Evaluating the effectiveness of Z: The claims made about CICS and where we go from here

There have been few genuine success stories about industrial use of formal methods. Perhaps the best known and most celebrated is the use of Z by IBM (in collaboration with Oxford University's Programming Research Group) during the development of CICS/ESA (version 3.1). This work was rewarded with the prestigious Queen's Award for Technological Achievement in 1992 and is especially notable for two reasons: 1) because it is a commercial, rather than safety- or security-critical, system and 2) because the claims made about the effectiveness of Z are quantitative as well as qualitative. The most widely publicized claims are: less than half the normal number of customer-reported errors and a 9% savings in the total development costs of the release. This paper provides an independent assessment of the effectiveness of using Z on CICS based on the set of public domain documents. Using this evidence, we believe that the case study was important and valuable, but that the quantitative claims have not been substantiated. The intellectual arguments and rationale for formal methods are attractive, but their widespread commercial use is ultimately dependent upon more convincing quantitative demonstrations of effectiveness. Despite the pioneering efforts of IBM and PRG, there is still a need for rigorous, measurement-based case studies to assess when and how the methods are most effective. We describe how future similar case studies could be improved so that the results are more rigorous and conclusive.

Thixotropic studies of lead-based solder, lead-free solder and conductive adhesive pastes

The stencil printing process is an important process in the assembly of Surface Mount Technology (SMT)devices. There is a wide agreement in the industry that the paste printing process accounts for the majority of assembly defects. Experience with this process has shown that typically over 60% of all soldering defects are due to problems associated with the flow properties of solder pastes. Therefore, the rheological measurements can be used as a tool to study the deformation or flow experienced by the pastes during the stencil printing process. This paper presents results on the thixotropic behaviour of three pastes; lead-based solder paste, lead-free solder paste and isotropic conductive adhesive (ICA). These materials are widely used as interconnect medium in the electronics industry. Solder paste are metal alloys suspended in a flux medium while the ICAs consist of silver flakes dispersed in an epoxy resin. The thixotropy behaviour was investigated through two rheological test; (i) hysteresis loop test and (ii) steady shear rate test. In the hysteresis loop test, the shear rate were increased from 0.001 to 100s-1 and then decreased from 100 to 0.001s-1. Meanwhile, in the steady shear rate test, the materials were subjected to a constant shear rate of 0.100, 100 and 0.001s-1 for a period of 240 seconds. All the pastes showed a high degree of shear thinning behaviour with time. This might be due to the agglomeration of particles in the flux or epoxy resin that prohibits pastes flow under low shear rate. The action of high shear rate would break the agglomerates into smaller pieces which facilitates the flow of pastes, thus viscosity is reduced at high shear rate. The solder pastes exhibited a higher degree of structural breakdown compared to the ICAs. The area between the up curve and down curve in the hysteresis curve is an indication of the thixotropic behavior of the pastes. Among the three pastes, lead-free solder paste showed the largest area between the down curve and up curve, which indicating a larger structural breakdown in the pastes, followed by lead-based solder paste and ICA. In a steady shear rate test, viscosity of ICA showed the best recovery with the steeper curve to its original viscosity after the removal of shear, which indicating that the dispersion quality in ICA is good because the high shear has little effect on the microstructure of ICA. In contrast, lead-based paste showed the poorest recovery which means this paste undergo larger structural breakdown and dispersion quality in this paste is poor because the microstructure of the paste is easily disrupted by high shear. The structural breakdown during the application of shear and the recovery after removal of shear is an important characteristic in the paste printing process. If the paste’s viscosity can drop low enough, it may contribute to the aperture filling and quick recovery may prevent slumping.

Relational dimensions of corporate governance in translation: networked governance in China and India

The effectiveness of corporate governance mechanisms has been a subject of academic research for many decades. Although the large majority of corporate governance studies prior to mid 1990s were based on data from developed market economies such as the U.S., U.K. and Japan, in recent years researchers have begun examining corporate governance in transition economies. A comparison of China and India offers a unique environment for analyzing the effectiveness of corporate governance. First, both countries state-owned enterprise (SOE) reform strategies hinges on the Modern Enterprise System characterized by the separation of ownership and control. Ownership of an SOE’s assets is distributed among the government, institutional investors, managers, employees, and private investors. Effective control rights are assigned to management, which generally has a very small, or even nonexistent ownership stake. This distinctive shareholding structure creates conflict of interest not only between management (insiders) and outside investors but also between large shareholders and minority investors. Moreover, because both governments desire to retain some control—in part through partial retained ownership of commercialized SOEs, further conflicts arise between politicians and firms. Second, directors in publicly listed firms in both countries are predominantly drawn from institutions with significant non-market objectives: the government and other state enterprises, particularly in China, and extended families, particularly in India. As a result, the effectiveness of internal governance mechanisms, such as the number of independent directors on the board and the number of independent supervisors on the supervisory committee, are likely to be quiet limited, although this has yet to be fully evaluated. Third, because of the political nature of the privatization process itself, typical external governance mechanisms, such as debt (in conjunction with appropriate bankruptcy procedures), takeover threats, legal protection of investors, product market competition, etc., have not been effective. Bank loans have traditionally been viewed as grants from the state designed to bail out failing firms. State-owned banks retain monopoly or quasi-monopoly positions in the banking sector and profit is not their overriding objective. If political favor is deemed appropriate, subsidized loans, rescheduling of overdue debt or even outright transfer of funds can be arranged with SOEs (soft budget constraints). In addition, a market for private, non-bank debt is limited in India and has yet to be established China. There is no active merger or takeover activity in Chinese stock markets to discipline management. Information available in the capital markets is insufficient to keep at arm’s length of the corporate decisions. In light of the above peculiarities, China and India share many of the typical institutional characteristics as a transition economy, including poor legal protection of creditors and investors, the absence of an effective takeover market, an underdeveloped capital market, a relative inefficient banking system and significant interference of politicians in firm management. Su (2005) finds that the extent of political interference, managerial entrenchment and institutional control can help explain corporate dividend policies and post-IPO financing choices in this situation. Allen et al. (2005) demonstrate that standard corporate governance mechanisms are weak and ineffective for publicly listed firms while alternative governance mechanisms based on reputation and relationship have been remarkably effective in the private sector. Because the peculiarities are significant in this context, the differences in the political-economies of the two countries are likely to be evident in such relational terms. In this paper we explore the peculiarities of corporate governance in this transitional environment through a systematic examination of certain aspects of these reputational and relationship dimensions. Utilising the methods of social network analysis we identify the inter-organisational relationships at board level formed by equity holdings and by shared directors. Using data drawn from the Orbis database we map these relations among the 3700 largest firms in India and China respectively and identify the roles played in these relational networks by the particularly characteristic institutions in each case. We find greatly different social network structures in each case with some support in these relational dimensions for their distinctive features of governance. Further, the social network metrics allow us to considerably refine proxies for political interference, managerial entrenchment and institutional control used in earlier econometric analysis.