The Efficiency Level and Quality Production Factors - Essay Example

Marketing Contents Introduction 3 Theoretical Background 3 Positive Factors 7 Negative Factors 9 Critical Analysis 10 Conclusion 12 Reference List 14Bibliography 15 Introduction The degree of market competition faced by most profit making business institutions is high in the modern world. The commercial success of a company is directly related to the efficiency level and quality of its production factors or inputs (Brown, et al., 2002). Land, labour, capital and entrepreneurship are considered to be the primarily productive factors that influence long run success of an organization. However, it is perceived that the relative importance of labour resource is highest among the companies that provide intangible services to its customers. This is because; the potential buyers formulate their own perceptions regarding the organization and its service quality on grounds of its staff efficiency and service performance (Brown, et al., 2002). This research paper aims to critically analyze the positive and negative impacts of service worker’s job performance. It is highly rational to conduct this critical analysis because it aims to estimate the factors that might both directly and indirectly influence the quality of working within a service providing organization. In this era of “consumerism”, the firms aim to maximize utility of its potential buyers and hence their business revenue. However, it should be noted that customers satisfaction derived from the products or services of an organization considerably depends on the quality of services provided by the employees of the company. Thus, from the analysis and implications of this essay, managerial authorities of different companies can eradicate the potential problems faced by them in human resource management and hence improve the quality of their working in long run (Brown, et al., 2002). Theoretical Background Economists treat labour resource of an organization as a type of capital. This is because a worker earns money with the help of acquired education, work experience and knowledge. Originally human capital was perceived to be a microeconomic concept but over time its implications are also linked up with the field of macroeconomics. Lucas introduced the “New Growth Theory” of economics and claimed that human capital productivity and economic growth is directly proportional to each other (Brown, et al., 2002). A rise in the efficiency level of human capital helps to augment economic surplus procured by the profit making firms within a country and finally leads to growth of its national domestic productivity level. Researchers have stated that quality of schooling, educational level of parents, before and on-the-job training significantly influences the quality of labour productivity (Brown, et al., 2002). However, researchers have stated that just like physical capital human capital acquired by an organization can also depreciate over time. For instance, an unethical and immoral practice in workplaces lowers the productivity level of the existing human capital resource. It is also believed by some scholars that human capital resource of an organization possesses the features of a public good. This is because, such resources are excludable and therefore rival in nature. The Solow Growth endogenous and exogenous models states that improvement in the quality and efficiency level of human capital helps to stimulate the economic growth of a nation. However, it should be noted that the economic growth is achieved via commercial progress (Brown, et al., 2002). Since the emergence of globalization and trade liberalization, companies are exposed to greater degree of market rivalry. In order to lead within the existing competition of a knowledge-based economy, organizations seek new innovative ways through which their competitive advantages in trade can be improved (Kotler, et al., 2009). At this juncture, research studies state that human capital or labour resource possessed by a company is a type of its valuable business asset (Kotler, et al., 2009). Researchers also state that such human capital is expandable, transportable, shareable and self- generating in nature (Kotler, et al., 2009). Since such resources are expandable and self-generating, increase in knowledge stock helps to improve its quality and efficiency level. At the same time human capital resource is sharable and transportable because the knowledge acquired by an individual can be shared or transmitted to others (Kotler, et al., 2009). Researchers believe that the activities of a productive labour force within a nation are primarily categorized in terms of three different dimensions; namely society, organization and individual (Kotler, et al., 2009). It is found that the income earned by an individual is directly proportional to the level of his working productivity. At the same time productive workers helps to augment the level of organizational competitiveness and brand value. Finally, certain social factors such as human rights, democracy and political stability of a country are directly dependent on the quality and efficiency of human capital (Kotler, et al., 2009). Thus from the above context of the literature review it is proved that productive services provided by the labour force of a concern is highly beneficial to the economy as well as the organizations. However, it should be noted that there are certain factors that positively and negatively influence the quality of service provided by the workers within an organization (Kotler, et al., 2009). Figure 1: Importance of Labour Resource (Source: Dubra, 2012) The above flow chart explains the precise way through which an organization’s performance depends on the quality of service provided by its labourers. The following context of the essay will explain the positive and negative factors influencing the quality of service provided by the workers of a service providing organization (Dubra, 2012). Positive Factors The workers service providing quality in an organization substantially depends on the level of motivation possessed by its workers. This is because motivation bridges the gap between ability to work and willingness to do the same. It is believed by several