Human resources management: Lloyds TSB Group

Human resources management: Lloyds TSB Group INTRODUCTION A companys growth can normally happen in one of the two ways. Organic or inorganic growth. Merger and acquisition mainly results from inorganic growth. In the early 1990s, there was a great increase in the number of mergers and acquisitions in the banking industry. Lloyds TSB has recently grown through a further acquisition. By acquiring HBOS (Halifax/Bank of Scotland) plc, the Lloyds Banking Group has become the largest retail bank in the UK. Around half of all people in the UK (30 million) now bank with the Lloyds Banking Group. The group has the largest branch network of any UK bank and 140,000 staff. The acquisition also means that the new group has a broader range of expertise with multiple brands under its banner. It is a more diverse business, with stronger market presence in areas such as mortgages, insurance, finance and investments. With refer to this merger and acquisitions hold major organizational behavior challenges such as Change of Human Resources Management, Culture, Conflict and change within the organizational for managers at various levels of the firms involved. This paper attempts to chronicle the acquisition of HBOS bank by Lloyds TSB bank that tried to create the UKs leading financial services group. Unlike previously written papers that describe the performance of the firm before and after the acquisition, this paper focuses on the human resources management, culture, conflict and change issues involved in the acquisition before and after the acquisition is completed. This paper tries to explain the organizational behavior of the acquired banks personnel and what their expectations, fears, hopes, and beliefs are before and after the transaction takes place. 1.0 Background of Lloyds TSB Group Lloyds TSB is a leading UK based financial services group providing a wide range of banking and financial services, primarily in the UK, to personal and corporate customers. The main business activities are retail, commercial and corporate banking, general insurance, and life, pensions and investment provision. The Group has a large and diversified customer base and services are offered through a number of well recognized brands (Lloyds TSB, Cheltenham Gloucester, Scottish Widows), and via a unique distribution capability comprising one of the largest branch networks in the UK and intermediary channels. On January 16, 2009, Lloyds Banking Group plc acquired HBOS plc. In November 2009, The Bank of New York Mellon Corporation completed the acquisition of Insight Investment Management Limited from the Company. Lloyds TSB Group is quoted on the London Stock Exchange and is one of the largest companies within the FTSE 100, with a market capitalization of  £26.7 billion on 31 December 2007. At the end of 2007 total group assets were  £353 billion and the Group has nearly 70,000 employees. Total income for the 12 months to 31 December 2007 was  £18 billion with profit before tax totaling  £4 billion. The group activities are organized into three businesses: UK Retail Banking, Insurance and Investments and Wholesale and International Banking. Question (i) 2.0 Human Resource Management Human Resources Management (HRM) can play a very important role in the success of HBOS merger. HRM is acting an important source of the input while evaluating whether to go ahead with a given merger or not. According to Carter McNamara The HRM function includes a variety of activities, and key among them is deciding what staffing needs you have and whether to use independent contractors or hire employees to fill these needs, recruiting and training the best employees, ensuring they are high performers, dealing with performance issues, and ensuring your personnel and management practices conform to various regulations. Activities also include managing your approach to employee benefits and compensation, employee records and personnel policies. (Carter McNamara, 2009) 2.1Challenges faced by new organization 2.1.1HR policies HRM help in ensuring that the employees of acquired new organization remain motivated after the merger. According to the Fisher (1989), transfer of the HRM practices can be difficult in organizations with different cultures compared to transfer of other resources like technology, capital and others. But this does not deter the transfer of HRM practices. It is further important to differentiate between the requirements of various organizations and it is not necessary a uniform policy can be successful across the broad. After the merger, HR policies are directed focus at two directions. The first one, is to achieve integration and provide a good working environment through a good compensation policy and training programs. Secondly, the main objective of the HR policies is to meet broader objective like bringing about a culture change in the organization. According to Fisher (1989), immediately after merger there is focus to make the operations move profitability and productive, as a result to focus on restricting operations and cutting costs. One of the key tool applied is downsizing the workforce. So, new management uses merger an opportunity to implement some of the difficult decisions in both the acquired and acquirer organization. 2.1.2Changing new strategy The merger is essential to define new common strategies to align the new organization towards its new vision. According to Recklies (2001), the vision of the merged organization is one of the first issues to be addressed before merger stage of the process of the transaction. The Lloyds TSB is necessary to align the HRM strategy of the new organization with the MA strategy. According to Aguilera and Dencker (2004) the following conceptual tools have been used to identify the key HRM challenges in MA key: Resources- people and capital Processes- activities involved in converting inputs to output Values- employees mode of thinking Table 1: Comparison of various merger strategic based on certain conceptual tools in the new organization HR tools Overcapacity strategy Product/market Extension strategy Substitute to RD strategy Resources Reduce in manpower. Downsizing strategy is essential for achieving economic of scale. Reserve of manpower as the managers of the two organizations specializes in different function. Reserve of employees in order to facilitate sharing of technology and knowledge. Processes Processes are similar and not much changes are required. Processes are different and their integration is one of the key issues for the success in the merger. Training system can help in this regard. Processes of the participating organization are different and need to be aligned with the help of training to help on transfer of knowledge. Value Differences in values are not much different if the organization is operating in the same geography and market. Values are differences and should be integrated smoothly. Value is similar and can be aligned easily. 