figure below shows a diagram that clearly represents the Strategic Management Process Model. Customer Stakeholders Partners

Needs

Advance Planning

External and Internal Information (Environmental Scans)

Products and services

Setting Strategic Direction

Feedback

Translating Strategic Direction into Action Performance Evaluation Information, data and feedback

Figure 1: The Strategic Management Process Model [8].

The diagram shows many of the influences in the strategic management process. Although the strategic plan should be revised and published at least annually, strategic planning is not done only once a year, but it is an on-going process. Obviously the vision and mission won’t normally change over a number of years, but both the strategic objectives and goals may change, often as a result of an assessment of how well the organization is moving towards its vision. Having set a strategic direction, the next process is to translate that into action. Often an organization will establish a small number of strategic objectives, broad “goals” for the organization to achieve. 71

These strategic objectives are achieved through focused programs and initiatives. Many of these programs will depend upon information systems - thus re-establish the connection between strategic objectives and information system programs. To successfully implement the strategic objectives, an organization must have the capability to execute the strategy. By capabilities we refer to the individual, process and organizational tools, skills and knowledge required to successfully implement change [9]. Managers need to recognize and deal with some common potential problems in the implementation of strategic planning, as follows: Lack of commitment - A common concern in strategic planning is the potential lack of commitment from the leadership of the organization. Top management bodies are often unwilling to support a system of strategic planning, because they consider it decentralizes authority and power. Therefore, the design of strategic planning process should be done having in mind the necessity of an increasing top management commitment; Organizational politics - A major problem is represented by the individual agenda of planners and managers, which have their own interests, beliefs and biases. Planning is supposed to be objective and personal biases should not influence the process; Organizational climate - A successful strategic planning process also requires a favourable climate within the organization regarding the concept itself. Briefly speaking, if the organizational culture does not support strategic planning, then there is little chance of it being properly used; Resistance to change - The necessity of carefully introducing the strategic planning process into the organization cannot be overstressed. It always implies new (or different) ways of doing things and people may reject it simply because it is not a familiar concept. In some cases, the strategic planning model was followed exactly and the mission statement was revised and refined multiple times, the SWOT analysis was completed and we finally create a list of goals with deadlines. The task was accomplished, but there is only one problem: it doesn’t work. And when or if it does, it doesn’t work nearly as well as it needs to work to have the improvements that are necessary to stay ahead of your competitors. In this case, several issues prevent us from an easy-to-follow implementation activity of the strategic plan: There are no strategies inside the strategic plan - The plan is completely lacking of any defined / real strategies; without the strategy, the chances of using your resources to create the results you want are based mostly on luck. Even if results are achieved, they are obtained with a much greater level of effort than was necessary; There is no list of obstacles for each strategy and no contingency plans for each obstacle - The end result will be that it will take us longer to accomplish our goals, because we’ll need to regroup as we encounter each obstacle; There is no clear structure or implementation deadlines - The global project leader for the initiative is not defined, it is unclear to whom and when will give status reports and so are the milestones.

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5. Conclusion The theoretical and practical importance of developing and applying strategic planning to sustain a organization’s competitive advantage in complex and volatile external environments has promoted this issue to the forefront of the research agendas of many scientists. So, the strategic planning capability is recently receiving much more attention, focused on the organization’s ability to renew its resources in line with changes in its environment. The turbulent and changing nature of the environment suggests that the strategic management process could not be static and still considered to be valuable. It must be continually evolving and developing, otherwise organizations may only be able to be competitive on short term. To have a persistent advantage, organizations must plan for the future and consequently continue to upgrade their resources to create new strategic growth alternatives. References [1]

[2]

[3]

[4] [5]

[6]

[7]

[8]

