Liberalisation of Market Labour - Essay Example

Running Head: LIBERALISATION OF MARKET LABOUR. LIBERALISATION OF MARKET LABOUR. AUTHOR INSTITUTIOAL AFFILIATION AUTHORS NOTE. Abstract. This paper analyzes how liberalization of the market labour has resulted to the improvement of an organizations inputs and development in general. Development of a free market is crucial for economic development of any organization and especially a period like now that we have recovered from the global recession. Therefore Governments should be on the fore front to ensure that there exists a liberalized market labour for better performance. The paper discusses two market like mechanisms used in our workplace to ensure efficiency in service delivery and enhance market liberalization. It takes a retrospective approach of a study carried out in our organization to assess the impact of work based incentives and pricing to our organizations outcomes. Most organizations don’t have a mechanism to motivate their employees and this greatly compromises the organizations service delivery and outputs. Pricing is also a crucial mechanism that affects a companies output as it determines if the customers will be willing for a particular product or service provided by the organization. There is also a conclusion of what was learnt both the positive and negative impacts of these mechanisms in our organization. Liberalization of market labour. In any working organization, the labour market must always be an integral part in policies that are in place to enhance productivity and living standards of individuals in general. The liberalization of labour market has had a positive impact on the outcomes of organizations as active labour market policies that have minimal regulations yield better outcomes than the passive ones that have so many restrictions. (Fine and Boateng, 2000).There fore it would be correct to say that a liberalized market labour tends to put in place protection of minimum conditions and also income security. Liberalization aims at getting the right prices to operate within the existing economy by ensuring that there is efficiency in all the operations of the markets. The Government has a very significant role to play in that it puts in place the necessary regulations for a smooth flow and efficient business environment but it must not get too much involved in the operations of organizations as this would hinder the liberalization of labour market in these organizations and thus affecting their outputs in generals. Efficiency in the labour market is achieved through putting in place policies that allow for employment and wage flexibility so as to ensure the demand of labour is directly corresponding to the current economic times. (Taylor and Van der hoeven, 2000)The most important thing that occurs as a result of flexible wages is that it greatly reduces the incidences of involuntary unemployment in organizations. To get a better understanding of this concept we can first assume that the labour market is similar to the goods market where there exists equilibrium between supply and demand and price established. Therefore an excess in labour supply is eliminated through proper wage adjustments and thus a rigid labour market would hinder an organization from attainment of its goals and reduced out puts. A report by the World Bank (1990) suggested that rigid labour markets tend to increase the cost of labour thus on the other hand reducing its demand and in return results to high unemployment. Generally labour market has been greatly affected by structural adjustment policies that are in existence. Liberalization of labour market should be aimed at enhancing quality but not quantity therefore emphasis should not be put on large numbers of employees but improved wages and living standards for the few laborers employed. By doing this an organizations output per worker is improved and productivity in general. This liberalization of labour markets has led to the use of market like mechanisms such as competition, pricing dispersed decision making and work based incentives for the enhancement of program outputs. This paper will discuss two work based incentives that have had an impact on the outputs and outcomes of a program implemented by an organization to better their service production and maximize profit 1. Work based incentives. Incentives given to the workers in my workplace include salaries, secondary benefits and other intangible rewards like recognition. The main aim of giving incentives to the workers is to motivate them and thus motivation can both be internal or external. These incentives greatly help the workers perform their duties better thus translating to better outputs for the organization and better performance. They also play a critical role in capacity development of individuals resulting to effective and sustainable increased performance. According to Flynn,(1990) motivators help initiate, direct and also intensify a persistent behavior among workers thus when we give incentives to our laborers then they act as the external factors to intensify the will of the internal self thus workers perform their duties effectively. Generally there exists a perception that unmotivated workers tend to be lazy thus incentives within an organization help workers become activated and always rejuvenated to perform their duties efficiently. Incentives are aimed at motivating and are different from rewards which are given for an achievement. Incentives within our organization are both monetary and non monetary incentives. The non monetary incentives may also be classified as tangible non monetary, social non monetary and job related non monetary incentives. According to Harrold (1998) performance in an organization is related to the concept of ability, opportunity and motivation and thus it is very important for employees in an organization to be always motivated since they tend to work energetically and with creativity resulting to achievement of the organizations goals and objectives. The introduction of incentives in our organization had tremendous positive impacts on the general outputs and outcomes. It brought the urge of the employees to work more effectively; they became creative and had a desire to do better. Our organization could not offer monetary issues all the time as it would be quite expensive and therefore we introduced non monetary incentives. Some of these incentives included encouraging them thus providing them with an autonomic working environment, directly involving them in the organizations decision making process directly and recognizing exemplary performance through small gifts, letters cards and also improving their working conditions. The study conducted in our organization was a retrospective study to analyze the impact of work based incentives to the organizations outputs. We conducted a survey study to try and discover to what extent incentives and especially non monetary incentives have on the motivation potential of our organization. We also wanted to identify the employees’ perception of the incentives that were provided by the organization. We assumed that the population was adequate to provide adequate information require for the study. The main reason of non monetary incentives was to analyze if they could provide the required satisfaction