Understanding Casual Work, Industrial Awards, and Competitive Advantages
Casual Work
No guaranteed hours of work. Usually works irregular hours – can be 3 hours one week, 0 hours the following week and 20 hours in the third week. Employees can end employment without notice. Not paid annual leave or sick/personal leave – although the Victorian Government has introduced paid sick leave for casual employees as a 2-year trial in some industries. Received a higher HOURLY rate of pay than permanent employees – to compensate for not receiving annual or sick leave and not having guaranteed work.
Industrial Awards
are set by government body. They outline basic working conditions of a specific industry. They grant all wage earners in one industry or occupation the same minimum pay rates and conditions of employment, as well as other workplace related conditions. Conditions include: leave entitlements, overtime, and allowances.
Why do People Work?
- To have money
- Can be a form of therapy
- We enjoy it
- To achieve goals
- To be a part of a community
- To offer something to society
- To raise a family
- We don’t know any other way
- To be a member of society
- To make friends
- To feel independent
- To feel secure.
Corporate Social Responsibility
refers to the way in which a business demonstrates some commitment to their community beyond that imposed on it by laws. Examples can include: Businesses developing policies to ensure that women have equal ability to that of men to progress to senior management positions Supermarkets not using single-use plastic bags. Banks commit to investing in projects that benefit the environment and community and decline investing in projects that are negative for the environment. E.g. Adani Coal Mine Businesses using renewable energies to power their equipment to minimize their carbon footprint.
Innovation
refers to changing or creating more effective processes, products and ideas, and can increase the likelihood of a business succeeding. Businesses that innovate create more efficient work processes and have better productivity and performance. For businesses, this could mean: implementing new ideas creating new/dynamic products improving your existing services. Reminder: Innovation and inventing are not the same thing!
Advantages of Innovation
- Appeals to customers
- Sets you apart from the competition
- Makes you more efficient
- Reduce costs in the long run
- Can be environmentally friendly
- Can create new employment opportunities.
Disadvantages of Innovation
- High start up cost, reduces profit in short term
- Time to implement
- Inefficient while training staff
- Staff being terminated
- Lose customers in act of innovation
- Conflict between stakeholders
- What if it doesn’t work
Competitive Advantages
are conditions that allow a business to generate more sales or higher profits than its competition. Competitive advantages include cost of materials, brand, quality of product offerings, choice of suppliers, and customer service.
Types of Competitive Advantage
- Differentiation
- Price
Increasing Competitive Advantage
- Continually innovating products and services – consumers are attracted to new and exciting products.
- People – hiring people with the right attitude and passion (Customer Service).
- Marketing – impactful advertising can affect the choices consumers make.
- Price strategy – large businesses can afford to charge lower prices due to volume sales.
- Social responsibility – consumers are enticed by environmentally conscious businesses.
Why is it important?
- To meet the changing demands of consumers (Giving customers what they want!)
- Achieve efficiencies (To avoid wasting energy, materials, money, effort & time)
- Lower costs (Less wastage amounts to less money being spent)
- Improve their profit margins (Less money being spent amounts to higher profits)
- Without a distinct competitive advantage a business will stagnate or, at worst, decline into non-existence
Globalization
is a process of interaction between the people, companies, and governments of different countries. It is sometimes described as the opening of borders. Interactions include exchanges of goods and services, exchanges of property, employment, and sport. Advances in transportation, telecommunications and infrastructure have been major factors in the increase of globalization.
Advantages of Globalization
- Worldwide access to information, ideas, and goods & services – when people have greater access to other countries their standard of living improves.
- Countries can specialize in areas of expertise – if a country specializes in a particular field they can use this as their main export. They can lower the costs with efficiency in their work and therefore charge a lower price to consumers
Disadvantages of Globalization
- A more rapid degradation of resources – due to an increase in the demand of goods and services, there will be a higher demand for materials to produce them. Trees will be cut down, water will be used, flattening of forests
- Exploitation of disadvantaged nations – while workers in disadvantaged nations will be paid for their work, they may be paid a very low amount of money and still be below the poverty line.
Economics
What is Economy? The state of a country or region in terms of the production and consumption of goods and services and the supply of money. Economic growth is defined as the increased volume (value) of goods and services produced by an economy over a period of time. Economic growth can occur due to population increases, replacing existing goods and services, and the desire to continually improve the quality of products. Economic growth is important as it helps the economy by increasing the supply of goods and services. Demand is consumers desire for a product at a specific price. As a whole, consumers will desire more of a product as the price decreases. Therefore: LAW OF DEMAND Price ↓ Demand ↑ Price ↑ Demand ↓ Demand Curve When the price of bananas increases, the demand for bananas decreases. When the price of bananas decreases, the demand for bananas increases. Demand is treated from the perspective of the consumer. Supply refers to total amount of product available for purchase at a specific price. Producers will make more of a product available as the ability to generate a profit rises. Therefore: LAW OF SUPPLY Price ↓ Supply ↓ Price ↑ Supply ↑ Supply curve When the price of bananas increases, the supply for bananas increases. When the price of bananas decreases, the supply for bananas decreases. Supply is treated from the perspective of the producer. Shifts in the supply curve The price will stay the same but the quantity supplied will change. Therefore the supply curve must shift to the left or right. Decrease in supply: 1st image. Increase in supply: 2nd image. Exports are when goods are produced in one country and sold to another. Examples include sending meat, dairy or cars. What is inflation? As consumers we constantly look for the highest quality goods at the lowest possible price. However, when the cost of a good or service increases it represents a loss in value of the money that we hold. When a price of a good or service increases, it is called inflation. Inflation is defined as a sustained increase in the general price level of goods and services in an economy over a period of time. How does inflation work? I nflation results in the decreased value of money over time. Each dollar will buy less goods and services as time goes on. In order for people to maintain the same standard of living, wages and salaries need to increase at the same rate as the inflation. Inflation in Australia is measured by calculating the change in the Consumer Price Index (CPI). The CPI measures the total price of the essential goods and services used by most households. The average inflation level is 3% p.a. The items considered for measurement in CPI include; food, clothing, housing, household contents and services, transport, recreation, financial and insurance services, communication, alcohol and tobacco, health and education. Free (pure) market economy An economic system where all of the economy is driven by the consumer and their needs and wants. Businesses will only produce goods and services that are demanded by consumers. Individuals own the resources and there is little government interference. Benefits of a free market High Competition Amongst Business: Drives innovation and high quality output. -No restrictions on goods and services A large variety of goods and services is available and consumers are free to choose the goods and services they want. -Government involvement is usually very restricted or non existent Limitations of a free market economy Businesses are heavily profit driver: Therefore the distribution of wealth will be unequal. Consumers may be exploited: No protection is provided by the government. Eg. Monopolies. Infrastructure and welfare not provided by the government: Public roads, schools, postal services, hospitals.