DEAN, L. A. Council for the Advancement of Professional Standards in Higher Education, 6th edition, 2006, Glossary of Terms. Available from http://www.gvsu.edu/dos/glossary-of-terms-72.htm. JOHNSON, G. Managing Strategic Change Strategy, Culture and Action. Long Range Planning, Vol. 25, No. 1, p. 28, 1992. Available from http://xa.yimg.com/kq/groups/18937164/744773344/name/johnson%252B(1).pdf DE LONG, D. Building the Knowledge-Based Organization: How Culture Drives Knowledge Behaviors. Center for Business Innovations, Ernst & Young LLP, p. 4, May 1997. ORNE, D., KOTHA, S., ERICKSON, R. Planning for Managers in the Middle. Tool and Manufacturing Engineers Handbook, Chapter 1 - Planning, p.1-3, 1988. WILKINSON, A. J., MELLAHI K. Organizational Failure: A critique of recent research and a proposed integrative framework. International Journal of Management Reviews, Volume 5, Issue 1, p. 15, 2004. Available from http://onlinelibrary.wiley.com/doi/10.1111/j.1460-8545.2004.00095.x/pdf . KENNEDY, J. F. Excerpts from “Urgent National Needs” Speech to a joint session of Congress, 25 May 1961, Available from http://history.nasa.gov/Apollomon/apollo5.pdf. MINTZBERG, H. The Fall and Rise of Strategic Planning. Harvard Business Review, January-February, p. 112, 1994. Available from http://staff.neu.edu.tr/~msagsan/files/fall-rise-of-strategic-planning_72538.pdf. GRANT, J. H. Advances and Challenges in Strategic Management, International Journal of Business, Vol. 12, No. 1, p. 15, 2007.

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PARTICULAR APPROACHES TO DISCRIMINATION IN LABOUR MARKET Hana Vlachová Abstract: The article deals with the problem of gender discrimination which is a cause of gender pay gap meaning that women are less remunerated than men for the same work done in the same quality. The article shortly presents four economic models explaining gender discrimination in labour market – monopsonistic discrimination, Becker’s taste-fordiscrimination model, statistical discrimination and crowding model. It also shows gender discrimination in labour market in the Czech Republic on ordinarily available data from the Czech Statistical Office.

Keywords: crowding model, discrimination, gender pay gap, monopsonistic discrimination, statistical discrimination, taste-for-discrimination model 1. Introduction Since 19th century there were fundamental changes in women’s position in the labour market. Women shifted from keeping households and taking care of children to factories and other parts of labour market. The biggest changes came with the 2nd World War. However differences between men and women have been still persisting in the labour market and women were employed in branches which were considered to be traditionally female professions as nurses, kindergarten and elementary school teachers or librarians. Although the situation began to change in the 1970s and many disparities have been reduced [1] men and women still do not have the same conditions in the labour market. The main problem of contemporary labour market, from the women’s point of view, is different remuneration for work done by them and by men. 2. Gender Pay Gap Gender Pay Gap (GPG) is the main tool for measuring the differences in remuneration of men and women in labour market. The unadjusted GPG is an important indicator used within the European employment strategy to monitor differences in payment between men and women. GPG can be defined as “the difference between men’s and women’s pay, based on the average difference in gross hourly earnings of all employees” [2]. From Eurostat estimates it is obvious that there are considerable differences between the European Union member states. Since it concerns only salaried people GPG is not an indicator of the overall inequality between women and men. It is necessary to look at GPG in conjunction with other indicators linked to the labour market, in particular those ones that reflect the different working patterns of women. In countries with low female employment rate (e.g. Italy) GPG is lower than average, which could be a reflection of the small proportion of low-skilled or unskilled women in the workforce. A high GPG is 74