to the employees without burdening the organization financially. Another advantage of non monetary incentives is that they create platforms for employees to socialize thus promote belongingness and respect among employees. The findings of the study indicated that after the incentives were introduced in the organization, there was tremendous improvement in the performance of the employees and an increase in outputs in terms of services provided from the customers. This market like scheme also resulted to rejuvenated employees who were more creative and efficient in their duties. The introduction of these incentives helped our organization in service delivery through improved standards and high class customer care services. The workers were more rejuvenated and they treated our customers as kings. This in turn helped our organization in maintaining the customers we already had and also woo other customers. The most noticeable change with our workers after the incentives were introduced was that they developed a sense of belonging and viewed the organization as their own thus they delivered better services to our customers. The first thing that incentives do in an organization as evident in our organization is they induce action among the workers. You find workers who were not motivated earlier on becoming more active; dressing smartly which really improves the organizations reputation thus the whole organization is transformed. For an organization like ours which directly deals with our customers, if you fail to motivate your workers it will really affect how they behave in their roles and thus in the way they deliver their services to the customers. Motivating the employees bears all positive impacts in service delivery as it connects the customers with the employees thus resulting to effective and efficient delivery of services. 2. Pricing. Pricing is a very crucial decision for any organization as the main agenda for any organization is to penetrate in the markets and pricing determines if the customer will be willing to pay for a certain amount for the particular good or service provided. According to Gregory, (1986) pricing is a decision that affects the organizations objectives either directly or indirectly. Any organization whether big or small has to make competitive prices that ensure factors such as demand, competitors and environment must be put into consideration. Pricing will be affected by the organizations internal environment such as the goals and objectives of the organization and costs incurred by the organization, the external environment such as competitors, customers and the existing legal environment. None of these factors can be undermined while trying to make a pricing decision in an organization. The major decision of pricing is to ensure that the company makes profit and also satisfies its customers. Another important consideration is that the company’s market size increases at the expense of their competitors. In my workplace pricing has had a very major role to play on our outputs. The approach I used to study the impact of pricing in our organization is also a retrospective study. The study considered the major factors that affect pricing in our organization and they include the cost of production. According to Fine and Boating (2000) both the fixed and the variable cost must be considered including the cost incurred in services such as advertisement and transportation. The price of our services must consider factors such as transportation and advertisement. We also studied the nature of the market competition and realized that since we were not a monopolistic organization, we considered the competitors and the consumers’ perception on the prices we decide in relation to our customers. The pricing strategies we adopted included the market penetration strategy where we considered the price that will be accepted and afforded by the customer. We also adopted a market skimming strategy where we intentionally raised the price of a particular service and then dropped it and studied the consumers’ reaction about the pricing. Another strategy was establishment of promotional pricing where we reduce the price of our services for a short duration and then take them back after the season had expired. Another factor of consideration was demand as the services we provided were in very high demand and we had to continuously monitor the demand as if it dropped then the price was bound to change. There are factors in our organization that affected the decision of changing prices which included, underselling and following the trend of competition. The main aim of this study was to analyze the impact of competition and pricing on the outcomes of the organization. This was done by administration of a questionnaire that aimed at getting information from the consumers about the impact of pricing on their buying routines. The main variables observed included pricing variable in relation to company’s outputs. The analysis of the results included the demographic location of study to reflect the market penetration and size of the services provided. This study indicated that effective pricing helped our organization in effective service delivery as when we made our prices competitive enough through studying the existing external factors like competition and customers preference we increased our number of customers and market penetration was easier. It was also evident that our customers were very satisfied with the pricing strategy we adopted and this increased our market size. This was also evident in the markets and super markets as our services were on high demand as compared to other organizations. The most important finding was that there was need to carry out a continuous price evaluation system for effective organizational outputs. This is due to the continuous changes occurring within the external environment such as competition, customers’ satisfaction and also the legal changes within the existing governing policies and regulations. This would enhance better customer services delivery and market penetration. Conclusion Generally, labour market has in the past been affected by structural adjustment policies that have hindered development of the economy. This has hindered in the way organizations operate including production of goods and service delivery. Market labour liberalization is very important to improving our economy as it opens platforms for organizations creativity and development. This is through flexibility in employment and wages and also enhancing income distribution and efficiency. It is therefore important for any government to establish an efficient and effective free and liberalized market labour for the attainment of desired goals and objectives. References. Barrow, C.W. (1996), 'The strategy of selective excellence: Redesigning higher education for global competition in a postindustrial society. In: Higher Education, 41, Kluwer Academic Publishers, Netherlands, pp. 447-469. Evenett, S.J. & Hoekman, B.M. (2004), 'International Cooperation and the Reform of Public Procurement Policies' Fitzgerald, L. et al. (1991), Performance Measurement in Service Businesses, Chartered Institute of Management Accountants, Cambridge, Ch 1. (Dixson 338.455/P438) Flynn, N. 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