2.1.3 Structure issues Due to the acquisition with HBOS, this is an important decision to be made by HR during the integration of the merger is determination of the management structure. According to Anderson (1998), this is a decision that should be made as soon as the deal for the merger is signed by both the parties to avoid confusion among the manager about their roles in the new organization. A centralized structure with well defined relationships is necessary in order to enable quick decision making and accountability among the managers. Conflicts are likely to occur while designing the organizational structure due to the assignment of positions in the hierarchy. This can be prevented to certain extent by ensuring the managers from both the organizations are present in the different layers of the organization. The determination of the hierarchy of the organizations should be purely based on the merit. 2.1.4 Leadership issues After the merger, a new clear leadership will be appointed. These appointments are subject to formal FSA approval and will become effective upon the completion of the HBOS acquisition. (Source from Lloyds TSB press release) According to Sitkin and Pablo (2004), a clear leadership has a positive impact on the employees of the organization. Leadership includes the individual leader of the organization at the top and both the top management. According to De Georgio (2003), the management is likely to face the barriers while deciding the leaders of the organization: Lack of time Lack of information about candidates from the other organization Culture conflict Split in the differences in culture, the leader should be able to communicate the mission, values and vision of the organization successfully to the employees. 2.1.5 Downsizing and persisting key talent The merger usually results to redundant people. The objective of the new entity is to persist with the most capable person regardless of the original company they belong in. The process is not based on the objective measures and fairness it could change the attitude of employees towards the merger and employees may not look at it favorable. This will make employee focus on their personal job security and worries rather than on the larger organizational objectives. The management is reluctant to communicate with the employees of these issues in before merging stage. Any failure in the communication or vague communication will makes the employees uncertain about their career and future role in the organization. They may seek other information source like informal communication and rumors which has a very negative impact on their performance and also will increase the anxiety. The only way to solve this matter for the management is to open a frequent channel of communication with the employees. Regular and honest communication can stabilizing the effect on the employees. For more effective in the communication, the management should address the issues that are most relevant to the employee such as layoffs, compensation, change in benefits and change in responsibilities. 2.1.6 Culture integration issues The new organization will faced culture integration issue. Where, this is the toughest matter that companies face in merger is the two different cultures. According to Bowick who lead the HR through the HP-deal merger deal day its critical to get people speaking the same language. For instance, discovered the people at both organizations were using the term customer solution, but it meant different thing to each of them. In order to solve culture integration, HR management needs to be the first to identify the disconnexion and get discussion. The role of HR in the whole merger process has undergone changes in given the failures in number of deals that due to problems in cultural integration. (Bowick, 2002) The key role of the HR manager will face after merging phase is to identify the mission, vision, values and culture that the organization plan to implement. These activities of HR manager in the integration process is include the aligning and defining employees with the strategies vision, developing effective communication channel, integration philosophy, conflict management and defining uniform HR practices across the whole entity. The HR managers need to make a proper assessment of the new organizations culture. There is also a trend that the HR executive needs interviews with the senior management of the new organization to evaluate the leadership qualities. HR Executive also need to create a profile of the best practices of the organization and compare it with their own staff to identify similarities and differences. Besides that, HR executives also need to identify common points in the two culture from where they can base the whole process of the integration after the acquisition. 2.1.7 Conflict management Conflict is likely to occur almost the employees in the after merging phase. HR manager need to keep in place on conflict resolution and escalation plan. It is also responsible for organizing training the managers in conflict management. Conflict can often arise due to culture differences, control, structure, not clear demarcation of role and responsibilities, organizational hierarchy and miscommunication. Through these issue of conflict resolution will be part of the integration plan the HR should be ready for contingencies. Question (ii) 3.0 Culture Organization can be conduct in many ways such as culture, virtual, organism, brain, political system and so on. Organizational culture is the first issues that they need to consider to acquisition HBOS. Organization culture refers to the general culture within an organization, and is always also referred to as corporate culture, though that isnt the best description since a large non-profit organization or charity could also have its own organizational culture even though they are definitely not corporations. Gareth Morgan has described organizational culture as: The set of the set of beliefs, values, and norms, together with symbols like dramatized events and personalities that represents the unique character of an organization, and provides the context for action in it and by it. (Morgan, 1997) Figure 1- Ways of seeing an organization (2006 p.139 fig.5.4) Brooks claims there are many ways of seeing an organization. Organism Virtual Organizational is aà ¢Ã¢â€š ¬Ã‚ ¦. Brain Culture Political System Machine The Lloyds TSB takeover of HBOS is not only means merging of two different financial organizations but also an acquisition of two different cultures. The new management have to be ready to facing new challenges when the two organisations are merging. Bicultural audit is important for the merging of two organisations culture. This audit produces data for starting work platform, strategy required for successful merger. The three types are as follows: Identification of cultural gap- Is comparing the values, vision and management behaviour for both companies, this phase recognizes the gap. Analysis of cultural gap- This phase brings out the similarities and dissimilarities between the two organizational cultures. Culture bridging- Refer to the basis of the above two informations the data management team can start the bridging of culture process.