researchers that empowerment of the workers within a concern directly influences the quality of their service. Figure 2: Positive Factors Influencing Service Quality (Source: Anaza, 2014) The above flowchart shows that empowered workers become satisfied in their respective workplaces. Furthermore, satisfied workers provides superior services that assist in augmenting the organizational identification or brand value and makes the firm more customer oriented in nature (Anaza, 2014). Finally perceived service quality of an organization can be good only with the help of increased customer centric business practices. Apart from increased empowerment, the quality of service provided by the workers of an organization can also be improved with the essence of job training. It is the process through which the existing knowledge and skill set of the employees can be enhanced trough successive knowledge building sessions. Increased efficiency and a higher degree of specialization can be practiced by the workers through such sessions. The level of workers motivation at work and the overall performance of the organization can be improved with the help of training and knowledge building sessions. The operational success of a profit making concern considerably depends on its state of used technological knowhow. Workers of a service providing firm can adopt and use new technologies while working, only if they are adequately trained for it. Figure 3: Training Cycle (Source: Kimando and Njogu, 2012) The above flow chart explains the training cycle that can be followed by each organization to enhance the level of its workers service quality. However, it should be noted that apart from empowerment and training, the quality of services provided by the human capital of an organization also depends on the level of their motivation (Tepper, 2000). It is found that increased motivation helps to augment the level of enthusiasm and consciousness of the workers in the workplace. The Skinner’s theory states that motivation emerges from the interplaying process of response and stimulus (Tepper, 2000). The working efficiency of the employees is directly proportional to the level of job satisfaction derived by them within workplace (Tepper, 2000). If the workers are not satisfied with their work and find less scopes of professional career growth, then their productively and competence at workplace significantly declines. Apart from these basic factors it is also found that the quality of services provided by the workers is directly proportional to the management expertise (Tepper, 2000). Negative Factors The states of commercial affairs are highly complex in the current epoch and companies often faces situations in that adversely influences the quality and efficiency of its workers services. It is claimed by some researchers that the eminence of service provided by the workers is dependent on both external and internal business market affairs. Sudden negative uncertainties in the economic system can adversely influence the job satisfaction and working proficiency of the employees in an organization. It is also claimed by certain researchers that globalization and trade liberalization process has declined the productivity and sincerity of work done of the employees whose services are highly demanded in the market. However, it is believed that employees’ efficiency at work primarily depends on certain internal business factors. If the workers are not treated on grounds of equality, then their productivity and efficiency level significantly declines. At the same time unhealthy workplace atmosphere is found to adversely influence the quality of service delivered by the employees of a concern. This is because, discriminating treatment provided by the employer’s declines the motivational level of the employees and hence makes the quality of their services inferior. Moreover, if a company experiences autocratic management system then the quality of services provided by its employees strictly decline. Finally, problems such an bureaucracies, lobbying, politics and weak knowledge sharing sessions are direct causal factors of poor job performance. Critical Analysis Increased empowerment helps to augment the level of job satisfaction and quality of service provided by the workers in a company. This is because, the workers experiencing higher empowerments are able to take part in the valuable decision making process of the company. When the workers are given importance through increased empowerment, then they consider their contribution to be valuable and hence increase their willingness to work more. It is theoretically proved that human resource possessed by a company is expandable, transportable, shareable and self- generating. Thus, increased training opportunities considerably help to enhance the level of expertise and efficiency of the workers. It should be noted that increased empowerment and training opportunities helps to directly enhance the quality of services provided by the workers. However, the same factors indirectly influence the organizational performance quality in a positive fashion. For instance WalMart the popular multinational retailing company uses electronic billing and product labelling system for selling its products in the market (Fishman, 2006). If the service providers of the company were not trained to use such new technologies then they would not be able to work with it and hence augment the operational efficiency of the concern. It is also critically analyzed that motivation helps to directly improve the working performance of employees within an organization. Perhaps this is the reason for which giant corporate companies such as Apple Inc. and Procter & Gamble conduct several activities through which they are able to improve the motivational level of the workers (Fishman, 2006). These companies enhance the utility level of its workers by providing them with additional rewards and incentives against handwork. However, it is found that increased motivation at workplace is indirectly influenced by the degree of employee diversity and equity within a concern. If all the service providers in an organization are treated equally irrespective of their caste, creed, religion and sex, then the workers interest to provide