usual in highly segregated labour market with women more concentrated in a restricted number of sectors or professions (e.g. Czech Republic, Estonia and Finland) [3]. For example the public sector employs more than 3 times as many women as men in the Czech Republic [4]. A high GPG is also usual in labour market with a significant proportion of women working part-time (e.g. Germany and Austria). Also GPG can be influenced with institutional mechanisms and systems on wage setting. [3] GPG brings many consequences which affect big amount of people. Current GPG affects not only women, it likely affects their children and future generations too [5]. GPG is also cause of lower living standard and poverty of women in their old age, because due to lower earnings women tend to have lower pensions. This issue is very important especially because of longer longevity of women. 3. Models of discrimination in labour market All above mentioned effects are results of discrimination in labour market. International Labour Organization [6] defines discrimination as “treating people differently because of certain characteristics, such as race, colour or sex, which results in the impairment of equality of opportunity and treatment. In other words, discrimination results in and reinforces inequalities“. Many of occupational differences between men and women still remain and women face two main risks of undervaluation. First they will be paid less than men for the same efficiency within the same job, and second they will be employed in jobs or occupations which are undervalued themselves [7]. Grimshaw and Rubery [7] explored the social construction of value and found five factors contributing to women’s lower earnings. The first factor is visibility which means that women’s skills are often not visible; their jobs tend to be aggregated in large and undifferentiated pay group. The second is valuation of women’s skills where pay and grading structures are still often based on male-type skills. Third is vocation meaning that women’s skills are often treated as “natural” and considered to provide opportunities for high levels of job satisfaction that justify lower pay. Fourth is value added, meaning that women tend to be found in low value added or labour intensive occupations. The last one factor is variance, which means that women’s lives are different from men’s and women are considered to occupy a separate sphere that is non commensurate with men’s sphere. [7] Fernández and Pena-Boquete [8] explored consequences of gender discrimination both microeconomic and macroeconomic. They aimed to linkage between productivity and gender wage discrimination. They found that gender discrimination has consequences for the whole labour market, especially on productivity. Their preliminary results said that an increase of the degree of discrimination causes a decrease of productivity and a change in the employment allocations between men and women. Because of these serious consequences discrimination in labour market is a topic that was given significant attention in the literature in recent decades. Economists have been looking for explanation on discrimination and governmental bodies and other institutions are still working on decreasing of this negative phenomenon. Edgeworth [9] was the first who applied neoclassical theory to discrimination in wages of men and women, but the main study has been performed by Becker in 1957. Till present four most important models for describing and explaining the discrimination of women in labour market were created. The first explanation of discrimination in labour market is the theory of monopsonistic discrimination. However this concept does not get much credit as an explanation of gender differences in remuneration. The author of the idea of monopsonistic 75

discrimination in the labour market is Joan Robinson [10]. The concept is simple. A single buyer, a monopsonist, sets wages below marginal revenue product and the more inelastic the labour supply is the lower are wages relative to productivity. The monopsonist obtains higher profit by differentiating wages between groups with different elasticities of labour supply. Employees with more inelastic labour supply will earn less. One way for differentiating employees is differentiating by gender. Today economists do not consider this theory to add much to the understanding of the overall GPG. [11] The second model for explaining discrimination in labour market is taste-fordiscrimination model created by Gary Becker in his book The Economics of Discrimination [12]. The theory is based on relating of prejudiced behaviour to preferences that economic subjects may have with respect to clearly identified groups. According to this theory the worker’s type is defined by an observable characteristic (for example gender) that induce a different behaviour in the employer because the employer has distaste for working with people with these characteristics and is willing to pay a price to avoid contact with this type of employees. This behaviour is relevant in the bargaining process to determine wage and it happens conditionally on the realization of the meeting. Taste discrimination is still the most widespread model of prejudiced behaviour and has already been combined with search models to study gender discrimination in labour market. [13] Other group of models dealing with discrimination in labour market includes statistical discrimination models. Statistical discrimination refers to the phenomenon of an employer using observable characteristics of individuals as a proxy for unobservable characteristics. The observable characteristic in this case is gender, in other cases can include recognizable physical traits, as race and ethnicity or endogenously chosen characteristics, such as club membership or language. In statistical discrimination models the employers are utility or profit maximizers, and in most of these models, they are imperfectly informed about relevant characteristics of the potential employees, such as their productivity or qualifications, which makes them motivated to use group statistics as proxies of unobserved characteristics. [14] Employer's preferences of male employees can come out from his previous statistical experience with the two groups (males and females), or it might come out from prevailing sociological beliefs that women deliver on the average an inferior performance. [15] The last model connected to discrimination in labour market to be described is Bergmann’s crowding model. In this model there is no wage discrimination. Crowding model is based on assumption that women are allowed to enter occupation B, but not occupation A. They are pushed into occupation B with relatively large supply of workers to demand. Marginal product of labour is declining therefore the large supply of worker in occupation B cause a low marginal product of labour and a low wage. In occupation A with smaller supply of workers the situation is reverse. This model is based on wages equal to marginal product; therefore there is no wage discrimination. Female employees have a low marginal product because of female occupations and that is the reason for their lower remuneration. [16]