(Bicultural Audit, by Richard Cook) 3.1 The Cultural perspective: According to Brooks I (2006 p.140) Culture and organization can be viewed as an iceberg, a metaphor which suggests you to see on the surface masks a much deeper, mystical and powerful reality. Lloyds TSB HBOS It seen that though Lloyds TSB, they have merged with many companies in previously, they were all similar culture so that the original culture of Lloyds TSB is still stayed undiluted. (Source: Company Corporate Responsibility Review 2007, VAULT Employee Satisfaction Surveys and Media Articles) Lloyds TSB is based on Artifacts: Recruit talented people through tough selection procedure. Customer oriented. Employees rewarded on the basis of client satisfaction. Create framework for employee clear learning and future needs. Provide personal development programs for employees. Their Anglo-Scottish merger earlier between Halifax and Bank of Scotland however it seems have resulted in dilution of both cultures. (Source: Company Corporate Responsibility Review 2007, VAULT Employee Satisfaction Surveys and Media Articles) HBOS is based on Values: Market savvy. Younger. Mortgage expertise. Rewards-oriented company. 3.2 Type of Culture between Lloyds TSB and HBOS Lloyds TSB HBOS Lloyds TSB is based on role cultured: Produce more output in good environment. Strong banking system. HBOS is based on task cultured: Focused on goals. Work in team. It seems there are cultural differences between Lloyds TSB and HBOS, due to these culture differences it can make misunderstandings, fuelled emotional reactions, and conflicts. This can conduct to negative attitudes by the key top managers and be a major obstacle to the successful integration of the two organizations. Cultural differences will appear to be a critical factor in creating such an atmosphere and obtaining peoples cooperation. Figure 2: As per Deal Kennedy Feedback-Rise Model: High Risk HBOS High Risk High Feedback Bet your company culture High Risk Lloyds TSB -Low Risk -High Feedback -Process driven culture Feedback High As per Hofstedes study model (Source: Social Responsibility Report 07/08) Lloyds TSB HBOS Power distance High-Disciplined Low-Acceptance of responsibility Uncertainty Avoidance High- Precision Low- Basic innovations Collectivism vs. Individualism High-Employee commitment Low- Management mobility Masculinity vs. Feminity High-Mass production, efficiency and bulk chemistry Low- Personal service, custom made products and biochemistry Long vs. Short term orientation High- Developing markets Low- Fast adaptation 4.0 Conflict Is process that begins when an organization or party perceives differences and opposition between itself and another organization or party about interest and resources, belief, values or practices that matter to them. According to Gareth R. Jones and Jennifer M. Georges, conflict is the discord that arises when the goals, interests or values of different individuals or groups are incompatible and those individuals or groups block or thwart one anothers attempts to achieve their objective. (Gareth R. Jones and M. George, 2008) 4.1 Positive of conflict 4.1.1 Clarification of view The Boards of HBOS and Lloyds TSB believe that the Acquisition is a compelling business combination which offers substantial benefits for shareholders and customers. There is a clarification of view in the Acquisition is accelerates to build the UKs leading financial services company by focusing on growing sustainable earnings streams, based on deep customer relationships. 4.1.2 A chance for people to test their capabilities The group has excellent breadth and balance with strong positions in Retail, Corporate Banking, SME Business Banking and Long Term Savings. The group will have a substantial direct personal customer base and the means to unlock the significant commercial opportunities offered by Lloyds TSBs and HBOSs. The combined group will benefit from a portfolio of strong and trusted brands including Bank of Scotland, Halifax, CG and Scottish Widows. With these strong trusted brands, customers have more confident to choices or try the different products that the new organization offers. 4.1.3 Long-standing problems brought to the surface and resolved Normally, cost synergies savings are always a long-term issues for organization to solve, with the merger with HBOS will lead to an additional contribution to earnings before tax from cost synergies significantly in excess of  £1 billion per year. 4.1.4 To produce better idea The Acquisition brings together two of the leading retailers in UK financial services, with strengths in customer relationship management, product design, branch sales processes and in telephone and internet banking through gain sustainability competitive advantage in banking industry. 4.2 Conflict comparison between Lloyds and HBOS 4.2.1 Differences in perception Lloyds TSB Remains to grow the business through developing long-term customer relationships and building customer franchise. HBOS Delivering growth in profits to its many shareholders and transparent, fair, value-for-money products and services to its customers. Positive Argument Perception is the process of acquiring, interpreting, selecting and organizing sensory information to achieve the organizational goals. The important of perception is to find innovative solution for the problems, to leverage creativity and motivation the higher plateau of thinking, to help of perception, habits and attitudes will get changed and can find solution the most difficult problems. Negative Argument Lloyds TSB and HBOS may have different motives on perception going such as increasing market share, achieving economic of scale, entering new market, acquiring new technologies, warding off threats of hostile takeover and diversification. Different perception might cause the failure in Merging. 4.2.2 The Nature of work activities Lloyds TSB HBOS Its main business activities are Retail Commercial and corporate banking General insurance and life Pensions and investment provision. The HBOS Groups products and services can be categorized into the following business divisions: Retail Corporate Insurance Investment Strategy International Treasury and Asset Management. Positive Argument The merge of Lloyds TSB and HBOS were similar nature of working activities so there is no much changes of the organizations business or activities. In might change in the staffs working activities such as changing department, office and so on. With this change, staffs will beneficial in changing new working environment where some of the staff had feel bored, inefficiency with the current position. Secondly, staffs are able to learn new skills in the new working place. Negative Argument Change nature of activities will change characteristics, beliefs, values, and expectations. Some of the staff will have demanding in the salaries, position, rewards and so on. Besides that, changes a persons nature of working activities might waste time because the person might not have the skills or confident with the department they change it need to take time to learn. 