more labour enhances. At the same time, greater heterogeneity among the employees ensures increased workforce efficiency. Job satisfaction also directly influences the quality of service delivery of a company. When workers access future career growth prospects from an organization, then they desire to work harder and are highly motivation to improve the quality of their services. For this particular reason, highly productive workers are always found in successful business organizations. At the same time, companies experience losses if its employees are not satisfied with the financial and non financial provisions provided to them. Recently it was found that WalMart was penalized for ill treating its service providing agents. Some of its female employees claimed that they were not provided with adequate scopes for professional growth and were not paid properly by the company. Such cases signify poor job satisfaction derived by the employees of the concern and hence lowers the brand value of the organization. The quality of employee service delivery also depends on the appropriateness of its management process. If management authorities of a company establish realistic job targets then employees can preferably attain these goals. Such achievements help to increase the confidence of workforce and hence make them more productive in the long run. However, it is critically analyzed that service quality of employees is adversely affected in certain specific situations. Such circumstances lower the utility level of the consumers and diminish the brand value of the organization in the business world (Carolan, 2014). However, it is noted that there are some external factors that adversely influence the quality of service delivered by the employees in a service providing organization. For instance, if the average price level of an economy increases within a very short span of time, then the real income level of the employees falls given their existing money income. This is because: Real Income = Money Income / Average Price Level Under such circumstances, when the real purchasing power experienced by the employees declines then the satisfaction derived by them from existing income and job declines. This lowers their overall service eminence (Spreitzer, 1995). It is also critically analyzed that globalization process has declined the sincerity of work done by some employees (Spreitzer, 1995). This is because, after globalism the total amount of employment opportunities available to these workers have enhanced. This has increased their overall bargaining power in the market and significantly reduced their switching costs in workplaces. Such employees are often found to be less genuine while providing service because they do not fear losing a job due to its excess availability. Equity and equality is a very crucial component of human resource management (Fishman, 2006). It is critically analyzed that employees provides poor services to customers if they realize that they are not treated ethically and equally by their employers. For instance, the female workers of Bank of England had once stopped to provide services when they had claimed that they were not provided equal pay and promotional offers as their male colleagues. It is also found that the superiority of services provided by the workers is weak in an autocratic organization. This is because, the level of empowerment provided to each employee in such companies are extensively low. Moreover, internal politics and lobbing practices also declines the performance quality of employees, as worker loyalty towards an organization declines due to such incidences (Chenet, Tynan and Money, 2000). Conclusion The companies of the contemporary era try to find ways through which they are able to improve the level of competitive advantage in business. The commercial success and operational proficiency of an organization considerably depends on the superiority of its factor services. However, from the context of the essay it would be correct to state that human capital is the most important factor of production (Chenet, Tynan and Money, 2000). This is because, trained and resourceful workers of a concern helps it allocate scarce resources in business in the most economic pattern. Furthermore, the importance of workers service providing quality is highest for companies that deal with intangible product or service trading. The workers service quality helps to bridge the gap between the customers and sellers in such organizations (Chenet, Tynan and Money, 2000). However, the essay had proved that quality of services rendered by the employees directly and indirectly depends on certain specific positive and negative factor. The level of employee empowerment, job satisfaction, job motivation, quality of training, workplace equity and diversity positively influences the quality of services provided by the employees of a company. However, external market factors such as sudden price rise and globalism adversely affects the quality of services provided by the employees in an organization. At the same time, internal unfair management practices, poor motivation also declines the interests of the employees in a company and hence lowers their service quality. If in the long run a company desires to improve business in the dynamic world and aim to increase the strength of its loyal customers; then it must try to increase the influence created by the positive factors and lower the adverse service quality manipulating elements from business in the long run (Chenet, Tynan and Money, 2000). Reference List Anaza, N. A., 2014. Factors influencing perceptions of service quality in cooperative extension workers. [online] Available at: [Accessed 7 July 2014]. Brown, T., Mowen, J. C. Donavan, D. T. and Licata, J. W., 2002. The customer orientation of service workers: Personality trait effects on self-and supervisor performance ratings. Journal of Marketing Research, 39(1), pp. 110 - 119. Carolan, M., 2014. Cheaponomics: The high cost of low prices. London: Roultedge. Chenet, P., Tynan, C. and Money, A., 2000. The service performance gap: Testing the redeveloped causal model. European Journal of Marketing, 34(3), pp. 472-497. Dubra, I., 2012. 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