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4. Discrimination in labour market in the Czech Republic The Czech Republic also deals with the problem of gender discrimination in labour market and GPG. It can be seen from following graphs. Graph 1 shows medians of earnings by CZ-NACE in 2011 in the Czech Republic. It is obvious that in particular branches are men’s earnings markedly higher than earnings of women; especially in information and communication branch and financial and insurance activities. Medians of earnings by CZ-NACE in 2011

CZK 50 000 40 000 30 000 20 000 10 000 0

A B C D E F G H

I

women

J

K L M N O P Q R S men

CZ-NACE code

Graph 1: Medians of earnings by CZ-NACE in 2011. Source: Based on data from [17] Legend: A – Agriculture, forestry, and fishing; B – Mining and quarrying; C – Manufacturing; D – Electricity, gas, steam and air conditioning supply; E – Water supply, sewerage, waste management and remediation activities; F – Construction; G – Wholesale and retail trade, repair of motor vehicles and motorcycles; H – Transportation and storage; I – Accommodation and food service activities; J – Information and communication; K – Financial and insurance activities; L – Real estate activities; M – Professional, scientific and technical activities; N – Administrative and support service activities; O – Public administration and defence, compulsory social security; P – Education; Q – Human health and social work activities; R – Arts, entertainment and recreation; S – Other service activities.

According to the Czech Statistical Office payment of women is lower than payment of men in the Czech Republic. Women get approximately 75 percent of men’s earnings. It is shown in graph 2.

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CZK 35 000

Average gross monthly earnings and medians of earnings

30 000 25 000 20 000 15 000 10 000 5 000 0 2008

2009

2010

2011

Average earnings - women

Median of earnings - women

Average earnings - men

Median of earnings - men

year

Graph 2: Average gross monthly earnings and medians of earnings Source: Based on data from [17

From graph 2 it is also obvious that median of earnings is smaller and decreasing. Median is better measurement for differences in earnings of men and women, because it is not influenced with small amount of people with above-average high payment. The situation on labour market in the Czech Republic is worse for women as can be seen from graph 3 which shows higher unemployment rate of women than men. persons Unemployment in the Czech Republic in 1993 - 2011 (thousands) 300,0 250,0 200,0 150,0 100,0 50,0 0,0 1993

1995

2000

2005

women

2009

2010

2011

men

Graph 3: Unemployment in the Czech Republic in 1993 - 2011 Source: Based on data from [17]

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year

Higher unemployment rate and lower earnings of women are the fact in spite of their higher level of education. Graph 4 shows there are more female graduates with secondary education with A-level examination and also more university graduates among women in the Czech Republic. persons (thousands)

Education in the Czech Republic in 2011

90,0 80,0 70,0 60,0 50,0 40,0 30,0 20,0 10,0 0,0

women men

Basic and without education

Secondary without A-level examination

Secondary with A-level examination

University

education level

Graph 4: Education in the Czech Republic in 2011 Source: Based on data from [17]

Jurajda [4], Mysíková [18, 19] or Brožová [20] have studied GPG in the Czech Republic in detail. The Czech Republic is according to European Union’s effort working on improving women’s situation in labour market but from data which have been shown in this article it is obvious, even without complicated analysis, that there is still a lot to be improved. 5. Conclusions Since 19th century there were many changes in labour market and today women are commonly engaged in earning financial resources for their families. However there are still big disparities in remuneration of men and women. These disparities differ in dependence on country and other factors. Economists have been exploring this issue since the beginning of 20th century and have created several models and theories to be able to explain gender discrimination and GPG as its consequence. Even the Czech Republic is not an exception and it also deals with remuneration inequality. Because of serious negative consequences of GPG which cause lower living standard and poverty of women in their old age this issue should be in the centre of interest of economists and governmental bodies. References [1] [2]

BLAU, Francine D. a Lawrence M. KAHN. Gender Differences in Pay. Working Paper 7732. 2000. Available from: http://www.nber.org/papers/w7732. EUROPEAN UNION. Tackling the gender pay gap in the European Union. Luxembourg: Publications Office of the European Union, 2011. ISBN 978-92-7920772-3. Available from: http://www.ab.gov.tr/files/ardb/evt/1_avrupa_birligi/1_9_politikalar/1_9_9_ ekonomi/tackling_gender_pay_gap_in_eu.pdf .