4.2.3 Role Conflict Lloyds TSB HBOS And despite its black horse logo, Lloyds TSB is more of an old nag, following the market and paying poor rates to long-standing customers. Lloyds TSB, on the other hand, markets decent-sounding accounts to new savers but then closes them, often paying dreadful rates of interest to those still stuck in them. In Lloyds TSBs subsidiary Cheltenham Gloucester has complicated accounts which dock interest when you take money out or limit you to a certain number of withdrawals a year from an easy access account. Halifax has a reputation as an innovator when it comes to savings accounts its behavior can still hark back to its building society roots as it balances the interest of savers and borrowers. For instance, Halifax was among the first to offer a regular savings account paying a top rate of interest. Halifax makes a great effort to persuade its savers to move from old accounts to better-paying ones, and has been a leader in trying to reunite savers with old, forgotten accounts. Positive Argument: Role is an important process functional in an organization. May increase efficiency in process and product and services and gain competitive advantage in banking industry. Negative Argument Changes in role for both organizations will have negative impact such as inefficiency structure, lack process, take longer time than previously, and change in new rules and regulation and so on. 4.2.4 Departmentalism and specialization Lloyds TSB HBOS Lloyds TSB Corporate Markets is one of the UKs leading providers of corporate banking, supporting businesses with an annual turnover in excess of  £15m. We provide specialized financing to a range of industry sectors. Some of these services include: Cash management and payments, Foreign exchange and risk management, Loans and bonds, Trade finance, Structured investments. It is about integrating business activities so that HBOS acts as a good corporate citizen and meets the expectations of its stakeholders: colleagues, customers, shareholders, Government, the media and society. Included amongst the activities that HBOS aim to integrate are: Marketplace products, financial literacy, inclusion promoting the interests of shareholders and customers; dealing fairly with suppliers. Employment total reward, diversity, wellbeing how HBOS aim to attract and retain the best workforce. Community community investment, volunteering, sponsorship how HBOS manage our relationship with society in general. Environment responsible resource stewardship, etc. managing organizational environmental impacts effectively. Positive Argument: Departmentalism and specialization is a structures and the performance of the respective firms. By working in departmentalism and specialization, the staff in Lloyds TSB and HBOS are able to work efficiently through their skills, knowledge, professional and interest. Negative Argument Failure on departmentalism and specialization, the organization will not perform well, loss on business profit, lack of efficient, organization collapse, in a mess daily function and so on. 4.2.5 Limited Resources Lloyds TSB HBOS Branches: 1,900 Employees: 70,000 Customers: 16 million Savings: Lloyds is the UKs fourth largest saving provider. Retail saving balance:  £65 billion Revenue:  £18 billion (2007) Profit:  £4 billion (2007) Branches: 1,100 Employees: 72,000 Customers: 22 million Savings: HBOS is the market leader Retail saving balance: £139 billion Revenue:  £21,291 million (2007) Operating income:  £5,149 million (2007) Profit:  £4,109 million (2007) Positive Argument Mergers and acquisitions generally succeed in generating cost efficiency through the implementation of economies of scale. It may also lead to tax gains and can even lead to a revenue enhancement through market share gain. With refer to the acquisition; Lloyds TSB could achieve cost saving from the  £1.5 billion a year. Negative Argument In order to achieving revenue and cost synergies, Lloyds TSB and HBOS will face the conflict problems such as reduces 20,000 redundant staff, 164 branches network to close. 4.3 Conflict challenges faced between Lloyds TSB and HBOS are as follows: Lloyds TSB HBOS Job insecurity due to recession Financial crises in the market Searching for new investors Quick decision on merging with HBOS Financial crisis Fund raising from the whole sale market Misleading interview Clearing the picture about the organization 5.0Nature of Organizational Change in Lloyds TSB and HBOS Is refers to the overall nature of activities, such as their extent and rate, that occurs during acquisition that aims to enhance the overall performance of the organization. The activities are often led by a change agent, or person currently responsible to guide the overall change effort. The activities are often project-oriented and geared to address a current overall problem or goal in the organization. Besides that, organizational change also involve in external and internal environment of an organization is in a state of constant change. The organization has to re-adjust itself to this changing scenario in order to sustain competitive advantage in the market. 5.1 External forces of change External forces of change create from outside the organization. This is because these forces have global effects; they may cause an organization to question the essence of what business it is in and the process by which products and services are produced. There are four key external forces for change such as: demographic characteristics, technological advancements, market changes, and social and political pressures. 5.2 Internal force to change Internal forces to change are come from inside the organization. These forces may be subtle, such as low morale, or can manifest in outward signs, such as low productivity and conflict. Internal forces for change also come from both human resource issues and managerial behavior. 5.2.1Human Resource issues This issues stem from employee perceptions about how they are treated at job and the match between individual and organization needs and desires. 5.2.2Managerial Behavior Excessive interpersonal conflict between managers and their subordinates is a sign that change is needed. Both the manager and the employee may need interpersonal skills training, or the two individuals may simply need to be separated. 