Competitive Marketing Theories


Competitive market theories are derived from the neo-classical economic concepts of rational choice and maximization of utility. The assumption is that individuals choose jobs which offer them maximum benefits. The utility or value of these benefits – money, vacation time, pension entitlement and so on – vary for different individuals according to their personal preferences. People move from one organization to another if improved benefits are available. At the same time, employer organizations attempt to get the most from their employees for the lowest possible cost.

The outcome of this process is a dynamic and shifting equilibrium in which both employees and organizations compete to maximize benefits for themselves. Within a specific region or industry there is a balance between supply and demand for human resources. Pay and conditions for employees are determined by the relative scarcity or abundance of skills and abilities in the employment market. Competitive forces push wages up when demand for products – and hence employees – increases, and downwards when the economy is in recession. In the latter case a market clearing wage is eventually arrived at which is sufficiently low to encourage employers to increase recruitment and eliminate unemployment. This discourse reinforces the view that employees are objects to be traded like any other commodities in the market – human resources in the hardest possible sense. Supposedly, they offer themselves – their skills and human qualities – for sale to the highest bidders. Within this mindset they could just as well be vegetables on a market stall.

Competition theories assume that job-seekers have perfect knowledge of available jobs and benefits. Job-searching is an expensive and time consuming business. The unemployed do not have money and those in work do not have time. The result is that few people conduct the extensive searches required to find jobs which meet their preferences perfectly. In practice, most individuals settle for employment which is quickly obtained and which exceeds the reserve minimum wage they have in mind. There is a considerable element of luck involved. Moreover, the job-seeker does not make the choice: in most cases the decision is in the hands of employer.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Logistics


The management orientation evolves from an operational focus at Stage 1, through a managerial approach at Stage 11, to the strategic top management level at Stage 111. Simultaneously, the financial orientation evolves from that of cost reduction at Stage 1, to profit maximization in Stage 11, to the optimization of return on investment in Stage 111—the orientation of senior corporate executives.

As logistics organizations take on the appearance of a senior management function, they assume senior-level positions within the company. Fifty-nine percent of the Stage 1 organizations report to general management, 14 percent report to marketing and sales, and 27 percent report to manufacturing. By Stage 111, a distance shift has occurred: 73 percent of logistics organizations report to general management. Thus, it is at Stage 111 that logistics organizations assume a truly top management position in the general management structure.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Productivity Maximization


To maintain the same or higher productivity, it is essential that people have the specific skills, knowledge and characteristics required to be effective. By identifying relevant skill gaps, competency models help to ensure that the training and development budget will be spent wisely. Competency models also allow for the development of appraisal systems that evaluate people on their use of behaviors and practices that directly contribute to competitiveness, encouraging both the business and the individual to focus on whatever will have the greatest impact.

 

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight