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.

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Structural Unemployment


Structural unemployment refers to that unemployment caused by the restructuring of firms or by mismatch between the skills (or location) of job seekers and the requirements (or location)  of available jobs. A major cause of this type of unemployment is the decline of the manufacturing sector. Another cause is the replacement of workers by technology. Structural unemployment calls for industry retraining programs to move workers into growth industries.

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.

Industrial Competitiveness


The European Management Forum defines industrial competitiveness as “the immediate and future ability of, and opportunities for, entrepreneurs to design, produce and market goods within their respective environments whose price and non-price qualities form a more attractive package than those of competitors.”

The major factors affect competitiveness:

  • The dynamism of the economy measured by criteria such as growth rates, monetary strength, industrial production and per capita performance.
  • Industrial efficacy, which involves direct and indirect employee costs, per capita output, employee motivation, turnover and absenteeism.
  • The dynamics of the market, when efforts to improve competitiveness are increased and better directed to more intensive market forces.
  • Financial dynamism that is the strength and importance of the commercial banking sector, stock and bond markets and their ability to provide capital.
  • Human resources that is the dynamism of the population and the labor force, employment, unemployment, executive quality and motivation.
  • The role of the state in fiscal policies and other regulations.
  • Resources and infrastructure (transport and communications facilities), domestic energy and raw material sources.
  • Outward orientation, the will to promote trade actively, buying and selling goods, service-related investments or any other form of international exchange.
  • Innovative forward orientation which emphasis national research and development efforts, corporate and government attitudes to exploiting new ideas, products and production processes.
  • Socio-political consensus and stability, the degree to which strategies and policies reflect a society’s aspirations.

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.