5.3 The stage of Organizational Change in Lloyds TSB and HBOS According to Robbins (2003), a well-known approach to managing change, that requires people to go through three separate processes, is called Lewins Three-Step Change Model. Lewin developed the threeà ¢Ã¢â€š ¬Ã¢â‚¬Ëœstage model of planned change which explained how to initiate, manage, and stabilize the change process. The three stages are unfreezing, changing, and refreezing (p. 564). Figure 3: Movement of an organization from a status quo to a desired state The first transition step is unfreezing, requires a personnel to say goodbye to the way things used to be. The managers must understand that their employees are being asked to give up tasks and processes that have made their previous successful in the past and all the emotional and resistance factors will kick in if enough time is not allotted for this step. The second step is movement, when everyone shifts into neutral. The employees in the organization may have given up their old ways of accomplishing tasks, but they may not quite ready to start using the new process. Employees may seem a slight uncomfortable and there is often confusion. Managers have to manage movement step carefully if not the staffs may try to revert back to the old process. A comparison for unfreezing and movement differences is provided at below. The final step is refreezing, when everyone moves forward and starts accomplishing tasks in the new manner. Again, the great care must be taken when managing this st ep to identify resistance and prevent personnel from going back to the original process. Figure 4: The differences between unfreezing and movement Table: (a) An organization before the change; the Change Group is inactive (b) O Nanotechnology: An overview Nanotechnology: An overview Abstract Nanotechnology has been an important scientific topic for future studies since 1959. ‘Nano derives from the Greek word nanos meaning a dwarf, term strickly for size and not chemical composition. According to recent toxicological studies nanoparticles are any particle less than 100 nm in at least one dimension, classified as natural, anthropogenic or engineered in origin. Nanomaterials are a major trend in medicine. These help deliver medications in a specific target, this is known as Nanomedicine. Another study of the impact of toxic nanoparticles is Nanotoxicity. This later one depends in the future understanding of the toxicity of nanomaterials depend on technological innovations and scientific results stemming from enhanced research and discovery in nanotechnologies. The communication between different areas in science to aid in the study of nanoparticles risk assessment, and toxicology. There are international efforts to study nanotoxicology. Therefore there is a high demand for research, on the effects of nanoparticles. The Amara Law is an advice to that as time pass when humans use the nanotechnology there increase in nanowaste. The interactions between nanoparticles and harmful environmental chemicals may lead to unique exposures and health risks. The research should focus in the merge between the nanoparticles and the environment. Therefore t here are developing laws to be applied for better research the better risk assessment. Regulations for efficiently develop useful and well-planned studies, and future recommendations to manage nanowaste. Nanotechnology is an applied science, growing by the creation of nanoconstructs and the presence of nanoparticles. This derived from nanoscience that is the science of the usage of materials in the nanometer scale. Nanoscience and nanotechnology developing areas of scientific interest in the entire world and have already become key for research and development (Piotrowska G et al. 2009). Nanotechnology has been an important scientific topic for future studies since 1959. According to Richard Feynman, â€Å"Theres Plenty of Room at t the Bottom,† a presentation that is possible to manipulate matter at the atomic and molecular scales (Hardman R. 2006). Nanoparticles are nanotechnology products, these accumulate creating waste. Nanoparticles are necessary for new medical advances. Studies are currently being done as a result of their impact to the environment. Therefore another subsection of nanotechnology emerges nanotoxicology. There is high demand for studies in risk assessmen t have led to cross communication among physical science and biological science scientists, and recent laws and regulations regarding these small particles. These nanomaterials have novel properties, and a great potential in becoming biologically active, that can lead to a environmental contamination (Friedrichs S, and Schulte J. 2007). Nanotechnology the enabling technology, that involves materials at the nanoscale. ‘Nano derives from the Greek word nanos meaning a dwarf (Piotrowska G et al. 2009). The term Nano is strickly to size and not chemical composition in terms of nanoparticles (Oberdoerster G et al. 2005). According to recent toxicological studies nanoparticles are any particle less than 100 nm in at least one dimension, classified as natural, anthropogenic or engineered in origin (Moreira S et al. 2009 ) , (Kanno S et al. 2007), (Piotrowska G et al. 2009),( Bà ©ruBà © K et al. 2007),(Oberdoerster G et al. 2005). Because of the small size these particles are toxic, as a result of their greater surface area. Their toxicity of remains widely unknown and still poses concerns, due to the peculiar characteristics of materials in the nano-size range (Kanno S et al. 2007), (Bregoli L et al. 2009). The most common nanoparticles present in the environment are combustion derived nanoparticles, from an anthropogenic source (Oberdoerster G et al. 2005), (Bregoli L et al. 2009). Nanoparticles are incorporated in many products from pharmaceuticals to catalysts. As an example, in 2 002 an indium tin oxide nanopowder manufacturing facility was launched by Samsung, used in the production of flat panel displays based on liquid crystals. Therefore the silver nanoparticles and carbon nanotubes now have the widest range of applications (Piotrowska G et al. 2009), (Balbus J et al. 2007). The expansion of the nanotechnology, resulted in further classification of nanoparticles in size, shape, charge, chemistry, coating and solubility (Elliott KC. 2007). Some examples of nanoconstructs are carbon nanotubes, fullerene, carbon derivative, quantum dots, and manufactured nanoparticles. Fullerene NanoCarbon60: Started since 1985 these are composed of 60 carbon atoms named Buckyballs o fullerenes, this discovery from Buckminster Fuller (Piotrowska G et al. 2009). This nanoparticle induces lipid peroxidation, this according to a study in fish. The investigation included that it also induces oxidative stress, and upregulate genes related to the inflammatory response and metabolism, and that nanoC60 releases oxyradicals in in vitro systems, or act as an oxyradical scavenger (Zhu S et al. 2006). These carbon materials including nanotubes are popular in consumer products since 2006 according to the Nanotechnology Consumer Products Inventory (Friedrichs S, and Schulte J. 2007). Carbon Nanotubes and Asbestos: Started since 1991, these were synthesized, found to be 100 times stronger than steel. The unusual heat and conductivity characteristics of the nanotubes are important to further developing of new technology (Piotrowska G et al. 2009). Both asbestos and carbon nanotubes are consider to have major carcinogenic potential, they both act as needles to the cell membranes and cell walls (Moreira S et al. 2009). The asbestos fibers split lengthwise been in a size smaller than the nanosized particles. Quantum Dots QD: These are the semiconductor nanocrystals with special properties applied in biomedical imaging and electronics industries. Because some these have fluorescent properties for biomedical imaging, also there are targets specific biologic events and cellular structures, such as