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[3]

[4]

[5]

[6]

[7]

[8]

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[12]

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[14] [15]

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The situation in the EU. EUROPEAN COMMISSION. European Commission [online]. 2011, 2013-07-17 [cit. 2013-07-20]. Available from: http://ec.europa.eu/justice/gender-equality/gender-pay-gap/situationeurope/index_en.htm. JURAJDA, Štěpán. Gender Wage Gap and Segregation in Late Transition. CEPR Discussion Paper No. 2952. 2001. Available from: http://dev3.cepr.org/meets/wkcn/4/4522/papers/juradja.pdf . HAAS, Sherri. Economic Development and the Gender Wage Gap. The Park Place Economist. 2006, XIV, s. 49-55. Available from: http://www.iwu.edu/economics/PPE14/Haas.pdf. Workplace discrimination. INTERNATIONAL LABOUR ORGANIZATION. International Labour Organization [online]. 2013 [cit. 2013-07-22]. Available from: http://www.ilo.org/global/topics/equality-and-discrimination/workplacediscrimination/lang--en/index.htm. GRIMSHAW, Damian a Jill RUBERY. Undervaluing women's work. Manchester: Equal Opportunities Commission, 2007. ISBN 18-420-6187-9. Available from: http://www.equalityhumanrights.com/uploaded_files/equalpay/undervaluing_wo mens_work.pdf. FERNÁNDEZ, Melchor a Yolanda PENA-BOQUETE. Macroeconomic consequences of gender discrimination: A preliminary approach: Could gender wage discrimination explain regional differences in productivity?. ERSA conference papers. 2011. Available from: http://wwwsre.wu.ac.at/ersa/ersaconfs/ersa10/ERSA2010finalpaper1066.pdf. EDGEWORTH, Francis Y. Equal Pay to Men and Women for Equal Work. Economic Journal. 1922, č. 31, s. 431-457. ROBINSON, Joan. The economics of imperfect competition. 2d ed. New York: St. Martins Press, 1976. ISBN 978-033-3102-893. BARTH, Erling a Harald DALE-OLSEN. Monopsonistic Discrimination, Worker Turnover, and the Gender Wage Gap. IZA discussion papers, No. 3930. 2009. Available from: https://www.econstor.eu/dspace/bitstream/10419/35465/1/58980801X.pdf. BECKER, Gary S. The economics of discrimination. 2nd ed. Chicago, Ill.: University of Chicago Press, 1971, 167 p. Economics research studies of the Economics Research Center of the University of Chicago. ISBN 9780226041162. FLABBI, Luca. Gender Discrimination Estimation in a Search Model with Matching and Bargaining. IZA Discussion Paper No. 1764. 2005. Available from: http://ftp.iza.org/dp1764.pdf. VOLUME EDITOR, Jess Benhabib. Handbook of social economics. 1. ed. Amsterdam: North Holland, 2010. ISBN 978-044-4531-872. PHELPS, Edmund S. The Statistical Theory of Racism and Sexism. The American Economic Review. 1972, roč. 62, č. 4, s. 659-661. Available from: http://www2.econ.iastate.edu/classes/econ321/orazem/Phelps_statdiscrimination.pdf. BURNETTE, Joyce. The Emergence of Wage Discrimination in US Manufacturing. US Census Bureau Center for Economic Studies Paper No. CESWP- 11-18. 2011, x. Available from: http://eh.net/eha/system/files/eha-meeting2009/session_presentation_pdfs/files/23/original/Burnette.pdf?1253165481.

[17] ČESKÝ STATISTICKÝ ÚŘAD. Zaostřeno na ženy a muže 2012 [online]. 2012, 2013-01-18 [cit. 2013-07-26]. Available from: http://www.czso.cz/csu/2012edicniplan.nsf/publ/1413-12-r_2012. [18] MYSÍKOVÁ, Martina. Gender Wage Gap in the Czech Republic and Central European Countries. Prague Economic Papers. 2012, č. 3, s. 328-346. [19] MYSÍKOVÁ, Martina. Women Labor Market: Gender Pay Gap and Its Determinants. IES Working Papers 2007/13. 2007, č. 13. [20] BROŽOVÁ, Dagmar. Diskriminace žen v ekonomické teorii: Vybrané problémy. Politická ekonomie. 2006, č. 5, s. 646-660. Available from: http://www.vse.cz/polek/cislo.php?cislo=5&rocnik=2006.

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