peroxisomes, DNA and cell membrane receptors (Hardman R. 2006). This aids drug delivery and the advance in nanomedicine. For example, Nano selenium is one of the major components of Quantum Dots outer covering, there is a study in Makala Fish that studies the concentrations of micro and nano selenium in the Liver and Muscle. However the compound of selenium such as Sodiumselenite, Selenomethinine, and methylselenocysteine have greater toxicity impact than elemental nanoselenium(Li H et al. 2008). Then nanoparticles had a greater coverage. Manufactured Nanoparticles -Titanium Dioxide and Silver Nanoparticles: Silver particles are use in fridges to avoid growth of saprophytic bacteria and fungi. These particles behave as copper nanoparticles, these nano-biocides can become even cheaper in the next few years. Another nano-biocide is titanium dioxide used to protect glazing. There are studies that focus in Titanium Dioxide.These nanomaterials have greater access to the micrometer size pores in plants since nanoparticles have a greater possibility of fitting through micropores, then this allows an accumulation in the xylem structure, eventually blocking the continuity and disturbing or destroying the function of the xylem (Seeger EM 2009). The willow tree study presented that before the nanoparticles get through the xylem pores, there is some sedimentation then blocking the passage through the micropores (Seeger EM 2009). Consequently, more studies are required this TiO2 is in contact with humans through the sunscreen, acc ording to a british study done in 1997; contribute to the formation of free radicals in skin cells and in this way damage DNA. This can result in mutations further leading to modifications of the structure and function of proteins (Piotrowska G et al. 2009). Combustion Derived Nanoparticles CDNP: Nanoparticles area a threat when inhaled, because of the large surface area they are linked to health effects and respiratory toxicity h. These combustion-derived nanoparticles are thought to be the most potent component of the air pollution cocktail (Oberdoerster G et al. 2005), (Bregoli L et al. 2009), (Elliott KC. 2007). Their toxicology is used to predict the health outcomes in humans following exposure to manufactured nanoparticles, there is necessary to understand the toxicity to reduce occupational and environmental exposure (Bà ©ruBà © K et al. 2007). These emissions are considered to be carbon based aerosols nanoparticles as a result of incomplete combustion, as well as lead compounds. Because of these cars are equipped with catalysts, a couple of years ago platinum nanoparticles, with dimensions in the range 0.8-10 nm, are released from car catalysts during their life-time. Then newer catalysts were introduced by pioneering company M azda. Not long ago is found that additions to fuel of Aluminium or Aluminium Trioxide nanoparticles, aids to the fuel properties (Piotrowska G et al. 2009). The detrimental health effects of inhaling fine aerosols were recognised as early as the 4th century BC (Oberdoerster G et al. 2005), (Friedrichs S, and Schulte J. 2007). Since this being acknowledge various attempts to minimize exposure have been done. These particle size of aerosols are known to influence the deposition region in the lungs and translocation potential to the organs, e.g. the inhalable fraction (which can enter the respiratory tract), the thoracic fraction (capable of penetration to the airways below the larynx, smaller than 10 lm) and the respirable fraction (particles smaller than 4 lm) penetratingbeyond the ciliated airways to the gas exchange region of the lung (Piotrowska G et al. 2009). Regular particles affect upper respiratory tract, fine particles affect lower respiratory tract, and ultrafine particles or nanoparticles affect distal respiratory tract. The nanoparticles get stuck to the alveoli and cause problems. †Current and historical epidemiological and toxicological investigations with airborne nanoparticles are viewed as the pioneering nanoparticle for the expansion nanotoxicology, the major portal of entry into the human body for nanoparticles is via inhalation into the respiratory system† (Bà ©ruBà © K, et al 2007). Nanoparticles come in contact with the skin, then transported to the lymph nodes, then most are excreted via feces. Other ways for these tiny particles to get in are by blood circulation then these end up in the liver, and from there are distributed throughout every organ in the living organisms (Oberdoerster G et al. 2005), (Li C et al. 2009) . The skin is the great barrier against the nanoparticles for the new medicine the only way the particles enter the body effectively is through injection, for rapid release. The nanomaterials develop for medicinal purposes have been under development for many years. Nanomaterials are a major trend in medicine, these help deliver medications in a specific target, this is known as Nanomedicine (Oberdoerster G et al. 2005), (Balbus J et al. 2007). Some of the nanomedicines have a combination of properties for example a useful combination of lipophilicity and hydrophilicity so that they have some solubility in an aqueous environment, but are sufficiently hydrophobic to partition through membranes. These properties mean that they distribute all over the body fairly rapidly via the circulation and by diffusion through tissues and cells (Garnett M, and Kallinteri P. 2006) , (Oberdoerster G et al. 2005). Nanomedicines must be well tested before they enter in the hands of consumers. These enter the environment and have ecotoxicological effects therefore a new subsection of Nanoscience have emerged Nanotoxicology. The study of the impact of toxic nanoparticles, or simply Nanotoxicity. This is more complicated than expected, therefore there is a great need for further investigation for fundamental research and practical applications of nanomaterials. Therefore, further supportive and extensive researches are warranted; the study of the interactions of nanostructures with biological systems with an emphasis on elucidating the relationship between the physical and chemical properties (e.g. size, shape, surface chemistry, composition, and aggregation) of nanostructures with induction of toxic biological responses (Moreira S et al. 2009), (Oberdoerster G et al. 2005), (Balbus J et al. 2007), (Hardman R. 2006). Nanotoxicological research is in its infancy and the implementation of test standards and commercialisation of appropriate safety control systems can take several years (Friedrichs S, and Schulte J. 2007), (Marquis B et al. 2009) . The future understanding of the toxicity of nanomaterials depend on technological innovations and scientific results stemming from enhanced research and discovery in nanotechnologies, and conventional knowledge about exposure assessment, fate and transport, and current computer models is not necessarily applicable to nanoparticles(Balbus J et al. 2007), (Elliott KC. 2007), (Friedrichs S, and Schulte J. 2007), (Marquis B et al. 2009), (Piotrowska G et al. 2009). The improved study methods for rapid testing and efficient nanotoxicity assessments. Because there is a need to study the potential of nanoparticles to carry toxic chemicals that are man made or those found in the environment. For example fullerenes or nanoCarbon60 is a major threat to marine or aqu atic ecosystems, these particles are insoluble in water (Friedrichs S, and Schulte J. 2007) . This C60 is mixed with Tetrahydrofuran that is use as a vehicle solvent. The combination generates a yellowish adjacent C60. This is the main reason why there is potential that toxicity result from the presence of THF in between the adjacent nanoC60 and THF degradation products (Friedrichs S, and Schulte J. 2007). There is a need for more research other than the traditional invitro using tissue samples but the actual use of in vivo organisms to study the life cycle of nanoparticles. The In vitro toxicity assessment faster, cheap, and minimum ethical concers. In another hand, in vivo life cycle is accurate in assessing nanotoxicity. This life cycle study is base in the different characterizations of the nanoparticles, and relation with the environment where exposed (Fisher HC, and Chang WC 2007), (Marquis B et al. 2009). The nanoparticles have an important role in driving cellular responses related to oxidative stress, so extracellular levels should also be considered (Elliott KC. 2007), (Balbus J et al. 2007), (Oberdoerster G et al. 2005). Therefore, new studies permit the mapping the effect of the toxicity of nanostructure, allowing for the development of predictive models of nanostructure toxicity. However, because of ethical regulations the transition animal to humans still far, as a result of ethical laws and regulations regarding human testing, if allowed nanotoxicology could greatly improve the degree of confidence on the safety of nanomaterials for diagnostic and/or therapeutic strategies in humans (Bregoli L et al. 2009) . Further studies lead to required information so responsible regulatory decisions could be made. Despite this increase in the prevalence of engineered nanomaterials, the field of nanotoxicology has formed in response to this lack of information to be applied when conducting research studies (Bregoli L et al. 2009), (Fisher HC, and Chang WC 2007), (Marquis B et al. 2009). Nanotoxicology is dependent of analytical methods for future classifications of nanomaterials as well as their effects on in vitro and in vivo studies (Marquis B et al. 2009). Moreover, there is currently a small amount of investigation dealing with the impact of toxicity of nanoparticles. There is a future focus on nanoparticles toxicity in the molecular level leading to cellul ar oxidative stress. The technology boom raises an important question: what is being done to address the environmental risks associated with nanotechnology (Piotrowska G et al. 2009), (Garnett M, and Kallinteri P. 2006). So Nanotoxicologists could build a program to promote a safe and profitable nanotechnology (Elliott KC. 2007). The promotion of safe nanotoxicology started by a specific sub classification of nanoparticles, for example Quatum Dots. These are sub classified by inherent physical, and chemical properties, and environmental impact; the particle size, functional groups, and oxidative properties to establish the toxicity (Hardman R. 2006). The safe nanotechnology is achieve by following the main causes of nanoparticle toxicity (1) Due to chemical toxicity of materials from which they have been made. (2) Due to their small size: nanoparticles may stick to cellular membranes and enter the cells. (3) Due to their shape: e.g. carbon nanotubes can easily pierce cell membrane (Piotrowska G et al. 2009). According to Friedrichs S, and Schulte J. in 2007, acknowledge that by June 2005 the International Standard Organization launched a Nanotechnology Committee, that focus in the standardization of the nanotechnologies. In the past there were early warnings against the effects of manufactured nanoparticles from commercial products and new-generation-waste. Therefore new studies are necessary for the recognition of biological effects of nanoparticles in the environment, and creation of the bases of nanobiomonitoring (Piotrowska G et al. 2009). This nanomonitoring must be started before the Nanowaste accumulation that will be present in the near future and reduce ecotoxicological problems. There is a high demand for the appropriated risk assessment, this affecting global organizations in order to protect both their staff, clients, and customers. However, a cross disciplinary communication is required, this in the collaboration of researchers from different disciplines. For example communication between physical chemists that have knowledge in classification of materials, biologist with knowledge of the ecosystems and biological systems, and toxicologist to merge both skills to study the toxicity of these nanomaterials (Balbus J et al. 2007), (Friedrichs S, and Schulte J. 2007). For example analytical chemists in nanotoxicology, help in the classifications of future nanomaterials and particles. Some of their techniques are electron microscopy, this helps to study the accumulation of bioparticles(Marquis B et al. 2009).Then nanotoxicologist benefit from the intergration of both physical and biological sciences. The toxicologists discover that analytical chemists can develop assays that are both sensitive and selective for any species or cell function affected by nanoparticles(Wittmaack K. 2007). There are many scientific disciplines working together to study nanoparticles and their toxicology. Efforts have been internationally for a better assessment with two main groups International Council on Nanotechnology, and the International Organization for Standardization (Marquis B et al. 2009), (Oberdoerster G et al. 2005). Therefore there is a high demand for research, on the effects of nanoparticles. Since 1990, there is a high implementation of nanotechnologies (Piotrowska G et al. 2009) . The uses of nanotechnology products, these are used in electronics and cosmetics. As an comparative measurement, to consider is that in two grams of 100 nm nanoparticles contains enough to give every human a generous amount of these particles (Hardman R. 2006). There is a beneficial aspect by working with nanoscale technologies, expected to have heavy impact in diverse industries and areas of society like medicine, plastic, energy, electronics, aerospace, and emerging fields. According to Piotrowska G et al. 2009, there is a law imposed by Roy Amara the president of the Institute for the Future, â€Å"Nanoparticles benefits might be overestimated in the short run, and their effects in the long run such as the accumulation of nanowaste might be underestimated. The short term effects are the benefits of the new technology, nanomaterials, and usages of Nanoparticles, no nanowaste present. The long term effects are those that prove to be detrimental to the environment and increase the nanomaterials toxicity. For example time of nanotechnology usage increase Nanowaste increases toxicity. The interactions between nanoparticles and the environmental leads to harmful exposures for the affected ecosystem and living organisms (Balbus J et al. 2007) . As a result of increase in nanowaste. According to the Amara Law, this materials will be around and living organisms exposure is ensure and likely to increase over time (Hardman R. 2006). We must study the physicochem ical properties the research should focus on in vivo systems. Nanoconstructs interactions are important to take in consideration for future studies, there is the interactions of biological components such as proteins and cells organelles; that will give clues for the study of the nanocompounds biodistribution. This is important to understand because is the merge between the nanoparticles and the environment to then give specific laws (Marquis B et al. 2009), (Oberdoerster G et al. 2005), (Piotrowska G et al. 2009), (Friedrichs S, and Schulte J. 2007) . There is still a small amount of data regarding the handeling of discarded nanomaterials. Since there is a high demand for research, there is the Organisation for Economic Co-operation and Development (OECD) which launched an initiative to test human health and environmental safety of those nanomaterials that are already in use and the nanomaterials that may be developed in the forthcoming years. Consequently the greater amount of research the better risk assessment, therefore is beneficial to study nanoparticles potential impacts on environmental health and safety (Marquis B et al. 2009), (Oberdoerster G et al. 2005), (Piotrowska G et al. 2009). There is potential risk on environmental, health, and safety; with these new technology applied in commercialized products. As an example, in the usage of a glass and bathroom sealant spray Magic Nano, led to hospitalization of an aerosol industry (Friedrichs S, and Schulte J. 2007) . There is a high demand for nanotechnological research, these companies should focus in the appropriate toxicology and ecotoxicology for all nanoenabled products. The ecotoxicological hazard is that the nanoparticled accumulate in the soil, air, and surface water. There they last for a long time to be taken up by biological organisms, because they undergo biodegradation or bioaccumulate in the food chain (Piotrowska G et al. 2009), (Friedrichs S, and Schulte J. 2007). According to the United States Environmental Protection Agency there are nanoparticles contained in cosmetics, such as sunscreens can contaminate water and soil, contributing to their bioaccumulation in the food chain (Friedrichs S, and Sch ulte J. 2007),, (Oberdoerster G et al. 2005), (Elliott KC. 2007). In addition, this agency works closely with the Toxic Substances Control Act to study the toxicity of nanomaterials. The effects of carbon nanotubes are detrimental to humans and other living things, greater than any other nanoparticle (Oberdoerster G et al. 2005), (Piotrowska G et al. 2009), (Friedrichs S, and Schulte J. 2007). Carbon Nanotubes cause necrosis, degeneration, and apoptosis in the animal and plant cells. These nanoparticles are less biodegradable, and they have a lipophilic property making them easy to cross the cell membrane. Such properties may be associated with a tendency of carbon nanotubes to bioaccumulate (Piotrowska G et al. 2009), (Oberdoerster G et al. 2005). . Legal regulations are highly important issues, regarding nanowastes need to be regulated, following the life cycle of the remnants of the nanomaterials. This approach takes the stages of nanomaterials from production, through use, to disposal, which should avoid making the nanowaste problem a legacy of nanotechnology (Piotrowska G et al. 2009). This is an improvement after half a decade after the introduction of nanoparticles in manufacturing industries, known as the Life Cycle Assessment. Therefore, the companies working with nanotechnologies should keep up-to-date with information about the toxicological studies relevant to their area of RD. (Friedrichs S, and Schulte J. 2007), (Piotrowska G et al. 2009). Currently many international institutions are collecting results regarding nanomaterials. Since all this collection of results proves beneficial since these toxicological and ecotoxicological studies on nanomaterials effect to the environment and health are expensive and have a gr eat deal of length. This iniciative is known as ICON International Council of Nanotechnology. The University of California, has provided some surveys and research, to this international collection of nanomaterials research, this includes the Safety of Nano-Materials Interdisciplinary Research Centre, which conducts toxicological and epidemiological studies (Friedrichs S, and Schulte J. 2007).There is plenty room for further reaseach. Conclusion and Recommendations Nanotechnology an emerging science, from anthropogenic and natural sources for example ash from volcanoes. Other natural occurring nanoparticles biogenic magnetite, from bacteria to protozoa to animals; this associated with neurodegenerative diseases. As nanomaterials are used for manufacture industries, there is a need for accurate, and responsible nanotoxicological evaluation. Resources and funding for the study should be from government and pioneering industries. The studies will further help to sort and create regulations for risk evaluations, this information should be influenced from previous research studies (Marquis B et al. 2009), (Oberdoerster G et al. 2005), (Piotrowska G et al. 2009). The research on nanotechnology products is necessary to study adverse effects of the engineer nanomaterials to living organisms and the environment. Nanotoxicology is a challenge for research because of different exposure conditions, and biodistribution. This is the movements of materials th rough tissue, and organisms. As of now, there should be more rules for standardized testing for the assessment of toxicity of the nanomaterials. According to National Toxicology program of 2005 and the U.S. Environmental Protection Agency of 2003, these have harmful side effects that affect different biological systems and they have a novel properties and risk of exposures is inevitable becoming a concern for humans and the environment (Hardman R. 2006) , (Marquis B et al. 2009), (Oberdoerster G et al. 2005). A major recommendation, other than more funding and advance research in ecotoxicology and nanotoxicology, is the recycling of nanowaste. This recycling proves beneficial in the reduction of nanowaste independently of the time increase and nanowaste increase direct relationship. This recycling needs segregation of used nanoproducts, making them available for future use, in new products. These products if not possible to be recycled bioutilization is need to be used. For example, some species of plants and fungi are hyperaccumulators of heavy metals. Bioaccumulation of heavy metals, radionuclides and other xenobiotics by plants, fungi and microorganisms (e.g. fitoand mycoextraction or biodegradation) is a convenient way of remediation of polluted soils, water and air (Piotrowska G et al. 2009). Finally, the emerging development of nanotechnology needs a better reaserch and knowledge in how to bioutilise or recycle the nanowaste.